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The Honolulu Advertiser
Posted on: Friday, April 21, 2006

Senator wants 'loopholes' closed

By Sean Hao
Advertiser Staff Writer

A state senator yesterday announced plans to seek a change in the state procurement code to prevent a repeat of practices used by the Lingle administration to help finance trade missions.

The proposed legislation would eliminate activities such as the Department of Business, Economic Development and Tourism's use of a nonprofit organization to handle $268,000 in private sponsorships raised for Gov. Linda Lingle's trade mission to China last summer.

The state Procurement Office on Wednesday concluded that the Lingle administration did not violate the procurement code because there was no contract between DBEDT and two organizations the Pacific and Asian Affairs Council and the District Export Council which assisted with the trip. DBEDT directed the Pacific and Asian Affairs Council to pay vendors who worked on the trip. Because the council is not a state agency, its actions were not bound by procurement or sunshine laws.

The decision highlighted an apparent hole in the state's procurement law that allows agencies to avoid compliance with the procurement code simply by not signing a contract. Procurement laws are meant to ensure the state gets the best value for its money and that potential state suppliers are treated fairly.

"I am in the process of drafting legislation to close loopholes in the state procurement code that allow public agencies to sidestep the state's equal-opportunity procurement process," Sen. Lorraine Inouye, D-1st (Hamakua, S. Hilo), said in a written statement. "By making it clear what constitutes a contract between a public and private agency, the state can avoid questionable procurement practices in the future."

Reach Sean Hao at shao@honoluluadvertiser.com.