Auditor: Special-ed lacks oversight on spending

By Alice Keesing
Advertiser Education Writer

A "culture of profit" has developed around Hawai'i's efforts to improve special-education services, state Auditor Marion Higa told a legislative investigative committee yesterday.

Higa was the first witness called by the joint House-Senate committee that is seeking to find out why the state still is not in compliance with the federal court-ordered Felix consent decree after spending an estimated $1 billion.

While noting that there has been progress in the system, Higa also said it may be rife with conflicts of interest that suggest a lack of independent oversight.

"We have no checks and balances," she said. "The state is at the mercy of these practices. ... As these kind of abuses go unchecked, and these reports are coming to us from the field ... there is a great deal of angst out there, and people are saying Felix is creating a culture of profit."

For example, psychologists diagnosing children often are the ones who end up providing the services, she said. The Felix consent decree has attracted a number of people into the field "at very lucrative remuneration, and that contributes to the cost to the state."

"The consultants said somewhat facetiously that Felix has become the state's full-employment act for mental health professionals," Higa added.

Schools chief Paul LeMahieu later agreed that Felix has created an industry of private providers. Lacking their own expertise, schools have had to buy professional services at a greater cost, he said. However, a recent switch to school-based services will eliminate that situation, he said.

Higa also raised a possible conflict involving court-appointed monitor Ivor Groves. Groves is co-owner of the company that developed a testing product, which he has mandated be used in the compliance effort, she said. The test measures school services to students to determine compliance with the consent decree.

Groves could not be reached for comment, but previously told The Advertiser that there is no conflict in his position.

Attorney Eric Seitz, who represents plaintiffs in the Felix case, blasted Higa for her statements, calling her "incompetent."

"Ivor Groves has never charged the state, to my knowledge, anything for the use of that tool," Seitz said. Groves developed the service testing tool in Hawai'i for use in Hawai'i, Seitz said, and he has since used it in other states.

The committee had tried to subpoena Groves to testify yesterday, but U.S. District Judge David Ezra quashed that subpoena on Thursday, saying Groves was protected by quasi-judicial immunity.

Sen. Colleen Hanabusa, the committee co-chairwoman, said it is difficult to tell how serious the charges of conflicts are.

"On the surface it raises some concern," she said.

The committee has yet to set a date for its next hearing, but will continue to focus on the potential conflicts and also on how taxpayer money has been spent on special education, she said.

The committee yesterday issued a list of those it plans to subpoena for future hearings. The list includes LeMahieu and Department of Health Director Bruce Anderson and also two court appointees who worked on a technical assistance panel.

Seitz predicted the federal court will quash the subpoena for those individuals because they were appointed by the federal court. He said he has no problems with the committee calling LeMahieu or Anderson, with the proviso that it does not interfere with their work to reach compliance.

"If they create a climate where Dr. LeMahieu or Dr. Anderson cannot do the jobs that are required of them by the consent decree, then somebody else is going to have to do their jobs for them, and that's what the Legislature, I think, seems bent upon causing," Seitz said.

In August, Ezra will hear a motion asking him to appoint a receiver over the system.