The state’s HI-5 deposit redemption program is in dire need of a reboot. Audit after audit has revealed the program has mishandled funds.

The latest revelation was a "glaring example" of lack of oversight when the state Department of Health ultimately paid $543,374 for audits of its beverage container redemption centers that were "of little value," according to a new report released Thursday by acting state Auditor Jan Yamane.

In 2008, the Health Department issued a request for proposals to hire an outside auditor and received one proposal for $76,400, but before the contract was signed the vendor had increased its price to $340,000, according to Yamane.The state Procurement Office suggested the Health Department seek new bids, but the department ignored the recommendation — and the final amount paid out to PKF Pacific Hawaii LLP was 611 percent more than its original proposal.

In 2013, a separate state audit showed the HI-5 redemption program paid out $6.2 million in deposit funds between fiscal 2010 to 2012 for nearly 7.5 million pounds of material that could not be accounted for.

Those wasted or missing funds can be ill-afforded by any government program, let alone one that soon will see a drop in revenues due to declining container redemptions.

The rate of redemption dipped to 68.4 percent in fiscal year 2015, which is just slightly higher than the 67.6 percent rate the state reported a decade ago. The lower redemption rate has triggered a half-cent decrease in the fee that manufacturers, distributors and importers of HI-5 beverage containers pay.

Starting Sept. 1, the beverage container fee companies pay per bottle or can will drop to 1 cent from 1.5 cents, which is mandated when the redemption rate falls below 70 percent, the state Department of Health announced last Monday.

The reduction will lead to a projected $4.5 million loss in revenue for the the HI-5 recycling program, said Janice Okubo, a Health Department spokeswoman. That, in turn, will unfortunately limit the amount of education and research that can be done.

The law feeds into a downward spiral. Fewer people redeem their bottles and cans. Manufacturers, distributors and importers pay reduced fees. Program funds shrink, leaving fewer dollars for public education, marketing or research initiatives to promote recycling. Redemption rates could sink even further.

It would behoove lawmakers to revisit the law that automatically lowers the container fee when redemption rates go below 70 percent, to root out economic implications and efficiencies.

Just as important: A sense of urgency is needed for improved oversight and management of the recycling program. HI-5 has undoubtedly improved recycling efforts statewide. Yet recycling advocates are baffled by the recent drop in redemption rates.

Okubo offered that the recent decline in redemption centers may have affected HI-5 recyclers. There are 91 centers statewide compared with 110 in 2013.

The program will need to examine other convenient ways to allow recyclers to collect their nickels. Retailers have scoffed at becoming redemption sites, but that could be revisited as an option with incentives.

Terry Telfer, president of Reynolds Recycling, which operates 32 of the redemption centers, said he has lost 10 sites in three years and a couple of them "have been due to rail." The company is working on opening two additional sites by the end of the year.

"Even I only go once a month now," Telfer said, noting that consumers often complain they don’t want to drive to redemption centers on the weekends after battling traffic during the work week.

The bottom line is residents are not redeeming their bottles and cans as vigorously as they used to. The redemption rate was 77 percent in 2011.

HI-5 could benefit from bolstering its marketing or adding items that can be redeemed, Telfer said. Bottles larger than 67 ounces could be added to the redemption list, as well as wine bottles, he suggested.

Those are additions well worth exploring — both to boost redemption coffers as well as to ease landfill space. After all, the 31.6 percent of containers that go unredeemed enter the environment or the waste stream: on Oahu the containers are burned at the H-POWER plant, and on the neighbor islands they go to the landfills. Yes, lower program revenues are coming due to the half-cent container-fee drop, but the goal of recycling must remain clearly in sight — and with it, better means toward that goal.