Felix report finds waste

By Jennifer Hiller
Advertiser Education Writer

Services for some special-education students have improved, but the state program is still burdened with a host of bureaucratic and financial problems, some of which may merit criminal charges, according to a draft report released yesterday by a legislative committee.

The committee's report asked the attorney general's office to consider criminal charges.

While no specific charges are recommended and the report did not stipulate which activities the state attorneys should review, committee members say the attorney general's office has not been vigilant in investigating allegations of overcharging, waste and conflicts of interest.

Hawai'i's special-education system has been under federal court oversight since the state signed the Felix consent decree in 1994, agreeing to improve services as required by law. The state must meet certain deadlines by March or face a court takeover of the system.

But the report says schools are unsure how they can come into compliance because federal court requirements have become a moving target and there has been poor oversight of spending by the Department of Education and Department of Health. The result is a climate of waste and profiteering, according to the report.

"We're still not sure if students are receiving appropriate and effective services," said Rep. Scott Saiki,

D-20th (Kapahulu, Mo'ili'ili), a committee co-chairman. "It's something we were not able to verify because the departments did not give us the information that we needed. Another thing is the lack of controls that were in place. There were no fiscal controls or programmatic controls."

The draft report comes at a time when the state has achieved substantial compliance with the Felix consent decree. U.S. District Judge David Ezra last week said the state is moving in the right direction to meet the springtime deadline to move all of its schools into compliance with federal law.

But the report accuses the DOE and the DOH of taking advantage of the federal court's "money is no object" stance and trying to spend their way into court compliance.

Anita Swanson, deputy director for behavioral health at the DOH, said she is confident that there is no fraud or abuse at the department. She took issue with some of the broad generalizations made in the report.

Swanson said the committee has lost the perspective that all of the DOH employees are also taxpayers who do not want to waste state money.

"Nobody goes to work and says, 'How can we waste money today?' Most of these people are social workers. They want to see improvement in kids. They understand what these families are going through," Swanson said.

If members of the legislative committee are "aware of something they think is an issue," Swanson said, they should "bring us the specifics."

The draft report is a likely precursor to more investigative work by the joint House-Senate committee. Committee members, who say they have been blocked from doing their work by the federal court and uncooperative state agencies, will ask the full Legislature in January to authorize an extension of their investigation.

They also want to expand the authority of the state auditor so she can look at student records.

The draft report has been posted and is available at the Legislature's Felix consent decree's Web site.

Reach Jennifer Hiller at jhiller@honoluluadvertiser.com or 525-8084.