honoluluadvertiser.com

Sponsored by:

Comment, blog & share photos

Log in | Become a member
The Honolulu Advertiser
Posted on: Thursday, January 2, 2003

DOE closes supplies storeroom

By Jennifer Hiller
Advertiser Education Writer

The Department of Education is closing the books on its storeroom, a warehouse of school supplies in Waipahu that had come under scrutiny for waste and poor management.

The pallets of remaining supplies are being doled out to each of the state's school complex superintendents, who will determine the best way to distribute everything to the schools in their area. Schools on the Neighbor Islands will receive barge shipments soon.

The DOE hopes to have the 23,000-square-foot storeroom cleared by midmonth, said Chris Ito, accounting director for the Business Services Center.

Lawmakers last year told the DOE to shut down the storeroom after State Auditor Marion Higa issued a report critical of it.

The storeroom was set up 30 years ago to enable bulk purchases of educational, office and custodial supplies, which were then sold to public schools at cost plus an 8 percent delivery charge. The storeroom, on Leo'ole Street in Waipahu, was established before the advent of big-box discounters to give all schools access to supplies at a fair price.

But the storeroom has been long criticized for sloppy inventory practices. A 1996 financial audit of the public school system found "unwarranted, excessive ordering," citing as an example the unjustified purchase of 48,000 pairs of scissors.

Higa's office found little improvement in management of the facility as of last year. The audit found that the storeroom had, on average, enough stored inventory for the items to fill orders for two years, but in some isolated cases the hoarding created supplies to last as long as 12 years.

Higa recommended that lawmakers repeal the legislation that created the central storeroom and the revolving fund that supports it. Then-Gov. Ben Cayetano signed legislation in June to do so.

Gov. Linda Lingle also has called for a more modern purchasing system for the DOE.

The audit also said the storeroom itself was a waste of taxpayers' money. Between July 1, 1997, and June 30, 2001, the net loss totaled about $1.6 million, according to the report.

The audit also found that:

  • Inventory records were inaccurate. In one example, the audit team found 212 water hoses missing, and an order for 2,700 hoses had been placed by mistake. Nineteen cases of computer paper were also unaccounted for.
  • The excessive purchases led to losses from damage, spoilage and theft; some items also become obsolete before they could be used. The auditors cited $10,000 worth of obsolete student progress report cards being shredded to make packing materials, and 166 U.S. flags purchased in 1993 were disposed of because they were eaten by termites.
  • School officials have complained about defective and spoiled supplies.
  • The department has more warehouse space than necessary. The 23,000 square feet of space, rented for $250,000 annually, is used for storage of old files as well as supplies.
  • The state takes too long to deliver supplies, up to eight weeks for Neighbor Island orders. Schools also must consolidate orders to meet a required minimum order, adding to the delay.

Ito said the state has tried to liquidate its supplies this year and allowed schools to order through the storeroom throughout the fall.

"Basically we're just complying with a request to close," Ito said.

To replace the storeroom, Ito said the state will look at getting price lists from companies that can deliver goods directly to the schools, including those on the Neighbor Islands. Schools also can order supplies from local businesses.

"What we're looking at is something like a price list. We won't keep the supplies in a warehouse system anymore," Ito said. "The schools will have to go to the companies directly."

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