A House committee has revived a proposal to strip the University of Hawaii of procurement oversight of its construction projects as a prominent engineer has expanded on allegations that a top UH executive wasted potentially tens of millions of taxpayer dollars through blatant mismanagement.
The attorney general’s office, meanwhile, has agreed to investigate the allegations, UH said Thursday.
The House Finance Committee earlier this week amended House Bill 114 to include a provision transferring compliance oversight of university construction projects and related professional service contracts to the State Procurement Office.
By a 16-1 vote, the panel advanced the bill to the full House, whose members must approve the measure for the Senate to consider it. A Senate committee killed a similar bill last month.
On Wednesday, two days after the Finance Committee approved the amended bill, Dennis Mitsunaga, a politically prominent Democratic fundraiser, wrote letters to the UH Board of Regents and UH-Hilo Chancellor Donald Straney, adding details to explosive written testimony he submitted last month to a Senate committee.
As in his Senate testimony, Mitsunaga directed his charges at Brian Minaai, UH’s associate vice president for capital improvements, whom Mitsunaga accused of steering construction-related contracts to friends.
Mitsunaga’s testimony alleging cronyism was extraordinary because he openly voiced what many contractors believe but say they are unwilling to express publicly, fearing retaliation. Such contractors work on UH projects or expect to bid for such work.
In his letter to the regents, Mitsunaga, whose firm, Mitsunaga and Associates, is working on a UH-Hilo dormitory project, said Minaai is "running amok" as a manager.
"He awards construction contracts without any independent verification of the proposed cost, uses very suspect procurement procedures (contrary to HRS 304D-104) and has wasted millions and possibly tens of millions of taxpayer dollars — much more than the loss on the Stevie Wonder Concert," Mitsunaga wrote.
The concert reference was about the hundreds of thousands of dollars UH has spent dealing with the aftermath of last year’s planned athletic department fundraiser that never happened. UH was the victim of an alleged scam.
As has been the case since Mitsunaga’s accusations first surfaced, Minaai did not respond Thursday to a request for comment left at his UH office.
A Mitsunaga representative said he was unavailable for comment. Mitsunaga has not spoken publicly about his written allegations.
In his letter to Straney, Mitsunaga said his company, which is the designer for the Hilo project now under construction, was directed by inspectors Minaai hired to allow the use of spray paint, even though that is prohibited by the project’s contract specifications and UH policy.
Mitsunaga said his firm received an email last week from Albert C. Kobayashi Inc., the project contractor named by Minaai, indicating that spray paint would be used on the interior and exterior of the buildings, not the brush and roll methods specified in the contract.
His firm will again disapprove such a major change but to no effect because Minaai is "doing whatever he feels like doing," Mitsunaga wrote.
In the Straney letter and his Senate testimony, Mitsunaga alleged that Minaai allowed the contractor to make multiple changes to the Hilo project, downgrading the exterior structure, windows, electrical and plumbing fixtures and other materials, so that AC Kobayashi, as the company is known, can increase its profit margin.
AC Kobayashi has not responded to the allegations.
In his letter, Mitsunaga also noted that rainwater has infiltrated and soaked wood framing of the Hilo complex and that AC Kobayashi was supposed to document the moisture content before closing off the walls.
Yet Mitsunaga’s company has yet to see any moisture reports, and hence there is no way to verify that the wood studs in the dormitory wings were sufficiently dried before the gypsum boards were installed, he added. Installing gypsum board on damp studs can create mold and mildew and cause paint to peel, Mitsunaga wrote.
Asked Thursday about the new details of Mitsunaga’s allegations and the status of the investigation, UH officials did not respond — other than to issue a brief statement saying the attorney general would conduct the probe and report the findings to regents.
"Until the investigation is complete, we anticipate having no further comments," the statement said.
UH officials did not address Star-Advertiser questions about the timetable of the investigation and whether Minaai is still functioning in his normal capacity as an associate vice president.
Although President M.R.C. Greenwood said recently that the university would follow an open and transparent process regarding the investigation, the matter was discussed last week by the regents in executive session, and the school said nothing about it for days — despite multiple requests from the Star-Advertiser.
UH explained its silence by saying the discussions dealt with personnel matters and potential litigation.
Mitsunaga’s allegations are expected to bring more attention to the House bill as it continues through the legislative process.
Under the changes proposed, UH would retain all its responsibilities for selecting contractors and administering contracts for construction projects, according to written testimony from Aaron Fujioka, state procurement administrator. But his office would take over responsibility of determining whether UH follows the state procurement code, a task that now rests with the UH president, according to Fujioka.
UH opposes HB 114, saying changing who is UH’s chief procurement officer, as the bill proposes, could adversely affect more than $600 million worth of projects under construction or in the pipeline.
John Morton, UH’s vice president for community colleges, in written testimony also noted that UH is in compliance with the state’s procurement code.
The university does not support statutory changes based on unsubstantiated allegations against an individual, Morton wrote.
