STAND. COM. REP. NO. 386

                                   Honolulu, Hawaii
                                                     , 1999

                                   RE:  S.B. No. 456
                                        S.D. 1




Honorable Norman Mizuguchi
President of the Senate
Twentieth State Legislature
Regular Session of 1999
State of Hawaii

Sir:

     Your Committees on Education and Technology and Water, Land,
and Hawaiian Affairs, to which was referred S.B. No. 456
entitled: 

     "A BILL FOR AN ACT RELATING TO TUITION WAIVERS,"

beg leave to report as follows:

     The purpose of this measure is to provide tuition waivers to
students of Hawaiian ancestry to attend the University of Hawaii.

     Specifically, the measure requires the University of Hawaii
to provide tuition waivers, which are in addition to any tuition
waivers already granted, to students of Hawaiian ancestry who
are:

     (1)  Financially needy; and

     (2)  Enrolled in graduate or undergraduate courses within
          the university system for the purpose of obtaining a
          degree; or

     (3)  Participating in student recruitment programs within
          the university system.

     Testimony in support of the measure was received from the
Office of Hawaiian Affairs, the University of Hawaii's Center for
Hawaiian Studies, the Oahu Council of the Association of Hawaiian
Civic Clubs, the Ilio`ulaokalani Coalition, Kuikalahiki Hawaiian
Student Organization, Kalai Po Native Hawaiian Student

 
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Organization, the Associated Students of the University of
Hawaii, and a number of concerned citizens and college students.

     The University of Hawaii's Vice President for Student
Affairs testified that the University supported the intent of the
measure but felt that its purpose conflicted with that of Act
161, Session Laws of Hawaii 1995, which granted autonomy to the
University of Hawaii in these matters.  The Vice President for
Student Affairs also testified that currently, approximately nine
hundred students of Hawaiian ancestry are granted full or partial
tuition waivers based on their ancestry and financial need.

     Your Committees find that under section 5(f) of the
Admission Act, the public land trust and the revenues derived
therefrom may be used for the support of public schools and other
public educational institutions.  Because the University of
Hawaii is indeed a public educational institution, it is
compliant with the purpose of section 5(f) of the Admission Act.
While much of the supporting testimony indicated that these
tuition waivers should be considered as an entitlement since the
University of Hawaii at Manoa is situated on ceded lands, it is
the contention of your Committees that the University is not
obligated to grant tuition waivers to Native Hawaiians because of
its fulfillment of the educational purpose of section 5(f) of the
Admission Act.

     However, your Committees recognize the duty of the State to
provide increased opportunities and access to higher education
for native Hawaiians.  Your Committees find that increased
educational opportunities would create positive role models for
young Hawaiians, and allow for greater advancement for native
Hawaiians as a whole.

     Your Committees further find that another purpose of section
5(f) of the Admission Act is to provide for the betterment of the
conditions of native Hawaiians.  Thus, your Committees believe
that while the University is not obligated to provide tuition
waivers solely because it is located on ceded lands, the
provision of these waivers would fall under another purpose of
section 5(f) of the Admission Act.  As such, your Committees
believe that any money appropriated or allocated for the purposes
of providing tuition waivers for native Hawaiian students should
be credited against the State's pro rate share of ceded land
revenue obligations.

     Your Committees are also aware of the provisions of Article
XII, section 6, of the Constitution of the State of Hawaii which
requires the State to "...manage and administer the proceeds from
the sale or disposition of the lands, natural resources, minerals

 
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and income derived from whatever sources for native Hawaiians and
Hawaiians, including all income and proceeds from that pro rata
portion of the trust referred to in section 4 of this article for
native Hawaiians;..." (emphasis added).  Your Committees
interpret this provision to mean that any ceded land revenues for
which the State seeks to claim credit in satisfaction of the pro
rata share of revenue obligation first would have to either be
allocated to the Office of Hawaiian Affairs prior to disbursement
for the qualifying purpose, or be mutually agreed upon by the
State and the Office of Hawaiian Affairs as a creditable
expenditure of a pro rata share of ceded land revenues by the
State.

     In light of these concerns, your Committees have amended the
measure by deleting its substance and inserting provisions that:

     (1)  Appropriate funds to the Office of Hawaiian Affairs for
          the specific purpose of offsetting the costs incurred
          by the University of Hawaii in providing tuition
          waivers to students of Hawaiian ancestry;

     (2)  Declare that any moneys expended for the purpose of
          providing tuition waivers to students of Hawaiian
          ancestry shall be credited against the State's pro rata
          share of ceded land revenue obligation to the Office of
          Hawaiian Affairs; and

     (3)  Establish an accounting process to effectuate the
          intent of the measure.

     Your Committees further amended this measure to delete the
"financially needy" provision as a requirement for tuition
waivers.  Your Committees believe that all native Hawaiian
students should be eligible for tuition waivers regardless of
their financial status.

     Your Committees believe that the funding mechanism provided
in the measure should:

     (1)  Provide students of Hawaiian ancestry with the
          resources to obtain a post secondary education;

     (2)  Fulfill at least in part, the State's obligation to use
          a portion of ceded land revenues for the purposes
          stated under the Admission Act, Article XII, Section 6,
          of the State Constitution, and Chapter 10, Hawaii
          Revised Statutes; and


 
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     (3)  Ensure that the University of Hawaii possesses the
          necessary financial resources to educate students of
          Hawaiian ancestry who receive tuition waivers.

     As affirmed by the records of votes of the members of your
Committees on Education and Technology and Water, Land, and
Hawaiian Affairs that are attached to this report, your
Committees are in accord with the intent and purpose of S.B.
No. 456, as amended herein, and recommend that it pass Second
Reading in the form attached hereto as S.B. No. 456, S.D. 1, and
be referred to the Committee on Ways and Means.

                                   Respectfully submitted on
                                   behalf of the members of the
                                   Committees on Education and
                                   Technology and Water, Land,
                                   and Hawaiian Affairs,



____________________________       ______________________________
COLLEEN HANABUSA, Chair            DAVID Y. IGE, Chair

 
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