Honolulu Council Leaders Halt Rail Transit Authority Audit

Jun 13, 2020

The leadership of the Honolulu City Council has halted an independent forensic audit of the agency charged with building Honolulu’s rail line.

Council Chairman Ikaika Anderson and Vice Chairwoman Ann Koba­yashi will not allow an audit of the Honolulu Authority for Rapid Transportation to proceed, The Honolulu Star-Advertiser reported Thursday.

The agency is tasked with building the East Kapolei-to-Ala Moana project encompassing 21 stations over 20 miles (32 kilometers). The cost of the project has ballooned to an estimated $9.2 billion.

The $2 million expenditure to hire a forensic auditor is set to lapse at the end of the month and was not reinserted into the council’s budget for the 2021 fiscal year beginning July 1.

Conducting an audit could be difficult because of an ongoing federal investigation into the project, Anderson said.

The rail authority was served with three federal grand jury subpoenas in February 2019 seeking tens of thousands of records, although the focus of the investigation was not stated.

The council passed a resolution in March 2019 instructing the Office of the City Auditor to hire a contractor through a competitive bidding process to conduct the forensic audit.

Acting City Auditor Troy Shimasaki submitted a draft Request for Proposals to Anderson’s office in November. Documents needed for an audit would not be made available if they were subpoenaed by federal investigators, Shimasaki told council members.

“That could possibly result in a non-thorough audit” said Anderson, who confirmed the draft remains at his desk unsigned. “It’s not that we don’t want to do this, but we based this on what we’ve been told by the city auditor.”

City Councilwoman Heidi Tsuneyoshi opposed the cancellation of the audit as a result of what she called a “discretionary decision” by Anderson and Koba­yashi.

The economic impact of the coronavirus will result in less revenue for the project from state general excise and hotel room taxes, making an audit imperative “for transparency and accountability,” Tsuneyoshi said.

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