Public trust lands, approximately 1.8 million acres, derive from the 1848 Māhele, which transformed Native Hawaiian traditional land tenure systems to private land ownership under the Hawaiian Kingdom. Acting pursuant to Māhele enactments, the Land Commission “settled and established the inception of private land titles” under the authority of King Kamehameha III, the sovereign owner of all of Hawai‘i’s lands. Robert R. Kamins, Ownership of Geothermal Resources in Hawaii, 1 U. Haw. L. Rev. 69, 71 fn 5 (1979), quotingTerr. Of Hawai‘i v. Lili‘uokalani, 49 Haw. 88, 104 (1902). The Commission’s awards and patents are considered the “foundation of all titles to land in this Kingdom.” Kamins, 71 fn.15 quoting Thurston v. Bishop, 7 Haw 421, 429 (1888).
During the Māhele process, King Kamehameha III divided his lands into government and private (“crown”) lands. “Crown” lands consisted in approximately one million acres, or a quarter of the ʻāina, that Kamehameha III retained for himself from the Māhele. When Kamehameha III’s successor, Kamehameha IV, died in 1863, Kamehameha V (and not his widow, Queen Emma) received this lands in a court ruling that determined that Kamehameha V monarch needed to have lands to fulfill his responsibilities to his people. In 1865, the Hawai‘i legislature passed a statute that made Crown lands inalienable. From this point, a Board of Commissioners of Crown Lands managed the Crown Lands and used the revenues to support the monarchy.
“Government” lands, approximately 1.5 million acres, were transferred to the government itself in the Māhele, to be used for public purposes. Substantial amounts were sold during the Kingdom era, with about 800,000 acres remaining at the time of the 1893 overthrow. Both classes of lands were considered “public lands” under the Land Act of August 15, 1895, which repealed the 1865 statute that made Crown Lands inalienable. These lands were later merged into government lands. Lili‘uokalani v. United States, 45 Ct. Cl. 418 (1910). Between 1865 and 1898, the Reupblic of Hawai‘i, which succeeded the Kingdom after the 1893 overthrow, sold 46,594 acres of Crown and Government Lands.
Arising from the wake of the overthrow of the Hawaiian Kingdom’s last reigning monarch, the Republic of Hawai‘i usurped property consisting of: 1) government lands that had been surrendered by Kamehameha III; 2) lands ceded by the chiefs in lieu of a commutation fee required to establish their fee-simple ownership; 3) lands purchased by the government; 4) lands forfeited by certain claimants; and 5) pursuant to an 1894 act of the Republic of Hawai‘i, “crown” lands that had been the personal property of the King. Article 95 of the Constitution of July 3, 1894, Fundamental Laws of Hawaii at 237.
In 1898, the U.S. annexed Hawai‘i and the Republic of Hawai‘i “ceded” these government lands to the U.S. The instrument of that annexation, the 1898 Newlands Resolution, states that the Republic of Hawai‘i:
cede[s] absolutely and without reserve to the United States of America all rights of sovereignty of whatsoever kind in and over the Hawaiian Islands and their dependencies, and also . . . the absolute fee and ownership of all public, Government, or Crown lands, public buildings or edifices, ports, harbors, military equipment and all other public property of every kind and description belonging to the Government of the Hawaiian Islands, together with every right and appurtenance thereunto appertaining.
Resolution No. 55 of July 7, 1898 (Newlands Resolution), 30 Stat. 750 (emphasis added).
In 1982, the Hawai‘i Attorney General opined that the broadly inclusive language of the Newlands Resolution extends to all public property that the Republic controlled. Tany S. Hong, State of Hawai‘i Attorney General Opinion to Hon. Susumu Ono, Chairman DLNR, 6 (June 24, 1982).
Lands ceded to the Republic of Hawai‘i, and to the U.S. government thereafter, “include all of the rights reserved by the King at the Māhele, by the Government in Land Commission Awards and Patents, and all other property rights accruing to the Government of Hawai‘i prior to 1898.” Tany S. Hong, State of Hawai‘i Attorney General Opinion to Hon. Susumu Ono, Chairman DLNR, 9 (June 24, 1982). These “ceded” lands retain the “reserved rights of… all mineral and metallic mines of every kind and description,” and all other natural resources in the public domain in 1898, which have not been subsequently transferred. In re: Robinson, 49 Haw. 429, 431 (1966) citing "An Act to Organize the Executive Departments of the Hawaiian Islands," pt. I, ch. VII, art. IV, S.L. 1845-6, p. 107, effective February 7, 1846. This Act prescribed the form of Royal Patents.
The 1898 Newlands Joint Resolution, the 1900 Organic Act, and the later 1959 Admissions Act, provided that revenues and proceeds from public lands should be used for the benefit of the inhabitants of the Territory of Hawai‘i for educational and other public purposes. State v. Zimring, 58 Haw.106 (1977).In both the 1898 Joint Resolution of Annexation and the 1900 Organic Act, the United States recognized that the unique status of Hawai‘iʻs public lands and stated that the laws governing U.S. public lands generally should not apply to them, and that the revenues from these lands should go to the people of Hawai‘i.
An 1899 opinion of the U.S. Attorney General clarified that these lands should be considered to be “a special trust.”200,000 acres of these public trust lands were set aside for the Hawaiian Home Lands Program in 1921 and the federal government retained approximately 350,000 acres for military bases and national parks.
The 1959 Admission Act transferred approximately 1.4 million acres to the new State of Hawai‘i, recognized the trust status of these lands, and stated that land revenues should be used for public purposes, including “for the betterment of the conditions of native Hawaiians.” Act of March 18, 1959, Pub. L. 86-3, 73 Stat. 4 (Admission Act).
Under the Admission Act § 5, public trust lands consist in all 5(b) lands that were ceded by the Republic of Hawai‘i to the U.S., excepting lands that were 5(c) set aside by federal actors or the state governor as of Hawai‘i’s admission on August 21, 1959, or 5(d) lands that the Territory of Hawai‘i conveyed to the state. Act of March 18, 1959, Pub. L. 86-3, 73 Stat. 4. Section 5(f) of the Admissions Act established a special public trust from lands transferred from the U.S. to the State upon admission in 1959 and is the basis for the public trust established in section 4 of the state constitution. Section 5(b) of the Admissions Act specifies that public trust lands are those public lands and other public property that the Republic of Hawai‘i ceded to the U.S. federal government by Joint Resolution of Annexation.Resolution No. 55 of July 7, 1898 (Newlands Resolution), 30 Stat. 750.
In 2003, the Hawai‘i state attorney general (AG) stated, "[c]eded lands . . . includ[e] the water, minerals, plants, and other things connected with the lands, and every species of title inchoate or complete."03-03 Op. Haw. Att’y Gen 6-7 (2003). This reference to ‘ceded lands’ indicates those lands that constitute 5(b) public trust lands. In coming to this conclusion, the Hawai‘i state attorney general reviewed State v. Zimring, 58 Haw. 106 (1977), in which the Hawai‘i Supreme Court determined that newly-formed lands as a result of lava flows are part of the public trust. The Zimring court found the lava flow question a case of first impression and applied equitable doctrines to balance between the relative “windfall” coastal property owners would enjoy against the overall public “benefit of all the people of Hawaii.” Zimring, 58 Haw. at 120. The Zimring court looked to the language of the Joint Resolution, which conveyed rights to the U.S. that were then conferred to the state upon the passage of the Admissions Act. The court found that the Hawai‘i Republic’s voluntarily cession of “all other property of the Hawaiian Islands together with every right and appurtenance thereunder appertaining” included property “real, personal and mixed, choate and inchoate, corporeal.” Zimring, 58 Haw. at 21-25.
Because the right to these lava flow land extensions vested in the trust in 1898 with the Newlands resolution, the fact that the actual land did not form until 1955 did not remove them from the state’s public trust. “Since the right to future lava extensions was conveyed to the United States at the time of annexation,” the court found, “any lava extension thereafter created should be considered to be among the "lands and properties that were ceded to the United States by the Republic of Hawaii under the joint resolution of annexation." Id. at 123 citing Admission Act § 5(g). Lava flow land extensions, existing and in the future, were part of the 1898 cession and returned to the State in section 5(b) of the Admission Act. Tany S. Hong, State of Hawai‘i Attorney General Opinion to Hon. Susumu Ono, Chairman DLNR, 9 (June 24, 1982) interpretingState v. Zimring, 58 Haw. 106 (1977).
A later decision, Napeahi v. Paty, 921 F.2d 897 (9th Cir. 1988), used the Zimring rationale to find that the lands that become submerged through natural processes after 1898 also thereby become public lands subject to the section 5(f) trust. The Ninth circuit also drew from County of Hawaii v. Sotomura, 55 Haw. 176 (1973), which held that the state may acquire title to newly eroded submerged lands.
In 1978, Hawai‘i residents ratified Hawai‘i Constitution Article XII, section 6, which established a state agency, the Office of Hawaiian Affairs (OHA) and its right to receive a “pro rata portion” of the revenues generated from the use of public trust lands for the betterment of the conditions of Native Hawaiians. Hawai‘i Constitution Article XII, section 6 further empowers OHA board “to manage and administer the proceeds from the sale or other disposition of the lands, natural resources, minerals 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.”
Hawai`i Constitution, article XII, § 4 describes this public trust as “lands granted to the State of Hawaii by Section 5(b) of the Admission Act” and excludes Hawaiian Home Lands.
Through Act 273, Session Laws of Hawai‘i (SLH) 1980, which was codified as Hawai‘i Revised Statutes (HRS) section 10-13.5, the state legislature defined OHA’s pro rata portion as “twenty per cent of all funds derived from the public land trust.” Initially, the state interpreted HRS § 10-13.5 to include only revenues generated from lands controlled and managed by the Department of Land and Natural Resources (DLNR). An Attorney General Opinion dated Sept. 23, 1983 upheld the state’s practice of not including within OHA’s pro rata portion revenues from lands that had been set aside or leased to agencies other than DLNR for public use, such as harbors and airports, or revenues generated by private businesses managing or operating on public lands or facilities. Using this methodology, between 1981 and 1990, the state transferred an average of approximately $1.4 million annually to OHA.
Hawai‘i Revised Statute (HRS) § 10-3(1) further specifies that the public trust consists in:
all proceeds and income from the sale, lease, or other disposition of lands ceded to the United States by the Republic of Hawaii under the joint resolution of annexation, approved July 7, 1898 (30 Stat. 750), or acquired in exchange for lands so ceded, and conveyed to the State of Hawaii by virtue of section 5(b) of the Act of March 18, 1959.
Under HRS § 10-13.5, OHA should receive twenty-percent of these public trust revenues. Act 178, Session Laws of Hawai‘i 2006, sets aside HRS section 10-13.5 “until further action is taken by the legislature,” and establishes OHA’s interim pro rata portion as a specific dollar amount ($15.1 million per year). Accordingly, Act 178 is an interim determination of OHA’s pro rata portion of public land trust revenue going forward.
Currently, Executive Order 06-06, authorized by then Governor Linda Lingle, requires agencies to transfer twenty percent of revenues from public trust lands unless such a transfer conflicts with other laws.