(PNN) ANATOMY OF A MURDEROUS PROCESS- AN INVESTIGATIVE REPORT

OBEDIENCE SCHOOL DROPOUT: Senate Bill 456, designed to ban discrimination against “source of income” in housing and real estate – also known as the HUD Section 8 bill- is pretty much dead for this legislative session.

But the way it died is not as simple or straightforward as one might think and the bill’s originator and chief advocate Ann Punohu, head of the Kaua`i Housing Coalition, got a lesson in special interest pressure, political influence peddling and the general frustrations when trying to accomplish something in the public interest.

The view from the state senate is that the bill died for a few of the usual reasons a bill stalls according to it’s sponsor Kaua`i Senator Gary Hooser. He says the problem- which PNN has detailed in a series of articles over the past month- of discrimination against recipients of federal housing vouchers was viewed at the legislature as “mostly a Kauai problem”.

He told us that despite his best effort to shepherd the bill though

(F)or whatever reason even though it clearly occurs on all islands, it appears to be a bigger problem on Kauai than elsewhere. I spoke to the Chair of the Judiciary Committee in the Senate and for a variety of reasons he did not feel inclined to hear it. Perhaps it was because the HB444 is consuming and inordinate amount of time his energy, perhaps it is because this is the first time the issue has come up and did not appear to be urgent or statewide, or perhaps there was something else. Actually, it is rare to pass something into law the first year it is introduced and most measures have to be introduced several years in a row before they are finally able to pass through the process. The key to future success is probably to demonstrate clearly that this is a statewide and serious problem and then to build a statewide coalition in support.”
In passing it along the Senate Commerce and Consumer Protection (CCR) Committee recommended ridding the bill of that troublesome “protected class” of “source of income” language and substituting a measure banning advertising a rental and saying “no HUD”. They also put an “effective date” of 2015 on the bill.

Then the Judiciary Committee refused to schedule a hearing killing the bill for this session for all intent and purpose

But unbeknownst to Hooser, while the Senate Judiciary Committee was busy playing hide the salami with the civil-union bill, Punohu saw another storyline unfold on Kaua`i as the real estate industry and a hand full of their supporters among Kaua`i officials helped put the one of the biggest nail in the bill’s coffin, at least for now..

What Punohu found was that there are many ways to kill a good idea and one is by ripping out its guts and replacing it with a something vaguely resembling its original intent.

Punohu nearly blew a gasket when she heard what the CCP committee did to the bill and adamantly refused to go along with the “compromise”. Not just was the measure banning ads of questionable legality- since it would apparently restrict free speech in advertising a legal product in a legal fashion- but it doesn’t take care of the actual problem, just the symptom.

When the bill was running out if time to be scheduled in the Senate Judiciary committee- where it eventually died the first thing Punohu did was to write to the Chair saying

This bill does not just discuss section 8 rental discrimination, but all forms of source of income discrimination, and is much broader in scope than what was discussed yesterday at our meeting.

This intent of SB456 is to prevent discrimination against source of income. It is not just about a ban on advertising saying "no HUD, ", but is broader, and more far reaching.

Testimony that has already been submitted is in overwhelming favor of supporting the bill as a whole. That is why a resolution to support the bill in its amended form does not support our efforts at all, but rather runs contrary to what we are trying to accomplish.

Please remember, that it was myself, personally, and Gary Hooser who began this effort, before anyone else was involved, and that integrity of our original goal and purpose must be maintained. That we work cooperatively at the council level on a weaker version of this is fine, for the moment, but I cannot, as I said in my previous letter, go back on my original purpose and now not support my own efforts.

But she also had what she thought was a local champion in the form of new County Councilperson Dickie Chang who along with Councilpersons Lani Kawahara, Derek Kawakami and Tim Bynum had written testimony supporting the original bill.

The idea was to get the council to pass a resolution supporting the original bill - and maybe even create our own local ordinance..

But little did Punohu suspect she was being set up for the meeting from hell where Chang allowed the meeting to be stacked against the bill and for the CCP substitute measure by bringing in the big guns to shoot down Punohu’s anti discrimination provisions.

First apparently seeking to score political points by sucking up to the entrenched old boy network, Chang brought in, not one of the other three supporters of the bill but Councilperson Jay Furfaro.

As a matter of fact, according to Punohu, despite requests from the Bynum and Kawahara that one of them be included, Chang told them “no” and insisted on having Furfaro be the second councilmember there.

No more than two councilmembers are permitted to discuss matters outside of a regularly scheduled meeting according to the state Sunshine law (more on that later).

According to Punohu, at a meeting with Chang in his office, Chang also banned Kaua`i Housing Coalition members other than her daughters from the meeting along with Punohu’s attorney on the matter, former councilperson JoAnn Yukimura, whom Chang personally told to stay away or he would “cancel the meeting”.

Instead Chang allowed Furfaro to select the participants who turned out to be couple of real estate agents including the head of the Board of Realtors- which was the only non-governmental entity to testify against SB456- and two people from the county housing agency which, unlike any other housing agencies on the mainland where these bills have been enacted, was apparently opposing the bill.

According to the meeting notes taken by council services personnel the meeting was held in the council chambers with the following persons staring down Punohu and her daughters.

CM Dickie Chang — Economic Development/Housing Committee Chair
CM Jay Furfaro — EDH Committee Vice Chair
Gary Mackler — COK Housing Agency — Development Section
Sandy Ka'auwai — COK Housing Agency — Section 8
Rowena Cobb — Kauai Board of Realtors
Russell Kyono — Kauai Realty

As the notes from the meeting show, Furfaro- whose list of campaign contributors is filled with realtors, real estate developers and large land owners- was seeming fully uninformed about the problem but apparently knew who was buttering his bread.

As he is wont to do, Furfaro got huffy and puffy and took over the meeting, refusing to consider Punohu’s anti discrimination measure whether in the form of a resolution to support the senate bill and/or in a county ordinance to ban source-of-income discrimination in housing on Kaua`i.

They all apparently wanted Punohu to abandon her idea and support “educating” landlords and possibly ban advertising.

After some background info from the county housing people Punohu, according to the meeting notes,

Referred to the documents she submitted; SB 456; City of Palo Alto Ordinance No. 248; and the NY Times article, "Judge Upholds City Ban on Section 8 Rent Bias."
• California passed an emergency ordinance that specifies against discrimination.
• 3 key areas of concerns of landlords: payment on time, inspections on time, and owners' paperwork.
• 19 advertisements in the GI newspaper that said, "No HUD." She called the numbers provided and has transcripts of the conversations.
• Many real estate agents follow the requests of the owners.
• Education is the key, as there are ignorant people out there that don't know what HUD is and copy other ads in the newspaper.
• Civil Rights Commission was worried that they would not be able to handle the workload; referring to the influx of complaints should the bill pass.
• New York Bill was upheld by the Courts and was not onerous to the landlords.
• Explained how she and Pua first talked about this issue at her kitchen table; met with the Housing Agency; and the progression to this meeting.

Furfaro was particularly uninformed as to mainland enactment of these types of ordinances despite the voluminous material Punohu provided before the meeting and apparently had not read any the testimony in support of the bill sent to the CCP Committee, including that from the Legal Aid Society.

At first he insisted that there was no problem and intimated that this was all essentially due to the current economic downturn. He said that on

10/17/08, there were 23 ads in the GI newspaper with discrimination against HUD.
03/02/09, there were 3 ads in the GI newspaper with discrimination against HUD.
Correlated the decrease number to the change in market trends.

But Punohu then produced a subsequent newspaper with 19. ”House for Rent-no HUD” ads showing him to be either disingenuous or just plain uninformed.

The county housing officials were particularly opposed to anything that would force landlords to stop discriminating via source of income, saying they were working on educating landlords- a statement they have been making for many years.

HUD Section 8 chief Mackler said he

Has been thinking about this a lot — where is the solution?
• Acknowledged the stigma with HUD assistance.
• Currently, 680 people are leased up (per S. Ka'auwai)
• Believes that the Palo Alto Ordinance contain civil liabilities that we don't want.
• HUD is voluntary.
• It's a challenge to change people's perception. We need to do a better job in educating the public.
• Not sure if passing laws will be a solution, which may drive landlords away and will
look for ways to get around the Law.
• We need to step-up in coming up with ways in our efforts, instead of passing laws.

Furfaro agreed saying

• Educate — put out the information and make it ethical.
• Start looking at the economic indicator — don't discount the economic situation.
• We have some responsibility to support SB 456 by doing a Resolution.
• Issues: 9% unemployment, construction jobs have left, etc.

Punohu didn’t like the direction the talk was going and

Voiced her frustration and upset that she is hearing that a Law is not necessary.
• Wants a County Ordinance
• Ban on advertising
• Asked how do we address the verbal discrimination in phone calls.
• SB 456 was chopped in half.

But Cobb from the Board of Realtors then chimed in saying

You can never stop the way people speak. The more laws we have, there more our hands are tied. However, we can do something about what types of ads are allowed.

Then it started to turn ugly. Furfaro, apparently oblivious to the movement on the mainland to pass these types of laws and the courts’ approval of them

Warned Anne about her statements:
• 1st Amendment right to Freedom of Speech — landlords have the right to say what they want; however, there are consequences for what they say.
• Suggested to Anne that she ask the Legal Aide Society for "how do you define or correct Ad?"

Punohu didn’t back down reiterating

Protected class:
• Coerced, harassed, or impaired by being discriminated against.
• Adversely affect health and welfare

Then, despite apparent long-term past failures to “educate” landlords Mackler said they still thought “education” would work.

We can bring landlords to the table to help educate them:
• We do not support "No HUD" advertisements.
• Public Relations is very important: put something in the GI newspaper to bring awareness, put a banner outside like how they do it for CDBG week, do a Proclamation and Resolution.

It should be noted that no one mentioned what they were to be educated about and in fact, in our original report we interviewed many landlords who said their “no HUD” ads were because they had had or heard about problems dealing, not with HUD tenants but, with county housing agency.

Cobb agreed with Mackler and

Stressed Education:
• Suggested that there be a catching "tagline." e.g., "Come to See What Happens to your Rental."

Despite the adamancy of Punohu and the dozens who testified in support of the anti discrimination measure, Furfaro then asked for agreement on education and the advertising-ban-only saying he

Emphasized the importance of finding common areas to support each other when coming to together and working together. He recommended the following:
• Council Resolution for SB 456
• Send letter to the Housing Agency to support a grant to alleviate public misconceptions by providing public education via media attention.
• Amendment to the County Housing Ordinance (No. 860) to add HUD vouchers, data, etc.
• Supports modifying the bill.

As the meeting wrapped up the participants summed up.

Kyono made it perfectly clear what his position was saying

We don't support making HUD clients a protected class.

Furfaro, still in denial of the long term nature of the problem,

Reminded the group about the market trends and how it affects housing.

Lacking any support and having had her attorney specifically banned from the meeting Punohu

Stated that if no one agreed with her, that her bottom line was to inform the group that she would bring a class action lawsuit.

For Chang’s part, as he had throughout the meeting just seemed to want some kind of agreement and compromise and in ending the session

Reemphasized the goal of creating an agreement and model that would set the framework to address the issue of housing discrimination against HUD clients and bring fairness and opportunity for seeking rental housing.
• Kaua`i County can be a leader for the other counties statewide.

Parenthetically, the meeting- which was described to Punohu as standard practice that occurs all the time at the county council- apparently blatantly violates the state open meetings or “Sunshine” law in that neither this nor any other such meetings have ever been reported to the full council at a duly agendaed and conducted meetings.

HRS §92-2.5(b) "Permitted interactions of members” says.

(b) Two or more members of a board, but less than the number of members which would constitute a quorum for the board, may be assigned to:
(1) Investigate a matter relating to the official business of their board; provided that:
(A) The scope of the investigation and the scope of each member's authority are defined at a meeting of the board;
(B) All resulting findings and recommendations are presented to the board at a meeting of the board;

Punohu is still furious, as much at the attempt by Chang and Furfaro to intimidate her into selling out those who testified in favor of the discrimination ban as she is at what she sees as a disingenuous attempt by vested special interests to misrepresent the problems and solutions.

In a letter to the council and the meeting participants she said

I appreciate the time and energy that was put into yesterdays meetings.

However, after careful consideration of my feelings, and the intent and purpose of what I am trying to do, and out of respect to many people and agencies who came to the Senate to testify in support of SB456 as it was originally written, and to Senator Hooser, Representative Mina Morita, and Neil Abercrombie, (Congressman), and the hours and hours we put in to ask people to support this bill, I cannot in any good conscious ask people to know change their minds, and vote in favor of something that does very little to support the intention of this bill....

I am sorry that I am not "cooperating", or being "compliant", or "working together", but I cannot in all good conscious do that. I have a moral obligation to hold to my beliefs and stick to what I have said on this issue, that I have worked so long and hard at. I am under no obligation to any of you to agree with any of you...

I hope this does not offend anyone, and if it does I apologize. But I have worked long and hard on this issue, and I did not work so hard on it, than to disenfranchise the clear supporters of it, by now participating in its demise.

Finally here’s Punohu’s statement on what she sees as the whys and wherefores of Bill SB456. It details all the shenanigans she encountered with both the real estate industry and, more so, the state and county housing agencies.


I believe that forces working behind the scenes worked to kill the bill...


I had suspected that landlords and the real estate agencies would not particularly like the idea, and despite all of their rhetoric to the contrary, they are vehemently opposed to anything that brings on punitive damages, or makes "source of income" a protected class, essentially making it illegal to discriminate against anyone based on their legal source of income.


What this does, is offer the proper protections that I was looking for, based on the laws in other states, and the facts that in every single instance, the law has been upheld in the courts.


However, after our triumph, or so I thought in the first Senate committee, the CPN, when the committee report came out, it was suggested that our bill be downgraded and changed to be very weak, only asking for a "ban on advertising", and therefore not addressing any of the broader discrimination aspects of the bill, and punitive damages that would be involved. The main reasons cited, were the Civil Rights Commissions concerns that they did not have enough staff to take care of what they assumed would be an influx of calls, thus confirming what we have been saying all along, that this is a serious issue throughout the state.


Their concerns were that they were going to need more funds to accomplish the task, according to the law and respond promptly or lose their funding. The committee reasoned that this may be impossible to fund, and thought it would be an undue burden on the civil rights commission, therefore asked that the bill be downgraded to a ban on advertisements, and not be put into effect until 2015 in order to "allow for more dialogue, and for the real estate companies to change their paperwork.


None of this,. of course makes sense, unless you look at it from the aspect of the real estate companies who say a few things decidedly on the matter:

1. They are not to blame, and they do not discriminate in their advertising

2. They are not against a ban on advertisements.

3. They are against a "protected class" for "source of income", even though the bill protects landlords by not forcing them to rent to section 8 (participants), and allows the landlords to independently determine an applicants worthiness.

4. They feel that merely "educating" landlords will stop the discrimination. Further, the Housing Departments take on this bill was highly unusual, and the first of its kind in the nation, when dealing with these matters.


Usually, the HUD Department is the one championing these bills and pushing for them in the legislature.


Not so with the State of Hawaii. The testimony by Chad Taniguchi stated that the state "prefers to deal with landlords on a one on one basis with these types of situations". Further, our own (Kaua`i) housing department has made several statements with regards to this issue in a closed meeting on Monday.


They stated nine things:

1. That they had been negligent in not informing landlords better about these types of discrimination.

2. That they had not informed their clients adequately about their rights according to the Federal Law and what sorts of statements made to them could have been pursued legally.

3. That they failed to keep exit statistics on why people lose their vouchers.

4. That they had only 40 vouchers left, and that there were not enough vouchers to accommodate everybody on their lists, which would have required them informing the Federal Government that they were at 100 percent, and needed to fund more vouchers.

5. That they did not feel that laws or punitive damages would solve the discrimination problems, in direct contrast to HUD agencies in the other states where this law has passed.

6. They did not admit that people lose their vouchers due to being turned away from housing because their clients were on HUD, even though they were presented evidence to that effect, because they insisted it was due to other facts, even though they have no statistics to back up those claims, over the direct experiences of the general public.

7. That they sided with the landlords, and would not agree to any further protections for section 8 clients other than a ban on advertising.

8. That they felt that landlords should have adequate opportunity to have proper education, so that they do not get into trouble with the Federal Law.

9. That they do not support "source if income" legislation, again in absolute contrast to other HUD agencies in other states.


When we looked at this issue overall, due to the fact that the Landlords, real estate companies and the State Housing agencies seem to all be in collusion, and that no testimony was given by our own housing agency, or by any real estate agents or major companies at the hearings, and that the JGO committee would suddenly not accept even the extremely watered down version of the bill and give it a hearing, even in light of overwhelming testimony in its favor, from a broad range of testifiers, one can only assume that there were other forces at work that would not step foreword and make their opinions known.


Another very curious fact, is that individuals stopped advertising "No HUD", temporarily, for awhile while the bill was alive. Suddenly, as soon as it was assumed that the bill was dead, in this past Sunday edition of the GI, there were at least 19 ads in the newspaper stating "No HUD". I called each and every one of them. Some of them were others we had spoken to before. Again, I did hear many stories that were flat out discriminatory.


A ban just on advertising would not stop this particular practice. Landlords could still refuse to accept HUD, and not even accept someone’s application based on the fact that they were on the program. They could also reject other income from people that are not on the HUD program, such as social security, veterans benefits, or unemployment insurance.


This issue is not just about HUD, but about all sources of legal supplements individuals might have to put towards their rent.


A ban on advertising would also not prevent someone from making statements over the phone that would be derogatory and insulting to HUD clients and others, such as: "I don’t like HUD", "HUD people will trash my unit", "HUD people don’t work, or are bums".


This type of abusive behavior would still be allowed. When our coalition looked at the definitions for a protected class, the law is very clear. In the 1968 Civil Rights Act, which created the Fair Housing act in the US, and where the Housing Agency was born from, it is clearly stated that several criteria counted to create a "protected class", and these are:

1. That a certain group of individuals is singled out for harassment, coercion, and the deliberate steering away from Constitutional rights, such as food, shelter and medical attention.

2. That it would be adverse to the health safety and welfare of everyone should this situation continue to occur.

3. That the discriminatory acts are blatant, and readily visible to all.

The situations as described by those that have been victims of this sort of discrimination can attest to all three of these.

Is it harassment? It is certainly harassment to refuse to speak to someone, make derogatory statements and refuse them housing and shelter based on the fact that they have a needed, and legitimate source of supplemental income with which to pay for their housing needs with.

Is it a health, safety and welfare issue? Of course it is. With the mass refusals to rent to those on the HUD program, where else have they to go but the streets, whole families becoming homeless, and thus becoming an even larger burden to the health, and safety of the rest of the community, as extra resources are needed to house them in temporary shelters, and provide for other services such as mental health issues, and other needs to care for them as they continue to be without adequate housing.