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The Honolulu Advertiser
Posted on: Wednesday, March 10, 2010

Governor's criticism of Higa well-founded


By Barry Fukunaga, Linda Smith and Lenny Klompus

We are very disappointed in your editorial, "From virtuous to shoddy in only 7 years" (March 4), that calls into question Gov. Linda Lingle's well-founded criticisms of Legislative Auditor Marion Higa because of her draft report on the Department of Budget and Finance.

To begin with, the auditor is not an independent entity but an office that is hired by and performs under the direction of the Legislature. It is not subject to review by any other entity but the Legislature, and in turn it will never examine the operation or activities of the Legislature.

If you and your staff had reviewed the "fact versus statements" in the March 1 response from Budget and Finance Director Georgina Kawamura to Higa, you would have seen that the auditor's report is actually an operational review not a financial examination as the title of the report purports.

It is simply outrageous that any person with a modicum of knowledge would write such a report, draft or otherwise, after reading the response and attorney general's opinion.

In Kawamura's 23-page letter, she points out numerous inaccuracies, flaws and distortions that should be corrected in the final report.

We are concerned that Higa, who is not a lawyer or an accountant, took it upon herself to make a legal opinion, and based her report on her own uniformed opinion.

Had the auditor sought a legal opinion from the attorney general, as Kawamura did, she would have found how erroneous and factually wrong her accusations are. The attorney general's statements completely and absolutely exonerate the Budget and Finance department.

Based on this issue alone, Gov. Lingle was absolutely correct to call this examination flawed and "shoddy."

We can't help but wonder why the opinion page editors at The Advertiser chose to ignore this important point.

As Kawamura emphasizes in her response letter, this inflammatory and biased audit is contrary to the findings of numerous reviews by major accounting firms and bond rating agencies.

Far worse, such reckless charges could seriously damage Hawai'i's hard-earned reputation as a prudent manager of public resources and adversely affect our ability to sell bonds. Putting the state's financial reputation and credit rating in jeopardy as Higa has done is more reason why the governor and Kawamura feel so strongly about the blatant inaccuracies that the legislative auditor allowed to be published in her draft.

In your editorial, you pose the question of whether it is Gov. Lingle or Higa who has changed over the past seven years.

Gov. Lingle has not changed her position that audits are an important part of improving government operations and ensuring state funds are properly managed.

As a mayor, she found fact-based audits useful. As governor, she supported Higa in previous years because her audits were generally fair, accurate and unbiased.

Sadly, that is no longer the case, based on the auditor's last inflammatory report on DBEDT and now against Budget and Finance. Each is characterized by numerous unfounded and erroneous findings.

Higa appears to have drifted from impartiality and independence to politicizing her office and her reports to do the bidding of the Legislature.

Regardless of whether the review was performed by an independent entity, its conclusions were accepted and endorsed by Higa and her 37-person staff.

It remains to be seen whether Higa will recognize how she has erred in her report, and if she will correct the inaccuracies.

We sincerely hope the office of the auditor will conduct more thorough research in the future before putting reputations and credibility on the line with irresponsible and false statements. We concurrently trust The Advertiser won't take a position until it has all the facts.