"For 118 years ago, this House passed legislation which would have achieved a lot of what this legislation sets out to achieve, had the Crown only lived up to its obligations. Tuhoe spent the 20th century essentially locked out of involvement in their own homeland ... Today we begin to remedy that history."
Tuhoe did not sign up to the Treaty of Waitangi.
In the bills, the Crown unreservedly apologises for what has been called a calculated attempt to destroy Tuhoe.
"The relationship between Tuhoe and the Crown, which should have been defined by honour and respect, was instead disgraced by many injustices, including indiscriminate raupatu (confiscations), wrongful killings, and years of scorched earth warfare," the bills say.
The board will have equal representation from Tuhoe and the Crown, but after three years will see six Tuhoe members and three Crown members.
It will develop a management plan, with public consultation, and will make decisions by consensus to ensure the natural, recreational and cultural value of the area can be enjoyed.
Lake Waikaremoana, owned by Tuhoe and other iwi, will continue to be managed by the Department of Conservation.
The settlement has taken years of negotiation. It hit a rocky road in 2010, when Prime Minister John Key ruled out giving Tuhoe ownership of Te Urewera.
Tuhoe chief negotiator Tamati Kruger was central to pushing for a special status for Te Urewera, owned by nobody but itself.
Mr Finlayson will travel to Taneatua on August 22 to make a formal Crown apology.
He said today was the beginning of a new relationship.
"This is the second chance the Crown has to get this right. This time, it must do so."
National MP Tau Henare, chair of the Maori Affairs committee, said the passing of the bills should be an example to the world, including the current war raging in the Gaza Strip.
"What we are doing here today ... it puts the world on notice - that you can do things without blowing people up."
All parties voted in favour of the bills, except for New Zealand First, which abstained.
New Zealand First leader Winston Peters said other iwi with a presence in the area were not included in this settlement.
"It does appear that something is amiss ... We don't think that in correcting this wrong [against Tuhoe], we should be creating new ones."
But Mr Finlayson said the bills have no affect on the Treaty claims of other iwi in the area.