Land Exchange Procedures and Procedures to Amend the Hawaiian Homes Commission Act, 1920, 29776-29793 [2016-11146]

Agencies

• DEPARTMENT OF THE INTERIOR
• Office of the Secretary

[Federal Register Volume 81, Number 93 (Friday, May 13, 2016)]
[Rules and Regulations]
[Pages 29776-29793]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-11146]


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DEPARTMENT OF THE INTERIOR

Office of the Secretary

43 CFR Parts 47 and 48

[167D0102DM; DLSN00000.000000; DS61400000; DX61401]
RIN 1090-AA98


Land Exchange Procedures and Procedures to Amend the Hawaiian 
Homes Commission Act, 1920

AGENCY: Office of the Secretary, Interior.

ACTION: Final rule.

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SUMMARY: This rule provides clarity in how the Department of the 
Interior administers certain provisions of the Hawaiian Homes 
Commission Act and the Hawaiian Home Lands Recovery Act. It facilitates 
the goal of the rehabilitation of the Native Hawaiian community, 
including the return of native Hawaiians to the land, consistent with 
the Hawaiian Homes Commission Act, the State of Hawai[revaps]i 
Admission Act, and the Hawaiian Home Lands Recovery Act. The rule 
clarifies the land exchange process for Hawaiian home lands, the 
documents required for land exchanges, and the respective 
responsibilities of the Department of the Interior, the Department of 
Hawaiian Home Lands, the Hawaiian Homes Commission, and other entities 
engaged in land exchanges of Hawaiian home lands. It also identifies 
the documentation requirements and the responsibilities of the 
Secretary of the Interior in the approval process for State of 
Hawai[revaps]i proposed amendments to the Hawaiian Homes Commission 
Act, 1920.

DATES: This rule is effective July 12, 2016.

[[Page 29777]]


ADDRESSES: The final rule is available on the internet at: https://www.regulations.gov.

FOR FURTHER INFORMATION CONTACT: Ka`i`ini Kimo Kaloi, Director, Office 
of Native Hawaiian Relations, telephone (202) 208-7462.

SUPPLEMENTARY INFORMATION:

I. Background

    In 1921, Congress enacted the Hawaiian Homes Commission Act, 1920 
(HHCA), 42 Stat. 108, to provide a homesteading program for native 
Hawaiians by placing approximately 200,000 acres of land (known as 
Hawaiian home lands) into the Hawaiian Home Lands Trust. The day-to-day 
administration of Hawaiian Home Lands Trust is by the Department of 
Hawaiian Home Lands (DHHL), an agency of the State of Hawai[revaps]i, 
headed by an executive board known as the Hawaiian Homes Commission 
(HHC). The HHCA provides the Chairman of the HHC the authority to 
propose to the Secretary of the Interior (Secretary) the exchange of 
Hawaiian home lands for land privately or publicly owned in furtherance 
of the purposes of the HHCA.
    The HHCA also created a series of funds (the Hawaiian Home Lands 
Trust Funds, or ``trust funds'') See, HHCA section 213 as amended. The 
purpose of one of these trust funds is the ``rehabilitation of native 
Hawaiians, native Hawaiian families, and Hawaiian homestead 
communities,'' which shall include ``the educational, economic, 
political, social, and cultural processes by which the general welfare 
and conditions of native Hawaiians are thereby improved and 
perpetuated.'' Id. Another in this series of trust funds seeks, for 
instance, to enhance construction of replacement homes, repairs or 
additions, and enhance development of farms, ranches or aquaculture, 
and to provide farm loans, including for soil and water conservation. 
Still another trust fund provides money for construction, 
reconstruction operations and maintenance of revenue-producing 
improvements intended to benefit occupants of Hawaiian home lands; for 
investments in water and other utilities, supplies, equipment, and 
goods; and for professional services needed to plan, implement, develop 
or operate such projects that will improve the value of Hawaiian home 
lands for their current and future occupants. Other money is provided 
to establish and maintain an account to serve as a reserve for loans 
issued or backed by the Federal Government, to further the purpose of 
the HHCA. The purposes and goals of these funds reflect congressionally 
identified purposes and goals of the HHCA.
    In 1959, Congress enacted the Hawai[revaps]i Admission Act, 73 
Stat. 4 (Admission Act), to admit the Territory of Hawai[revaps]i 
(Hawai[revaps]i or State) into the United States as a state. In 
compliance with the Admission Act, and as a compact between the State 
and the United States relating to the management and disposition of the 
Hawaiian home lands, the State adopted the HHCA, as amended, as a law 
of the State through Article XII of its Constitution.
    In section 223 of the HHCA, Congress reserved to itself the right 
to alter, amend, or repeal the HHCA. Consistent with this provision, 
section 4 of the Admission Act provides limitations on the State's 
administration of the Hawaiian Home Lands Trust and the Hawaiian Home 
Lands Trust Funds (hereafter referred to together as the Trust) and 
also provides that the HHCA is subject to amendment or repeal by the 
State only with the consent of the United States. Recognizing, however, 
that it was vesting the State with day-to-day administrative authority, 
Congress in section 4 of the Admission Act also provided exceptions 
within which the State could amend certain administrative provisions of 
the HHCA without the consent of the United States. The HHCA is a 
cooperative federalism statute, a compound of interdependent Federal 
and State law that establishes a Federal law framework but also 
provides for implementation through State law.
    Consistent with the provisions of the HHCA and the Admission Act, 
Congress enacted the Hawaiian Home Lands Recovery Act in 1995 (HHLRA), 
109 Stat. 357, which provides that the Secretary shall determine 
whether a State-proposed amendment to the HHCA requires the consent of 
the United States under section 4 of the Admission Act. It is 
appropriately the function of the United States to ensure conformance 
with the limitations in the Admissions Act and protect the integrity of 
this statutory framework.
    The HHLRA also clarified the Secretary's role in the oversight of 
the Hawaiian Home Lands Trust. Section 204(a)(3) of the HHCA, in 
conjunction with Section 205 of the HHLRA, requires the approval or 
disapproval of the Secretary for the exchange of Hawaiian home lands. 
The HHLRA details the Secretary's responsibilities to ensure that 
Hawaiian home lands are administered in a manner that advances the 
interests of the beneficiaries.
    While the Secretary has broad responsibilities under the HHCA and 
the Admissions Act, the HHLRA clarifies the scope of the continuing 
responsibilities of the Federal Government with regard to the HHCA. Two 
of these responsibilities are addressed in the final rule. First, it 
clarifies the role of the Secretary in land exchanges and, second, 
clarifies the process for the Secretary's review of State-proposed 
amendments to the HHCA. As to HHC Chairman-proposed land exchanges, the 
HHLRA provides that the HHC Chairman submit a report to the Secretary, 
including identification of the benefits to the parties of the proposed 
exchange. The Secretary shall approve or disapprove the proposed 
exchange depending on whether it advances the interests of the 
beneficiaries. As to State-proposed amendments to the HHCA, the HHLRA 
requires the State to notify the Secretary of any amendment it proposes 
to the HHCA and then requires the Secretary to determine whether it 
impacts Federal responsibilities under the HHCA or infringes on Federal 
interests or those of the HHCA beneficiaries. If the Secretary 
determines the State's proposed amendment of the HHCA impacts the 
Federal responsibilities or infringes on either the Federal or 
beneficiaries' interests, the Secretary must submit the amendment to 
Congress for approval.
    Since Hawai[revaps]i's admission to the Union, both Secretarial 
reviews occurred on an ad hoc basis using procedures accepted by the 
State and the Department. See, letter dated August 21, 1987 to Chairman 
Morris Udall of the House Committee on Interior and Insular Affairs. 
This rule establishes a clear process for Secretarial review and 
approval of land exchanges proposed by the HHC Chairman under the HHCA 
and HHLRA (Part 47), and of State-proposed amendments to the HHCA (Part 
48).

II. Responses to Comments on the May 12, 2015 Notice of Proposed 
Rulemaking

    On May 12, 2015, the Secretary issued a Notice of Proposed 
Rulemaking (NPRM), entitled ``Land Exchange Procedures and Procedures 
to Amend the Hawaiian Homes Commission Act.'' 80 FR 27134-27141 (May 
12, 2015). The NPRM sought input from leaders and members of the Native 
Hawaiian community, HHCA beneficiaries, and the public about how the 
Secretary reviews land exchanges involving Hawaiian home lands proposed 
by the HHC Chairman and State-proposed amendments to the HHCA.

[[Page 29778]]

    The NPRM set an initial 60-day comment period that ended on July 
13, 2015. In response to requests from commenters, including the HHC on 
behalf of itself and HHCA beneficiaries, the Secretary extended the 
comment deadline another 30 days, ending on August 12, 2015. 80 FR 
39991 (July 13, 2015).
    The Secretary received over 500 written comments by the August 12, 
2015 deadline. All comments received on the NPRM are available in the 
NPRM docket at https://www.regulations.gov/#!documentDetail;D=DOI-2015-
0002-0001. Most of the comments revolved around a limited number of 
issues. The issues discussed below encompass the range of substantive 
issues presented in comments on the NPRM.
    After careful review and analysis of the comments on the NPRM, the 
Department concludes that it is appropriate to publish a final rule 
that would set forth the administrative procedures for the review of 
land exchanges involving Hawaiian home lands proposed by the HHC 
Chairman and amendments to the HHCA proposed by the State.

Overview of Comments

    The Department received comments from the Native Hawaiian 
community, the State, HHCA beneficiaries, and others. One fundamental 
question raised in the comments was whether the rule expands the 
Secretary's authority beyond the HHCA, Admission Act, and HHLRA. We 
conclude that the rule is within the Secretary's authority and 
consistent with long-standing practice under the HHCA, Admission Act, 
and HHLRA.
    State-proposed amendments. On August 21, 1987, the Secretary 
forwarded to the House Committee on Interior and Insular Affairs, a 
proposed procedure, agreed upon by the State and Secretary, for 
obtaining the consent of the United States to State-proposed amendments 
to the HHCA. That procedure provided for the HHC Chairman forwarding 
the proposed amendment to the Secretary with an opinion from an 
appropriate legal officer of the State, followed by the Secretary 
examining the material transmitted and then submitting to Congress a 
proposed report and bill. The parties anticipated that most State-
proposed amendments would be free of controversy and national 
implications and would be submitted to Congress once every one to two 
years. The Department endeavored to follow these procedures 
subsequently embodied in the HHLRA and in this rule.
    Land exchanges. In the late 1970's, the State and the DHHL were 
resolving claims between themselves over lands that the State had 
allegedly withdrawn illegally from the Hawaiian Home Lands Trust, while 
also addressing claims against the United States for lands allegedly 
withdrawn illegally from the Hawaiian Home Lands Trust or used by the 
United States during the territorial period. Congress considered 
addressing these claims and implementing some recommendations of the 
Federal-State Task Force Report from 1983, such as the existing 
informal process of Secretarial review of land exchanges proposed by 
the HHC Chairman. Accordingly, Congress passed the HHLRA which provides 
procedures for settlement of federal claims (section 203); approval of 
amendments to the HHCA (section 204); and approval of exchanges 
involving Hawaiian home lands (section 205). The HHLRA also designated 
a federal official within the Department ``to administer the 
responsibilities of the United States'' under the HHCA and the HHLRA, 
and to protect and advance HHCA beneficiaries' rights and interests, 
including promoting homesteading opportunities, economic self-
sufficiency, and social well-being (section 206). See, Hawaiian Home 
Lands Recovery Act: Hearing before the Senate Committee on Energy and 
Natural Resources on S. 2174, 103d Cong., 9-10, 19 (1994). See, 
response to questions 3 and 40.
    HHCA beneficiaries. The HHLRA defines ``beneficiary'' in the same 
terms as ``native Hawaiian'' is defined in the HHCA, which was adopted 
as a provision of the constitution of the State as a compact with the 
United States. In 1959, when section 4 of the Admission Act referred to 
amendments that ``increase the benefits to lessees of Hawaiian home 
lands,'' all lessees met the definition of ``native Hawaiian'' and had 
a blood quantum of at least 50 percent. Beginning in 1986, however, 
certain persons with a lesser blood quantum could obtain lessees 
through succession or transfer. See, 100 Stat. 3143 (1986). The HHLRA, 
nevertheless, defined beneficiary in terms of the HHCA definition, not 
in terms of lessees. Therefore, the rule evaluates and advances the 
interests of the beneficiaries as distinguished from all lessees.

Responses to Specific Issues Raised in the NPRM Comments

1. How do claims concerning the United States occupation of the 
Hawaiian Islands impact the rule?
    Issue: Multiple commenters who objected to Federal rulemaking based 
their objections on the assertion that the United States violated and 
continues to violate international law by illegally occupying the 
Hawaiian Islands and thus is without jurisdiction on the Islands.
    Response: The Department is an agency of the United States. The 
Secretary's authority to issue this rule derives from the United States 
Constitution and from Acts of Congress, and the Secretary's authority 
is confined within that structure. The Secretary is bound by 
Congressional enactments concerning the status of Hawai[revaps]i. Under 
those enactments and under the United States Constitution, 
Hawai[revaps]i is a State of the United States of America.
    In 1893, a United States officer, acting without authorization of 
the U.S. government, conspired with residents of Hawai[revaps]i to 
overthrow the Kingdom of Hawaii. In the years following the 1893 
overthrow, Congress annexed the Territory of Hawai[revaps]i and 
established a government for the Territory of Hawai[revaps]i. See, 
Joint Resolution to Provide for Annexing the Hawaiian Islands to the 
United States, 30 Stat. 750 (1898); Act of Apr. 30, 1900, 31 Stat. 141. 
In 1959, Congress admitted Hawai[revaps]i to the Union as the 50th 
State. In 1993, Congress, through a joint resolution, apologized to 
Native Hawaiians for the overthrow and the deprivation of the rights of 
Native Hawaiians to self-determination, and expressed its support for 
reconciliation efforts with Native Hawaiians. Joint Resolution of 
November 23, 1993, 107 Stat. 1510, 1513 (commonly known as the 
``Apology Resolution'').
    The Apology Resolution, however, did not effectuate any changes to 
existing law. See, Hawai[revaps]i v. Office of Hawaiian Affairs, 556 
U.S. 163, 175 (2009). Thus, the Admission Act established the current 
status of the State of Hawai[revaps]i. The Admission Act proclaimed in 
section 1 that ``the State of Hawai[revaps]i is hereby declared to be a 
State of the United States of America, [and] is declared admitted into 
the Union on an equal footing with the other States in all respects 
whatever.'' The Admission Act was consented to by the people of 
Hawai[revaps]i through an election held on June 27, 1959. The comments 
in response to the NPRM that call into question the legitimacy of the 
State of Hawai[revaps]i are inconsistent with

[[Page 29779]]

the express determination of Congress, which is binding on the 
Department.
2. Is the definition of a beneficiary of the HHCA consistent with the 
requirements of Federal law?
    Issue: Commenters questioned the Secretary's constitutional 
authority to promulgate rules for the Hawaiian Home Lands Trust, 
arguing that Congress's definition of a Native Hawaiian beneficiary is 
race-based because its use of a ``blood quantum'' violates the 
Constitution's guarantee of equal protection.
    Response: The Federal Government has broad authority to regulate 
with respect to Native American communities. See, U.S. Const. art. I, 
sec. 8, cl. 3 (Commerce Clause); U.S. Const. art. II, sec. 2, cl. 2 
(Treaty Clause); Morton v. Mancari, 417 U.S. at 551-52 (``The plenary 
power of Congress to deal with the special problems of Indians is drawn 
both explicitly and implicitly from the Constitution itself.''). In the 
case of the Hawaiian Home Lands Trust, Congress specifically chose to 
use a 50 percent blood quantum requirement for all beneficiaries of the 
HHCA rather than a 1/32 blood quantum in order to make the bill more 
distinctly a Hawaiian rehabilitation scheme. Proposed Amendments to the 
Organic Act of the Territory of Hawai[revaps]i: Hearings on H.R. 7257 
Before the House Comm. On the Territories, 66th Cong. 15 (1921). 
Acknowledging that the United States implemented similar rehabilitation 
programs for Indians because the government took away their lands 
without payment and violated treaties, Congressman Charles Curry, 
Chairman of the Committee on the Territories, said that it should be 
constitutional to do the same for the Hawaiians whose land had been 
taken away from them and noted that the Committee received opinions 
supporting the constitutionality of the proposed legislation from the 
Attorney General of Hawai[revaps]i and the Solicitor of the Department 
of the Interior. Id. at 141-142. Blood quantum reflects ties to the 
Native Hawaiian political community, as individuals marry within it. 
Id. at 140. And, as Congress explained, Congress ``does not extend 
services to Native Hawaiians because of their race, but because of 
their unique status as the indigenous peoples of a once sovereign 
nation as to whom the United States has established a trust 
relationship.'' 114 Stat. 2968 (2000) (Hawaiian Homelands Homeownership 
Act).
3. Is the Hawaiian Homes Commission Act still Federal Law?
    Issue: Commenters questioned whether the HHCA remains a Federal 
law, presuming that the passage of the Admission Act repealed it.
    Response: Yes, the HHCA remains a Federal law. As explained in more 
detail above under ``Background,'', in compliance with the Admission 
Act, and as a compact between the State and the United States relating 
to the management and disposition of the Hawaiian home lands, the State 
adopted the HHCA, as amended, as a law of the State through Article XII 
of its Constitution as a condition of its admission in 1959. The HHCA 
is a cooperative federalism statute, a compound of interdependent 
Federal and State law that establishes a Federal law framework but also 
provides for implementation through State law.
    Furthermore, consistent with the provisions of the HHCA and the 
Admission Act, the HHLRA provides that the Secretary shall determine 
whether a proposed amendment to the HHCA requires the consent of the 
United States under section 4 of the Admission Act. It is appropriately 
the function of the United States to ensure conformance with the 
limitations in the Admission Act and protect the integrity of this 
statutory framework.
    The HHLRA also clarified the role of the Secretary in the oversight 
of the Hawaiian Home Lands Trust. Section 204(a)(3) of the HHCA, in 
conjunction with section 205 of the HHLRA, requires the approval or 
disapproval of the Secretary for the exchange of Hawaiian home lands. 
The HHLRA details the Secretary's responsibilities to ensure that the 
administration of Hawaiian Home Lands Trust advances the interests of 
the beneficiaries.
    The HHLRA thus confirms the continuing role of the Secretary in 
implementing the HHCA and defines the scope of the continuing 
responsibilities of the Federal Government related to approval of land 
exchanges of Hawaiian home lands and state-proposed amendments to the 
HHCA.
4. Is the Secretary's interpretation of the term ``rehabilitation'' as 
including political, cultural and social reorganization correct?
    Response: The meaning of the term ``rehabilitation'' under the HHCA 
was provided for background purposes in the proposed rule, and resulted 
in a number of comments. We now clarify the Department's position.
    The Secretary's interpretation of the term ``rehabilitation'' to 
include political, cultural, and social reorganization is consistent 
with both the statutory text and legislative history of HHCA. The term 
``rehabilitation'' was added to the HHCA through the 1978 amendments to 
the Hawaiian Constitution. Section 213(i) of the HHCA, as amended, 
creates a ``rehabilitation fund'' that can be used for ``the 
rehabilitation of native Hawaiians'' including ``educational, economic, 
political, social, and cultural processes.'' Congress consented to this 
language through a joint resolution approved October 27, 1986, thereby 
amending the HHCA. 100 Stat. 3143. The purposes and goals of the 
rehabilitation fund are congressionally identified as some of the 
purposes and goals of the HHCA.
    Furthermore, the legislative history of the HHCA indicates that the 
bill's purpose was to protect the welfare of the Native Hawaiian 
people. See, 67 Cong. Rec. 3263 (1921) (statement of Rep. Almon). 
Methods to achieve that purpose included revitalizing the ``mode of 
living'' of Native Hawaiians from prior generations. See, 
Rehabilitation and Colonization of Hawaiians and Other Proposed 
Amendments to the Organic Act of the Territory of Hawai[revaps]i: 
Before the House Comm. on the Territories, 66th Cong 4 (1920) (quoting 
Sen. John H. Wise's testimony before the Territorial Legislature that: 
``[t]he Hawaiian people are a farming people and fishermen, out-of-door 
people, and [being] frozen out of their lands. . . . is one of the 
reasons why the Hawaiian people are dying. Now, the only way to save 
them, I contend, is to take them back to the lands and give them the 
mode of living that their ancestors were accustomed to and in that way 
rehabilitate them.'').
    In 1982 the Secretary and the Governor of Hawai[revaps]i created a 
task force whose purpose was to consider how to better effectuate the 
purposes of the HHCA. Federal-State Task Force on the Hawaiian Homes 
Commission Act Report to the Secretary of the Interior and the Governor 
of the State of Hawai[revaps]i, Honolulu, Hawai[revaps]i, August 1983, 
pp. 4, 8. That task force found that the term ``rehabilitation'' 
``implies that traditional and cultural practices of native 
beneficiaries, to the extent not precluded by law, should be respected 
and acknowledged by the DHHL in order to enable native beneficiaries to 
return to their lands and to provide for their self-sufficiency and 
initiative and for the preservation of their culture.'' Id. at 55. 
Thus, the term ``rehabilitation'' has been consistently interpreted in 
ways that support the development of the Hawaiian community itself. The

[[Page 29780]]

Secretary's interpretation of the term ``rehabilitation'' to include 
political, cultural, and social reorganization is consistent with the 
statutory language, congressional intent, and longstanding 
interpretation of the HHCA.
    The funds Congress provided for in the HHCA represent factors that 
Congress identified as some of the purposes and goals of the HHCA. 
These purposes and goals guide the Secretary's review in determining 
whether a proposal advances the interests of the beneficiaries. Section 
48.25 has been modified in response to these comments.
5. Should leaseholds to beneficiaries be converted to fee simple 
allocations of land?
    Issue: Commenters recommend a path that would convert HHCA 
leaseholders into the outright owners of their leasehold property.
    Response: Allowing for the conversion of leaseholds into fee simple 
ownership of Hawaiian home lands properties, which resembles the 
allotment process that was repudiated by Congress in 1934, is 
prohibited by current Federal law and is not within the scope of the 
rule.
6. Does the State of Hawai[revaps]i have the ability to amend the HHCA?
    Issue: Commenters allege that the State has no ability to amend the 
HHCA through the process outlined in the Admission Act because it 
remains a Federal law.
    Response: The HHCA is a cooperative federalism statute, a compound 
of interdependent Federal and State law that establishes a Federal law 
framework but also provides for implementation through State law. The 
Admission Act provided that the State could amend certain provisions of 
the HHCA but expressly limited the State's authority. The HHLRA 
provides further clarification, providing that the Secretary shall 
determine whether a State-proposed amendment to the HHCA requires the 
consent or approval of Congress under section 4 of the Admission Act. 
If the State-proposed amendment is found not to require the approval of 
the United States, the rule provides that the effective date of the 
State-proposed amendment is the date of the Secretary's notification 
letter to the Congressional Committee Chairmen that Congressional 
approval was not required. It is appropriately the function of the 
United States to ensure conformity with the limitations in the 
Admission Act and protect the integrity of this Federal statutory 
framework.
7. Do parts 47 and 48 create an administrative burden that would make 
it more difficult for the State to move forward with land exchanges or 
amendments to the HHCA that would benefit the Hawaiian home lands 
program?
    Issue: Commenters stated that while it may be lawful for the 
Secretary to engage in rulemaking, administrative requirements and 
criteria may constrain state officials and make it more difficult for 
them to proceed with land exchanges or amendments to the HHCA that they 
consider beneficial to the program.
    Response: The three main Hawaiian Home Lands Trust statutes (the 
HHCA, the Admission Act, and the HHLRA) establish a trust relationship 
and grant the Secretary authority to protect and advance the interests 
of the beneficiaries. Section 206 of the HHLRA charges the Secretary 
with advancing the interests of the beneficiaries in administering the 
HHCA. Parts 47 and 48 will assist the Secretary in carrying out this 
responsibility and make the Secretary's actions more transparent to the 
public. Similarly, the rule will assist the State in understanding what 
information the Secretary considers necessary in order to evaluate the 
proposed actions. As evidenced by the fact that the HHLRA requires the 
Secretary to approve or disapprove all land exchanges involving 
Hawaiian home lands and to review all proposed amendments to the HHCA 
proposed by the State, Congress not only recognized the benefit of an 
independent Federal determination that the proposal advances the 
interests of the beneficiaries, but also recognized that the interests 
of the Hawaiian Home Lands Trust and its beneficiaries may not always 
coincide with the interests of the State and their overall program. 
Congress prioritized the interests of the beneficiaries and in doing so 
circumscribed the day-to-day administration of the Trust by the State, 
notwithstanding benefits to other State goals.
8. Should a federalism assessment be performed for this rule?
    Issue: One commenter suggests that the rule has sufficient 
federalism implications to warrant the preparation of a federalism 
assessment in accordance with Executive Order 13132.
    Response: No. While the HHCA, the Admission Act, and the HHLRA, 
limit what the State can do in administering the Trust, 43 CFR parts 47 
and 48 merely provide a path for administering those Federal laws 
within the original limited delegation to the State in the Admission 
Act; thus, no federalism assessment needs to be performed. Recognizing 
the direct effect the three statutes have on the State and the benefits 
of working with the State to protect the beneficiaries and the Hawaiian 
Home Lands Trust, the Department held high level discussions with State 
officials as early as 2011 that resulted in this rulemaking to 
formalize the process for review of land exchanges and State proposed 
amendments to the HHCA.
    As discussed above, the statutory framework of the HHCA, the 
Admission Act, and the HHLRA result in a compound of interdependent 
Federal and State law. Those laws undoubtedly have federalism 
implications. This rule, however, does not. In accordance with E.O. 
13132, rules or policies have federalism implications if they ``have 
substantial direct effects on the States, on the relationship between 
the national government and the States, or on the distribution of power 
and responsibilities among the various levels of government.'' Parts 47 
and 48 have none of those effects. The rule merely formalizes the 
process the Secretary will use in reviewing and approving land 
exchanges and in reviewing proposed amendments to the HHCA under 
existing law, and clarifies the documentation that the HHC Chairman, an 
officer of the State of Hawai[revaps]i, must submit to implement 
existing law. The relationship between the State and the Secretary is 
unchanged by this rule. We expect the HHC Chairman will continue to 
submit proposed land exchanges and proposed amendments to the Secretary 
as it has since passage of the HHRLA. The distribution of power and 
responsibilities remains unchanged; the respective decision making 
authority of the Secretary and State are limited by section 4 of the 
Admission Act and sections 205 and 206 of the HHLRA. The only ``direct 
effect'' imposed on the State by this rule is the requirement to submit 
some additional documentation, which, given the level of documentation 
required and the frequency of submissions, does not rise to a 
``substantial direct effect.'' We therefore conclude that no federalism 
analysis is necessary.
9. Do parts 47 and 48 allow the Secretary to amend the HHCA?
    Issue: Commenters suggest that parts 47 and 48 amend or allow the 
Secretary to amend the HHCA.
    Response: The rule does not amend the HHCA. Parts 47 and 48 merely 
assist in the administration of the HHCA. One

[[Page 29781]]

of the purposes of part 48 is, however, to provide clarity, consistent 
with Federal law, on what subjects under the HHCA the State may amend 
on its own and which subjects Congress must approve. Similarly, part 47 
adds clarity to Federal review of land exchanges. This rulemaking 
process provided the public and all interested parties an opportunity 
to review and comment on the Department's existing process before it is 
replaced with a formalized one under this rule.
10. Should the Secretary monitor State legislation that poses a threat 
to the HHCA?
    Issue: Commenters recommend that under part 48 the Secretary 
adequately monitor any legislation that would pose a threat to the 
HHCA.
    Response: Section 204 of the HHLRA requires that the Chairman of 
the HHC submit for review by the Secretary and if required, 
congressional approval, all State enactments proposing to amend the 
HHCA. Any proposed amendments to any terms or provisions of the HHCA by 
the State should also specify that the proposed amendment seeks to 
amend the HHCA, which puts all persons on notice that the amendment 
needs review by the Secretary. Consistent with the Admission Act and 
HHCA, if Federal review finds that any State enactment impacts any of 
the factors in Sec.  48.20 of this rule, Congressional action is 
required before it has any effect on the provisions of the HHCA or 
administration of the Trust. It is the responsibility of the HHC 
Chairman to monitor the State's legislative activities and to obtain 
the required review by the Secretary if it is the State's intent to 
amend the HHCA.
    Once the Department determines that Congress must approve a 
proposed amendment to the HHCA and the Department transmits the 
proposed amendment to Congress, there is no requirement that the 
Administration monitor or advocate its passage. The Administration may 
oppose an amendment that does not advance the interests of the HHCA 
beneficiaries.
11. Do State-proposed amendments to the HHCA require Congressional 
approval or consent?
    Issue: A commenter suggests that Congressional consent and not 
approval is required for certain proposed amendments to the HHCA.
    Response: Congress provided in section 4 of the Admission Act that 
certain amendments to the HHCA would require the consent of the United 
States. Congress also clarified in section 204 of the HHLRA that the 
consent of the United States is provided through the approval by 
Congress. Thus, approval is required.
    Section 204(c)(1) also requires the Secretary to submit to Congress 
a draft joint resolution approving the proposed amendment. Section 397, 
Joint Resolutions, of Jefferson's Manual of the House of 
Representatives of the United States Congress, provides, with the 
exception of joint resolutions proposing amendments to the 
Constitution, all resolutions are sent to the President for approval 
and have the full force of law.
12. Does Sec.  47.50(a)(8)(i) authorize the State of Hawai[revaps]i to 
evict tenants from property being considered for a land exchange?
    Issue: Multiple commenters expressed concern that Sec.  
47.50(a)(8)(i) authorizes the State to evict tenants from property 
being considered for a land exchange.
    Response: Section 47.50(a)(8)(i) does not authorize the State or 
any other entity to evict tenants from property being considered for a 
land exchange. This provision asks that if a party to the exchange will 
evict a tenant from land being exchanged under separate legal 
authority, the party should provide the Secretary details of 
arrangements for the relocation of the tenants. The provision in Sec.  
47.50(a)(8)(i) does not expand or grant such authority. The provision 
in Sec.  47.50(a)(8)(i) is almost identical to section 43 CFR 
2201.1(c)(11) which applies to other Federal land exchanges. The 
purpose of both 43 CFR 2201.1(c)(11) and final rule 43 CFR 
47.50(a)(8)(i) is to assist the Secretary in identifying all costs, 
both economic and social, to all persons directly affected by an 
exchange.
13. Should the definition of consultation in both parts 47 and 48 of 
this rule require face-to-face meetings with beneficiaries to be valid?
    Issue: Commenters question whether consultation with beneficiaries 
without face-to-face meetings will allow for a sufficient opportunity 
to engage in dialogue with the beneficiaries, consider their views, 
and, where feasible, seek agreement with them.
    Response: The definition of consultation in this rule provides a 
minimum requirement and is intended to give the Secretary, the HHC 
Chairman, as well as beneficiaries and interested parties, flexibility 
in the consultation process in order to efficiently and effectively 
engage beneficiaries and interested parties in informed consideration 
of proposed actions. Such actions may involve a wide spectrum of issues 
ranging from those that are singular, simple, and straight forward to 
those that are multi-faceted and complicated or complex. Such actions 
may also vary from those that are mandatory to others that allow 
greater discretion. Face-to-face meetings may be necessary under 
certain circumstances while other means of communications, including 
but not limited to letters delivered by the postal service, email, 
teleconferences, etc., may be just as effective in other circumstances.
    One commenter suggested requiring face-to-face consultations with 
beneficiaries and lessees who live within a 50-mile radius of the 
existing Hawaiian home lands to be exchanged or received into the 
Trust. While the rationale for not requiring face-to-face consultations 
presented in the previous paragraph still holds true, the Secretary 
encourages the State to engage in face-to-face consultations, at a 
minimum, within a 50-mile radius. The beneficiaries who live within a 
50-mile radius of a proposed exchange will likely have a great deal of 
information important in making a decision about an exchange that would 
assist the Department in its review.
    The final rule modified the definition of consultation in response 
to these comments.
14. Does Sec.  47.45(a) impede the State's ability to engage in land 
exchanges involving Hawaiian home lands?
    Issue: Commenters raised the question whether Sec.  47.45(a), which 
recommends the HHC Chairman and the other party seeking the exchange 
meet with the Department prior to finalizing an exchange, would hamper 
the progress of land exchanges involving Hawaiian home lands.
    Response: Section 47.45(a) is a suggested course of action and does 
not require pre-land exchange meetings. The Department finds, however, 
that getting all parties who are interested in a particular land 
exchange talking to one another can be extremely useful and time-
saving. It is especially useful to have this type of pre-meeting to 
avoid the submission of a presumed final document that cannot be 
approved by the Department. The language of Sec.  47.45(a) would leave 
it to the discretion of the HHC Chairman as to whether to engage in the 
pre-land exchange meeting. The meeting may be conducted via 
teleconferencing or web-conferencing rather than in-person.

[[Page 29782]]

15. Should Sec.  47.65(b) clarify the circumstances under which the 
Secretary will consult with the beneficiaries when making a 
determination if a land exchange advances the interests of the 
beneficiaries?
    Issue: Commenters suggest that it is unclear when and under what 
circumstances consultation might occur by the Secretary when reviewing 
a HHC Chairman-proposed land exchange.
    Response: When reviewing a land exchange proposal submitted by the 
HHC Chairman, it is essential to the Secretary's decision-making 
process to have input from the beneficiary community about the effect 
the land exchange may have on the beneficiaries and the Hawaiian Home 
Lands Trust. The reason for making consultation under Sec.  47.65(b) 
permissive is that if the HHC Chairman has already consulted with the 
beneficiaries on the land exchange proposal that is before the 
Secretary, and records of this consultation provide the input that the 
Secretary seeks, then no further consultation by the Secretary may be 
necessary. If the HHC Chairman forgoes consultation on a land exchange 
or a proposed amendment to the HHCA, the Secretary may be required to 
consult directly with the beneficiaries in order to approve the 
exchange or to find that an amendment does not require Congressional 
approval.
    Upon consideration of the comments, language similar to that in 
Sec.  47.65(b) was inserted into Sec.  48.20.
16. Should the term ``consultation'' be better defined?
    Issue: Commenters suggested that there be greater clarity and 
formalization as to when the Secretary would seek such consultation, 
what such consultation would entail, and how beneficiary input will be 
taken into account in any decision making process.
    Response: The Department agrees with this point and modified the 
definition of consultation in both parts 47 and 48 so that they are 
consistent with the definition used by Federal agencies when consulting 
with the Native Hawaiian community under section 106 of the National 
Historic Preservation Act.
17. Are the standards for the review of land exchanges sufficiently 
clear to protect the interests of the beneficiaries?
    Issue: Commenters suggest the standards for review of land 
exchanges is not sufficient to guarantee the Hawaiian Home Lands Trust 
will be preserved.
    Response: The definition of land exchanges in section 47.10 is 
based upon section 204 of the HHCA and the Secretary's experience with 
reviewing land exchanges involving Hawaiian home lands and other 
properties throughout the United States. Exchanges can be a valuable 
tool for the HHCA Chairman in managing the Hawaiian Home Lands Trust 
and advancing the interests of the beneficiaries. Part 47 seeks to 
clarify the section 205 of HHLRA to ensure it is carried out in 
compliance with section 206 of the HHLRA that requires the Secretary, 
in administering the HHCA, to advance the interests of the 
beneficiaries. The protections provided by the HHCA, Admission Act, and 
HHLRA, along with the details laid out in part 47, allow the HHC 
Chairman to engage in land exchanges involving Hawaiian home lands 
without endangering the Trust.
18. Should the definition of ``market value'' be amended to take into 
consideration such things as utility and cultural significance of the 
properties?
    Issue: Commenters suggest that when there are multiple reasons for 
a land exchange to occur that the appraisals of the properties should 
take those reasons into account.
    Response: The Secretary is authorized to approve a land exchange 
under section 204 of the HHCA if the property to be added to the 
Hawaiian Home Lands Trust is of ``equal value'' to the property leaving 
the Hawaiian Home Lands Trust. The Secretary interprets this 
requirement to be referring to market value, similarly to the BLM land 
exchange regulations included in 43 CFR part 2200 that only consider 
the economic uses of the subject property. In order to approve the 
exchange, however, the Secretary must determine whether the proposed 
exchange advances the interests of the beneficiaries as required by 
section 206 of the HHLRA and as implemented in section 47.20 of this 
rule. At that point, the Secretary may take into account things such as 
the utility and cultural significance of the properties.
19. Should the Secretary ensure that the appreciation rate of any new 
property being proposed for inclusion in the Hawaiian Home Lands Trust 
be at least equal to the rate of return for the property proposed to 
leave the Hawaiian Home Lands Trust?
    Issue: A commenter suggests that an appreciation rate of any new 
property being proposed for inclusion in the Hawaiian Home Lands Trust 
be at least equal to the rate of return for the trust property proposed 
to leave the Hawaiian Home Lands Trust. The example given by the 
commenter is that the return on the generation of electricity on a 
current trust property and the revenue it can potentially generate is 
more important than its present cash value of the property.
    Response: The definition of market value used in this rule requires 
that the estimate of value be made in terms of cash or its equivalent. 
The appreciation rate and rate of return reflect future income 
potential, of the properties being considered in an exchange and will 
be considered in the appraisal of a property if the highest and best 
use of the property is for generating income. Properties considered for 
exchange will be valued at their highest and best use as required by 
UASFLA for market value appraisals. The income capitalization approach, 
which is required to be completed on income producing properties under 
UASFLA, requires the appraiser to analyze a property's ability to 
generate future benefits and capitalizes the income into an indication 
of present cash value. The result is that the market value of the 
property as of the date of appraisal takes into account future income 
and any appreciation by converting future benefits into a present cash 
value. If the two exchange properties have similar highest and best 
uses, similar capitalization rates would likely be used ensuring equal 
treatment of the properties under appraisal.
20. Should only Federal employees licensed in the State of 
Hawai[revaps]i be allowed to conduct appraisals of properties involved 
in an exchange involving Hawaiian home lands?
    Issue: A commenter suggests only Federal employees licensed in the 
State of Hawai[revaps]i be allowed to conduct appraisals of properties 
involved in an exchange of Hawaiian home lands.
    Response: The vast majority of Department's appraisals are 
completed by private contract appraisers under the direction of the 
Department. The review of those reports is done, however, exclusively 
by Federal employees. Requiring that appraisals be conducted by only 
Federal employees would place an unnecessary obstacle in the path of 
completing these land exchanges.
21. Should the Secretary include in 43 CFR part 47 a process that 
addresses section 205(c) of the HHLRA which authorizes the Secretary to 
initiate a land exchange involving Hawaiian home lands?
    Issue: Commenters suggest 43 CFR part 47 include a process that 
addresses section 205(c) of the HHLRA which

[[Page 29783]]

authorizes the Secretary to initiate a land exchange involving Hawaiian 
home lands.
    Response: In this rule, the Department did not include procedures 
governing land exchanges involving Hawaiian home lands initiated by the 
Secretary, but chose to address the primary way in which land exchanges 
are currently initiated. The Department is unaware of any land exchange 
involving Hawaiian home lands being initiated or proposed to be 
initiated by the Secretary. Thus, the need to address such an exchange 
through rulemaking is not necessary. Should the Secretary decide to 
engage in a land exchange involving Hawaiian home lands under the 
authority of section 205(c) and (d), we will consider then what process 
is required and if a rule is warranted.
22. Should the factors listed in section 47.20 include ``reduce the 
diversion of staff resources dedicated to deriving revenues from land 
dispositions to fund the DHHL's administrative and operating 
expenses''?
    Response: It is unnecessary to specifically insert the suggested 
language as it is encompassed within section 47.20(i).
23. After approving or disapproving a proposed amendment to the HHCA, 
should the Secretary provide an email notice to the Native Hawaiian 
Organization List maintained by the Secretary and post on the 
Department of the Interior's Web site?
    Response: The Secretary does not approve or disapprove proposed 
amendments to the HHCA but merely reviews proposed amendments to 
determine if Congressional approval is required. Following the required 
review, the Secretary will post notice of the determination on the 
Department of the Interior Web site.
24. Should the Secretary review and provide rulings to Congress and the 
HHC Chairman on State-proposed amendments to the HHCA that in 
accordance with their own provisions require Congressional approval to 
become effective?
    Issue: The State will sometimes pass legislation that proposes to 
amend the HHCA but is expressly contingent on approval by Congress.
    Response: When the State passes legislation that proposes to amend 
the HHCA but includes a provision that the effectiveness of the 
proposed amendment is contingent on approval by Congress, no proposal 
to amend the HHCA was made for purposes of section 206 of the HHLRA. In 
circumstances such as these, the State is merely taking on a general 
advisory role and providing advice to Congress on what Federal laws 
they should pass. Congress may consider the proposed amendment offered 
by the State of Hawai[revaps]i and this does not require a review under 
section 206 of HHLRA.
25. Is it the responsibility of DHHL and the HHC to determine whether 
proposed land exchanges are appropriate for the Hawaiian people?
    Response: In accordance with section 205(b) of the HHLRA, ``the 
Secretary shall approve or disapprove the proposed exchange'' submitted 
by the HHC Chairman. While the Chairman may propose an exchange, the 
ultimate responsibility for determining the appropriateness of the 
proposed exchange remains with the Secretary.
26. Are the factors the Secretary will consider in analyzing a land 
exchange listed in section 47.20 too restrictive to allow for the 
proper use of the land exchange tool by the HHC Chairman?
    Issue: A commenter suggests that the rule relies solely on the 
language listed in section 204(3) of the HHCA, which provides for an 
exchange of equal value ``to consolidate its holdings or to better 
effectuate the purposes of the HHCA.''
    Response: Section 206 of the HHLRA requires that the Secretary 
``advance the interest of the beneficiaries'' in administering the 
HHCA. Implementation of this provision is consistent with the purposes 
of section 204(a)(3) of the HHCA, which is to advance the interest of 
its beneficiaries when managing the Hawaiian Home Lands Trust. Section 
47.20 articulates factors that are consistent with the purposes of the 
HHCA and with advancing the interest of the beneficiaries to provide 
transparency in the Secretary's decision making process. Section 47.20 
of the rule implements both statutes in a consistent manner and 
utilizes the Secretary's expertise in reviewing land exchanges 
involving trust lands held for other U.S. indigenous communities.
27. Should the factors the Secretary will consider in analyzing a land 
exchange listed in section 47.20 be expanded to include such things as 
the development of Hawaiian home lands for mercantile use and to 
protect ecological and cultural resources?
    Response: Section 47.20 specifies that the main purpose of engaging 
in a land exchange must be to advance the interests of the 
beneficiaries as provided in section 206 of the HHLRA. Accordingly, it 
lists the factors the Secretary will consider in analyzing a land 
exchange. These factors themselves are purposefully broad to allow 
flexibility in the analysis.
    Moreover, in order for the exchange to be approved, the purpose of 
the land exchange must be well documented and demonstrate how the land 
exchange advances the interests of the beneficiaries. For instance, it 
would be insufficient under the rule for the party proposing the 
exchange to make only a conclusory statement that the exchange advances 
the interests of the beneficiaries without further explanation. 
Sections 47.20 and 47.30 provide the necessary information for the 
Secretary to make a reasoned decision to approve or disapprove a 
proposed land exchange.
28. Should there be a requirement that land exchanges not increase or 
decrease the acreage in the Trust in order to keep it whole?
    Response: While acreage is an important aspect of determining the 
market value of properties involved in a land exchange, it is not the 
exclusive determining factor. For example, 50 acres of heavily sloped 
rocky land will likely not be as valuable as a smaller number of acres 
of usable farm land or other more readily developable acres. Therefore, 
the HHCA requires that the exchange be of equal value, not that the 
acreage be the same. The Secretary needs to ensure the market value of 
the property coming into the Hawaiian Home Lands Trust is equal to or 
greater than the property leaving the trust as required by section 
204(c) of the HHCA, rather than rely on identical acreages.
29. Should the rule provide a more defined role for the Hawaiian Homes 
Commission in the review of land exchanges and amendments to the HHCA?
    Issue: Commenters suggest that the rule specifically recognize the 
role of the HHC because of its fiduciary duty to the beneficiaries of 
the HHCA.
    Response: Section 202 of the HHCA provides that the DHHL be headed 
by an executive board known as the HHC. The HHC and its Chairman are 
appointed by the Governor of the State of Hawai[revaps]i. The Chairman 
of the HHC is also the Director of DHHL and an Officer of the State of 
Hawaii. As officers of the State who are placed in their positions as 
Hawaiian Homes Commissioners to oversee the day-to-day management of 
the Hawaiian Home Lands Trust, the Secretary values their input. In 
response to comments, section 47.60(a)(1) now requires a statement of 
approval for a land exchange from the HHC, including

[[Page 29784]]

the Commissioners' recorded vote on the exchange, and Sec.  48.15(b)(2) 
requires that all testimony and correspondence from the HHC and its 
Commissioners related to proposed amendments be submitted to the 
Secretary in order to better inform the Secretary's review of proposed 
amendments to the HHCA. In addition, the rule now specifically 
references the Chairman of the HHC as submitting the State-proposed 
amendments to the HHCA and Chairman-proposed land exchanges to the 
Secretary to conform to the language in sections 204(a) and 205(a) of 
the HHLRA.
30. In addition to requiring the submission of homestead association 
testimony and correspondence regarding proposed amendments to the HHCA, 
should Sec.  48.15 also require the same documents from beneficiary 
associations whose membership is composed of persons who have submitted 
applications to the State for homesteads but are currently awaiting the 
assignment of a lot?
    Response: The Department appreciates the question. It is important 
for the Secretary to obtain the input of beneficiaries who are on the 
State's homestead waiting list as their priorities may diverge from the 
priorities of those beneficiaries who hold a homestead lease. 
Therefore, new definitions of HHCA Beneficiary Association and of 
Homestead Association are included in the rule and are referenced in 
Sec.  48.15(b)(2), and beneficiaries are added to Sec.  48.15(b)(2).
31. Should the definition of ``beneficiary'' include those Native 
Hawaiians with a blood quantum of more than 25 percent but less than 50 
percent who qualify to receive a homestead through transfer or 
succession?
    Response: Section 202 of the HHLRA states ``the term `beneficiary' 
has the same meaning as given the term `native Hawaiian' under section 
201(7) of the Hawaiian Homes Commission Act.'' Section 201(7) of the 
HHCA states, ``Native Hawaiian means any descendant of not less than 
one-half part of the blood of the races inhabiting the Hawaiian Islands 
previous to 1778.'' Changing the definition of ``beneficiary'' to 
include those Native Hawaiians with a blood quantum of at least 25 
percent but less than 50 percent who received a homestead through 
transfer or succession is not consistent with the HHLRA and HHCA and 
would require Congressional action.
32. Will the rule assist in meeting the Congressional deadlines for the 
review of State- proposed amendments to the HHCA and HHC Chairman-
proposed land exchanges involving Hawaiian home lands?
    Response: In order to provide a rational basis for decisions 
regarding land exchanges involving Hawaiian home lands and proposed 
amendments to the HHCA, the Secretary requires sufficient information 
on which to base those decisions. This rule details what information 
the Department requires to make an informed decision. The intention of 
the rule is to reduce the amount of time the Department takes to make 
an informed decision by providing clarity on the information necessary 
from the State about proposed land exchanges involving Hawaiian home 
lands or proposed amendments to the HHCA.
33. Should the purpose of the rule regarding land exchange procedures 
be for the benefit of the beneficiaries of the HHCA?
    Response: While each part in the rule has a specific purpose, the 
overall purpose of the Secretary's oversight of the Hawaiian Home Lands 
Trust is to advance the interests of the beneficiaries of the HHCA in 
accordance with section 206(b) of the HHLRA. Advancement of these 
interests in both parts 47 and 48 must be specific to the interests of 
the beneficiaries, not others, and documented. For the purposes of an 
HHCA review, the interests of parties other than the beneficiaries are 
not relevant to the Secretary's decision making process; rather, the 
Secretary's approval is contingent upon a determination that the 
proposal does not decrease benefits to the beneficiaries. In response 
to comment, Sec.  48.25 was modified to require that the Secretary 
consider the goals and purposes of the Trust when determining whether a 
proposed amendment to the HHCA decreases the benefits to the HHCA 
beneficiaries.
    It is important to note that there are other factors the Secretary 
must find to approve a proposed land exchange in addition to finding 
that the proposed exchange advances the interest of the beneficiaries. 
See, HHCA Section 204(a)(3) and final rule Sec.  47.35 requiring the 
Department to ensure the market value of the property coming into the 
Trust is equal or greater than the property departing the Trust. 
Similarly, a finding that a proposed amendment to the HHCA advances the 
interests of the beneficiaries does not obviate the need for 
Congressional approval. See, Admission Act Section 4 (detailing 
circumstances in which Congress reserved its own authority over the 
Trust). Consideration of whether a land exchange advances the interests 
of the beneficiaries or a proposed amendment decreases the benefits to 
beneficiaries are separate steps in the Secretary's review processes in 
both parts 47 and 48.
34. Should the rule require public input or a public vote when 
determining if a State-proposed amendment to the HHCA or HHC Chairman-
proposed land exchange involving Hawaiian home lands is reviewed by the 
Secretary?
    Response: When reviewing land exchanges involving Hawaiian home 
lands proposed by the Chairman of the HHC or State-proposed amendments 
to the HHCA, the Secretary will consider all information provided by 
the State, including any public input it received. For purposes of land 
exchanges, it is the Chairman's decision as to whether to include 
public input, including any vote results from the public, in a land 
exchange proposal submitted to the Secretary. Section 47.60 sets forth 
the documentation that the Chairman must submit to the Secretary in a 
land exchange packet, which, in response to this comment, now includes 
the recorded vote of the Commissioners. The rule requires in Sec.  
48.15 that the final vote totals for votes taken by the HHC and the 
State of Hawai[revaps]i Legislature on a proposed HHCA amendment be 
forwarded to the Secretary when it is submitted for review. These vote 
totals help to provide the Secretary with a full picture of the State's 
position on a proposed amendment and whether that amendment decreases 
the benefits to the beneficiaries. This requirement is retained in the 
final rule.
35. Should the rule require that the HHC Chairman engage in 
consultation with the beneficiaries before any land exchange involving 
Hawaiian home lands is approved or the Secretary makes a final 
determination regarding a proposed amendment to the HHCA?
    Response: The HHCA, Admission Act, and the HHLRA define the three 
parties involved in reviewing land exchanges involving Hawaiian home 
lands and proposed amendments to the HHCA. These parties are the State 
of Hawai[revaps]i (represented by the DHHL and HHC), the HHCA 
beneficiary community, and the Federal Government (represented by the 
Secretary of the Interior). The beneficiary community obtains much of 
this voice through consultation with either the State or the 
Department.

[[Page 29785]]

Thus, while the HHC Chairman is not required to engage in consultation 
with the beneficiary community, without it the Department may not have 
sufficient information to evaluate whether a Chairman-proposed land 
exchange or a State-proposed amendment advances the interests of the 
HHCA beneficiaries.
36. Should the rule provide a definition of a homestead association?
    Response: The Department agrees that the rule should provide a 
definition of a homestead association to provide clarity to the 
definition in the HHCA. The Secretary added a definition of homestead 
association in Sec.  48.6 of this rule based on the language provided 
in sections 204(a)(2), 213, and 214(a) of the HHCA. This definition is 
also based on the definition of a Native Hawaiian organization listed 
in the National Historic Preservation Act and Native American Graves 
Protection and Repatriation Act (NAGPRA). The Secretary will maintain a 
list of the homestead associations that meet this definition and file a 
statement, signed by the association's governing body, of governing 
procedures and a description of the territory it represents.
37. Should the purpose of consultation be only to engage in good faith 
efforts to educate the beneficiaries, discuss and solicit their 
comments, and not to seek agreement?
    Response: As the National Historic Preservation Act provides 
Federal agencies with guidance on how to work with the Native Hawaiian 
community, the Department chose to use the Act's definition of 
consultation for working with the Native Hawaiian beneficiary 
community. The National Historic Preservation Act defines consultation 
as the process of seeking, discussing, and considering the views of 
other participants, and, where feasible, seeking agreement.
38. Do the rules already in place that deal with the treatment of land 
exchanges involving indigenous lands held in trust for Federally 
recognized tribes with whom the United States has a formal government-
to-government relationship provide sufficient guidance to the Secretary 
when reviewing land exchanges involving Hawaiian home lands?
    Response: No. The rules related to exchanges to lands held in trust 
are located in 25 CFR part 151 that do not apply to Hawaiian home 
lands. Congress enacted the HHCA and HHLRA to govern land exchanges 
involving Hawaiian home lands.
39. Is the rule necessary to provide HHCA beneficiaries with options to 
hold the DHHL and the State accountable when proposing land exchanges 
involving Hawaiian home lands and amendments to the HHCA?
    Issue: A commenter questions the need for parts 47 and 48 and 
states ``Beneficiaries have held DHHL as well as the State accountable 
through the judicial process, both federal and state; special 
legislative hearings; legislative audits; and media reports (including 
traditional print and TV media as well as social and internet based 
media resources). Statutorily, beneficiaries can pursue action for 
breaches of trust under Hawaii Revised Statutes Chapter 673 (Native 
Hawaiian Trusts Judicial Relief Act; aka Right to Sue).''
    Response: Parts 47 and 48 seek to provide clarity and transparency 
in the Federal administration of the Hawaiian Home Lands Trust 
statutes. By providing this clarity, the Secretary can better implement 
section 206(b) of the HHLRA that requires the Secretary to administer 
these statutes in a way that advances the interests of the 
beneficiaries. This rule also seeks to provide transparency about what 
information is necessary to make decisions regarding HHC Chairman-
proposed land exchanges involving Hawaiian home lands and State-
proposed amendments to the HHCA. Such transparency should increase 
confidence of the beneficiary community in the decisions of the 
Secretary and State, thus minimizing any risk and need for litigation.
    The rule incorporates consultation with the HHCA beneficiaries and 
consideration of the interests of the HHCA beneficiaries as provided by 
Congress in the HHLRA during the proposal and review processes. Such 
provisions address HHCA beneficiary concerns that they are often the 
last to be informed about proposed actions affecting their interests 
and are often informed after-the-fact when decisions have already been 
made. Such consultation should result in better-informed decision-
making and lessen the need of beneficiaries to seek recourse after 
decisions have already been made.
40. Does the rule expand the Secretary's authority beyond the HHLRA?
    Response: No. The rule simply provides uniform processes for 
implementing the authorities and responsibilities Congress granted the 
Secretary in the HHCA and HHLRA, consistent with the standards and 
requirements established by Congress in these and other applicable 
Federal laws, including those listed in Sec.  47.15. It is important to 
note that Congress did not exempt the Secretary's actions under the 
HHLRA from other applicable Federal laws, such as Native American 
Graves Protection and Repatriation Act that directly apply to Hawaiian 
home lands.
    The information delineated in this rule provides clarity in the 
Department's decisions regarding land exchanges involving Hawaiian home 
lands and amendments to the HHCA proposed by the State. While the 
Secretary will give weight to the State in its findings and analysis, 
the rule seeks to make certain the information gathered is substantive 
and reasonably verifiable in order to ensure the Hawaiian Home Lands 
Trust statutes are administered in a way that advances the interests of 
the beneficiaries as required by section 206 of the HHLRA.
41. Should the rule provide for recourse if the Secretary fails to 
follow the rule or act within specific timeframes?
    Response: No. Congress provides for uniform and consistent systems 
of recourse and judicial review through other statutes, such as the 
Administrative Procedure Act, and has not provided any other specific 
recourse with regard to the Secretary's responsibilities under the HHCA 
or HHLRA.
42. Should the rule provide for automatic approval of a HHC Chairman-
proposed land exchange or State-proposed amendments to the HHCA if the 
Secretary fails to follow the rule or act within specific timeframes?
    Response: Automatic approval of HHC Chairman proposed land 
exchanges or State-proposed amendments to the HHCA is inconsistent with 
sections 204 and 205 of the HHLRA, section 4 of the Admission Act, and 
potentially section 206 of the HHLRA, which requires that these 
Hawaiian Home Lands Trust statutes be administered to advance the 
interests of the beneficiaries. Moreover, such automatic approvals 
would deprive the beneficiary community of the reasoned analysis and 
considered judgment of the Department in its exercise of these 
statutory responsibilities.
43. Should part 47 include a fast-track process for approval of land 
exchanges involving emergency situations, smaller acreages, less 
intense uses, or already developed land where the use will remain the 
same?
    By following the provisions of sections 47.50-47.60, the HHC

[[Page 29786]]

Chairman and DHHL can dramatically reduce the amount of time necessary 
to complete a land exchange and increase the likelihood the exchange 
will be acted on by the Secretary without the delay necessitated by 
requests for additional information. In cases where a proposed land 
exchange is between the DHHL and another agency of the State or a 
Federal agency, where no change in land use is planned, a categorical 
exclusion under NEPA may be applicable as listed under Chapter 7.5 of 
the Department of the Interior Departmental Manual, which reduces the 
time required in preparation and review.
    If the HHC Chairman chooses not to seek the assistance of the 
Secretary in developing an exchange proposal, the HHC Chairman may 
merely submit the documentation listed in Sec.  47.60. In accordance 
with section 205 of the HHLRA, the Secretary will approve or disapprove 
the proposed exchange not later than 120 days after receiving the 
information required in Sec.  47.60.
44. Does an assessment of beneficiary interests by the Secretary 
undermine the State's subject matter expertise and usurp the executive 
power of the HHC by re-evaluating the Commission's determination?
    Response: No. While the Hawaiian Home Lands Trust statutes provide 
the State and its subdivisions, including the HHC and its Chairman, 
certain responsibilities, nowhere do they relieve the Secretary of the 
requirement in section 206(b) of the HHLRA to administer the Hawaiian 
Home Lands Trust statutes in a way that advances the interests of the 
beneficiaries. For proper care of the Trust to take place, all three 
parties, the State, the Secretary, and the beneficiary community, must 
work together and fulfill their respective duties assigned by Congress. 
It is because the Federal government has an independent interest in 
implementing the Trust and because Congress understood that the State 
and its subdivisions might have interests that conflict with the 
interests of the beneficiaries, that Congress required Secretarial 
approval or disapproval of the HHC Chairman-proposed land exchange or 
State proposed amendment to the HHCA in section 205 of the HHLRA and 
section 204 of the HHCA. In addition, the Secretary has an interest in 
enforcing Federal law within her responsibility.
45. Does the language ``benefits to the parties of the proposed 
exchange'' in section 205(a)(3) of the HHLRA require the Secretary to 
look at the benefits to the DHHL because the parties to an exchange 
will always be DHHL and another?
    Response: No. Such language requires the Secretary to look at the 
benefits to the beneficiaries of the Hawaiian Home Lands Trust. This 
provision must be read to be consistent with section 206, which 
requires the Secretary to advance the interests of the beneficiaries. 
Such a reading is also consistent with the purposes of the HHCA. The 
Hawaiian Home Lands Trust was established for the benefit of the HHCA 
beneficiaries. Section 206(b)(1) of the HHLRA specifically directs the 
Department to ``(1) advance the interests of the beneficiaries.'' To 
read the language in section 205(a)(1) as suggested by the commenter, 
gives no weight to this provision of section 206 and ignores the 
responsibilities of the State to the beneficiaries. In response to this 
comment, the language in Sec.  47.30(a) was edited to remove the 
reference of ``administration.''
46. Does the rule limit the amount of consultation that the HHC 
Chairman or the Secretary may engage in with beneficiaries when 
reviewing Chairman-proposed land exchanges involving Hawaiian home 
lands or State-proposed amendments to the HHCA?
    Response: The definition of consultation provided in both parts 47 
and 48 outline the minimum requirements for consultation. If the HHC 
Chairman chooses to engage in additional consultation efforts or 
decides to require a higher standard, such as holding face-to-face 
consultation with beneficiaries on all proposed land exchanges and 
amendments to the HHCA, the Department supports such efforts as 
beneficial to the beneficiaries, the Chairman, and the Secretary.
47. If the factors from Sec.  47.20 refer to the non-Hawaiian home 
lands that would be received, how are the benefits in retaining 
Hawaiian home lands determined in order to apply the balancing test in 
Sec.  47.30(b)?
    Response: The factors listed in Sec.  47.20 are utilized by the 
Secretary to review both the non-Hawaiian home lands proposed to be 
received into the Hawaiian Home Lands Trust and the Hawaiian home lands 
the HHC Chairman proposes to remove from the Hawaiian Home Lands Trust. 
Section 47.30(b) provides explicit instruction on how the Sec.  47.20 
factors are to be weighed.
48. The Factors Listed in Sec.  47.30(a) and (c) Are Ambiguous
    Response: The language in Sec.  47.30(a) is not ambiguous. It 
requires the exercise of judgment when reviewing land exchanges 
covering a wide range of circumstances. Section 47.30(a) emphasizes the 
need for the Secretary to consider the long term effects a land 
exchange will have on the lands in the Hawaiian Home Lands Trust. These 
trust lands are being held in order to advance the interests of the 
HHCA beneficiaries. Section 47.30(b) is intended to ensure that 
beneficiaries benefit from every exchange. Section 47.30(c) emphasizes 
the need for the Secretary to consider whether a proposed exchange will 
significantly conflict with the beneficiaries' interests in adjacent 
Hawaiian home lands.
49. Is the analysis presented in Sec. Sec.  47.20 and 47.30 highly 
discretionary and provide for circumstances where the various factors 
may conflict?
    Response: Section 204(a)(3) of the HHCA and section 205(b) of the 
HHLRA make clear that a land exchange is not valid until it has been 
approved by the Secretary, but does not suggest that the Secretary is 
required to approve every proposed land exchange. Indeed, Congress 
provided expressly in section 205(b) of the HHLRA that ``the Secretary 
shall approve or disapprove the proposed exchange.'' The Secretary must 
also, at a minimum, be satisfied that the purposes of the Hawaiian Home 
Land Trust statutes are met. Each of these factors requires the 
exercise of judgment. Thus, the discharge of the responsibility placed 
on the Secretary is not ministerial. Nor is it ``discretionary'' as the 
factors to be considered are enumerated. There is, nonetheless, some 
subjectivity in the evaluation. Sections 47.20 and 47.30 provide 
factors to clarify the weighing process the Secretary must engage in 
when determining if a land exchange advances the interests of the 
beneficiaries. The factors in Sec.  47.20, however, are not exhaustive.
    It is possible certain proposed exchanges will present situations 
where certain factors listed in Sec.  47.20 may conflict with each 
other. In those circumstances the Department will be required to 
exercise expertise and judgment within these limits in weighing the 
factors in order to determine whether a proposed land exchange advances 
the interests of the beneficiaries. If the factors listed in Sec.  
47.20 conflict with Sec.  47.30 (a) and (c),

[[Page 29787]]

however, the Secretary will be required to disapprove the proposed land 
exchange.

III. Summary of Impacts

1. Regulatory Planning and Review (Executive Orders 12866 and 13563)

    Executive Order 12866 provides that the Office of Information and 
Regulatory Affairs will review all significant rules. The Office of 
Information and Regulatory Affairs determined that this rule is not 
significant.
    Executive Order 13563 reaffirms the principles of E.O. 12866 while 
calling for improvements in the nation's regulatory system to promote 
predictability, to reduce uncertainty, and to use the best, most 
innovative, and least burdensome tools for achieving regulatory ends. 
The executive order directs agencies to consider regulatory approaches 
that reduce burdens and maintain flexibility and freedom of choice for 
the public where these approaches are relevant, feasible, and 
consistent with regulatory objectives. E.O. 13563 emphasizes further 
that rules must be based on the best available science and that the 
rulemaking process must allow for public participation and an open 
exchange of ideas. This final rule is consistent with these 
requirements.

2. Regulatory Flexibility Act

    The Department of the Interior certifies that this final rule will 
not have a significant economic effect on a substantial number of small 
entities under the Regulatory Flexibility Act (5 U.S.C. 601 et seq.) as 
the final rule merely describes agency procedures and practices when 
reviewing HHC Chairman-proposed land exchanges involving Hawaiian home 
lands and State-proposed amendments to the HHCA. These procedures and 
practices are not agency activities that will have a significant 
economic effect on a substantial number of small entities. This rule 
neither imposes burdens on small entities nor requires actions by them. 
As such, the Regulatory Flexibility Act does not apply.

3. Small Business Regulatory Enforcement Fairness Act (SBREFA)

    This is not a major rule under 5 U.S.C. 804(2), the Small Business 
Regulatory Enforcement Fairness Act. This final rule:
    (a) Does not have an annual effect on the economy of $100 million 
or more.
    (b) Will not cause a major increase in costs or prices for 
consumers, individual industries, Federal, State, or local government 
agencies, or geographic regions.
    (c) Does not have significant adverse effects on competition, 
employment, investment, productivity, innovation, or the ability of 
U.S.-based enterprises to compete with foreign-based enterprises.

4. Unfunded Mandates Reform Act

    This final rule does not impose an unfunded mandate on State, 
local, or tribal governments or the private sector of more than $100 
million per year. The final rule does not have a significant or unique 
effect on State, local or tribal governments or the private sector. A 
statement containing the information required by the Unfunded Mandates 
Reform Act (2 U.S.C. 1531 et seq.) is not required.

5. Takings (E.O. 12630)

    This rule does not affect a taking of private property or otherwise 
have taking implications under Executive Order 12630 as the taking of 
private property is not a subject covered or even contemplated under 
this rule. A takings implication assessment is not required.

6. Federalism (E.O. 13132)

    In accordance with Executive Order 13132, the final rule does not 
have sufficient federalism implications to warrant the preparation of a 
federalism summary impact statement. Based on research and the 
deliberations outlined in the response to questions number 8, the final 
rule does not substantially and directly affect the relationship 
between the Federal and state governments. The Secretary of the 
Department of the Interior has oversight to ensure that land under the 
HHCA is administered in a manner that advances the interests of the 
beneficiaries. A federalism assessment is not required.

7. Civil Justice Reform (E.O. 12988)

    This rule complies with the requirements of Executive Order 12988. 
Specifically, this rule:
    (a) Meets the criteria of section 3(a) requiring that all rules be 
reviewed to eliminate errors and ambiguity and be written to minimize 
litigation; and
    (b) Meets the criteria of section 3(b)(2) requiring that all rules 
be written in clear language and contain clear legal standards.

8. Consultation With Indian Tribes (E.O. 13175)

    The Department of the Interior strives to strengthen its 
government-to-government relationship with Indian tribes through a 
commitment to consultation with Indian tribes and recognition of their 
right to self-governance and tribal sovereignty. We evaluated this rule 
under the Secretary's consultation policy and under the criteria in 
Executive Order 13175 and determined that it has no substantial direct 
effects on federally recognized Indian tribes and that consultation 
under the Secretary's tribal consultation policy is not required.

9. Paperwork Reduction Act

    This rule does not contain information collection requirements 
subject to the Paperwork Reduction Act and therefore a submission to 
the Office of Management and Budget under the Paperwork Reduction Act 
(44 U.S.C. 3501 et seq.) is not required. We may not conduct or 
sponsor, and you are not required to respond to a collection of 
information unless it displays a currently valid OMB control number.

10. National Environmental Policy Act

    This final rule does not constitute a major Federal action 
significantly affecting the quality of the human environment. A 
detailed statement under the National Environmental Policy Act, 1969 
(NEPA) is not required. Under Departmental Manual 516 DM 2.3A(2), 
Section 1.10 of 516 DM 2, Appendix 1 excludes from documentation in an 
environmental assessment or impact statement ``policies, directives, 
regulations and guidelines of an administrative, financial, legal, 
technical or procedural nature; or the environmental effects of which 
are too broad, speculative or conjectural to lend themselves to 
meaningful analysis and will be subject later to the NEPA process, 
either collectively or case-by-case.'' We have also determined that the 
rule does not involve any of the extraordinary circumstances listed in 
43 CFR 46.215 that would require further analysis under NEPA.

11. Effects on the Energy Supply (E.O. 13211)

    This final rule is not a significant energy action under the 
definition in Executive Order 13211. A Statement of Energy Effects is 
not required.

12. Clarity of This Regulation

    The Secretary is required by Executive Orders 12866 (section 
1(b)(12)), 12988 (section 3(b)(1)(B)), and 13563 (section 1(a)), and by 
the Presidential Memorandum of June 1, 1998, to write all rules in 
plain language. This rule meets the requirements that each rule the 
Secretary publishes must:
    (a) Be logically organized;
    (b) Use the active voice to address readers directly;

[[Page 29788]]

    (c) Use clear language rather than jargon;
    (d) Be divided into short sections and sentences; and
    (e) Use lists and tables wherever possible.

List of Subjects in 43 CFR Parts 47 and 48

    Hawaii, Intergovernmental Programs, Land, State-Federal Relations.

Kristen J. Sarri,
Principal Deputy Assistant Secretary for Policy, Management and Budget.

    For the reasons stated in the preamble, the Department of the 
Interior amends title 43 of the Code of Federal Regulations by adding 
new parts 47 and 48 as set forth below:

PART 47--LAND EXCHANGE PROCEDURES

Sec.
47.5 What is the purpose of this part?
47.10 What definitions apply to terms used in this part?
47.15 What laws apply to exchanges made under this part?
Subpart A--The Exchange Process
47.20 What factors will the Secretary consider in analyzing a land 
exchange?
47.30 When does a land exchange advance the interests of the 
beneficiaries?
47.35 Must lands exchanged be of equal value?
47.40 How must properties be described?
47.45 How does the exchange process work?
47.50 What should the Chairman include in a land exchange proposal 
for the Secretary?
47.55 What are the minimum requirements for appraisals used in a 
land exchange?
47.60 What documentation must the Chairman submit to the Secretary 
in the land exchange packet?
Subpart B--Approval and Finalization
47.65 When will the Secretary approve or disapprove the land 
exchange?
47.70 How does the Chairman complete the exchange?

    Authority:  State of Hawai[revaps]i Admission Act, 73 Stat. 4, 
approved March 18, 1959; Hawaiian Homes Commission Act, 1920, as 
amended, Act of July 9, 1921, 42 Stat. 108; Hawaiian Home Lands 
Recovery Act, 1995, 109 Stat. 537, 5 U.S.C. 301; 25 U.S.C. 2 and 9; 
43 U.S.C. 1457; 112 Departmental Manual 28.


Sec.  47.5  What is the purpose of this part?

    This part sets forth the procedures for conducting land exchanges 
of Hawaiian home lands authorized by the Hawaiian Homes Commission Act, 
1920 (HHCA).


Sec.  47.10  What definitions apply to terms used in this part?

    As used in this part, the following terms have the meanings given 
in this section.
    Appraisal or Appraisal report means a written statement 
independently and impartially prepared by a qualified appraiser setting 
forth an opinion as to the market value of the lands or interests in 
lands to be exchanged as of a specific date(s), supported by the 
presentation and analysis of relevant market information.
    Beneficiary or beneficiaries means ``native Hawaiian(s)'' as that 
term is defined under section 201(a) of the Hawaiian Homes Commission 
Act.
    Chairman means the Chairman of the Hawaiian Homes Commission 
designated under section 202 of the Hawaiian Homes Commission Act.
    Commission means the Hawaiian Homes Commission established by 
section 202 of the Hawaiian Homes Commission Act, which serves as the 
executive board of the Department of Hawaiian Home Lands.
    Consultation or consult means representatives of the government 
engaging in an open discussion process that allows interested parties 
to address potential issues, changes, or actions. Consultation does not 
necessarily require formal face-to-face meetings. The complexity of the 
matter along with the potential effects that the matter may have on the 
Trust or beneficiaries will dictate the appropriate process for 
consultation. Consultation requires dialogue (oral, electronic, or 
printed) or a good faith, dialogue or documented effort to engage with 
the beneficiaries, consideration of their views, and, where feasible, 
seek agreement with the beneficiaries when engaged in the land exchange 
process.
    DHHL or Department of Hawaiian Home Lands means the department 
established by the State of Hawai[revaps]i under sections 26-4 and 26-
17 of the Hawai[revaps]i Revised Statutes to exercise the authorities 
and responsibilities of the Hawaiian Homes Commission under the 
Hawaiian Homes Commission Act.
    Hawaiian Home Lands Trust means all trust lands given the status of 
Hawaiian home lands under section 204 of the Hawaiian Homes Commission 
Act, and those lands obtained through approval under this part, and as 
directed by Congress.
    Hawaiian Home Lands Trust Funds means the funds established in the 
HHCA section 213.
    Hazardous substances means those substances designated under 
Environmental Protection Agency regulations at 40 CFR part 302.
    HHCA or Hawaiian Homes Commission Act means the Hawaiian Homes 
Commission Act, 1920, 42 Stat. 108, as amended.
    HHCA Beneficiary Association means an organization controlled by 
beneficiaries who submitted applications to the DHHL for homesteads and 
are awaiting the assignment of a homestead; represents and serves the 
interests of those beneficiaries; has as a stated primary purpose the 
representation of, and provision of services to, those beneficiaries; 
and filed with the Secretary a statement, signed by the governing body, 
of governing procedures and a description of the beneficiaries it 
represents.
    HHLRA or Hawaiian Home Lands Recovery Act means the Hawaiian Home 
Lands Recovery Act, 1995, 109 Stat. 357.
    Homestead Association means a beneficiary controlled organization 
that represents and serves the interests of its homestead community; 
has as a stated primary purpose the representation of, and provision of 
services to, its homestead community; and filed with the Secretary a 
statement, signed by the governing body, of governing procedures and a 
description of the territory it represents.
    Land exchange is any transaction, other than a sale, that transfers 
Hawaiian home lands from the Hawaiian Home Lands Trust to another 
entity and in which the Hawaiian Home Lands Trust receives the entity's 
land as Hawaiian home lands. A land exchange can involve trading 
Hawaiian home lands for private land, but it can also involve trading 
land between the Hawaiian Home Lands Trust and State or Federal 
agencies.
    Market value means the most probable price in cash, or terms 
equivalent to cash, that lands or interests in lands should bring in a 
competitive and open market under all conditions requisite to a fair 
sale, where the buyer and seller each acts prudently and knowledgeably, 
and the price is not affected by undue influence.
    Native Hawaiian or native Hawaiian has the same meaning as that 
term defined under section 201(a) of the Hawaiian Homes Commission Act.
    Office of Valuation Services (OVS) means the Office with real 
estate appraisal functions within the Office of the Assistant 
Secretary--Policy, Management, and Budget of the Department of the 
Interior.
    Outstanding interests means rights or interests in property 
involved in a land exchange held by an entity other than a party to the 
exchange.

[[Page 29789]]

    Secretary means the Secretary of the Interior or the individual to 
whom the authority and responsibilities of the Secretary have been 
delegated.
    Trust means the Hawaiian Home Lands Trust and the Hawaiian Home 
Lands Trust Funds.


Sec.  47.15  What laws apply to exchanges made under this part?

    (a) The Chairman may only exchange land under the authority of the 
HHCA in conformity with the HHLRA.
    (b) When the Chairman makes any land exchange, the following laws 
and regulations constitute a partial list of applicable laws and 
regulations:

----------------------------------------------------------------------------------------------------------------
                 Legislation or regulation                                         Citation
----------------------------------------------------------------------------------------------------------------
(1) The National Historic Preservation Act, 1966...........  16 U.S.C. 470 et seq.
(2) Implementing regulations for the National Historic       36 CFR part 800.
 Preservation Act.
(3) Section 3 of the Native American Graves Protection and   25 U.S.C. 3002.
 Repatriation Act (NAGPRA).
(4) Implementing regulations for the Native American Graves  43 CFR part 10.
 Protection and Repatriation Act.
(5) The National Environmental Policy Act, 1969 (NEPA).....  42 U.S.C. 4371 et seq.
(6) Implementing regulations for NEPA......................  40 CFR parts 1500-1508; 43 CFR part 46.
(7) The State of Hawai[revaps]i Admission Act..............  73 Stat. 4.
(8) Hawaiian Homes Commission Act, 1920, as amended........  42 Stat. 108.
(9) Hawaiian Home Lands Recovery Act, 1995.................  109 Stat. 537.
(10) Comprehensive Environmental Response, Compensation,     42 U.S.C. 9601 et seq.
 and Liability Act (CERCLA).
(11) Implementing regulations for CERCLA...................  40 CFR part 312.
----------------------------------------------------------------------------------------------------------------


No new legal rights or obligations are created through listing 
applicable laws and regulatory provisions in this section.

Subpart A--The Exchange Process


Sec.  47.20  What factors will the Secretary consider in analyzing a 
land exchange?

    The Secretary may approve an exchange only after making a 
determination that the exchange will advance the interests of the 
beneficiaries. In considering whether a land exchange will advance the 
interests of the beneficiaries, the Secretary will evaluate the extent 
to which it will:
    (a) Achieve better management of Hawaiian home lands;
    (b) Meet the needs of HHCA beneficiaries and their economic 
circumstances by promoting:
    (1) Homesteading opportunities,
    (2) economic self-sufficiency, and,
    (3) social well-being;
    (c) Promote development of Hawaiian home lands for residential, 
agricultural, and pastoral use;
    (d) Protect cultural resources and watersheds;
    (e) Consolidate lands or interests in lands, such as agricultural 
and timber interests, for more logical and efficient management and 
development;
    (f) Expand homestead communities;
    (g) Accommodate land use authorizations;
    (h) Address HHCA beneficiary needs; and
    (i) Advance other identifiable interests of the beneficiaries 
consistent with the HHCA.


Sec.  47.30  When does a land exchange advance the interests of the 
beneficiaries?

    A determination that an exchange advances the interests of the 
beneficiaries must find that:
    (a) The exchange supports perpetuation of the Hawaiian Home Lands 
Trust;
    (b) The interests of the beneficiaries in obtaining non-Hawaiian 
home lands exceeds the interests of the beneficiaries in retaining the 
Hawaiian home lands proposed for the exchange, based on an evaluation 
of the factors in Sec.  47.20; and
    (c) The intended use of the conveyed Hawaiian home lands will not 
significantly conflict with the beneficiaries' interests in adjacent 
Hawaiian home lands.


Sec.  47.35  Must lands exchanged be of equal value?

    Hawaiian home lands to be exchanged must be of equal or lesser 
value than the lands to be received in the exchange, as determined by 
the appraisal. Once the market value is established by an approved 
appraisal, an administrative determination as to the equity of the 
exchange can be made based on the market value reflected in the 
approved appraisal.


Sec.  47.40  How must properties be described?

    The description of properties involved in a land exchange must be 
either:
    (a) Based upon a survey completed in accordance with the Public 
Land Survey System laws and standards of the United States; or
    (b) If Public Land Survey System laws and standards cannot be 
applied, based upon a survey that both:
    (1) Uses other means prescribed or allowed by applicable law; and
    (2) Clearly describes the property and allows it to be easily 
located.


Sec.  47.45  How does the exchange process work?

    (a) The Secretary recommends the parties prepare a land exchange 
proposal in accordance with Sec.  47.50. The Secretary also recommends 
the Chairman and the non-Chairman party in the exchange meet with the 
Secretary before finalizing a land exchange proposal and signing an 
agreement to initiate the land exchange to informally discuss:
    (1) The review and processing procedures for Hawaiian home lands 
exchanges;
    (2) Potential issues involved that may require more consideration; 
or
    (3) Any other matter that may make the proposal more complete 
before submission.
    (b) Whether or not a land exchange proposal is completed, the 
Chairman initiates the exchange by preparing the documentation, 
conducting appropriate studies, and submitting them to the Secretary in 
accordance with Sec.  47.60.
    (c) Upon completing the review of the final land exchange packet 
under Sec.  47.60, the Secretary will issue a Notice of Decision 
announcing the approval or disapproval of the exchange.
    (d) If the Secretary approves an exchange, title will transfer in 
accordance with State law.


Sec.  47.50  What should the Chairman include in a land exchange 
proposal for the Secretary?

    (a) A land exchange proposal should include the following 
documentation:

[[Page 29790]]



----------------------------------------------------------------------------------------------------------------
           The proposal should include . . .                            that should contain . . .
----------------------------------------------------------------------------------------------------------------
(1) Identifying information............................  (i) The identity of the parties involved in the
                                                          proposed exchange; and
                                                         (ii) The status of their ownership of the properties in
                                                          the exchange, or their ability to provide title to the
                                                          properties.
(2) Descriptive information............................  A legal description of:
                                                            (i) The land considered for the exchange; and
                                                            (ii) The appurtenant rights proposed to be exchanged
                                                             or reserved.
(3) Authorized use information.........................  (i) Any authorized uses including grants, permits,
                                                          easements, or leases; and
                                                         (ii) Any known unauthorized uses, outstanding
                                                          interests, exceptions, adverse claims, covenants,
                                                          restrictions, title defects or encumbrances.
(4) A time schedule for completing the exchange........  Expected dates of significant transactions or
                                                          milestones.
(5) Assignment of responsibilities.....................  Responsibilities for:
                                                            (i) Performance of required actions; and
                                                            (ii) Costs associated with the proposed exchange.
(6) Hazardous substance information....................  Notice of:
                                                         (i) Any known release, storage, or disposal of
                                                          hazardous substances on non-Hawaiian Home Land Trust
                                                          properties in the exchange;
                                                            (ii) Any commitments regarding responsibility for
                                                             removal or remedial actions concerning hazardous
                                                             substances on non-Hawaiian Home Land Trust
                                                             properties; and
                                                            (iii) All terms and conditions regarding hazardous
                                                             substances on non-Hawaiian Home Land Trust
                                                             properties.
(7) Grants of permission by each party to the other....  Permission to enter the properties for the purpose of
                                                          conducting physical examination and studies in
                                                          preparation for the exchange. Written permission to
                                                          appraise the properties should also be included.
(8) Three statements...................................  Details of:
                                                            (i) Arrangements for relocating tenants, if there
                                                             are tenants, occupying the Hawaiian Home Land Trust
                                                             and non-Hawaiian Home Land Trust properties
                                                             involved in the exchange;
                                                            (ii) How the land exchange proposal complies with
                                                             the HHCA and HHLRA; and
                                                            (iii) How the documents of conveyance will be
                                                             exchanged once the Secretary has approved the
                                                             exchange.
----------------------------------------------------------------------------------------------------------------

    (b) When the parties to the exchange agree to proceed with the land 
exchange proposal, they may sign an agreement that the Chairman will 
initiate the exchange.


Sec.  47.55  What are the minimum requirements for appraisals used in a 
land exchange?

    (a) The following table shows the steps in the appraisal process.

----------------------------------------------------------------------------------------------------------------
                 Appraisal process step                                        Requirements
----------------------------------------------------------------------------------------------------------------
(1) The parties to the exchange must arrange for         (i) The parties must arrange for appraisals within 90
 appraisals.                                              days after executing the agreement to initiate the
                                                          land exchange, unless the parties agree to another
                                                          schedule.
                                                         (ii) The parties must give the appraiser the land
                                                          exchange proposal, if any, and the agreement to
                                                          initiate the land exchange, and any attachments and
                                                          amendments.
                                                         (iii) The Chairman may request assistance from the
                                                          Office of Valuation Services (OVS). OVS can provide
                                                          valuation services to the Chairman, including
                                                          appraisal, appraisal review, and appraisal advice on a
                                                          reimbursable basis. OVS is also available for post-
                                                          facto program review to ensure that appraisals
                                                          conducted by the State are in conformance with the
                                                          Uniform Standards of Professional Appraisal Practice
                                                          and the Uniform Appraisal Standards for Federal Land
                                                          Acquisitions as appropriate.
(2) The qualified appraiser must provide an appraisal    The appraiser must:
 report.                                                  (i) Meet the qualification requirements in paragraph
                                                          (b) of this section;
                                                            (ii) Produce a report that meets the qualifications
                                                             in paragraph (c) of this section; and
                                                            (iii) Complete the appraisal under the timeframe and
                                                             terms negotiated with the parties in the exchange.
(3) The Secretary will review appraisal reports........  The Secretary will evaluate the reports using:
                                                         (i) The Uniform Standards of Professional Appraisal
                                                          Practice; and
                                                         (ii) The Uniform Appraisal Standards for Federal Land
                                                          Acquisitions.
----------------------------------------------------------------------------------------------------------------

    (b) To be qualified to appraise land for exchange under paragraph 
(a)(2) of this section, an appraiser must:
    (1) Be competent, reputable, impartial, and experienced in 
appraising property similar to the properties involved in the appraisal 
assignment; and
    (2) Be approved by the OVS, if required by the Department of the 
Interior's Office of Native Hawaiian Relations.
    (3) Be licensed to perform appraisals in the State of 
Hawai[revaps]i unless a Federal employee whose position requires the 
performance of appraisal duties. Federal employees only need to be 
licensed in one State or territory to perform real estate appraisal 
duties as Federal employees in all States and territories.
    (c) Appraisal reports for the exchange must:
    (1) Be completed in accordance with the current edition of the 
Uniform Standards of Professional Appraisal Practice (USPAP) and the 
Uniform Appraisal Standards for Federal Land Acquisition (UASFLA); and
    (2) Include the estimated market value of Hawaiian home lands and 
non-Hawaiian home lands properties involved in the exchange.

[[Page 29791]]

Sec.  47.60  What documentation must the Chairman submit to the 
Secretary in the land exchange packet?

    The documents in the exchange packet submitted to us for approval 
must include the following:

----------------------------------------------------------------------------------------------------------------
             The packet must contain . . .                               that must include . . .
----------------------------------------------------------------------------------------------------------------
(a) Required statements................................  (1) A statement of approval for the exchange from the
                                                          Commission that includes the recorded vote of the
                                                          Commission;
                                                         (2) A statement of compliance with the National
                                                          Historic Preservation Act and, as appropriate, a
                                                          cultural and historic property review;
                                                         (3) An explanation of how the exchange will advance the
                                                          interests of the beneficiaries;
                                                         (4) A summary of all consultations with beneficiaries,
                                                          HHCA homestead associations, or HHCA beneficiary
                                                          associations; and
                                                         (5) A statement of compliance with the Native American
                                                          Graves Protection and Repatriation Act.
(b) Required analyses and reports......................  (1) Environmental analyses and records sufficient to
                                                          meet CERCLA, NEPA, and all other pertinent Federal
                                                          environmental requirements;
                                                         (2) Land appraisal reports and statements of
                                                          qualification of the appraisers in accordance with
                                                          Sec.   47.55; and
                                                         (3) If property conveyed is adjacent to Hawaiian home
                                                          lands:
                                                         (i) An analysis of intended use of the Hawaiian home
                                                          lands conveyed;
                                                         (ii) A finding that the intended use will not conflict
                                                          with established management objectives on the adjacent
                                                          Hawaiian home lands; and
                                                         (4) A copy of the land exchange proposal, if any.
(c) Relevant legal documents...........................  (1) Any land exchange agreements entered into regarding
                                                          the subject properties between Chairman and the non-
                                                          Chairman party;
                                                         (2) Evidence of title; and
                                                         (3) Deeds signed by the parties, with a signature block
                                                          for the Secretary of the Interior or our authorized
                                                          representative to approve the transaction.
----------------------------------------------------------------------------------------------------------------

Sec.  47.65  When will the Secretary approve or disapprove the land 
exchange?

    On receipt of the complete land exchange packet from the 
Commission, the Secretary will approve or disapprove the exchange 
within 120 calendar days.
    (a) Before approving or disapproving the exchange, the Secretary 
will review all environmental analyses, appraisals, and all other 
supporting studies and requirements to determine whether the proposed 
exchange complies with applicable law and advances the interests of the 
beneficiaries.
    (b) The Secretary may consult with the beneficiaries when making a 
determination if a land exchange advances the interests of the 
beneficiaries.
    (c) After approving or disapproving an exchange, the Secretary will 
notify DHHL, the Commission, and other officials as required by section 
205(b)(2) of the HHLRA. The Secretary will post notice of the 
determination on the DOI Web site and give email notice of the posting 
to all those on the notification list maintained by the Office of 
Native Hawaiian Relations requesting notice of actions by the 
Secretary.


Sec.  47.70  How does the Chairman complete the exchange once approved?

    (a) The Chairman completes the exchange in accordance with the 
requirements of State law.
    (b) The Chairman shall provide a title report to the Secretary as 
evidence of the completed exchange.

PART 48--AMENDMENTS TO THE HAWAIIAN HOMES COMMISSION ACT

Sec.
48.5 What is the purpose of this part?
48.6 What definitions apply to terms used in this part?
48.10 What is the Secretary's role in reviewing proposed amendments 
to the HHCA?
48.15 What are the Chairman's responsibilities in submitting 
proposed amendments to the Secretary?
48.20 How does the Secretary determine if the State is seeking to 
amend Federal law?
48.25 How does the Secretary determine if the proposed amendment 
decreases the benefits to beneficiaries of Hawaiian home lands?
48.30 How does the Secretary determine if Congressional approval is 
unnecessary?
48.35 When must the Secretary determine if the proposed amendment 
requires Congressional approval?
48.40 What notification will the Secretary provide?
48.45 When is a proposed amendment deemed effective?
48.50 Can the State of Hawai[revaps]i amend the Hawaiian Homes 
Commission Act without Secretarial review?

    Authority: State of Hawai[revaps]i Admission Act, 73 Stat. 4, 
approved March 18, 1959; Hawaiian Homes Commission Act, 1920, 42 
Stat. 108 et seq., Hawaiian Home Lands Recovery Act, 1995, 109 Stat. 
537; 5 U.S.C. 301; 25 U.S.C. 2 and 9; 43 U.S.C. 1457; 112 
Departmental Manual 28.


Sec.  48.5  What is the purpose of this part?

    (a) This part sets forth the policies and procedures for:
    (1) Review by the Secretary of amendments to the Hawaiian Homes 
Commission Act proposed by the State of Hawai[revaps]i; and
    (2) Determination by the Secretary whether the proposed amendment 
requires congressional approval.
    (b) This part implements requirements of the Hawaiian Homes 
Commission Act, the State of Hawai[revaps]i Admission Act, 1959, and 
the Hawaiian Home Lands Recovery Act, 1995.


Sec.  48.6  What definitions apply to terms used in this part?

    As used in this part, the following terms have the meanings given 
in this section.
    Beneficiary or beneficiaries means ``native Hawaiian(s)'' as that 
term is defined under section 201(a) of the Hawaiian Homes Commission 
Act.
    Chairman means the Chairman of the Hawaiian Homes Commission 
designated under section 202 of the Hawaiian Homes Commission Act.
    Commission means the Hawaiian Homes Commission, established by 
section 202 of the Hawaiian Homes Commission Act, which serves as the 
executive board of the Department of Hawaiian Home Lands.
    Consultation or consult means representatives of the government

[[Page 29792]]

engaging in an open discussion process that allows interested parties 
to address potential issues, changes, or actions. Consultation does not 
necessarily require formal face-to-face meetings. The complexity of the 
matter along with the potential effects that the matter may have on the 
Trust or beneficiaries will dictate the appropriate process for 
consultation. Consultation requires dialogue (oral, electronic, or 
printed) or a good faith, dialogue or documented effort to engage with 
the beneficiaries, consideration of their views, and, where feasible, 
seek agreement with the beneficiaries when engaged in the land exchange 
process.
    DHHL or Department of Hawaiian Home Lands means the department 
established by the State of Hawai[revaps]i under sections 26-4 and 26-
17 of the Hawai[revaps]i Revised Statutes to exercise the authorities 
and responsibilities of the Hawaiian Homes Commission under the 
Hawaiian Homes Commission Act.
    Hawaiian Home Lands Trust means all trust lands given the status of 
Hawaiian home lands under section 204 of the Hawaiian Homes Commission 
Act, and those lands obtained through approval under part 47, and as 
directed by Congress.
    Hawaiian Home Lands Trust Funds means the funds established in the 
HHCA section 213.
    HHCA or Hawaiian Homes Commission Act means the Hawaiian Homes 
Commission Act, 1920, 42 Stat. 108 et seq., as amended.
    HHCA Beneficiary Association means an organization controlled by 
beneficiaries who submitted applications to the DHHL for homesteads and 
are awaiting the assignment of a homestead; represents and serves the 
interests of those beneficiaries; has as a stated primary purpose the 
representation of, and provision of services to, those beneficiaries; 
and filed with the Secretary a statement, signed by the governing body, 
of governing procedures and a description of the beneficiaries it 
represents.
    HHLRA or Hawaiian Home Lands Recovery Act means the Hawaiian Home 
Lands Recovery Act, 1995, 109 Stat. 537.
    Lessee means either a:
    (1) Beneficiary who has been awarded a lease under section 207(a) 
of the Hawaiian Homes Commission Act;
    (2) Person to whom land has been transferred under section 208(5) 
of the Hawaiian Homes Commission Act; or
    (3) Successor lessee under section 209 of the Hawaiian Homes 
Commission Act.
    Homestead Association means a beneficiary controlled organization 
that represents and serves the interests of its homestead community; 
has as a stated primary purpose the representation of, and provision of 
services to, its homestead community; and filed with the Secretary a 
statement, signed by the governing body, of governing procedures and a 
description of the territory it represents.
    Secretary means the Secretary of the Interior or the individual to 
whom the authority and responsibilities of the Secretary have been 
delegated.
    Trust means the Hawaiian Home Lands Trust and the Hawaiian Home 
Lands Trust Funds.


Sec.  48.10  What is the Secretary's role in reviewing proposed 
amendments to the HHCA?

    (a) The Secretary must review proposed amendments to the Hawaiian 
Homes Commission Act (HHCA) by the State of Hawai[revaps]i to determine 
whether the proposed amendment requires approval of Congress.
    (b) The Secretary will notify the Chairman and Congress of this 
determination, and if approval is required, submit to Congress the 
documents required by Sec.  48.35(b).


Sec.  48.15  What are the Chairman's responsibilities in submitting 
proposed amendments to the Secretary?

    (a) Not later than 120 days after the State approves a proposed 
amendment to the HHCA, the Chairman must submit to the Secretary a 
clear and complete:
    (1) Copy of the proposed amendment;
    (2) Description of the nature of the change proposed by the 
proposed amendment; and,
    (3) Opinion explaining whether the proposed amendment requires the 
approval of Congress.
    (b) The following information must also be submitted:
    (1) A description of the proposed amendment, including how the 
proposed amendment advances the interests of the beneficiaries;
    (2) All testimony and correspondence from the Director of the 
Department of Hawaiian Home Lands, Hawaiian Homes Commissioners, 
Homestead Associations, HHCA Beneficiary Associations, and 
beneficiaries providing views on the proposed amendment;
    (3) An analysis of the law and policy of the proposed amendment by 
the Department of Hawaiian Home Lands and the Hawaiian Homes 
Commission;
    (4) Documentation of the dates and number of hearings held on the 
measure, and a copy of all testimony provided or submitted at each 
hearing;
    (5) Copies of all committee reports and other legislative history, 
including prior versions of the proposed amendment;
    (6) Final vote totals by the Commission and the legislature on the 
proposed amendment;
    (7) Summaries of all consultations conducted with the beneficiaries 
regarding the proposed amendment; and
    (8) Other additional information that the State believes may assist 
in the review of the proposed amendment.


Sec.  48.20  How does the Secretary determine if the State is seeking 
to amend Federal law?

    (a) The Secretary will determine that Congressional approval is 
required if the proposed amendment, or any other legislative action 
that directly or indirectly has the effect of:
    (1) Decreasing the benefits to the beneficiaries of the Trust;
    (2) Reducing or impairing the Hawaiian Home Land Trust Funds;
    (3) Allowing for additional encumbrances to be placed on Hawaiian 
home lands by officers other than those charged with the administration 
of the HHCA;
    (4) Changing the qualifications of who may be a lessee;
    (5) Allowing the use of proceeds and income from the Hawaiian home 
lands for purposes other than carrying out the provisions of the HHCA; 
or
    (6) Amending a section other than sections 202, 213, 219, 220, 222, 
224, or 225, or other provisions relating to administration, or 
paragraph (2) of section 204, section 206, or 212 or other provisions 
relating to the powers and duties of officers other than those charged 
with the administration of the HHCA.
    (b) The Secretary may consult with the beneficiaries when making a 
determination.


Sec.  48.25  How does the Secretary determine if the proposed amendment 
decreases the benefits to beneficiaries of Hawaiian home lands?

    (a) In determining benefits to the beneficiaries, the Secretary 
will consider the goals and purposes of the Trust, including, but not 
limited to, the following:
    (1) The provision of homesteads to beneficiaries;
    (2) The rehabilitation of beneficiaries and their families and 
Hawaiian homestead communities;
    (3) The educational, economic, political, social, and cultural 
processes by which the general welfare and conditions of beneficiaries 
are improved and perpetuated;

[[Page 29793]]

    (4) The construction of replacement homes, repairs or additions;
    (5) The development of farm, ranch or aquaculture, including soil 
and water conservation;
    (6) The enhanced construction, reconstruction, operation and 
maintenance of revenue-producing improvements intended to benefit 
occupants of Hawaiian home lands;
    (7) The making of investments in water and other utilities, 
supplies, equipment, and goods, as well as professional services needed 
to plan, implement, develop or operate such projects that will improve 
the value of Hawaiian home lands for their current and future 
occupants; and,
    (8) The establishment and maintenance of an account to serve as a 
reserve for loans issued or backed by the Federal Government.
    (b) The Secretary will determine if the proposed amendment or any 
other legislative action decreases the above-described or similar 
benefits to the beneficiaries, now or in the future, by weighing the 
answers to the following questions:
    (1) How would the proposed amendment impact the benefits to current 
lessees of Hawaiian home lands?
    (2) How would the proposed amendment impact the benefits to 
beneficiaries currently on a waiting list for a Hawaiian home lands 
lease?
    (3) How would the proposed amendment impact the benefits to 
beneficiaries who have not yet applied for a Hawaiian home lands lease?
    (4) If the interests of the beneficiaries who have not been awarded 
a Hawaiian home lands lease and the lessees differ, how does the 
proposed amendment weigh the interests of beneficiaries who have not 
been awarded a Hawaiian home lands lease with the interests of Hawaiian 
home lands lessees?
    (5) If the interests of the beneficiaries who have not been awarded 
a Hawaiian home lands lease and the lessees differ, do the benefits to 
the lessees outweigh any detriment to the beneficiaries who have not 
been awarded a Hawaiian home lands lease?
    (6) If the interests of the beneficiaries differ from the interests 
of the lessees, do the benefits to the beneficiaries outweigh any 
detriment to the lessees?


Sec.  48.30  How does the Secretary determine if Congressional approval 
is unnecessary?

    The Secretary will determine that Congressional approval is 
unnecessary if the proposed amendment meets none of the criteria in 
Sec.  48.20.


Sec.  48.35  When must the Secretary determine if the proposed 
amendment requires Congressional approval?

    The Secretary will review the documents submitted by the Chairman, 
and if they meet the requirements of Sec.  48.15, the Secretary will 
determine within 60 days after receiving them if the proposed amendment 
requires Congressional approval.


Sec.  48.40  What notification will the Secretary provide?

    (a) If the Secretary determines that Congressional approval of the 
proposed amendment is unnecessary, the Secretary will:
    (1) Notify the Chairmen of the Senate Committee on Energy and 
Natural Resources and of the House Committee on Natural Resources, the 
Governor, Speaker of the House of Representatives and President of the 
Senate of the State of Hawai[revaps]i, and the Chairman of the Hawaiian 
Homes Commission; and
    (2) Include, if appropriate, an opinion on whether the proposed 
amendment advances the interests of the beneficiaries.
    (b) If the Secretary determines that Congressional approval of the 
proposed amendment is required, the Secretary will notify the Chairmen 
of the Senate Committee on Energy and Natural Resources and of the 
House Committee on Natural Resources, the Governor, Speaker of the 
House of Representatives and President of the Senate of the State of 
Hawai[revaps]i, and the Chairman of the Hawaiian Homes Commission. The 
Secretary will also submit to the Committees the following:
    (1) A draft joint resolution approving the proposed amendment;
    (2) A description of the change made by the proposed amendment and 
an explanation of how the proposed amendment advances the interests of 
the beneficiaries;
    (3) A comparison of the existing law with the proposed amendment;
    (4) A recommendation on the advisability of approving the proposed 
amendment;
    (5) All documentation concerning the proposed amendment received 
from the Chairman; and
    (6) All documentation concerning the proposed amendment received 
from the beneficiaries.
    (c) The Secretary will post notice of the determination on the 
Department of the Interior's Web site.


Sec.  48.45  When is a proposed amendment deemed effective?

    (a) If the Secretary determines that a proposed amendment meets 
none of the criteria in Sec.  48.20, the effective date of the proposed 
amendment is the date of the notification letter to the Congressional 
Committee Chairmen.
    (b) If the Secretary determines that the proposed amendment 
requires congressional approval then the effective date of the proposed 
amendment is the date that Congress's approval becomes law.


Sec.  48.50  Can the State of Hawai[revaps]i amend the Hawaiian Homes 
Commission Act without Secretarial review?

    The Secretary must review all proposed amendments to the Hawaiian 
Homes Commission Act. Any proposed amendments to any terms or 
provisions of the Hawaiian Homes Commission Act by the State must also 
specifically state that the proposed amendment proposes to amend the 
Hawaiian Homes Commission Act. Any state enactment that impacts any of 
the criteria in Sec.  48.20 shall have no effect on the provisions of 
the HHCA or administration of the Trust, except pursuant to this part.

[FR Doc. 2016-11146 Filed 5-11-16; 12:00 pm]
 BILLING CODE 4334-63-P