EDITORIAL
OHA should take advice from auditor

The state auditor has delivered a sharp rebuke to the Office of Hawaiian Affairs that surely stings staffers and elected trustees who worked in recent years to make the agency more professional than it once was.

It's unfortunate that the upbraiding comes now, after OHA has largely overcome its reputation for public dysfunction. But rather than spend time licking its wounds, the most prudent course now is to absorb and adopt the sound advice contained in the 44-page report.

Most important is the call for a more systematic means of evaluating the investment management advisers OHA has hired to guide the growth of its beneficiaries' primary asset: the $350 million Native Hawaiian Trust Fund.

OHA administrator Clyde Namu'o rightly acknowledges that developing an investment manual would give the trustees a uniform basis for rating the performance of OHA's two consulting management firms, Goldman Sachs and Russell Investment Group.

The auditor also faulted OHA for "questionable" spending practices and high rates of default and delinquencies in its revolving loan fund.

Although officials may pick apart the loan finding on technicalities and quibble with criticisms of its petty-cash expenditures, it is best for OHA to bend over backward and avoid marginal spending.

The agency has the limelight now, as a chief proponent of the Native Hawaiian federal recognition bill that awaits a Senate vote; it should do all it can to be fiscally prudent.

However, auditor Marion Higa's fuss over the absence of a comprehensive master plan is simply puzzling. OHA's existing master plan may need revision, but its more recent strategic plan seems to be guiding the program fairly well.

If the agency functions haltingly, it's probably due more to the frequent turnover in staff, an operational problem that needs improvement.

Overall, Namu'o flinched less over the particulars in the audit than in the smackdown delivered by the biting conclusion, which charges the 25-year-old OHA with behaving like a "fledgling" organization. OHA might argue with that characterization, but the better response is introspection.

Fix it, and move on.