Hawaii Hospital Needs Federal Permission for $16M Self-Deal
Published Date: 11/26/2025
Notice
Summary
Hawai'i Pacific Health’s retirement plan wants to sell a piece of property to its own hospital, Straub Clinic, for at least $16.25 million or more. Normally, this kind of sale isn’t allowed by law, but the Department of Labor is thinking about giving a special okay to make it happen. If approved, the deal kicks in as soon as the exemption is published, and people have until January 16, 2026, to share their thoughts or ask for a hearing.
Analyzed Economic Effects
2 provisions identified: 2 benefits, 0 costs, 0 mixed.
Plan may sell land to Straub for $16.247M+
The Department of Labor is proposing to allow the Hawai'i Pacific Health Retirement Plan to sell the parcel at 888 South King Street to Straub for at least $16,247,000 or 110% of the Appraised Value on the date of sale. The Plan has 8,513 participants and $451,900,283 in net assets (as of December 31, 2023); the Sale must be a one-time lump-sum cash payment and, if the exemption is granted, must occur within 60 days of the exemption's publication.
Straub must repay past expenses and excise taxes
Before the Sale can proceed, Straub must repay the remaining Property Expenses the Plan erroneously paid from 2006 through 2014 (approximately $180,185) plus lost interest as calculated using the Department's VFCP Calculator. Straub also must pay the IRS the legally required excise tax for prohibited transactions from 2006 through 2022 (payment to the IRS need not occur before the Sale, but failure to pay after a final determination can render the exemption retroactively void).
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