������Ƶ

Some Hawaiian homestead residents seem to still have phone and internet services provided by Sandwich Isles Communications on Monday even though the company indicated on Saturday it would cut service.

Gov. Josh Green issued an emergency proclamation Friday evening stopping Sandwich Isles from disconnecting about 1,500 households. State regulators also stepped in and issued a notice of violation against the telecommunications company that has provided services to homesteads in rural parts of the state since the mid-1990s.

In interviews with Civil Beat, residents of areas serviced by Sandwich Isles described problems that have been going on for years.

Big Island residents attending Hawaiian Homes Commission meetings remotely have seen calls drop in staff offices. Families near a homestead division in Waimea have driven into town to get reliable internet. Homesteads in Kapolei as well as businesses and residences in Kona have reported slow internet speeds.

“We were required to use Sandwich Isles, and we did. But the internet service was awful,” said Bo Kahui, the former president of a nonprofit operating on homestead lands.

DHHL started encouraging its residents more than a week ago to switch service providers. Sandwich Isles founder Albert Hee has said that sort of encroachment by other carriers into areas that should have been exclusive to Sandwich Isles has eaten company revenues and led to a drop in the quality of service.

Hee challenged the Public Utilities Commission’s notice of violation on Saturday, arguing that the PUC doesn’t have jurisdiction in choosing DHHL’s service providers.

The PUC has a hearing scheduled for June 17, where Sandwich Isles will have the opportunity to defend itself.

Drop In Revenues

Financial problems for Sandwich Isles began when the company defaulted on more than $100 million in federal loans intended for companies providing broadband services in rural communities.

The federal government sued Sandwich Isles and its affiliates, including Hee, in 2018. At the time, Hee was serving a 46-month prison sentence for tax fraud. A judgment was entered against Sandwich Isles in 2020.

The courts put a lien on Sandwich Isles assets, which it began auctioning off. The most recent sale took place on May 20, when Hawaiian Telcom submitted a winning bid to acquire some of Sandwich Isle’s broadband infrastructure.

Meanwhile, Sandwich Isles started sending letters to its customers on DHHL lands, saying they may lose service and pointing to a purported lack of support from the department.

After the auction to Hawaiian Telcom, Sandwich Isles sent another letter to its customers alleging that the bidding process was somehow rigged against Waimana Enterprises, which is Sandwich Isle’s parent company. The company said it had been providing services at a loss.

“This is to notify you that should you experience service interruptions, SIC is unable to help,” a May 21 letter said.

Three days later, DHHL told its beneficiaries to switch to Spectrum or Hawaiian Telcom. Sandwich Isles later wrote to its customers that service was set to end on June 1. Having part of its network portioned off in the sale to Hawaiian Telcom seemed to deal the death blow. 

“SIC has been losing money and this will only make it worse,” the company wrote. 

Things all came to a head Friday evening, when the governor and the PUC stepped in and forced Sandwich Isles to continue providing services. The emergency proclamation requiring Sandwich Isles to continue its services is set to end on June 30.

Issues Across The Islands

Homelani Schaedel, a homestead leader in Kapolei, needs her landline, which is currently provided by Sandwich Isles. It’s how she keeps in touch with residents who want to bring issues to her attention.

“It’s my connection to our community,” she said.

After receiving the letters from Sandwich Isles last month, she said she was surprised to find her landline still working Monday morning when a reporter called. She inquired about switching to Hawaiian Telcom, but company representatives told her it won’t be able to service her area until it has the infrastructure in place.

In the Villages of Laiopua on Hawaii island, residents were required to sign up with Sandwich Isles as a condition of their leases, according to Bo Kahui, the director of Laiopua’s homestead association.

Kahui said he covertly signed up with Oceanic Time Warner Cable, the predecessor to Spectrum, because he thought the internet service provided by Sandwich Isles was too slow. He said he eventually obtained an opinion from the state Attorney General’s Office saying that switching to Oceanic was legal.

Kahui was the former president of Laiopua 2020, a nonprofit that operates on the homestead lands. The nonprofit was required to use Sandwich Isles at its offices in the Laiopua homestead’s community center, where it experienced intermittent drops in services.

“We were down for hours,” Kahui said. “There was only one person working on the island for what would have been thousands of recipients that were required to use Sandwich Isles.”

Some homes at the Puukapu homesteads up the hill from Laiopua have been without phone or internet service since April 30.

Mike Hudson, president of the Waimea Hawaiian Homesteaders Association, said he heard from parents who have driven their children to Starbucks to get internet. But above all, Hudson said, the lack of connectivity has created a safety issue for the mostly elderly residents who live in that area of Puukapu.  

“It’s hazardous for their life,” Hudson said. “That’s not a safe environment, where if something happens they don’t have phone service.”