This article was produced for ProPublica’s Local Reporting Network in partnership with the Honolulu Star-Advertiser. Sign up for Dispatches to get stories like this one as soon as they are published.
Can the federal government underwrite mortgages for homes in Hawaii on a spot where there may be buried bombs from World War II?
The answer depends on which federal program insures the loans. When it comes to the one for Native Hawaiians, the answer has been an emphatic no. But when it comes to more traditional mortgages for the general public, a different federal program has been saying yes.
in late 2014 restricted some mortgage lending in a region of Hawaii’s Big Island known as the Waikoloa Maneuver Area, concerned that buried bombs still posed a danger to thousands of residents. Funds would flow again, officials said, once the military removed any unexploded devices and once the state deemed the land safe.
That policy effectively froze lending for many Native Hawaiians, who relied on HUD-backed loans to develop homesteads within a historic land trust, parts of which were located in an area with a potential for unexploded ordnance, known as the UXO zone.
U.S. Sen. Brian Schatz, a Democrat from Hawaii, said in a statement to the news organizations that he is concerned about the impact of the HUD policy on the state Department of Hawaiian Home Lands, which oversees the Native trust. That department, he said, is now subject to “more onerous restrictions on building and financing than any other landowner in the state.” Schatz said he was working with federal and state agencies “to find a path forward to make it easier to finance and develop on Hawaiian Home Lands while continuing to keep people safe.”
U.S. Sen. Mazie Hirono, a Hawaii Democrat, wrote to leaders of four federal and state agencies, including HUD, saying the problems highlighted by the Star-Advertiser/ProPublica reporting have made clear that implementing an interagency approach will be critical to ensuring lands become safely available for residential construction. Specifically, she called for a working group made up of HUD, the Corps, the state Department of Health and the state Department of Hawaiian Home Lands. That group, she said, should determine the necessary steps to clear and secure the land “as quickly as possible” to ensure the state and federal governments meet their obligation to provide safe, affordable housing options to beneficiaries of the Native Hawiian land trust.
“Today, there are more than 6,000 beneficiaries on Hawaii Island who are waiting for land, and for many of them, HUD financing will be the best or only option for building an affordable home,” Hirono wrote in her Jan. 11 letter.
The Military Pledged to Remove Unexploded Bombs From This Island. Native Hawaiians Are Still Waiting.
Native Hawaiian leaders note that, so far, relatively few munitions have been found in Puukapu, the largest trust parcel in the UXO zone. Yet beneficiaries are still waiting on the Corps and state regulators to officially clear the area. Many have leases that flag their land as being located in a UXO zone.
Gambill-De Rego, the mortgage broker and a Puukapu beneficiary, said she has helped some beneficiaries whose older leases did not contain that flag but has had to tell many others that they can’t get mortgages until the UXO issue is resolved. “This is not fair at all,” she said.
Ian Lee Loy, a former member of the state commission that oversees the trust lands, noted that many Native Hawaiians have already waited years — and sometimes, decades — for the opportunity to establish homesteads on the Big Island. “Everything you’ve uncovered is shameful,” he said.
Agnel Philip of ProPublica contributed data analysis.
Source: propublica.org