Housing office debates next move
By Jim Dooley
Advertiser Staff Writer
Beleaguered directors of the state public housing agency are meeting this week to decide how to respond to federal demands that they resign and refund $771,000 to the U.S. Department of Housing and Urban Development.
HUD Assistant Secretary Michael Liu said in a Nov. 1 letter that directors of the Housing and Community Development Corp. of Hawaii had until Friday to refund the money and to give him assurances that they would resign by the end of the year.
Liu also wanted a commitment by Friday that HCDCH executive director Sharyn Miyashiro and executive assistant Robert Hall will resign by the end of the year.
Liu told HCDCH board chairman Wesley Segawa that the federal government considered HCDCH board members and executives to be "incapable of successfully managing and overseeing departmental monies allocated" to the corporation.
According to a federal audit attached to Liu's letter, HCDCH jeopardized federal money "as a result of inconsistent and ineffective management practices, lax oversight and a failure to follow established procurement polices" including its own procedures.
Gov. Ben Cayetano angrily termed Liu's letter a political ploy meant to help the Hawai'i gubernatorial campaign of Republican Linda Lingle, who won the governor's seat on Election Day. Liu is a former Hawai'i Republican politician now serving in the Bush administration.
Cayetano said it was unusual for someone in Liu's position to directly question a state housing agency's contracting record rather than regional or local HUD officials. The state was not given a fair opportunity to review HUD's findings and issue a response, he said.
"I don't think it's fair, I don't think it's right, and I think it's very political and Mike should be ashamed of himself," Cayetano said.
Liu has denied a political agenda.
"The issue is not about politics," he said. "It is about opening the doors of housing for the people who need it most."
The $771,000 Liu wants returned was spent by HCDCH on a nonbid, sole-source contract awarded by Miyashiro to a company partly owned by her ex-husband.
Liu said federal auditors determined that the contract amount was "grossly higher than the value of the services provided."
One finding of the auditors, Liu said, was that the contractor charged $2,500 "for a closet door that could have easily been purchased for $500."
In his response to Cayetano, Liu, said, "an agency that spends four times the price for a door is not opening the doors of opportunity — it is closing them. We refuse to sit idly by and let this continue."
Reach Jim Dooley at jdooley@honoluluadvertiser.com or 535-2447.
