UH regents to ask for Mauna Kea audit

Responding to accusations of financial mismanagement, the University of Hawaii Board of Regents today will be asking its internal auditor to look at the university’s Mauna Kea books with fresh eyes.

The request comes in the wake of recent blistering criticism about the university’s management of the Mauna Kea Astronomy Reserve, home to nearly a dozen world-class telescopes at the summit of Hawaii’s tallest mountain.

“We think it’s the right thing to do, to look at all the costs and how the money flows through and around the mountain. We want to be transparent about that,” said Greg Chun, senior adviser to UH President David Lassner on Mauna Kea.

The regents will be meeting at 10:45 a.m. at the ‘Imiloa Astronomy Center of Hawaii in Hilo in a special meeting about Mauna Kea. It will follow the board’s regular monthly meeting at 9:30 a.m. at the same location.

Hawaii island Mayor Harry Kim, who is working on a plan to revamp the summit’s management as part of his peace park proposal, is also scheduled to address the special meeting.

In recent months, the university has faced a growing number of challenges to its jurisdiction on the mountain. In addition to criticism from Kim, the Office of Hawaiian Affairs has filed a lawsuit in an effort to wrest control of the ceded lands at the summit, and the state Legislature is considering a measure, Senate Bill 3090, to establish a new management authority.

Still another measure, Senate Bill 757, requires the state auditor to conduct a “forensic financial audit” to examine the university’s financial dealings in regard to Mauna Kea. A forensic audit is more comprehensive than a garden-variety audit in that it looks for evidence that could lead to prosecution for criminal wrongdoing.

At a recent hearing on Senate Bill 3090, university officials were accused of sitting on a gold mine at the summit and allowing millions of dollars in potential fees, charges and rental payments to slip through their fingers.

State Sen. Kaiali‘i Kahele (D, Hilo), who introduced the bill, cited a 2001 Keck Observatory report that indicated it cost $1 a second to use the telescope and $30,000 a night. Multiply that over the course of the year and it costs $8 million to $10 million to use the telescope, he said.

Charging even more per second could reap even more money, he said.

But Kalbert Young, UH’s vice president of budget and finance, said the telescope charges do not represent points of revenue but rather expenses.

“This is what it costs to run those telescopes,” he said.

Officials said the observatories spend a combined $72.4 million a year for their operations. That includes $5.6 million allocated to Mauna Kea Support Services, the entity that runs the day-to-day operations of the summit region. That’s also on top of a combined $601 million that the observatories spent to build the observatories in the first place.

Critics also have blasted the university for charging only $1 a year for rent payment on the telescope subleases.

But Robert McLaren, interim director of the UH Institute for Astronomy, said the state offered the summit’s master lease to the university at no charge for the benefit of scientific research, and the nominal sublease rent charge is consistent with that.

The $1-a-year rent payment, McLaren said, was set up decades ago to help lure observatories to the top of Mauna Kea, with a requirement that UH be given a percentage of viewing time.

The effort has brought tens of millions of dollars to Hawaii’s economy and resulted in scores of scientific discoveries, he said.

But the days of nominal rent payments are coming to an end as the planned Thirty Meter Telescope has agreed to eventually pay $1 million a year — 20 percent of which will go to OHA and 80 percent to mountain management.

McLaren said the other telescopes already know they will be expected to pay substantially more when their subleases come up for renegotiation.

The university also has been criticized for not generating more revenue from commercial activities, but Chun said UH has to be careful because the summit can be a dangerous area for tourists. He said the university will be looking at more equitable commercial fees in the near future.

Chun said that while the university is committed to working collaboratively with others in the future, none of the current management proposals for Mauna Kea hit the mark.

University spokesman Dan Meisenzahl said some people are twisting facts and offering up the myth that the summit is poorly managed. The fact is, he said, the state auditor praised UH for managing and protecting Mauna Kea in its last assessment.

“I could make an argument that it’s the best-managed state land in Hawaii,” he said.

As for the internal audit or proposed forensic financial audit, “There’s absolutely nothing to hide,” Meisenzahl said. “No one’s going to find anything.”