SR118.DOC

WHEREAS, the lands on the summit of Mauna Kea are public lands returned to Hawaii at Statehood (1959) under section 5(f) of the Admission Act and subject to an express public trust; and

WHEREAS, that trust imposes an express public trust duty and legal restrictions on the State, including a requirement that all revenues derived from the use of the public trust lands must be deposited into the public lands trust fund; and

WHEREAS, under section 171‑17, Hawaii Revised Statutes, the State's Board of Land and Natural Resources (BLNR) is required to assess and charge fair-market lease rent for the use of section 5(f) public trust lands (ceded lands); and

WHEREAS, in 1961, the Mauna Kea summit, forestry, and watershed lands were designated for protection and placed in the state Conservation District, pursuant to section 205‑2, Hawaii Revised Statutes; and

WHEREAS, in 1968, the BLNR leased approximately 13,320 acres of public trust lands on the Mauna Kea summit and slopes to the University of Hawaii and the University of Hawaii's Institute for Astronomy (UH/UHIFA) for "a scientific complex, including without limitation an observatory...." (General Lease No. S‑4191); and

WHEREAS, the lease term was sixty-five years until 2033, and the lease rent to the UHIFA was a nominal $1 per year; and

WHEREAS, the lease or setting aside of public trust lands from BLNR to a state department, agency, or county is often made for nominal or no rent because the entities are sub-units of the State; and

WHEREAS, since 1968, UHIFA has entered into multiple sub-lease and use agreements with private third parties for the development of telescope facilities on Mauna Kea's summit; and

WHEREAS, in exchange for the sub-lease and use agreements, UHIFA obtained the right to viewing time on each of the telescopes and a formally-established sub-lease rent of a nominal amount; and

WHEREAS, both UHIFA and BLNR failed to assess, charge, or collect fair-market lease rents from private third parties for the use of the public trust lands on Mauna Kea, and UHIFA obtained a valuable quid pro quo of viewing time which was never monetized or deposited in the public land trust fund pursuant to section 171‑18, Hawaii Revised Statutes; and

WHEREAS, instead of assessing and charging reasonable lease rents pursuant to state law, BLNR has allowed the UHIFA since 1968 to negotiate sub-lease agreements with some of the world's wealthiest foreign and domestic entities (corporations and foreign governments) in exchange for $1 per year and time-in-lieu-of-rent agreements for the use of the Mauna Kea lands; and

WHEREAS, while state taxpayers face employee layoffs, furloughs, salary cuts, reduced public services, and potential tax increases, the same taxpayers continue to subsidize wealthy foreign and domestic entities' direct use of public trust lands through the failure of BLNR and UHIFA to collect fair-market lease rent for the use of Mauna Kea lands; and

WHEREAS, from 1968 to 1970, UHIFA built two twenty-four inch (0.6 m) telescopes and UH built an eighty-eight inch (2.2 m) telescope on the summit of Mauna Kea (BLNR 1983 documents including sub-lease agreements and Mauna Kea chronology); and

WHEREAS, in 1979, BLNR and UH negotiated the first sub-lease agreement with foreign entities (France and Canada) for the construction of the Canada-France-Hawaii Telescopes on the summit of Mauna Kea; and

WHEREAS, subsequently, several more foreign entities entered into sub-lease agreements with the BLNR and UH for the use of public trust lands on the summit including, but not limited to; Canada, France, the United Kingdom, the Netherlands, Japan and the Mitsubishi Corporation, Australia, Taiwan, Brazil, Chile and Argentina; and

WHEREAS, BLNR and UH negotiated sub-leases with out-of-state public and private universities and institutions, including but not limited to the California Institute of Technology, the University of California institutions including Berkeley, the California Association of Research in Astronomy, and the W.M. Keck Foundation; and

WHEREAS, BLNR and UHIFA required these wealthy foreign and out-of-state entities to pay only $1 per year in lease rent and to provide ten to twenty per cent of the viewing time on each facility to the UHIFA in lieu of charging fair-market lease rent as required by law; and

WHEREAS, BLNR and UH negotiated and are currently negotiating lease agreements with private asset-rich organizations including the W.M. Keck Foundation and the Gordon and Betty Moore Foundation; and

WHEREAS, the summit of Mauna Kea is an important community resource; and

WHEREAS, the world astronomy community ranks the summit of Mauna Kea as one of the best sites in the world for conducting world class astronomy, and the University of Hawaii has long claimed that Mauna Kea's rarified atmosphere and excellent viewing conditions make it one of the premier astronomical sites in the world; and

WHEREAS, the lands of Mauna Kea are host to unique and fragile ecosystems and threatened and endangered plant and animal species found nowhere else on Earth; and

WHEREAS, the conservation district of Mauna Kea encompasses critical watershed and forestry lands; and

WHEREAS, the Mauna Kea aquifer is the principal freshwater aquifer for the island of Hawaii and provides Hawaii island residents with drinking water; and

WHEREAS, Mauna Kea is considered one of the most sacred places in Hawaii and native Hawaiians continue to revere it as a sacred burial ground and wahi pana; and

WHEREAS, Mauna Kea is home to unique cultural and historic resources that have been designated as a National Historical Landmark and granted protection under state and national historic preservation laws; and

WHEREAS, Mauna Kea summit lands and Lake Waiau contain unique geological characteristics that have contributed to geological knowledge regarding glaciers and glaciations of the last ice age; and

WHEREAS, viewing time is very valuable as astronomy is a competitive industry and many institutions are willing to pay extraordinary hourly rates for time on the astronomical facilities on Mauna Kea; and

WHEREAS, under the time-in-lieu-of-rent agreements, each astronomical facility is required to give the UHIFA approximately thirty-six to fifty-four observing nights per year; and

WHEREAS, in 2009, Yale University agreed to pay $12,000,000 for fifteen observing nights per year for ten years on the William M. Keck Observatory, which is $1,200,000 per year for fifteen nights or $80,000 per night; and

WHEREAS, the W.M. Keck Foundation owns and operates the William M. Keck Observatory on Mauna Kea; and

WHEREAS, the W.M. Keck Foundation website reports assets in excess of $1,000,000,000; and

WHEREAS, the UHIFA is unilaterally appropriating value from the use of public lands by private third parties (in lieu of lease rent) for UHIFA's exclusive benefit without legislative appropriation or approval and without any public accounting to the residents and taxpayers of Hawaii; and

WHEREAS, public/private sector patent-leasing agreements are valuable; and

WHEREAS, since at least 1968, the UHIFA has come before state lawmakers seeking moneys from the general fund to support UHIFA and astronomy development in general on both Mauna Kea and Haleakala; and

WHEREAS, in 2001, UHIFA sought the Legislature's approval of approximately $709,000 in public funds and in 2010, the UHIFA requested $2,100,000 in public funds to secure the bid for the Thirty Meter Telescope to be built on Mauna Kea; and

WHEREAS, UHIFA claims it holds numerous patents on various technologies that were developed and tested on the astronomical facilities on Mauna Kea and Haleakala, and the patents are often leased to private high tech companies for substantial monetary value; and

WHEREAS, in 2001, UHIFA claimed it had patent leasing contracts worth approximately $14,000,000; and

WHEREAS, there has been no public accounting of the patent-leasing contracts that are held by foreign and out-of-state entities using Mauna Kea and Haleakala, and UHIFA has not explained why these patent lease revenues were never recorded as public revenues on the public ledger; and

WHEREAS, the existence of public-private agreements in which public tax dollars are taken from the general fund, used for initial research and development, and then patented and sold for profit implies that Hawaii taxpayers could be subsidizing out-of-state and foreign private profit; and

WHEREAS, contracts held by out-of-state and foreign entities that benefit from Hawaii public taxpayer support should be publically assessed and accounted for; now, therefore,

BE IT RESOLVED by the Senate of the Twenty-fifth Legislature of the State of Hawaii, Regular Session of 2010, that UH and UHIFA are requested to provide a written accounting and report to the Legislature within fourteen calendar days of the effective date of this Resolution setting forth the following information:

(1) A list of the total viewing time provided to UH, UHIFA, their employees, agents, faculty, researchers, affiliates, graduate students, visiting scientists, and all those operating under or in association with UH or UHIFA, without exception, for each telescope or astronomical facility on Mauna Kea by year since 1968;

(2) A determination of the financial value by night or by hour of the viewing time for each facility for each year since 1968 for all of the viewing time set forth in paragraph (1);

(3) A list of all value (viewing time, financial, quid pro quo exchanges, and any and every other benefit) received by the UH or UHIFA in relation to each facility on Mauna Kea (or the sponsor) by year since 1968; and

(4) A list and copy of every contract or working agreement or any other agreement UH or UHIFA has entered into for the use of any facility on Mauna Kea by year since 1968; and

BE IT FURTHER RESOLVED that the Auditor is directed to conduct a review of the UH and UHIFA written report and make a separate written report to the Legislature within thirty days following receipt of the UH and UHIFA report by the Legislature; and

BE IT FURTHER RESOLVED that certified copies of this Resolution be transmitted to the President of the University of Hawaii, the Executive Director of the University of Hawaii Institute for Astronomy, the Chair of the Board of Regents of the University of Hawaii, the Chair of the Board of Land and Natural Resources, the Director of Commerce and Consumer Affairs, and the Auditor.

	OFFERED BY:	_____________________________

Report Title:

UH Institute for Astronomy; Mauna Kea Lands; Accounting; Audit

THE SENATE	S.R. NO.	118
TWENTY-FIFTH LEGISLATURE, 2010
STATE OF HAWAII