The state Ethics Commission on Wednesday rebuffed a staff recommendation to advise Gov. David Ige to consider replacing Aloha United Way as the state’s workplace giving program with a combined state-run campaign.

The staff had found that Aloha United Way enjoyed an "unfair advantage" over other private charities, a preference that was inconsistent with the fair treatment provision of the state ethics code, which prohibits state workers from granting unwarranted privileges to private interests. The staff had recommended that the commission advise Ige to replace Aloha United Way with a combined campaign that might enable more state workers to give directly to specific charities.

But a commission staffer clarified on Wednesday that the staff does not contend the preference for Aloha United Way actually violates the ethics code. The staff, in presenting the recommendation to the commission in front of an audience filled with nonprofit advocates, also took a much softer tone in describing the issue that undercut the staff’s own written findings.

No commissioner would even make a motion to vote on the staff recommendation, so the issue was dropped.

"It is not a violation of the fair treatment (provision)," Edward Broglio, the commission’s chairman, said afterward. "We have given an exemption to the Aloha United Way in the past, and that is consistent with all the testimony we heard today. It allows everybody to apply. They have a very good criteria. They follow up.

"And all the information we heard from the participants today, I think, backs up that the United Way is definitely the way to fundraise (for) our charities," Broglio said.

Aloha United Way raised $9.1 million last year for charity, including about $849,000 from its state campaign. One-third of the money raised was designated by donors to specific charities, while two-thirds was distributed by AUW based on guidance from volunteers.

The commission staff had suggested that converting to a state-run campaign might encourage more state workers to designate their money to specific charities, rather than leaving the choice of how to spend the money with AUW.

"We’re just so relieved," Cindy Adams, president and chief executive officer of AUW, said after the commission’s decision. "I think there was just tremendous support for the current model in terms of the partnership between the state and Aloha United Way and the way that we’re supporting both the donors as well as the partner agencies.

"So we’re very pleased and very thankful."

Adams and several other nonprofit advocates warned the Ethics Commission that a change to the state’s workplace giving program would likely lead to a decline in charitable giving.

Aloha United Way coordinators are typically assigned in state departments to spearhead the campaign, creating what one advocate described as a "culture of giving" that might be diminished if AUW is not the umbrella organization behind the drive.

"Change will cause people to pull back," said Richard Rosenblum, the former president and chief executive officer of Hawaiian Electric Co., who is the chairman of the board of directors at AUW.

Rosenblum urged the commission not to recommend a change without a "demonstrable likelihood that something will be better."

Several state workers have complained to Ethics Commission staff about the favoritism shown to AUW and the pressure to donate. David O’Neal, a commissioner, said one state worker described it as being "voluntold" to participate in the fundraising campaign.

The ethics staff has already advised the state that it cannot demand full participation in the fundraising campaign, post lists of workers who have donated, or allow supervisors to solicit donations from their subordinates.

Leslie Kondo, the commission’s executive director, said afterward that Ige could still consider changes to the state’s workplace giving program on his own.

Under Kondo, the commission has taken fresh looks at many long-standing ethics issues to review whether the practices are consistent with the ethics code. The commission, for example, had since 1976 considered the AUW fundraising campaign a "public business" exempt from the fair treatment provision because of its communitywide support.

Several state lawmakers and state workers have complained that Kondo has overreached in his interpretation of the ethics law.

Randy Perreira, executive director of the Hawaii Government Employees Association and who serves on the board of the AUW, said he thought none of the commissioners wanted to make a motion because "nobody sees the wisdom of what the staff was proposing here."

Perreira called it "just a big waste of taxpayer dollars to spend all this time deliberating on nothing."