There is hope as well as a warning sign on the horizon for the future of Oahu’s affordable housing inventory, affordability that is needed even more urgently in these uncertain times.
First, the hope: The city has just launched the Department of Housing and Land Management (DHLM), pulling together into a single agency four previously separate offices that have dealt with housing matters.
If the DHLM is able to operate with sufficient transparency and oversight — a big “if” — this could boost efficiency at a time when affordable-housing development, always a challenging enterprise, could face further economic headwinds.
In fact, this “new” agency is actually a relaunch of a similar one, after nearly 30 years. The city had the Department of Housing and Community Development until the 1997 arrest of city housing official Michael Kahapea. His management of the Ewa Villages project led to his conviction three years later for theft, money laundering and other charges.
That notorious case effectively put a comprehensive housing agency on ice, with the city eventually picking up pieces of the puzzle over time.
But it’s plain that the city needs a more coordinated approach to such a critical public concern as Honolulu’s persistent housing shortage. It’s also crucial that authorities erect the guardrails that can prevent backsliding into corruption territory.
So here’s where the most recent warning comes in, from a neighbor island jurisdiction but informative as Oahu’s newest department kicks off.
A federal jury on Wednesday found three men guilty in connection with a conspiracy with a Hawaii County worker to exchange affordable housing credits for $1.9 million in “paid bribes and kickbacks,” according to the U.S. Attorney’s Office.
The verdict implicated attorneys Paul Joseph Sulla Jr.and Gary Charles Zamber, as well as businessmen Rajesh P. Budhabhatti, in the scheme coordinated with Alan Scott Rudo, a housing specialist for Hawaii County Office of Housing and Community Development.
Sulla, Zamber and Budhabhatti were convicted of conspiracy and honest services wire fraud. Sulla alone was found guilty of money laundering.
Rudo had earlier pled guilty of conspiracy in the bribery and kickback scheme and testified at trial. His conviction found that in exchange for the cash, Rudo used his government position to make certain the county approved three affordable housing agreements for Sulla, Zamber and Budhabhatti’s development companies — Luna Loa Developments LLC; West View Developments LLC; and Plumeria at Waikoloa LLC.
In their agreements for the housing credits, the defendants promised to build affordable units for Hawaii County — but never produced a single unit, according to the U.S. Attorney’s statement.
Forewarned is forearmed, the saying goes. Witnessing such a vivid derailment of housing intentions should incentivize Honolulu’s city administration to steer clear of any such landmines in its DHLM rollout.
In April, the Honolulu City Council approved the plan. Organizationally, it makes sense: The new department encompasses offices focusing on housing development, finance, policy, and property and asset management, as well as land transactions and conservation.
Kevin Auger, who will direct the department, has said DHLM “was built to execute” — an encouraging resolve internally. But as the housing scandals demonstrate, external surveillance is essential, too.
This agency seems off to a good start, but the work of the mayor and the legislative branch is far from finished. Frequent progress reports to the people’s representatives at Honolulu Hale will help ensure that hope can yield housing success.
