Redlining is the deliberate act of denying access to financial services and capital to certain neighborhoods. It is best known when banks manifest bias about communities of color, by not making capital available at the same terms as other communities. And the result of closing off access to capital? Economically depressed communities, families trapped in poverty or forced into homelessness, families denied asset-building tools like owning or keeping a home, families denied the ability to start a business using home equity, and the inability of families to pass on intergenerational wealth. Sound familiar Hawaiians?
Here’s how the denial of access to financial services and capital happens to Hawaiians:
1. Denied Access to Market Value Appraisals of Homes We Own. Homestead residents are required to use “replacement cost” valuations on the home assets they own, while all other citizens, including American Indian and Alaska Native citizens on their trust lands, have access to both “market value” and “replacement cost.”
2. Denied Access to 2nd Equity Loan Products. Homestead residents do not currently have the right to access a 2nd equity loan to send our kids to college, to start a business, to add a bedroom, to consolidate debt or to get through an economic downturn in the State.
3. Denied Access to Loan Delinquency Options to Save Our Homes. Homestead residents don’t have access to written policies that ensure all families can pursue every type of loan delinquency cure that all other citizens have. Policies must be in writing and equitable to all.
Redlining has been happening and has gone unchecked, decade after decade, at one of the most important sources of loan capital on homesteads for moms and dads, kids and siblings – the state agency of the Department of Hawaiian Home Lands (DHHL). It’s time to end redlining. It’s time to recognize and reconcile a debilitating practice that robs families of full participation in an economy built on the flow of capital, yes, loan capital, whether for a business, or a home addition, or sending young adults to college. It’s time for parity with our fellow Hawai‘i citizens.
SCHHA, DHHL, OHA, the State of Hawai‘i Legislature and federal officials charged with oversight of the Hawaiian Homes Commission Act can, and must, end redlining. We can fix this. Together we can reconcile decades of redlining. Open the doors of capital on the homesteads and the homesteads will prosper; all of Hawai‘i will prosper. Mahalo, homestead leaders, for putting solutions forward.
A national policy advocate for Native self-governance, Danner is the elected Chair of the Sovereign Council of Hawaiian Homestead Associations, the oldest and largest coalition of native Hawaiians on or waiting for Hawaiian Home Lands. Born on Kaua‘i, Danner grew up in Niumalu, and the homelands of the Navajo, Hopi and Inuit peoples. She and her husband raised 4 children on homesteads in Anahola, Kaua‘i where they continue to reside today.