Kamehameha Schools “Lead” Trustee for Education
Price of Paradise · Hawaii Public Radio · aired 1996-10-06
Guests: Lokelani Lindsey (Kamehameha Schools/Bishop Estate trustee)
Duration: 0:59:58

[00:00:19] Randall Roth: Aloha, this is Randy Roth, host of the Price of Paradise radio show. We're broadcast live each Sunday morning at 8:00 on KHPR and KKUA, and then rebroadcast Sunday evenings at 8:00 on KIFO. All of us who work to bring this program to you are volunteers. Our sponsor, the Hawaii Community Foundation, is an organization that supports grassroots efforts to improve the quality of life in Hawaii and that administers charitable funds with efficiency and compassion. Our topic today is Kamehameha Schools Bishop Estate, and with me in the studio to discuss it is one of its trustees, Lokeilani Lindsay. Lokeilani Lindsay has been a trustee at the Bishop Estate since 1993. Prior to that, she held numerous positions in the Department of Education. She taught at Kūhuku High School for 12 years, was the vice principal at Campbell High School, Molokai High, and intermediate and Baldwin High School. Served as principal at Kaimukī High and for 11 years was Superintendent of Education for the island of Maui. Lokeilani Lindsay, good morning.
[00:01:25] Speaker 1: Good morning.
[00:01:26] Randall Roth: And welcome to the Price of Paradise radio show.
[00:01:28] Speaker 1: Thank you.
[00:01:29] Randall Roth: First question, I note from the article that you wrote in this morning's advertiser, that you say the Bishop Estate is quote, probably one of the most misunderstood institutions in Hawaii. What do you mean by that?
[00:01:43] Speaker 1: I mean that some people see just one phase of Bishop Estate or one part of Bishop Estate and they don't see the total picture. We are a charitable trust, but we're a self-sustaining charitable trust, which means we have to earn all of the money ourselves, and they don't understand that if we don't earn the money, there would be no Kamehameha schools, and if there were no Kamehameha schools, there would be no need to go out and earn the money to support it into perpetuity.
[00:02:08] Randall Roth: Has there ever been thought of trying to raise current contributions so that you wouldn't be totally dependent upon the endowment, or is there something about this that causes you to believe that it really does have to rely solely upon the endowment?
[00:02:24] Speaker 1: It has to rely solely on the endowment and our investments from monies earned on the endowment.
[00:02:30] Randall Roth: Okay. And and you know, as a trustee, I'm really curious, you're one of five, and one would assume that you've got the best investment advisers that money can buy, and and the best personnel to run the schools that that money can buy. What is it that trustees actually do?
[00:02:46] Speaker 1: Boy, that would take a month of Sundays to explain to you. In essence, it varies from trustee to trustee, but in essence, it doesn't. Again, a kind of a dual statement there. What happens is that each of us bring to the table our vast experience and knowledge base on some of the things that we've done in the past, and as we look at these investments and as we look at programs for the school, all five of us make a decision on it. It's not made in isolation, and our Chairman Dickie Wong has also often said, it's five fingers, one hand. Sometimes we debate an issue for days and we defer it to the next meeting and the next meeting until we're comfortable with what it is we're going to propose, and then when once the decision is made, all five of us go forward with that decision.
[00:03:38] Randall Roth: Okay, and just so listeners will recall, the five trustees are Lokeilani Lindsay, Henry Peters, Dickie Wong, Oz Stender, and Jerry Jervis. Well, Lokeilani, normally you and I would talk a bit more before I would invite calls, but because it's it's just the two of us this morning, I'm going to go ahead and invite calls now, and then there are a couple of other topics I would like to raise. But listeners, if you want to ask Lokeilani Lindsay a question about the Bishop Estate or what it's like to be trustee of the Bishop Estate, any of the questions that you would like answered, whether it involves a controversial issue or not, our number is 955-8821. If you're on a neighbor island, the number is 1-800-955-8821.
[00:04:21] Randall Roth: Well, one of the more controversial issues in the last year or so has been the elimination of of various outreach programs. I have an editorial from the Advertiser about a year or so ago, and it was complaining about the sacrificing of promising and much-needed community outreach efforts, and I'll just I'll read from it. It says, only about 3,000 students now attend the Kapālama Heights campus, but 32,000 native Hawaiian youngsters in public schools as well as native Hawaiian adults benefit from the outreach programs. And it goes on to list just what those outreach programs were all about. As I understand it, many if not all of those outreach programs were eliminated in part in preparation for setting up the new schools that have just opened. What's your reaction to the public criticism with respect to cutting those outreach programs?
[00:05:14] Speaker 1: My reaction is that this needed to be done to change the direction of the school. Based on my educational experience, we found after doing a complete audit of all of the programs, that some of the programs did not meet the needs of the Hawaiian children in this day and age. What happened was they were founded about 25 years ago, and they they were much-needed at that time, there's no doubt about it. And they could be much-needed at this time. However, we found that in having remedial programs, we were addressing the problem after the fact. And with having preschool programs, we were making sure that the students were ready to go into school and they were in step with everyone else, because once you were a half a step behind, you stayed a half a step behind. And we found that, for example, our preschool programs that we had in existence, really prepared the students so the at-risk student no longer was at risk. And in 13 years of following the students in the Maui District, where Kamehameha School and the DOE had a partnership, in the preschool program, there was only one at-risk student. And we felt it was better to put all of our emphasis on preventing them to be at risk rather than addressing the at-risk problem after the fact.
[00:06:33] Randall Roth: In a way, I guess this is is related to to another issue where where you've been criticized by some, and that is the movement toward merit-based admissions. As as I understand it, it used to be done on a lottery basis and there were a number of kids that simply wouldn't be admitted to Kamehameha Schools if it were based on on testing, but they were getting in on the lottery system. For the last few years as I understand it, it's merit-based, and critics are saying, well, you're focusing your resources on those kids who really don't need it nearly as much as the kids who aren't getting into the schools.
[00:07:09] Speaker 1: The merit-based program was in existence prior to the lottery, and then Kamehameha Schools went to a lottery program and they've gone back to a merit-based program in the kindergarten through 12th grade, well we don't accept anyone at 12th grade, but through the secondary school. However, our preschools are still on a lottery system. I don't think many people know that. The other thing is that as we look at a student coming into Kamehameha, we don't just look at grades. There are many, many other aspects that we look at. And there are six components, really. Some are grades, some are extracurricular activities, some are um teachers' recommendations and so forth. So we get a comprehensive view of each student coming in. The other thing I think people don't understand is 15% of the students we take have to be orphans or indigents.
[00:08:03] Randall Roth: They have to be?
[00:08:05] Speaker 1: They are. I mean, that's that's a decision that you've made. Not a decision we made. According to the will of Bernice Pauahi Bishop, we had to uh give preference to orphans and indigents of native Hawaiian ancestry.
[00:08:18] Randall Roth: And that percentage is is your way of of of of approaching that in an objective fashion. Yes. Okay. Well, we've got one person on the line. I had thought our lines would fill up immediately, folks. The number is 955-8821. Let's go to Eldred in Honolulu. Good morning, Eldred.
[00:08:35] Speaker 2: Morning. I'd just like to um ask a question and then I'll sign off so I can listen on the radio. Okay. Um Ms. Lindsay, um first I'd like to uh I guess commend the the trustees on their recent contracting out of services. Um I guess for for security on the on the campus. They're really uh enjoyable group of security officers. Uh my question is, what did I guess how what did the jeopardizing of the tax exempt status of Kamehameha Schools come to play with their decision to uh make satellite schools. Thank you.
[00:09:12] Randall Roth: Okay. I guess everybody knows that uh Kamehameha Schools Bishop Estate is a a 501c3 charitable organization with all of the tax benefits that go with that. And uh there are a number of people who have suggested that at least in the past, uh the Bishop Estate has been skating close to thin ice in terms of of possibly losing that status. And I don't know if that was a part of of Eldred's uh question or not, but but how does that terribly important tax status relate to your decision to open the the three new schools?
[00:09:43] Speaker 1: That had nothing to do with our decision to open the three new schools. We were trying to be of service to many more people than just the people on the island of Oahu, especially in the elementary arena. We were trying to make sure that we would have schools in the neighborhoods where families would not have to leave their children would not have to leave their homes in order to go to school on Oahu, and to that extent, we took a look at the whole family situation, the trauma that it was for students in the seventh and eighth grade to leave home, felt it was a little bit too young and that prompted our decision to have schools on the neighbor island.
[00:10:19] Randall Roth: Okay, so now you have schools not only on on this island but Maui and the Big Island as well, and and admission to those three schools are by merit, but you've got preschools scattered about and that's where you're still doing a a lottery. That's correct. We have 27 preschools right now. We have about 900 students in those preschools, and we hope to have about 1,800 students in even more preschools throughout the state. Okay. Well, let's go to Myrtle in Kahalu'u. Good morning, Myrtle.
[00:10:50] Speaker 3: Hi. You're on the air. Okay. My question is, um Lokeilani Lindsay said that the uh alternative education programs were removed and instead the focus was on prevention. And, um, I know at the school that I work at, uh which is an elementary school, the program was preventive and that there were many preventive programs that were also removed and that uh, well, I was sorry to see them leave. And, uh I'm that, um, so the programs are that were removed were also preventive programs. They were not just adult education programs.
[00:11:29] Randall Roth: Myrtle, stay on the line. Let's get Lokeilani's reaction to that.
[00:11:34] Speaker 1: Myrtle, you're right. If you're from the Kahalu'u area, I'm sure you're talking about the counseling program that we had in partnership with the Department of Education, and that was removed so that we could use our resources to strengthen our preschool programs. It wasn't something we did lightly. In fact, when that decision was made, I think it was the hardest decision the trustees had made in a long time. But we knew that our resources were limited, and we found in um the audit that we did of all of our programs that our students did best when they were taught in KSBE classrooms full-time, rather than a part-time. And that's what we wanted to focus on was to make sure that the students had a full-time experience rather than just a part-time experience.
[00:12:22] Speaker 3: Well, yes, it was part. Well, we had a full-time person at our school. And all I can say is that that it really did help many of our part-Hawaiian children, and I was really sad to see it go, that it was helpful, very helpful.
[00:12:39] Speaker 1: But it was also helping other students and well as well, Myrtle, and I know we had a full-time person there, but they didn't teach students full-time. And we wanted to go into the real hands-on teacher pupil mode.
[00:12:53] Randall Roth: Myrtle, thank you for your call. Okay, thank you. Thank you. Uh we go to Lila in Honolulu Honolulu. Good morning, Lila.
[00:13:00] Caller: Good morning. I wanted to ask, since you're expanding your schools um on the Neighbor Islands um and eventually those students are coming to the campus here um on this island, are you going to expand the Kapalama campus to accommodate them? Or are you going to cut back on the students here on Oahu that are planning to go to Kapalama campus?
[00:13:29] Lokelani Lindsey: We have already expanded the number of students at the Kapalama campus because we're trying to reach as many Hawaiian children as resources will permit. And as a result of that, we continue to plan to expand the campus. What we want to do is keep the seventh and eighth graders home on their own island with their families, so that they have the family support while they're still starting the puberty years and then bring them to the Kapalama campus from the ninth through the 12th grade. Therefore, as we eliminate the dorm space for some seventh and eighth graders from the Big Island and from Maui, we will increase the number of students that will be boarding in the ninth through the 12th grade years.
[00:14:12] Caller: So what is the maximum number of students you project um given um the schools that you have started in the Neighbor Islands when they are ready to come here to Oahu? Or is are there any plans to set up um high school courses on a any of the Neighbor Islands and have students exchange from here to there?
[00:14:38] Lokelani Lindsey: There are no plans to do this at present. As you know, this is the very first year we've opened the schools and we opened them for kindergarten to third grade, and we're going to add a grade each year until the schools house students from the kindergarten through the eighth grade. And as a result of that, since this is our very first month in opening up and running schools on the Neighbor Islands, we're kind of taking a wait-and-see approach, and we're going to evaluate at the end of this year. At the same time, we're also doing master planning at Kamehameha Schools, and that will determine the projected number of students that will be at Kamehameha Schools in the future.
[00:15:15] Caller: Well, you know, I was at the master uh planning um uh informational briefing that you gave on Hawaiian organizations and you said that you weren't going to expand uh the Kamehameha campus here. Has that really changed that? I still would like to know, at the current time, how many students are you graduating and uh when you have this expansion, how many more students do you expect to graduate, or will the numbers be the same?
[00:15:49] Lokelani Lindsey: We graduated this year over four about 430 seniors from Kamehameha School. What's interesting to note of that 430, 421 went on to institutions of higher learning. And right now that figure will stay stable because it'll be a five-year period before we even contemplate bringing in the third graders who will finish their eighth grade year on the Neighbor Island schools.
[00:16:13] Randall Roth: Leila, thank you for your call. Thank you very much. We've got a couple callers from the Neighbor Islands, but I want to remind listeners that this is The Price of Paradise radio show. My name is Randy Roth. I'm here with Lokelani Lindsey, who's one of the five Bishop Estate trustees. We're taking questions, anything having to do with Kamehameha Schools, Bishop Estate. Our number is 955-8821. Or if you're on a Neighbor Island, 1-800-955-8821. If you tune in a little bit late, we'd like to hear the show in its entirety tonight at 8:00 on KIFO 1380 AM. You can do just that. We go to Ray from Kauai. Good morning, Ray.
[00:16:49] Speaker 4: Uh, good morning.
[00:16:51] Randall Roth: You're on the air.
[00:16:52] Speaker 4: Okay. Uh, since the Bishop is a uh 501(c)(3) uh charitable trust, uh what is its uh annual income or what let's say what's its income for the last year and how much of that income is devoted to the operation of the Kamehameha school?
[00:17:14] Randall Roth: Uh, Lokelani, do you recall just what the income for the last year was?
[00:17:18] Lokelani Lindsey: No, I don't recall the exact figures, but I do know that 95% of our income is spent on Kamehameha Schools.
[00:17:30] Speaker 4: Well, I find that rather surprising for a trustee who earns nearly a million dollars a year and not to know what the trust income is.
[00:17:38] Lokelani Lindsey: I don't know exactly, Ray, and that's why I don't want to say something. I know approximately what it is. I know that our worth is 1.8 billion as uh portrayed in our income tax forms, but I'm not sure specifically, and rather than give you the wrong figure, I would not I elect not to give you any figure at all. However, even just because you brought up commissions, let me share with you that yes, we get paid a lot of money, but look at what we do for all of the students that we serve and all the families that we serve. We work very, very hard. It's not uncommon for me to work a 16-hour day, seven days a week. But we do a lot for the students of Hawaii of Hawaiian ancestry. And I think I the proof is in the pudding. Many, many our students are coming back and taking leadership positions in the community.
[00:18:32] Speaker 4: Yeah, so I have a related question, if I may. One more. One more. And that is uh uh if you look at comparable uh charitable uh institutions, uh let's say the Ford Foundation, which has the larger uh reported net worth than the Bishop. And yet its president gets a salary which is less than half of what uh each of the five uh Bishop trustees get. Uh I wonder how you explain that.
[00:19:02] Lokelani Lindsey: I don't know anything about the Ford Foundation, so I can't explain that. I can only tell you that for us, yes, it's a lot of money, and yes, we do a lot of things for the students of Hawaiian ancestry in the state.
[00:19:14] Randall Roth: Okay. We'll circle back. I'm sure that topic will come up again, but we've got some people who have been waiting. So we're going to go to Genie on the Big Island. Good morning, Genie.
[00:19:22] Speaker 5: Yes, good morning. Uh my question departs from the educational uh subject here. Uh I live on on the Big Island uh on Hamakua Coast and Bishop Estate recently purchased about my understanding uh 20,000 22,000 acres of the old Hamakua Sugar property over here and we I think that the community has a lot of concerns about the nature of the use of that land and I'm wondering if the Bishop Estate will be getting involved with the community as it decides what to do with the land.
[00:19:54] Lokelani Lindsey: That's a good question Genie. We have been out in the community already. We've had meetings, public meetings in a lot of the different uh villages there, and we've met with people from the Hamakua Coast in general. We purchased 30,000 of acres of Hamakua land and right now most of it has been leased to um a timber operation, and they will be running it. We did this because we thought it should stay in agriculture and we wanted to provide some jobs for the people of that community. We understand the community is very depressed and we're working very, very hard to make sure that we do our part in providing some opportunities for the people who were laid off from the sugar plantations.
[00:20:39] Speaker 5: Uh, it I personally I never have heard of any of the meetings that you have held. Uh we live in Honokaa and are pretty involved with what goes on here. I I sense myself, uh personally, not representing anybody else, that there's a concern that this uh timber organization is just another big company and then it would be probably or perhaps a better idea to do smaller diversified projects where people are empowered to work for themselves instead of having another operation. I know there's a tremendous amount of concern about having a logging operation here. It's uh I I sense a lot of concern in the community and I I don't feel that there's been a lot of community involvement and I think that there's uh a lot of concern in this area.
[00:21:26] Lokelani Lindsey: There is a lot of concern, and we did go out and we met with the people right after we purchased the land, and we met with them before we went into this uh timber industry. But we also have not limited to that. The rest of the land, and we own much more than the 30,000 acres we purchased, because we had land there before, is destined for diversified agriculture. We have leased 3,000 acres to a banana farmer, we have 10 and 20-acre parcels that are going out to people who are growing ginger and uh small crops. We're working very, um diligently with the people who want to have diversified agriculture up there, and we we feel that we will meet a need in the not-too-distant future.
[00:22:11] Speaker 5: Genie, thank thank you for your call. I'm I'm going to have to move on. Yeah, one quick quick uh one question that's very quick. Okay. I I'm wondering if there's a phone number or a contact person that a potential farmer could get in touch with Bishop Estate in regard to this diversified ag land that is available. The person to get in charge with uh in touch with is our land manager up there, Bobby Lindsey. He lives in Waimea and he works out of the Kona office of Kamehameha Schools Bishop Estate. Thank you.
[00:22:38] Randall Roth: Thank you, Genie. We go to Keith on Maui. Good morning, Keith.
[00:22:42] Speaker 6: Good morning. I'm delighted to have this possibility of speaking with Lokelani. I have a lot of admiration for the Bishop Estate and what they've done. My question, uh, very quickly is a kind of corroboration question. Someone told me recently that in the past, like 20 years ago, the income for the Board of Trustees was significantly significantly less. Could you give me a figure what it was like maybe 1970 or 1960. What did the Bishop Estate trustees earn?
[00:23:19] Lokelani Lindsey: We're doing the figuring. Approximately 52,000 maybe a year, but you have to, and that's in 1970s. But you have to realize Keith is in 1984, there was a landmark decision by the Supreme Court where we were forced to sell our single family fee simple land. I mean our single family lands in fee instead of leasing it out, and that took a big drain from our corpus. Therefore, in selling that, Kamehameha Schools Bishop Estate had more income than they ever had before. We were land-rich and cash-poor, and all of a sudden, overnight with the sale of these lands, we went into a a cash uh rich entity and had to invest these funds. As a result of that, the Bishop Estate trustees have been paid way more. Our uh commissions, and they are commissions based on what we do and how much we earn, are determined by state law. It's 2% of whatever we bring in divided by the five trustees. So you can imagine, if you look at the commissions, how much more we bring in for the institution, which is 98%. And remember, with this money we that we earn, and we are self-sustaining, we make sure that we educate a lot of the students here of Hawaiian ancestry, and we're expanding that base.
[00:24:41] Speaker 6: Mhm. And in the expansion of that base, would you consider the possibility of a stream of another private school like uh the Waldorf School um method which operates has been operating on Oahu for over 30 years and on on Maui now for 25. The I say I asked that because uh your new school in Pukalani will impact on effect an inclusion of Hawaiian uh children. And it uh, you know, we we've really honored uh working with the Hawaiian children. We have a you know, a growing Hawaiian program that we are very proud of and we'd like uh very much to cooperate and at the same time not be negatively impacted.
[00:25:28] Lokelani Lindsey: I I'm familiar with the Waldorf school and I'm familiar with your efforts and I think you've done a commendable job in Maui of providing an independent school for, and as you well know, for the people of Maui because Maui schools are so overcrowded. Um, there might be a possibility that we can share some educational materials with you. I'd like to have you call me, Keith, at the office to see exactly what you're thinking of, and maybe there's some way for us to cooperate.
[00:26:00] Speaker 7: We have to move on, I appreciate your call. We go to Kathy in Honolulu. Good morning, Kathy. Oh, we go to William on Molokai. Good morning, William.
[00:26:07] Speaker 8: Good morning. Uh, yes, I have a question for Lokeilani. Um, I live on Molokai but I have many acquaintances that work at Kamehameha schools and I've noticed over the last few years that morale seems to be declining considerably among the staff and one of the reasons for that seems to be the need for the review of many, many classroom decisions in the elementary grades. And I'm wondering if Lokeilani works a 16-hour day, um, why she couldn't relieve some of that stress by trusting the uh wonderful faculty that she has available.
[00:26:44] Speaker 7: Um, Lokeilani, I know this is something that that's been raised, uh Bud Smiser had a column which I'm sure you're familiar with and and just to give listeners a little bit more background on this. Uh, according to Bud's column of about six months ago, there evidently are some people, who like William feel that there's micromanaging going on at Kamehameha schools. And according to the article, um and the people he talked to, it's creating a quote, glum, play it safe attitude that inhibits experimentation, saps academic vitality, and has made the flagship campus a fortress on the hill. And it goes on to say that that really uh it's you, that you're the one who's doing this micromanaging. Whether it's Bud's column or William's question, uh what's your response?
[00:27:30] Speaker 9: That's an interesting response. I don't have time to do my job as bishop estate trustee and actually run the schools. However, there are some very solid principles that we're looking at from the trustee level and we have some policies. And one of the policies is that we will have a kindergarten through 12th grade curriculum continuum so that we can replicate this on the neighbor islands and it means some changes in some of the things we do.
[00:28:00] Speaker 9: I kind of took a I was taken aback William by your statement that we don't trust the teachers. We have some very very fine teachers up there and they have worked very very hard. It's just that in changing the direction of the school and taking the school to the neighbor islands, we want to make sure the same quality we have at Kapalama campus can be replicated on the neighbor islands and that the neighbor island schools will also be able to share with the Kapalama campus some of their successes. Therefore, we're putting in place a kindergarten through 12th grade curriculum continuum that means that some of the teachers will have to change. And as we all know, change is very very hard for people who have been doing some of the things that they've been doing successfully for years. But we want to make sure every child gets the best education they can possibly get at our schools.
[00:28:51] Speaker 7: Lokeilani, and and William, I'll come back to you in a second. I just want to ask you in Bud's column, he says that you personally clear or or it's it's a requirement that you personally clear all printed literature before it leaves the campus. Is that a correct statement?
[00:29:05] Speaker 9: Not only the campus, Kamehameha Schools Bishop Estate. And the reason for that is that some of the things have gone out have been detrimental to us in the legal sense and we've had some of our brochures and stuff used against us in court. So, we do have a clearing house. Not for the regular run of the mill memos and such as that, but for things that are going out to the the general populace.
[00:29:27] Speaker 7: You don't mean you personally, you mean your lawyers or or whomever it is.
[00:29:31] Speaker 9: Well, no. I'm kind of it comes to my desk and we go and re uh confer with lawyers and such as that. We want to make sure that even in our our um internal and external communications, more external in this case, that things go out are absolutely accurate and that they are indeed legally correct.
[00:29:54] Speaker 7: Okay, William?
[00:30:08] Speaker 8: I understand that, and and certainly that does make sense. Um, I want just quick response to the um maintenance of the continuum of education K through 12. And again, um I'm speaking just from talking to many of my friends that live in Honolulu and it seems that change is in fact occurring, but from an educator's standpoint, that change appears to be a retrogressive change rather than progressive change because Kamehameha was at one time on the cutting edge of research and development in education. And now it seems like the trustees uh are trying to make Kamehameha like a wonderful big public school system and in fact, uh going backwards instead of forwards by some of these quote changes and uh this is what is depressing many of the quality uh educators that are on the staff there.
[00:31:03] Speaker 7: William, let's get a quick response from Lokeilani and then I need to move on. But thank you very much um for your call, Lokeilani.
[00:31:08] Speaker 9: It's absolutely, you're absolutely correct William, in that, uh we decided to do away with the research component at Kamehameha schools. We did not feel we were a research institution. We felt we were an educational, hands-on institution and we wanted to provide the very best programs for the students. And I think we're doing our job.
[00:32:21] Speaker 7: Our number is 955-8821, and we go to Allison on Maui. Good morning, Allison.
[00:32:27] Speaker 10: Oh, good morning. Um, I had a question about the policy you have for when you admit the children. Um, where they're born in the in the year is where they're, you know, what grade determines what grade they're in. Um, when you opened up the Maui schools, how well thought out was that? I have a son who's in, who's on the Maui campus, and he's um, he's born in December so he has to be in second grade, though he just completed second grade in the public school.
[00:33:01] Speaker 7: Okay. Lokeilani, it sounds like she's suggesting it's rather inflexible.
[00:33:04] Speaker 9: No, it's not inflexible. And yes, it is. Um, it's different from the Department of Education. There's no one more familiar with that, because my birthday is December 31st and we found that some of the students mature later than others. And if you take them from the calendar year January till December, that you have as much as a as a year difference between the students that are in the same class. Therefore, our cutoff date at Kamehameha school is much earlier.
[00:33:36] Speaker 7: Allison, thank you for your call.
[00:33:38] Speaker 10: Uh well, I had a I had a one extra comment. I I found that with the um the school up on Oahu, and when you accept fourth graders, you don't do the same sort of, you know, that you don't cut it off that way. If they were if they completed third grade, no matter where they were born in the year then you will accept them in fourth grade. And so and I understand why you do it in kindergarten, but I it's it seems kind of hard for the kids who have to repeat second grade. Some of whom are, you know, they my my son's a fairly good reader so he's he's he's doing for, you know, he's ahead of most of the kids in his class now.
[00:34:18] Speaker 7: Allison, you you've made your point real well. Um, I'm not sure there's an answer other than to say uh the rule is as you've described it, and and Lokeilani has has agreed, that is the rule. Okay. Thank you.
[00:34:29] Speaker 9: And that's it.
[00:34:31] Speaker 7: We go to Lokeilani on Oahu. Good morning, Lokeilani.
[00:34:34] Speaker 11: Good morning. Thank you very much for the program. It's very, very good. We appreciate the Price of Paradise. Uh I would like to ask what is the percentage of the corpuses uh monies devoted to education at Kamehameha schools and the various uh outreach programs, etcetera, etcetera. Uh I understand that the uh corpus is a very large one on the stock market and what is the percentage of the corpuses funds actually and what do they, you know, how do they apply that percentage to the educational programs at the schools? The perception is that most of the monies are now outgoing to different areas around the world and not enough of the monies are being devoted here in Hawaii. So, could you set that perception at rest, perhaps?
[00:35:32] Speaker 7: And let me just as a little bit additional background, Lokeilani, I think you mentioned 1.8 billion or something like that earlier. Um, that's based upon real estate values from years and years ago and nobody knows exactly what the total value is now. But I think most educated guesses in terms of current value of the corpus which is what Lokeilani on the phone has raised, is in the neighborhood of $10 billion. So we're we're talking about a fair chunk of change here. What's your reaction to Lokeilani's question?
[00:36:01] Speaker 9: Well, first I'd like to react to your your comment and then Lokeilani's question. Um, 98% of our land is in conservation and agriculture which brings in only 3% of the income. And we only about 1,400 acres are zoned for residential and as you know, we're trying to get out of the residential building uh business. Only about 850 plus acres are in commercial use. So we can't really tell what the value of the land is until you sell it and we have no intention of selling the land in any way, shape or form. We want to keep it.
[00:36:37] Speaker 7: But you would agree it's a lot more than 20 years ago.
[00:36:41] Speaker 9: Oh, it's a lot more than 20 years ago but if it's in conservation and agriculture and you can't do anything with it, it's not worth very much as well. Okay. So I needed to make that comment. Okay. And then going back to your question, uh we have to reinvest some of the money that we earn in order to make more money because we have to support this educational endeavor into perpetuity. As a result of that, we return to corpus that which is corpus and we spend 95% of our profit on Kamehameha schools.
[00:37:13] Speaker 7: Um, you know, Lokeilani, as I understand it there there are some people at least who feel that the approach that you're taking leaves you accountable to no one, that that you don't have to convince anyone that that you're doing a good job in order to to stay in existence and that if you did spend more of of your funds so that you would have to rely upon contributions to supplement the funds from the endowment, that that would instill a level of accountability that would be healthy in the long run. Do you have any reaction to that?
[00:37:46] Speaker 9: Well, I don't know if soliciting funds give you a level of accountability. Look at United Way for example. However, I do feel that we are accountable to a lot of people. I don't know if the public is aware of that. We have um coined a court appointed masters who come in and audit to make sure that we're doing what we're supposed to do. We're accountable to the probate court, we're accountable to the Supreme Court, we're accountable to the IRS. And let me tell you, it takes a lot for us to make sure that we're not going out of the parameters set for everybody else. We have to follow the law like everyone else.
[00:38:29] Speaker 7: So so basically your response to Lokeilani on the phone is that you're spending as much of the income as you feel you prudently can consistent with your your attempt to to keep this self-sustaining um unreliant upon any outside supplemental sources of revenue.
[00:38:45] Speaker 9: That's correct and it's our fiduciary responsibility to do just that.
[00:38:49] Speaker 7: Okay. We go to I think it's Ida on Maui. Ida, are you there?
[00:38:53] Speaker 12: Yes, I am.
[00:38:55] Speaker 7: You're on the air.
[00:38:56] Speaker 12: Good morning. I um I just a comment. I've met some one
[00:39:00] Speaker 7: for outstanding students from Kamehameha School. And I think it's it's commendable that 421 out of a class of 430 are college-bound. But I was sort of baffled by the national merit scholarship nominees this year. There was just, I think, one from Kamehameha. What is the deal on that? That just doesn't seem right.
[00:39:25] Speaker 13: Okay. And and this is obviously something that's that's determined outside of Hawaii.
[00:39:30] Speaker 7: Yeah, it's some of the national And there are Uh it's the national picture, and, bunch of other smaller schools. you know, some of the smaller schools.
[00:39:38] Speaker 13: Right, Punahou and Iolani for example have have many, many.
[00:39:41] Speaker 7: Yeah, and with all the resources and the wonderful job they're doing. Why
[00:39:46] Speaker 13: Why wouldn't there Why wouldn't there be more local?
[00:39:49] Lokelani Lindsey: I think it unfairly to compare us to Punahou and Iolani because they can take the top five percent of the students from wherever they are and they also pay their own way and we take students from every geographic location and we're limited in that we take students of native Hawaiian ancestry, no matter how small the blood quantum. There's an entirely different set of criteria for those smaller schools, and Punahou is actually larger than Kamehameha and us. I think it would be fair, instead, to look at how far these students progress individually and collectively from the time they come into Kamehameha School until such time as they graduate. And mere fact that we send 421 out of 430 to institutions of higher learning means that they have the opportunity to go on and become real contributing members of the society and I think that's how we should be judged.
[00:40:50] Speaker 13: Edith, thank you for your question. Thank you. Uh, Lokelani, there are there are a couple of issues that I thought would would come up by now and they haven't. Let me very quickly put them on the table, get your reaction, maybe we'll have some callers who who want to get a little bit more in the way of details. Leasehold conversion, obviously has been a very controversial issue in Hawaii for a number of years. I should say mandatory leasehold conversion, which the Bishop Estate has suggested is a a form of stealing. And the Supreme Court of the United States some years ago has said it's perfectly legal so far as single-family houses are concerned, and right now the courts are looking at whether or not it's legal with respect to um condominium ownership. Um but something that I'm I'm curious in terms of your response to was an article by Thurston Twigg-Smith a while back where he said, "How can you say this is uh stealing?" So indignantly say this is stealing when the land was stolen by Kamehameha the first in the first place? I think he used the word "evolution" to describe how the land changes hands over time.
[00:41:58] Lokelani Lindsey: I would refrain from responding directly to Thurston Twigg-Smith's comments because if you looked at Europe, that same thing happened in the feudal systems of Europe and through the wars of the Moors and everything else that's happened in the world throughout the years. However, it was Hawaiian land and as it pertains to Kamehameha School, it was land that was deeded to us, not ceded, deeded to us by our princess Keliipawahi, who insisted that we not sell the land unless it was necessary to do so for the support of the schools and this is very explicit in her will. If today, Kamehameha Schools was given the option of selling the land or keeping the land, we would all go back to not selling the land. Now, it was mandatory conversion but it wasn't, and the first wave on single-family houses also set a ceiling on the prices. So we could not sell it for market value. We had to sell it for the within the ceiling that was set. Therefore, for example, a beautiful lot in Kahala on the beach we had to sell for $262,000. That person turned right around and sold it on the market at marketable prices because they weren't bound by the ceiling for $3.1 million. We feel it's stealing when we can't sell our land for the prices that we think that the land is worth. We realize we have to sell the land, but we want to sell it for what we want to sell it for and not what somebody predetermines it's worth.
[00:43:38] Speaker 13: Okay. Another issue that I thought would come up and it hasn't, folks will remember the the "Save Sandy Beach" bumper stickers which we occasionally still see. Back in 1989 there was a downzoning at Sandy Beach that a lot of lawyers feel was an unconstitutional taking from the Bishop Estate without compensation. There is a lawsuit alleging that that's that's in the process right now. And reports over the last year or so have been that the city has engaged in settlement discussions with Bishop Estate that would say, "Look, instead of giving you the $100 million that you say you've you've had taken from you, we will do some rezoning over at Queen's Beach and we'll let you put in a golf course and a hotel and a number of other things at Queen's Beach." Um quick thoughts on the what I'll call the Queen's Beach controversy.
[00:44:34] Lokelani Lindsey: The Queen's Beach controversy is still evolving, I'm sure, and there's going to be a lot more said about that going forward. But yes, we did have zoning on the property and much of it is leased to other people from Kamehameha Schools Bishop Estate, so we're a small stakeholder in that we own the land and yet it's leased out to Kaiser and Kemper. Uh yes they took away the zoning from us and yes, we went to court. The city requested that we come to the negotiating tables and unfortunately, since we've been at the negotiating tables, we've had nothing but bad publicity on it, and yet it wasn't us who requested a sit-down session if you will. We feel that um the zoning was taken away unfairly and granted a lot of people lobbied for it and they were very successful in doing this, and we feel that it has to be resolved shortly and maybe the resolution will have to take place in the courts. And because it's even though we're negotiating, it's still in the litigation, there's not that much I can say about it.
[00:45:44] Speaker 13: Okay. And you'd probably just as soon have the $100 million cash as the zoning changes at Queen's Beach.
[00:45:51] Lokelani Lindsey: I I'm not going to answer that.
[00:45:53] Speaker 13: Okay. Well, the the other issue that I thought would come up that hasn't is has to do generally with um what I'll call troubled mainland investments. There have been a lot of mainland investments but there have been a few that have been written up a lot over the last couple of years. The most recent has been this golf course, the Robert Trent Jones Golf Course uh in Virginia with uh you know, the the rich and famous of the world as as members. And I'm sure it's quite complicated, but the way the media has portrayed it is that uh Henry Peters recused himself as a Bishop Estate trustee, said, "Okay, I'm taking off that hat. I'm just negotiating a sale as a trustee of this golf course" and watching out for the interests of its members. There was a a transaction between Bishop Estate and and basically the members of this club, which now has some members saying that there was fraud. There've been lawsuits filed and the fraud word "fraud" is very um um prominent in these lawsuits. Any reaction from the standpoint of the Bishop Estate to this particular controversy?
[00:47:01] Lokelani Lindsey: First, I think the audience needs to realize that we were a limited partner in this venture and because our partners could not perform, we took over the entire entity and so we own the golf course. There were uh certain conditions in which the people the members of the club could buy the golf course back from us if they met certain criteria and this was all established ahead of time. There is an allegation of fraud from two of the members. Um our lawyers are working on that right now. Again, it's being worked upon, so I can't give you too many details, but I think you'll see a very favorable resolution to this problem.
[00:47:46] Speaker 13: Okay. Well, want to remind listeners that this is the Price of Paradise radio show. We're down to the last uh 13 minutes. I'm here talking with Lokelani Lindsay, a trustee of the Kamehameha Schools Bishop Estate. She's served in that capacity since 1993. Prior to that, she had a career in the Department of Education, most recently, 11 years as Superintendent of Education on the Island of Maui. We're down to 12 minutes now, but if you'd like to call very quickly, our number is 955-8821 or 1-800-955-8821. We go to Kalani from Kapaaulu. Good morning, Kalani.
[00:48:23] Speaker 14: Good morning. Aloha.
[00:48:25] Speaker 13: Aloha.
[00:48:26] Speaker 14: Uh Lokelani, will there be a uh anytime down the future that you can see when the trustees will say that there will be no more chipping away of Kelly Powley's will? I mean, it's got to stop.
[00:48:48] Lokelani Lindsey: Kalani, that's an interesting question. I think the trustees have always said that we should not chip away at the will. Unfortunately, it's not the trustees who are chipping away at the will, but the outside forces that govern us. Exactly. We are being chipped away through some of the legislative rules that are enacted, uh some of the decisions made by the judiciary, most notably the Supreme Court decision that forced us to sell our land when the will of our princess said do not sell the land and we are forced uh on one hand to uphold what is written in the will, and that's our fiduciary responsibility, and on the other hand we have to obey the laws of the land and that makes for a very precarious position for trustees to be in. There's no doubt that we cannot go against uh what is mandated through the judicial and the legislative systems.
[00:49:41] Speaker 14: Yeah, but and just one more comment. Uh it should be a lot of people concerned with the Bishop Estate must realize that the uh princess was not an American when her will was drawn up. That it was She was still under the Kingdom. And so all these rules that are coming up were after her death and after Hawaii became a part of the United States.
[00:50:07] Lokelani Lindsey: That's correct.
[00:50:08] Speaker 13: Okay. Kalani, thank you very much for your call. We go to Al at uh uh Good morning, Al.
[00:50:14] Speaker 15: Hi. Good morning. I I'd like to ask uh uh Lokelani a question regarding uh I guess some of the statistics she quoted this morning on the operation of the Kamehameha schools. You're saying that 95% of the profit is currently being spent on Kamehameha schools and I guess, maybe I'm a little bit naive, but with the expansion to the outer island schools, how will that be funded?
[00:51:02] Lokelani Lindsey: It will also be funded with the monies that we have. Let me give you some real life figures so you can see what we're doing.
[00:51:08] Speaker 15: Cuz I mean, you you see from my perspective, it's like if 95% goes to Kapalama, then I mean, you have all these other schools that I guess it doesn't. Okay, go ahead.
[00:51:28] Lokelani Lindsey: 95% goes to the Kamehameha Schools per se, not just Kapalama and to just give you an idea of what we spent during this last year, we spent the budget is $151 million for that school. For just that one school? Yes. Okay. And and also right now it includes the two neighbor island schools and we uh have used the bulk of our money in renovating the facilities cuz the first time for the first time in many a year, we have the money to do so and you'll see new dormitories, I mean the dormitories being renovated, you'll see new facilities being built. We're in um temporary facilities on the neighbor islands and we will be building brand new schools out there in the next three to five years.
[00:51:43] Speaker 13: Right. Al, thanks for your call. I've got some people waiting. We're running out of time. Thank you very much. We go to Doug from Palolo. Good morning, Doug.
[00:51:50] Speaker 16: Oh, good morning and uh good morning Lokelani.
[00:51:53] Lokelani Lindsey: Good morning.
[00:51:54] Speaker 16: Uh Lokelani, uh recognizing that much of the investment of the Bishop Estate is in agricultural land in
[00:52:00] Speaker 7: which really produces a low income jobs and coupling that with the investment outside of the state. What do you think that the Bishop Estate can do to support high technology business in Hawaii. You know the ones that will provide and create jobs for the top level graduates and and will help to prevent the brain drain out migration from the state of Hawaii.
[00:52:24] Lokelani Lindsey: That's an interesting question and I'd like to answer that by saying in the last two and a half years, we have tried to make Kamehameha School campus, Kapaalama campus as well as our campuses on the neighbor island um high-tech, user friendly if you will, and we are going to be in the next year on the absolute cutting edge of everything that's um that's involved with high technology. We are building our own studio on the campus. We'll be broadcasting out from that studio and taking our lessons to people around the state instead of just being isolated by the campus. I think as we do this and we look at the telecommunication and technology plan for the school, we will be able to offer a lot more jobs. In fact, I just looked at a draft of the plan and it looks like there'll be 36 more jobs created by the time we get into uh fully staffing this entity. It'll be a big help to us and hopefully we'll be able to work with the supercomputer center people up in in Maui and provide more services as well as opportunities for the people of Hawaii.
[00:53:31] Speaker 7: Doug, thanks a lot for your call. Lokelani, we've got some more people on the line and I'm going to try real hard to get to all of them but I told the caller earlier that we'd circle back to the compensation issue and I want to be sure to to ask you a specific question before we run out of time. Earlier this year, there was a bill in Congress that would have limited effectively and it would have done it in a roundabout way but it would have effectively limited how much compensation could have been paid to trustees of charitable organizations generally, but it it certainly would have affected the the five trustees of the Bishop Estate. According to the media, the Bishop Estate um spent a lot of money lobbying against this and was successful the bill didn't get enacted. Were those reports accurate, inaccurate, any reaction to that?
[00:54:17] Lokelani Lindsey: The bill did get enacted as part of the tax Omnibus bill and it's that section is commonly referred to as the tax exempt status section. Uh yes, we did lobby hard against it because of its impact on not only Kamehameha School Bishop Estate, but all 501 C3 organizations. And there's been many meetings now across the nation by 501C3 501 C4 organizations to see exactly what that impact will be. What it did was prior to this, the IRS could only take away your tax-exempt status if you did something wrong. What it does is actually add into their sanctions or penalties if you will, if you do something wrong short of taking away tax-exempt status which would hurt the people that uh these charitable institutions serve. As a result of that, they have a commission right now that's writing the rules and regulations for the bill that passed Congress and we won't know until early next year how it impacts on us.
[00:55:20] Speaker 7: Right, and that bills a greatly watered down version of what what it started to be, but I guess time will tell what it's going to translate. Okay. Well we're going to try to get to everybody before we run out of time and next is Jean on Maui. Good morning, Jean.
[00:55:33] Speaker 17: Hello.
[00:55:34] Speaker 7: You're on the air.
[00:55:34] Speaker 17: Hi Jean. Hi. Yes, I have a question for you. What has Bishop Estate attempted to help native Hawaiians gain homesteads? And the previous caller mentioned high technology, but there's such a solar energy and bioconversion and there's with these huge agricultural lands you hold. Could you as a charitable activity encourage the homesteading with modern technology involved in solar collection, bioconversion and so on.
[00:56:11] Speaker 7: Jean, I'm since we're running out of time and since that touches on the last question that Lokelani just responded to, uh I'm going to take that as a comment and I I think it's a good comment but I I do have to to move on. Lokelani,
[00:56:24] Lokelani Lindsey: I just want to make one comment right here real quick and that is we're an educational institution and we serve native Hawaiian children in the educational spectrum and we don't have anything to do with uh homesteading. That's the Hawaiian Homestead land and I'd like to also say that uh Kamehameha school's Bishop Estate is the school itself is the sole beneficiary of Bernice Pauahi's will.
[00:56:50] Speaker 7: Okay. We go to Evie in Pearl City. Good morning, Evie.
[00:56:54] Speaker 18: Morning.
[00:56:55] Speaker 7: You're on the air.
[00:56:56] Speaker 18: I had a question on um on the micro management comment. I understand that Lokelani has to approve every t-shirt that the um schools um um sell, has not as the schools, but it you know, alumni or Booster club things. And I also had a comment on the uh high-tech um comment she made. I understand that the TV studio that was in Midkiff was dismantled and could she answer that?
[00:57:22] Speaker 7: Let's take the t-shirt first because I'm interested in that. Okay. The t-shirt first.
[00:57:26] Lokelani Lindsey: Uh it comes through me but not to me uh to a Hawaiian Cultural committee because much of the words that are put on t-shirts are in Hawaiian and we want to be culturally correct and there's a committee made up of a very highly acknowledged teacher and native speaker who's 84 years old, uh plus another uh speaker who's gone through the University system who looks at the t-shirts to make sure that we're culturally, culturally correct in the use of Hawaiian language. And that's what happens to the t-shirt. Secondly, athletics and all. For example, your volleyball t-shirts at Po'o Pali Lima on it, and that would be a slap in the night to some people, and yet it was being interpreted as volleyball to others and that's what we look at.
[00:58:14] Speaker 7: And what about the mid-fifth theater?
[00:58:15] Lokelani Lindsey: Midkiff uh um studio has not been dismantled. It is being reconfigured so we can broadcast from our own school using our own students and staff to the rest of the state.
[00:58:29] Speaker 7: Evie, thanks for your call. Mike from Kailua, you've got 15 seconds to either ask a question or make a comment.
[00:58:35] Speaker 19: Oh let me just say I'm really impressed with the the President of the school, Mike Chan. He's just done an outstanding job. Um I've I've heard him in in in presentations. I've seen him at seventh, eighth, ninth grade cross country meets cheering on his students and that's just outstanding and inspirational and I know he's got the support of the parents and alumni and I just congratulate the the school for having such a great guy.
[00:58:58] Speaker 7: Mike, thank you very much for your comment. Lokelani, thank you very much for coming this morning and for addressing all of these questions. Uh thank you very much.
[00:59:07] Lokelani Lindsey: Thank you, Randy for having me. It's been very educational.
[00:59:10] Speaker 7: Okay, well you've listened to the Praise of Paradise Radio Show. Our producer is Susie Roth, the director of operations at public radio is Jeff Ilardi. Next week we've got an interesting show for you on endangered species. Some people say let's use cost benefit analysis, others say how in the world would you determine the the benefit of saving endangered species or the cost? It doesn't lend itself to to dollars and cents. Also state law is very different than federal law. Should it be changed? Tune in next week. You've been listening to proper audio. I'm Randy Roth. Aloha.