Investigative committee finds no criminal wrongdoing by state auditor

A special House Investigative Committee created last year to look into audits of land management practices by two state agencies began in mid-July, mushroomed to include an investigation of State Auditor Les Kondo himself, and generated at least 30,000 pages of subpoenaed documents — with hundreds, perhaps thousands more, that have yet to be counted.

Kondo said his office of 21 people continued to do their jobs but several watched every minute of the 18 committee hearings and did research on their own to refute what Kondo called “crazy statements based upon biased witnesses, innuendo and half truths.”

With committee hearings sometimes lasting hours, Kondo said some of his staff continued to work at night, on weekends and while on vacation “because I can see when they’re logged onto our system.”

They were prepared to refute inaccurate testimony, but Kondo was never recalled to explain why testimony presented under oath was wrong or misleading.

“It’s despicable,” Kondo told the Honolulu Star-Advertiser Saturday. “It makes me so angry, what they’ve done to my guys with no evidence to support the mud they’ve slung at us. It had a huge impact on staff morale. Their professional reputations were being questioned. … A couple broke down … because their ethics and integrity were attacked.”

After hearings began in September, the investigative committee held its final meeting Friday when it approved a 292-page final report on its work, which was released Saturday on the committee’s website.

It found no criminal wrongdoing by the state Office of the Auditor, although committee Chairwoman Della Au Belatti, (D, Moiliili-­Makiki-Tantalus), said there were “serious omissions” in the two audits.

On the committee’s side, Belatti spent nights and weekends poring over documents and testimony. Two neighbor island members used their allotted per diem money to sometimes fly in and stay overnight on Oahu for meetings, although Rep. David Tarnas, (D, Kaupulehu-Waimea-Halaula) said he bundled his time on Oahu doing other House work looking at land transfers between the state Departments of Agriculture and Land and Natural Resources and coming up with long-term plans for management of Mauna Kea.

He called neighbor island legislators’ per diem expenses “a public fund, it’s a public trust. I stay up (in a residence) in Kaimuki and take TheBus. I had to be conservative.”

Staff members from the House work year-round, so their help for the committee cost no more than normal, Belatti said. But there was an additional cost of $15,779 to have the hearings broadcast on ‘Olelo as of Nov. 23, with an estimated $2,000 more for the more recent hearings.

The committee’s report made 11 recommendations regarding the Auditor’s Office, including creating permanent oversight.

But Belatti — the House Majority leader — told the Star-Advertiser on Saturday that’s not going to happen this legislative session.

“There was a lot of value of the investigative committee … to improve the state,” she said. “But the political temperature around this will not result in productive legislation (regarding Kondo and his office), even though I think it’s important.”

The start of the House Investigative Committee hearings represented Kondo’s second run-in with House leadership in 2021.

In March Kondo received a scathing, 79-page review of his office that was prompted by House Speaker Scott Saiki, (D, Downtown-Kakaako-­McCully).

During the special House Investigative Committee hearings, Kondo testified three times. From the very start, he questioned Belatti about why he had to be subpoenaed when he was willing to help the committee understand the audits of the Agribusiness Development Corp. and DLNR’s Special Land and Development Fund.

The tensions between Kondo and Belatti only grew after the lawmaker repeatedly subpoenaed documents the auditor considered “confidential work papers.”

The issue ended up in court and on Nov. 3, Circuit Court Judge Lisa Cataldo ordered Kondo to produce two documents that he originally agreed to hand over to the House Investigative Committee, but granted his request to quash subpoenas for other documents Belatti wanted.

On Friday, two of the eight committee members — Reps. Dale Kobayashi, (D, Manoa-Punahou-Moiliili) and Val Okimoto, (R, Mililani-Mililani Mauka-­Waipio Acres) — voted against approving the final report.

During the final hearing Friday, Kobayashi again criticized the committee’s investigation of Kondo and said he had joined the committee to improve shortcomings found by Kondo’s audits.

On Saturday, Okimoto told the Star-Advertiser in an email: “Overall, I didn’t think the committee’s conclusions regarding the auditor’s office served the best interest of the public. I have always been an advocate for public transparency, but it’s difficult to justify when the process is questionable. Especially regarding the auditor’s office, whose independence is a fixture of Hawai‘i State Government.

“I appreciate the scrutiny and determination of Majority Leader Belatti to better the SLDF and the ADC; that effort will certainly benefit the people of Hawai‘i.”

Tarnas, who helped edit the final report and made suggestions, said he agreed with its conclusions and recommendations, including the ones directed at the Auditor’s Office.

“I’m a process kind of guy and a policy guy and a policy geek … so there is value in seeking best practices,” Tarnas said. “So I’m OK with critiquing the auditor. But I regret that it also has been distracting.”