Provides for the development of infrastructure, including water infrastructure, at the Kikala-Keokea homestead area of the island of Hawaii. Establishes the infrastructure development fund and Kikala-Keokea housing revolving fund. Appropriates funds. (SD1)

A BILL FOR AN ACT

SECTION 1. The legislature finds that the destruction of Kalapana by lava flow displaced a tightly knit community with a truly Hawaiian lifestyle. In 1938, the United States Congress enacted Public Law 680, the Kalapana Extension Act, providing that native Hawaiian residents of the area were to be provided with leases for homesites and that fishing was to be permitted only by native Hawaiian residents of the area or adjacent villages, and by visitors under their guidance.

The continuation of the unique way of life of the Hawaiian residents of Kalapana was disrupted by volcanic eruptions and lava flows which began on January 3, 1983, destroying one of the last Hawaiian settlements on the island of Hawai'i.

The legislature recognized this tragedy by enacting Act 314, Session Laws of Hawai'i 1991, as amended, authorizing the department of land and natural resources to negotiate long-term leases with qualified, displaced Kalapana families to maintain their heritage in the Kikala-Keokea homestead area adjacent to the Kalapana-Kapoho Beach road. The site allows the Kalapana families to develop the land in a manner that will enable them to continue their traditional way of life by raising small animals, planting sustenance crops, growing herbal medicines and gathering additional food resources from the nearby ocean and uplands.

Act 314 also stipulated that the department of land and natural resources or its designated agency subdivide and create a residential subdivision in the Kikala-Keokea homestead area that will be exempt from all statutes, ordinances, charter provisions, and rules of any governmental agency relating to zoning and construction standards for subdivisions, the development and improvement of land, and the construction of units thereon; provided that it meets the minimum requirements of health and safety.

Prior to the expiration of Act 314, the department of land and natural resources entered into lease arrangements with forty-eight of the fifty-eight families who met both of the eligibility criteria set forth under the Act. However, the forty-eight Hawaiian families have not been able to use their leases since the project does not meet the minimum standards due to a lack of water.

The purpose of this Act is to:

SECTION 2. Act 242, Session Laws of Hawaii 1991, is amended by amending section 1 to read as follows:

"SECTION 1. The purpose of this Act is to provide [low-interest loans to the residents and citizens of Hawaii who have suffered the loss of their homes and lands to the devastating effects of the continued volcanic eruptions on the island of Hawaii. Under current law, chapters 127, 171, and 209, Hawaii Revised Statutes, some of Kilauea lava flow victims do not qualify for existing disaster recovery loans. Some Kilauea lava flow residents and citizens do not have sufficient income to qualify for loan assistance to purchase replacement land and build a home. These residents and citizens may be in need of a one-time public relief program with specific requirements for the repayment of low-interest loans to assist in rebuilding their homes in an area of lesser volcanic risk.] funds for the development of infrastructure, including water infrastructure, at Kikala-Keokea."

SECTION 3. Act 242, Session Laws of Hawaii 1991, is amended by amending section 2 to read as follows:

"SECTION 2. There is appropriated out of the general revenues of the State of Hawaii the sum of $1,750,000, or so much thereof as may be necessary for fiscal year 1991-1992, to provide [low-interest land acquisition, home construction, and mortgage loans of up to $35,000 each to residents and citizens of Hawaii] funding for infrastructure development, including water infrastructure, to benefit residents of Hawaiian ancestry who have been dispossessed of their homes and lands at Kalapana as a result of the continued volcanic eruptions on the island of Hawaii which began on January 3, 1983[; provided that the rate of interest on loans pursuant to this Act shall not exceed three per cent per annum and interest earnings on loans made pursuant to this Act may be used for administrative and other expenses necessary for administering the loan program. Guidelines shall be established by the housing finance and development corporation with respect to loan terms and loan qualification criteria. Moneys appropriated for the purposes of this Act shall be deposited into the housing finance revolving fund; provided that upon fulfillment of the purposes of this Act, all unencumbered moneys shall lapse into the state general fund]."

SECTION 4. Act 242, Session Laws of Hawaii 1991, is amended by amending section 3 to read as follows:

"SECTION 3. [The housing finance and development corporation shall administer the loans for the purposes of this Act, and shall adopt rules pursuant to chapter 91 to carry out the purposes of this Act.] There is hereby established in the state treasury:

SECTION 5. Act 242, Session Laws of Hawaii 1991, is amended by amending section 4 to read as follows:

"SECTION 4. The sum appropriated shall be expended by the [housing finance and development corporation] department of land and natural resources for the purposes of this Act[.]; provided that:

SECTION 6. Act 242, Session Laws of Hawaii 1991, appropriated funds to the housing finance revolving fund under the housing finance and development corporation, currently known as the housing and community development corporation of Hawaii. The director of finance shall transfer the unexpended balance, including encumbrances and accrued liabilities, of the funds appropriated to the housing finance revolving fund under Act 242, Session Laws of Hawaii 1991, as of the close of business on June 30, 2001, to the credit of the infrastructure development fund administered by the department of land and natural resources. Encumbered moneys shall continue to be encumbered until paid out or released from prior encumbrances.

SECTION 7. There is appropriated out of the infrastructure development fund the sum of $ , or so much thereof as may be necessary for fiscal year 2001-2002, for the development of infrastructure at the Kikala-Keokea subdivision on the island of Hawaii as follows:

The sums appropriated shall be expended by the department of land and natural resources for the purposes of this Act; provided that no funds shall be released unless matched on a dollar-for-dollar basis by the office of Hawaiian affairs.

SECTION 8. Any unexpended or unencumbered funds remaining in the infrastructure development fund as of the close of business on June 30, 2002, shall not lapse into that fund, but shall be transferred to the credit of the Kikala-Keokea housing revolving fund as of that date.

SECTION 9. There is appropriated out of the Kikala-Keokea housing revolving fund the amounts that have been transferred into that fund pursuant to section 8 of this Act, or so much thereof as may be necessary for fiscal year 2002-2003, for costs related to providing housing on Kikala-Keokea leasehold property for Kikala-Keokea residents, including those that were once Kalapana residents, to include the following areas:

The sum appropriated shall be expended by the housing and community development corporation of Hawaii for the purposes of this Act.

SECTION 10. Session law material to be repealed is bracketed and stricken. New session law material is underscored.

SECTION 11. This Act shall take effect on July 1, 2001.