Auditor denies violation claim
By Lynda Arakawa
Advertiser Capitol Bureau
A preliminary investigation by the state attorney general's staff has determined the state auditor's office violated federal law in obtaining restricted information from the Department of Human Services.
But Auditor Marion Higa and her office's attorney say that if there were any violation, it would have been on the part of DHS because the department is responsible for preventing confidential information from being released.
The legal controversy between Gov. Linda Lingle's administration and Higa surrounds an audit into DHS's electronic benefits transfer system, which distributes federal benefits under the food stamp program.
Failure to comply with federal regulations governing food stamps could jeopardize at least $6 million in federal reimbursement for the state agency's administrative costs, according to DHS director Lillian Koller. But Koller said yesterday the U.S. Department of Agriculture has been notified and she has not heard whether any action will be taken.
The dispute is detailed in letters attached to the audit released yesterday.
This is the second time since Lingle became governor that she and her administration have clashed with the auditor. Before taking office, Lingle praised Higa's work in exposing government waste; the two met after Lingle said she wanted to sit down with Higa to discuss how to reduce the cost of government.
But in June, Lingle issued two vetoes against bills that would have given Higa's office more authority to examine how the administration spends public money. Higa criticized the governor for those vetoes, but Lingle said the bills were not necessary and would clash with federal law and invite litigation.
The current controversy apparently began with a May 15 letter that Koller wrote to Higa, about a week after receiving a copy of the draft audit. Koller said she was concerned that while the audit purported to be a review of the electronic benefits transfer system, the audit focused largely on issues related to food stamps, "apparently based on your auditors accessing federally protected information which they did not have authorization to review."
"This has raised serious legal issues of federal law that must be addressed prior to publication of your report," Koller wrote.
In a July 7 letter to Higa, state Attorney General Mark Bennett said his office's preliminary investigation revealed that Higa's staff "unquestionably obtained information" in violation of federal regulations.
Bennett also told the auditor's attorney, Kerry Komatsubara, that while DHS does have the responsibility to "prevent unauthorized access to information," a staff member of Higa's office "insisted on being given restricted information, such as food stamp program case files, after he had been told that he could not see it."
Koller also said yesterday that Higa's office failed to clearly explain the scope of the audit and that if the DHS were to have received such specifics, it could have prepared the documents and redacted confidential information.
Higa was unavailable for comment, but Deputy Auditor Maria Chun said the auditor's office did nothing wrong. "I guess there was a misunderstanding that our staff forced them to give us files or we secretly got them, but that wasn't the case," Chun said. "We requested them formally so it's not like we snuck in and got the information that way."
She said the audit was conducted in the standard way. "For them to accuse us of breaching protocol or federal law ... , we kind of take issue with that," she said.
In a letter Monday to the attorney general's office, Komatsubara noted that some of the restricted information was redacted from the DHS records and therefore the auditor's objectives must have been clear.
"Why all other restricted information were not redacted is something the state auditor cannot answer; however we think that it is unfair and unwarranted to lay blame with the state auditor in this case," Komatsubara wrote.
Among the findings cited in the audit were that the department does not effectively use its quality assurance programs and that the department's case management tools were either ineffectively used or insufficient.
It also found a lack of control over the electronic benefits transfer system's card inventory, which leaves the system vulnerable to fraud, waste and abuse, the audit said.
Koller's response noted that the department does not know of any "breaches of integrity" that would require restructuring of the EBT system.
Reach Lynda Arakawa at larakawa@honoluluadvertiser.com or at 525-8070.
