Commentary: Audit of DBEDT

February 2010

Stories:
Senator Kim on the Hot Seat
Task Force on Reinventing Government
Interim of 2009 - Site Visits
Facts about Hawaii's Current Collective Bargaining Negotiations
Commentary
2009 Award Recipients
Sen. Hydrogen Investigation Final Report
Response to DBEDT Investigation
Photos: Active and Involved

Senator Donna Mercado Kim's Statement
on January 28, 2010 Audit of DBEDT

A “fresh, but not unprecedented, indictment of Liu's management.”

State Senator Donna Mercado Kim, chair of the Senate Ways and Means Committee, released the following statement commenting on the report of the Legislative Auditor examining the practices of the Department of Business, Economic Development and Tourism and its' director, Ted Liu:

“Today's report on DBEDT's operations is a fresh, but not unprecedented, indictment of Liu's management. He and his department have manipulated grants, transferred funds to avoid compliance with regulations, and lied to investigators. They have attempted to hide files to escape scrutiny and, in the final analysis, demonstrated an attitude that they should be allowed to do whatever they please.

“The auditor's report makes it clear that Liu and DBEDT cannot be trusted to operate within the parameters of the law, and, perhaps worse, are unwilling to acknowledge their transgressions. Where we should hear sincere assurances of changed practices - backed up by a workable plan for improvement - we instead hear excuses and equivocation. The danger under Liu's leadership is not simply that DBEDT cannot act appropriately; it is also the arrogant and shameless manner in which they assume that whatever they do is defensible.

“We should be especially concerned with one of the audit's findings: A lack of effective internal controls has enabled the department's overseas offices to spend money with little accountability and created opportunities for fraud and abuse.

“In her first inaugural address in December, 2002, Governor Linda Lingle said, 'A “New Beginning” means zero tolerance for political rewards and retribution.' Now, seven years later, her promise rings hollow as we ask ourselves why she will not end the disgraced tenure of Ted Liu as the head of DBEDT.

“Unfortunately, the governor's response has been to label the recent audit as political, just as she has questioned the motives behind other criticism of her administration. Her claim is absurd. The auditor's office has produced a thorough, well-documented review of DBEDT's actions, with more than enough hard facts and documentation to support their conclusions. The governor herself, again as part of her promise of a “New Beginning,” began her first term by praising Auditor Marion Higa and meeting with her to review the state's operations. Now the governor seems too willing to turn on former friends when the glare of disclosure shines on her own administration.”