City auditor faults
zoo train operationThe report cites secrecy and
unusual contract arrangements
Operation of the Honolulu Zoo "train" has been mired in secrecy and used unconventional contractual arrangements, according to a city audit released yesterday.
City Auditor Leslie Tanaka, in his first audit, tracked the management of the zoo train as part of an overall examination of the Department of Enterprise services, which oversees the zoo, city golf courses and auditoriums, including the Blaisdell Center and the Waikiki Shell.
Overall, the audit found deficiency in the department's management, oversight and enforcement of contracts.
But city administration officials responded that the audit is filled with "inaccuracies, innuendos and misleading statements," and that no city or state procurement laws were violated.
"The objective of the zoo train is to provide an amenity for children and parents and not to generate additional revenue," according to a written response by department Director Barry Fukunaga.
The zoo train is operated by Xtreme Fun Rentals Inc. at $2 a ride. The price went up from $1 last month after corporate donations ran out.
The city purchased the train for $61,806 in September 2002 as part of a plan to pay the then-food and gift concessionaire $25,000 to operate the train and provide free rides.
The train is actually a garden tractor with a fiberglass shell decorated to look like a locomotive, according to the audit.
After the train arrived at the zoo, the food and gift concessionaire declined to run it and the city sought to find another operator.
According to the audit, the future zoo train concessionaire submitted a "confidential" proposal to the city to operate it.
The audit says that the city initially intended to make the contract a "sole-source" award. But, according to the audit, the train project wouldn't have qualified under the law. Two weeks after the train's June 2 dedication, the city instead executed a revocable permit contract for three months beginning June 20.
The Managing Director's Office spearheaded a fund-raising campaign beginning in June to obtain funds from corporate donors to subsidize fares at $1.
"City administration, the department and the concessionaire suspected that the zoo train could not generate sufficient funds to cover its costs, especially under the terms required by the city," the audit said.
While $29,000 was pledged, only $18,000 was collected. The city arranged for donations to be deposited directly into the concessionaire's bank account.
"The department structured its payment agreement more to preserve the donated funds than to collect concession revenue for the city," the audit said.
A verbal agreement was struck between the city and the contractor to continue operating the train until a three-year contract is awarded.
Councilman Charles Djou, whose district includes the zoo, has filed a complaint with the city Ethics Commission over the city's soliciting donations from private organizations.
"Now the city auditor has done a systematic review of (the train) and there's a whole bunch of red flags that should be raised about this," Djou said. "It's really unfortunate because I think most people wouldn't disagree that the train is a nice idea."