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Tuesday, February 19, 2013

When the cat's away ...

... the mice will play.

Having recently raised concern about "fast-tracked" ways around prudent procurement strictures, this news item reported on The Hawai'i Procurement Institute website begs to be repeated.

But first, this bit of background. Hull: Building the campus at Palamanui
How exciting for the UH-Hilo campus … $66 million on three separate construction projects: a new student complex; a new campus student service building for $18, million; and a new permanent Ka Haka Ula Keelikolani College of Hawaiian Language for $20 million.

I am pleased for Hilo. This project was fast tracked after Gov. Neil Abercrombie released funding in December of 2011, according to Brian Minaai, VP/UH System for Capital Improvements.

At the Jan. 9 All Campus Meeting at the University of Hawaii Center in Kealakekua, VPCC John Morton announced the $21 million low bidder on Palamanui Campus withdrew the bid and the next lowest bid is $25 million for the long-proposed Hawaii Community College-Palamanui. We do have the funding of $7.5 million from the state bond issue and $9.7 million in private funds, but it seems like the project will be unable to proceed to break ground due to the almost $8 million needed for the $25 million bid.

At this meeting President MRC Greenwood told the attendees to contact Abercrombie and the Legislature to find the rest of the funds.
Now, the news item. UH official gave work to firm that built flawed softball field
Dennis Mitsunaga, who owns Mitsunaga and Associates, said the actions of UH’s associate vice president for capital improvements, Brian Minaai, on a Hilo dormitory project Mitsunaga is involved with would have been criminal had the university not had a temporary exemption from the state’s procurement code.

Mitsunaga, a major Demo­cratic political donor and supporter of Gov. Neil Abercrombie, made the startling accusations in written testimony submitted Thursday to a Senate committee considering a bill about UH construction projects.

The measure, Senate Bill 1383, would shift procurement oversight of construction contracts from UH and return it to the Department of Accounting and General Services, which handles that responsibility for most other state agencies. The bill passed the Senate Higher Education Committee on Thursday but was killed later that day by the Senate Economic Development Committee. UH opposed the bill while the Abercrombie administration supported it.

In his written testimony in support of the bill, Mi­tsunaga said Minaai’s process for selecting consultants for nonbid projects is highly suspect and, with the exception of Mitsu­naga’s firm, said Minaai picks only friends from a pool of hundreds of qualified Hono­lulu architects and engineers. Mitsunaga said working with Minaai on the Hilo dorm has been a nightmare for his staff. He accused Minaai of ordering the replacement of two project consultants and hiring of a third one after the selection process had been completed, adding to the cost. Minaai directed Mitsu­naga’s firm to hire the third company, Palekana Permitting and Planning, to do permit processing, even though that work usually is part of the engineer or architect’s basic service and normally doesn’t involve a separate charge. Palekana’s fee for this service is $23,000.

Asked about Mitsunaga’s testimony, UH spokes­woman Lynne Waters said in a written statement that the university leadership was aware of the serious nature of some of the Mitsu­naga allegations. “Please note these accusations have not been proven,” Waters wrote. “Nevertheless, a thorough investigation of the allegations will be conducted.”

When Minaai gave the general construction contract to Kobayashi, that company subcontracted what is normally considered the general contractor’s work to Isemoto Construction, the largest contractor in Hilo, according to Mitsu­naga. By not awarding the contract directly to Isemoto, the state probably has to pay an extra $3 million to $4 million, he estimated.

Louis Kiang, formerly with a company that settled a breach-of-contract lawsuit against UH tied to its soon-to-open cancer center, said Mitsunaga’s testimony is consistent with experiences he had with Minaai. Kiang said he believes Minaai is trying to subvert procurement rules to benefit friends and patrons. “It’s deliberate,” Kiang said. “These things go beyond incompetence.”
Read more at The Hawai'i Procurement Institute web link above.

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