Three of the people Gov. David Ige picked to head major state agencies were registered lobbyists for companies, organizations or clients whose interests likely will intersect with the departments they were nominated to oversee.
His attorney general nominee, Doug Chin, has been a lobbyist since 2013 for Corrections Corp. of America, which gets millions of dollars annually from the state to house Hawaii inmates in an Arizona prison.
The company hired the Carlsmith Ball law firm as a lobbying representative in Hawaii, and Chin, who is managing partner at the firm, was one of the lawyers who did work on the company’s behalf, mostly tracking legislation and answering questions from legislators, he said.
The attorney general’s office deals with matters involving the mainland prison operator in at least two ways. It reviews contracts with the company, such as the one under which the state paid Corrections Corp. about $34 million last fiscal year to house Hawaii inmates on the mainland. The office also represents the state in lawsuits — a handful are pending — in which the company and the state are defendants.
Carleton Ching, Ige’s pick to head the Department of Land and Natural Resources, is a registered lobbyist for Castle & Cooke Hawaii, one of the largest developers in the state. He currently is on a leave of absence from the company.
Castle & Cooke deals with the State Historic Preservation Division, a part of DLNR, when pursuing development projects. That division, for instance, had to sign off on the company’s plans to protect archaeological sites affected by Castle & Cooke’s controversial Koa Ridge planned development in Central Oahu. The division also has a review pending for a Waiawa solar farm project.
Rachael Wong, who was selected to lead the Department of Human Services, was a lobbyist for Healthcare Association of Hawaii, where she worked as vice president and chief operating officer before joining DHS in January.
The trade group, which represents hospitals, long-term care facilities and other providers, has dealings with DHS because of Medicaid, the health insurance program for low-income residents that the department oversees.
All three nominees, along with others Ige has named to his Cabinet, are awaiting confirmation from the Senate.
Dan Schnur, executive director of the Jesse M. Unruh Institute of Politics at the University of Southern California, said appointing lobbyists to run state agencies comes with risk, particularly for a new administration wanting to project a positive image with the public.
"It’s a fine line," Schnur said in a telephone interview. "On one hand, you want appointees who are familiar with the field in which they’ll be working. On the other hand, you want to avoid any conflicts of interest."
Chin told the Honolulu Star-Advertiser that, if he is confirmed, the Hawaii code of conduct for lawyers would prohibit him from participating in discussions or decision-making on any matters involving his prior clients, including Corrections Corp.
It’s not even a discretionary call, so others in the office would handle such matters, said Chin, who prior to his Carlsmith job spent two years as managing director for the city and 12 years at the prosecutor’s office.
An attorney who violates the conduct code would be subject to possible sanctions.
Chin said his lobbying duties did not involve any negotiations on the Corrections Corp. contract.
While at the Carlsmith firm, Chin also was a registered lobbyist for the Hawaii Pilots Association; Rental by Owner Awareness Association, a group of out-of-state owners of licensed vacation rentals; and two individual owners of licensed vacation rentals, according to records with the Hawaii State Ethics Commission.
Ching, who is vice president of community and government relations for Castle & Cooke Hawaii, said he would recuse himself if any Castle & Cooke matters come before the agency’s board unless doing so would prevent the panel from voting on a health and safety issue affecting the department’s mission.
"To me, that’s the right thing to do just to make sure there’s no appearance of impropriety," said Ching, who will become board chairman and department director if confirmed by the Senate.
Ching told the Star-Advertiser that the last time he personally dealt with DLNR was in 2008 when he and other company officials went there to discuss a proposed Lanai wind farm project. The meeting was just to talk about the project, not to seek DLNR support, he added. As a Castle & Cooke lobbyist, he also said he never appeared before the agency’s board or the water resource management commission that also comes under DLNR.
Wong, who used to serve on the city’s ethics commission, said in an interview that her obligation as DHS director is to the department, state and community that DHS serves and that she takes her ethical responsibility seriously.
She said she called the state Ethics Commission before joining DHS to discuss various issues and doesn’t even talk to her most trusted confidant — her husband — about department matters. Her husband is a physician at a community health center that treats Medicaid patients.
"It’s very, very clear to me that I work for the state," Wong said.
She said her prior lobbying activities were at the federal level — usually accompanying association members to Washington, D.C. — and did not involve DHS or going before the Legislature to lobby for bills.
The three directors are not the only registered lobbyists Ige has tapped to help run state agencies.
Kekoa Kaluhiwa, who heads Kuano‘o Communications, was named as the first deputy at DLNR. He was listed in Ethics Commission records as a lobbyist last year for Young Bros. and Horizon Lines, two shipping companies.
Community advocates raised concerns about lobbyists running major departments.
"It is discouraging," said Kat Brady, coordinator of the Community Alliance on Prisons. "You want an agency head to be knowledgeable but neutral."
In written responses to Star-Advertiser questions, Ige said his transition team looked for leaders dedicated to public service who have the skills needed to help change the culture and the way business is done in state government.
"All of my appointees have previous work experience that has given them the expertise the state needs, and now they are being asked to use their skills specifically for the people of Hawaii," Ige said. "Lobbyists generally have a good understanding of the legislative process, and that can help them when they take a position with the state."
The governor said that potential conflicts of interest for anyone in decision-making positions will be identified and avoided. He also said Chin, Ching and Wong are "very clear about the mission of their departments and their duty to protect the public’s interest."
Wong, who previously served as executive director of Kokua Mau, a state hospice and palliative care organization, and the Hawaii Consortium for Integrative Healthcare, said her experience with dealing with providers will help in finding solutions to problems, stressing the need to be transparent and honest. "Rather than being a conflict, I see it as being a positive," she said.
Ching similarly said his experience working in the development arena is a strength. In addition to Castle & Cooke, he previously worked for the Hawaii Housing Authority, Westloch Inc., Moloka‘i Ranch and SSFM International. He also served until recently on the boards of the Land Use Research Foundation and Building Industry Association.
Once nominated, he said he resigned from those boards and three others, including Hawaii Pacific University and Pali Momi Medical Center, to avoid any potential conflicts and because of the time commitment his new job would require.
Like Chin, Ching said he is awaiting confirmation before moving to his new post.
Environmental groups have criticized Ching’s appointment because of his lack of experience in the preservation and natural resources arena — a major part of DLNR’s mission.
Ching said he would rely on his staff to provide that expertise and will be guided by the agency’s mission and the law, adding that as director he would have to look at issues through many different lenses.
"It requires a balance toward land stewardship," he said. "You have to make decisions that are in the best interests of the state."
Unlike some states, Hawaii does not have what is sometimes called a reverse revolving door law, which generally would prohibit a private-sector worker who joins state government from taking action that affects the worker’s former employer, according to Les Kondo, executive director of the Hawaii State Ethics Commission.
Hawaii, though, does have a law dealing with workers going in the other direction. Within 12 months of leaving state government, no former employees can represent their new private-sector employers for pay in dealings with their previous state agency or on matters they worked on while with the state.
Hawaii also has a conflict-of-interest provision that prohibits any state employee from taking official action that directly affects a substantial financial interest he or she has, such as stock in a company, Kondo said.
In addition, state workers are not allowed to use their position to give an unwarranted advantage or preferential treatment to a business.
While defending his lobbyist appointments, Ige urged those concerned about such appointments to scrutinize his administration.
"Hold us accountable," he said. "Ensure that decisions we’re making are in line with the mission of each department and move us toward long-term solutions to the challenges facing the state. And it doesn’t end with the confirmation. We expect to be scrutinized and held to high standards every day of this administration."