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DBEDT Director Ted Liu under fire

By Mari-Ela David bio | email

HONOLULU (HawaiiNewsNow) - Four years after a luxurious trip to Asia, the State Auditor says Department of Business, Economic Development and Tourism (DBEDT) Director, Ted Liu, should be fired.

But the Governor says her cabinet member will not step down.

The audit hasn't been officially released yet. But Liu revealed some of the findings in the draft, saying it has serious errors.

In it, Liu says Auditor Marion Higa criticizes a 2005 trip to China and Korea that sparked controversy back then, but was cleared by the state.

"Both the State Procurement Office and the Attorney General's office looked into it and found there were no violations," said Liu.

Four years later, Liu faces scrutiny again over the trip he took with Governor Linda Lingle.

Spending public funds lavishly on the trip is among the alleged violations Higa's audit accuses DBEDT of.

But in his written response to her, Liu blasts the allegations.

"I believe the auditor has crossed the line," he said.

In a statement, Governor Lingle says "The draft audit glosses over the fact that much of the costs of the critical missions that took place in 2005 to China and Korea were paid for by donations and support from private sponsors that both recognized and approved the use of the money."

The other issue raised in the audit has to do with a nearly $400,000 federal grant.

It's supposed to go towards a project, helping Hawaii companies to open the China market.

The audit accuses DBEDT of spending that money for other things, thus allegedly violating federal guidelines.

But Liu says it was a reimbursement grant.

DBEDT paid for the project in advance, and once reimbursed, under the terms of the grant, DBEDT was free to use the funds as it wished.

"To come to that type of conclusion on the basis of either misunderstanding or ignoring the program I think really only points to how unproductive and unfair and indeed political this type of exercise is," said Liu.

Higa won't comment until the final audit is released.

DBEDT is a data center the state uses to help make decisions on boosting Hawaii's economy, business, energy conservation, and foreign trade.

DBEDT's budget is $256 million for the 2010 fiscal year.