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Procurements done properly, review finds

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The state Procurement Office has found nothing to substantiate a complaint that Honolulu violated the procurement code in dozens of city contracts for professional services, including three related to the city’s $5.5 billion rail project.

In a report sent to the state attorney general’s office last Wednesday, Aaron Fujioka, administrator of the procurement office, found no violations after a review of contracts awarded over several years.

In April, attorney John McLaren filed a complaint on behalf of former Gov. Ben Cayetano and other, unidentified critics that claimed the city did not negotiate with first-ranked respondents in bid requests on 72 occasions. The complaint also alleged that in 14 contracts the city improperly waived a requirement that awards come from lists of three competing bidders.

Acting Mayor Kirk Caldwell said the time spent by city officials addressing the complaint was a waste of taxpayer money given the budget constraints on the city. He suggested that McLaren forwarded a description of the complaint to City Councilwoman Ann Kobayashi as an official communication in May to ensure it was a public document in an attempt to get news coverage.

"Public contracting is serious business, not a political game," Caldwell said in a statement. "This complaint impacted the good work of those dedicated city employees who work hard day in and day out on the city’s procurement contracts. Fortunately, the state’s review was swift and well managed. We should all be grateful for that."

Former Mayor Mufi Hannemann’s campaign for governor has described the complaint against the city as politically motivated. Cayetano supports former U.S. Rep. Neil Abercrombie over Hannemann in the Democratic primary. Kobayashi ran unsuccessfully against Hannemann for mayor in 2008.

"We are obviously pleased with the finding of the State Procurement Office," Carolyn Tanaka, a spokeswoman for the Hannemann campaign, said in a statement. "The complaint was filed back in May by people not involved in any way with the contracts in question, and who are known supporters of Neil Abercrombie.

"It was clearly a politically motivated act to embarrass and raise suspicions about then Mayor Mufi Hannemann. Playing politics with serious issues like public contracting to smear a candidate should not be tolerated."

McLaren said he is still reviewing the state Procurement Office’s report. He said, however, that he revised and expanded his complaint in a June letter to the state auditor calling for the auditor to review the city’s contract awards. He said that letter also was sent to the Procurement Office and the attorney general, but he said the Procurement Office’s report appears to be based solely on his April complaint.

"It looks like a whitewash, to be honest with you," McLaren said.

Cayetano, in an e-mail, said he wanted the attorney general to rule on what he sees as a conflict between administrative rules under a previous version of the procurement code and the procurement code as it is written today.

"Clearing up the apparent conflict between the old rule and the current procurement law was a task for the state attorney general, who is the only state official whose legal opinion matters in procurement cases — not the state procurement officer," Cayetano said. "So I am disappointed the state AG turned our complaint over to the procurement officer and did not give an opinion on the issues we raised."

Cayetano rejected the Hannemann campaign’s accusation of a "smear." "Mufi is king when it comes to smears," Cayetano said. "What we asked of the attorney general was a legitimate complaint made openly and publicly."


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