[ OUR OPINION ]
CHARGES of political motivation have been cast aside by a Democratic state senator's acknowledgment that the Bush administration's accusation of improprieties in awarding a public housing nonbid contract was on target. The state should refund the federal money for the contract, tighten its ethical standards for awarding nonbid contracts and hold state board members accountable for gross negligence. Hold state board
members accountable
THE ISSUE A Senate committee chairman says federal accusations of impropriety in awarding a state public housing contract have merit.
The accusation was made on Nov. 1 by Michael Liu, assistant secretary of housing and urban development for public and Indian housing. Liu served 10 years as a Republican in the Hawaii Legislature and ran unsuccessfully for the GOP nomination for lieutenant governor in 1998. Liu demanded reimbursement to HUD of the $771,000 spent on the contract and resignation of all nine board members of the Housing and Community Development Corp. of Hawaii.
Then-Gov. Ben Cayetano called Liu's accusation politically motivated, coming four days before the general election. However, HUD criticism of the state agency's management began in the Clinton administration, and the contract at issue had been reviewed for months prior to Liu's demand. The timing of the accusation is politically suspicious, but that is overshadowed by its substance.
The board was faulted for granting the contract two years ago to Punaluu Builders to treat a public housing project in Waianae for termites and repair termite damage. The company is owned by Dennis Mitsunaga, the former husband of Sharyn Miyashiro, executive director of the state agency during the Cayetano administration.
Liu maintained that the contract amount was "grossly higher" than the value of the work. He accused the agency of "inconsistent and ineffective management practices, lax oversight and a failure to follow established procurement policies," amounting to "gross negligence."
State Sen. Ron Menor, chairman of the Senate Commerce, Consumer Protection and Housing Committee, says Liu's allegations have merit. The Mililani Democrat says the state must correct the problem or face sanctions beyond the reimbursement demanded by Liu. The board members are either gone or on their way out because of the change in state administrations.
Some of the documentation about how and why the contract was awarded to Mitsunaga's company cannot be found. As a result, questions remain about who initiated the contract, how the price was reached and why no one checked to determine if it violated federal procurement rules.
Menor says he may recommend changes in the ethics code and purchasing procedures, and state adoption of a federal rule that forbids not only impropriety in contract awards but the appearance of impropriety. He also suggests that members of state boards be held personally liable for the consequences of "gross negligence." Such a law would force board members to toe the line as they should.
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