SB2823

SECTION 1. The legislature finds that the office of Hawaiian affairs has significant fiduciary responsibilities to Hawaiian and native Hawaiian beneficiaries and exercises substantial authority over trust assets. To preserve public trust and ensure impartiality, complaints alleging misconduct, retaliation, discrimination, ethics violations, or unlawful activity by office of Hawaiian affairs trustees, officers, or employees should not be investigated internally by office of Hawaiian affairs personnel.

The purpose of this Act is to establish an independent complaint and investigation process by requiring that all complaints brought by employees, officers, and trustees of the office of Hawaiian affairs be referred directly to an appropriate independent state agency, including the department of the attorney general, the state ethics commission, or the Hawaii civil rights commission, as the case may be.

SECTION 2. Chapter 10, Hawaii Revised Statutes, is amended by adding four new sections to be appropriately designated and to read as follows:

"§10-A Independent complaint referral process. (a) All complaints, allegations, or credible information alleging misconduct, wrongdoing, violation of law, breach of fiduciary duty, misuse or misappropriation of funds, abuse of authority, unethical conduct, or violation of governing policies involving any employee or trustee of the office, without screening, delay, suppression, or internal determination, shall be promptly referred, as follows:

(1) To the state ethics commission when the complaint, allegation, or credible information alleges violations of chapter 84 or other ethics-related misconduct;

(2) To the Hawaii civil rights commission when the complaint, allegation, or credible information alleges discrimination, harassment, hostile work environment, or retaliation prohibited under chapter 368; and

(3) To the department of the attorney general when the complaint, allegation, or credible information alleges misconduct not expressly within the jurisdiction of the state ethics commission or the Hawaii civil rights commission.

(b) No complaint, allegation, or credible information filed by an employee or trustee against any other employee of the office, or member of the board of trustees shall be investigated internally by the office. The office shall immediately transmit any complaint received to the appropriate entity identified in subsection (a); refrain from screening, evaluating, investigating, or responding to the complaint; and notify the complainant of the referral and provide contact information for the receiving agency. The office and its trustees shall have no authority to:

(1) Determine the credibility, sufficiency, or merit of a complaint or allegation subject to this section;

(2) Decline, dismiss, delay, recharacterize, or resolve internally a complaint or allegation that is subject to this section; or

(3) Interfere with, influence, obstruct, or retaliate in connection with an independent review or investigation being conducted subject to this section.

(1) Immediately preserve all records, communications, and electronic data potentially relevant to the matter; and

(2) Fully cooperate with any review, audit, or investigation conducted by the attorney general, the state ethics commission, or any other authorized oversight authority.

(d) Nothing in this section shall:

(1) Limit or impair the authority of the attorney general, the state ethics commission, or any other authorized entity to pursue corrective, remedial, civil, administrative, or criminal actions as provided by law; or

(2) Prevent a complainant from filing a complaint directly with the state ethics commission, the Hawaii civil rights commission, or the department of the attorney general.

§10-B Whistleblower protections; anti-retaliation. (a) Any person who, in good faith, reports, discloses, or provides information regarding a complaint or allegation subject to section 10-A shall be afforded all protections available under part V of chapter 378 and any other applicable state or federal whistleblower protection law.

(b) No trustee or employee of the office, nor the office as an entity, shall retaliate or threaten retaliation against any whistleblower or witness.

(c) For the purposes of this section "retaliation" includes intimidation, harassment, discrimination, adverse action, denial of benefits, interference with contracts or opportunities, or any action intended to deter the reporting of alleged wrongdoing.

(d) Any act of retaliation shall constitute a separate violation of law and may be referred to the attorney general, the state ethics commission, or other appropriate authority for investigation and enforcement.

§10-C Failure to report; concealment; obstruction; penalties. (a) Any employee or trustee of the office who knowingly:

(1) Fails to report a complaint or allegation required to be referred under section 10-A;

(2) Conceals, alters, destroys, or withholds information or records related to complaint or allegation subject to section 10-A;

(3) Intentionally delays referral; or

(4) Interferes with or obstructs an independent review or investigation that is conducted pursuant to section 10-A;

shall be subject to a civil penalty not to exceed $10,000 for each violation. Individuals found in violation of this section may also be subject to administrative sanctions, including censure or removal from office where authorized by law, and referral to the attorney general or state ethics commission for further investigation or enforcement.

(b) Each failure to report, act of concealment, act of obstruction, or retaliatory act shall constitute a separate and distinct violation.

§10-D Annual complaint referral report. The office of Hawaiian affairs shall submit a report to the legislature no later than twenty days prior to the convening of the regular session of 2027, and every year thereafter. The report shall include:

(1) The number of complaints or allegations referred pursuant to this section 10-A;

(2) The general categories of alleged misconduct, excluding confidential or identifying information; and

(3) The status or disposition of matters, to the extent disclosure is permitted by law."

SECTION 3. If any provision of this Act, or the application thereof to any person or circumstance, is held invalid, the invalidity does not affect other provisions or applications of the Act that can be given effect without the invalid provision or application, and to this end the provisions of this Act are severable.

SECTION 4. This Act does not affect rights and duties that matured, penalties that were incurred, and proceedings that were begun before its effective date.

SECTION 5. In codifying the new sections added by section 2 of this Act, the revisor of statutes shall substitute appropriate section numbers for the letters used in designating the new sections in this Act.

SECTION 6. This Act shall take effect upon its approval.

INTRODUCED BY:	_____________________________

THE SENATE	S.B. NO.	2823
THIRTY-THIRD LEGISLATURE, 2026
STATE OF HAWAII