The state is suspending its performance review of the Office of Hawaiian Affairs after OHA’s board of trustees refused to release records to the auditors.
Les Kondo, Hawai?i’s chief auditor, said his office cannot complete an audit of OHA’s limited liability companies without full access to unredacted minutes from trustee meetings.
OHA’s subsidiaries have been shrouded in mystery since the agency created its first LLC in 2007 with the aim of pursuing business opportunities.
OHA has argued that the LLCs were private entities and not subject to state laws. It fought efforts to disclose information about the subsidiaries.
But Kondo said OHA, like any other state agency, needs to be held accountable.
"So if people are asking, 'Why do you need the minutes?' Well, because we don’t know what’s in them...From the information that we’ve received, there’s been very little access by the trustees to information about the LLCs, which to me is kind of a little crazy," he said.
The audit is tied to a funding bill passed by the Legislature. If the review is not completed, it could jeopardize millions of dollars set aside for OHA.
OHA Chair Colette Machado and Vice Chair Brendon Kalei??ina Lee on Monday released a statement on the suspended OHA audit: "We find it unfortunate that the State Auditor is using an unprecedented interpretation of his powers and has now unilaterally decided to not fulfill a legislative mandate and to instead play politics with critical general funds for Native Hawaiians."
But in an emailed statement, OHA Trustee Keli?i Akina called the auditor’s action “another black mark in OHA’s record of transparency.”
The suspended audit is the latest in recent developments involving examinations of OHA's practices.
Last month, an independent audit of Office of Hawaiian Affairs identified as much as $7.8 million in potentially fraudulent, wasteful or abusive spending.
The long-awaited audit conducted by accounting firm Clifton Larson Allen reviewed nearly 200 contracts and payments made by OHA over a five-year period beginning in 2012.
The report documented instances of poor record-keeping, inadequate oversight, and missing documents, among other lapses.
In September, the state attorney general issued a subpoena ordering OHA to provide information about how the agency is helping protesters blocking construction of the Thirty Meter Telescope on Mauna Kea.
The board of trustees unanimously approved a resolution authorizing OHA staff to advocate for the protesters and to do "assessment and provision of health, safety and legal needs" for the activists.
OHA spokesman Sterling Wong said at the time that the board was inclined to cooperate if the scope and purpose of the attorney general requests are legitimate.
OHA is a semi-autonomous state agency with a mission to improve the conditions of Native Hawaiians. Its nine trustees are publicly elected.
