University of Hawaii criticized for spending money to study itself

University of Hawaii criticized for spending money to study itself
Published: Feb. 26, 2013 at 1:58 PM HST|Updated: Feb. 26, 2013 at 10:50 PM HST
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HONOLULU (HawaiiNewsNow) - Some state lawmakers and many viewers are questioning the University of Hawaii and its decision to spend $260,000 on another study to look into the Stevie Wonder blunder concert last year.

The University lost $200,000 from the failed concert fiasco.  It already spent $50,000 on the Athletic Department's accountability.  Now it's spending up to $260,000 more to study the entire UH system's efficiency.

The University of Hawaii Board of Regents just approved a plan that would spend up to $260,000 to among other things review the University's organizational chart, interview various officials, and identify gaps and overlaps.  Some lawmakers say the study is a complete waste of taxpayer money.

"The University is out of control in terms of the finances and the public is really getting exercised about this. This would be yet another reason to raise student tuition to cover costs of this study. Totally unnecessary," said State Senator Sam Slom, (R) Minority Leader. "It's a waste of more taxpayer dollars."

"We need to cut the losses. We should have cut it awhile ago. But the other problem is I know we want to prevent things from happening again but they already have things in place. We don't need to hire someone for $260,000 to tell us and review what's already on the books what are already our policies," said Senator Donna Mercado Kim, (D) State Senate President.

Other questions come to mind like why spend the money when there is already a plan to audit the University?  And if UH really wants to study itself, couldn't it do that itself?

"People are being paid $225,000 on the payroll consistently and what are we paying them for if we have to go hire and pay another $260,000 every time there is a blunder," said Senator Mercado Kim.  "The problem we had with the Stevie Wonder, is that they didn't follow the procedures so why are we spending another $260,000 on top of the $1.2 million we already spent? And I'm not sure what we're going to get from this study."

State Representative Isaac Choy, who represents Manoa where the University, is also an accountant. He believes money could be saved by picking up a copy of the American Institute of CPA's, Audit Committee Toolkit.  Rep. Choy says the book would tell you the same thing and a copy only costs $32.  He believes the accountants already on the University's staff could handle study.

"I think the public needs to get really riled up and really mad," said Sen. Mercado Kim.

That's already happened judging from comments we received online that say things like...

"So the University lost $200K and now they want to spend $260K on an accountability study?! (Shaking my head), UH doesn't surprise me anymore," wrote Blake Sakata.

"That's Ridiculous! It's done and over with. Why spend more??? How about Scholarships?" wrote Casey Reel.

"Let me give you an assessment of what happened. Someone got suckered!!! Done. I'll take the $260,000. Thank you," wrote Ellery Galanto.

The University's consultant was not available to talk on camera until tomorrow, but did provide email responses today. The following are questions we asked and University responses.

1. What specifically is the $260,000 buying?

Phase 1 of the Advisory Task Group's work looked only at the UH Manoa Athletic Department in determining accountability and responsibility in the Wonder concert incident. The Regents wanted to - and the Senate Committee on Accountability recommended that - the entire UH System be examined to assess function and efficiency. This phase will allow that to occur.

In addition to the one-page memo outlining Phase 2 Project Scope and the attached org chart (click here), see attached UH BOR Advisory Task Group Phase 2 Scope of Work submitted by the Task Group and approved by the Board of Regents (click here).

2. What company will do the work?

KMH, which was procured for phase 1 and subsequent phases

3. Is it paying the contractor to conduct the interviews and write the report?

The contractor and other entities (such as AGB) will be performing the work under Phase 2. KMH will coordinate the work. With the information compiled by KMH, the Advisory Task Group with issue a report with its findings and recommendations.

4. Is this something UH could have done itself?

This project will require around 2,000 hours of labor and demands the best available in the field to perform it. UH does not have the internal capacity to produce this report. In addition, Regents wanted a neutral, objective assessment of how well the system is functioning in these key areas and feel external parties would provide the most valuable measure.

5. Would the proposed legislative audit have answered some of the same questions this study will ask? No.

6. Why spend $260k to find out how $200k was lost?

The Senate Committee on Accountability in its report to the Senate President recommended in item #14 that after the Board of Regents' Task Group completed its work in Phase 1 that it consider "external monitoring measures such as follow-up auditing by the Legislative Auditor or the hiring of a master to ensure that the recommendations of the Task Group, KHM, the Legislative Auditor or others as appropriate, are implemented…."

The organizations expected to assist with this phase have national expertise and have consulted with major public university systems across the nation with similar issues. Such studies can run close to or above $1 million.

Finally, the $260,000 authorized is a cap, not a final price. It's possible volunteer time and donated services could lower the final billed amount.

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