Department of Hawaiian Home Lands Chairman Micah Kane will likely step down from his state cabinet post now that he was named to Kamehameha Schools' board of trustees.

Kamehameha Schools and DHHL are partners in a number of projects, including a charter school in the Leeward side set up by Kamehameha on DHHL land.

What's more, there's an internal policy within Kamehameha Schools against hiring appointed government officials as employees and outside contractors, although there is some gray area when the government official is a trustee.

More practically, running a state department and serving as a trustee of a multi-billion trust may be too time consuming.

Kane's appointment to the Kamehameha Schools board doesn't take effect until Sept. 1 so he's likely to remain with the state until then. But even some of his supporters say that he's likely to step down from the DHHL.

Former Kamehameha Schools trustee Constance Lau set the precedent when she agreed to left the board in 2006 when she became Hawaiian Electric Industries Inc.'s CEO.

(The counter example is Henry Peters, who held the title as Speaker of the state House while serving on Kamehameha Schools' board during the late 1980s.)

During Kane's tenure at the DHHL, the department greatly expanded the number of homes built for native Hawaiians. Who Gov. Linda Lingle appoints as his replacement will show how committed her administration remains to the department's ambitious expansion.

The state Probate Court will hold a hearing tomorrow morning on a new Kamehameha Schools trustee.

Finalists include Department of Hawaiian Home Lands Chairman Micah Kane, Hawaii Community Development Authority Executive Director Anthony Ching, and former Kamehameha Schools executive, and ex-DHHL chairman Ray Soon to replace outgoing trustee Robert Kihune whose term ends tomorrow.

Unlike recent appointments to the trust's five-member board, this one has generated some discord in the Kamehameha ohana.

In May, the court-appointed master for the estate recommended extending Kihune's term by a year before backing away from the plan.

Shortly after the master made his recommendation, several prominent native Hawaiian women criticized the court-appointed screening panel for not considering a female among the finalists.

There are other logistical problems.

If the Probate Court ends up picking either Kane or Ching, it could conflict with a Kamehameha Schools internal policy against hiring or contracting current or former government official.

(The policy does not bar Soon from being hired because his employment as DHHL's chief occurred more than three years ago.)

The internal policy is part of the governance reforms implemented by Kamehameha Schools in wake of the late 1990s trust scandal.

It was meant to address the much-maligned practice of hiring or contracting with elected and appointed state officials such as former state Sen. Milton Holt, former state Sen. Marshall Ige, former state House Rep. Terrance Tom and ex-state Budget Director Yukio Takemoto.

The internal policy differs from the 1999 closing agreement with the Internal Revenue Service, which settled the IRS's long-running audit of the trust's finances and governance policies.

The IRS closing agreement only bans the hiring of current and former elected officials and not appointed officials such as Kane and Ching.

Of course, an internal policy banning the hiring of government officials is not binding on the Probate Court and the current board of trustees could chose to waive the internal policy in this case.

What's more, the position of a trustee is a gray area because experts argue that a trustee is not exactly an employee nor can they be considered outside contractors.

But what's troubling to some in the Kamehameha ohana is that the trustee screening committee didn't appear to take this internal policy into consideration.

If's far too late to redo the selection process but the proper thing the screening committee should have done is to acknowledge the potential conflict with the internal policy by petitioning the court for instructions, some legal experts say.

Otherwise, it makes it appear as the though the screening committee is ignoring the sad history of the trust's political activities during the 1980s and 1990s, they said.