The Birds in the Halls
THE UNIVERSITY OF HAWAII
Sightings from The Catbird Seat
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March 26, 2006
UH regents cited for secrecy
A state office rules that a closed-door meeting last month
should have been open to the public
By Craig Gima, Star-Bulletin
Most of a closed-door University of Hawaii Board of Regents meeting last month should have been open to the public, the state Office of Information Practices said in an opinion this month.
The Honolulu Star-Bulletin and UH journalism professor Bev Keever requested the opinion on whether the regents violated the Sunshine Law after they posted a vague notice of the Feb. 9 meeting to consider “the university’s powers, duties, privileges, immunities and liabilities with respect to financial issues.”
In a Feb. 21 letter to OIP, UH General Counsel Walter Kirimitsu said the meeting was held to brief the regents about the Sarbanes-Oxley Act of 2002, which established new standards for accountability for corporate officers and board directors.
To understand the full extent of their duties, Kirimitsu said, the regents needed to be aware of the budget and finance system, structure and practices of the university.
However, OIP said the exemptions to the open meetings law should be “strictly construed” so briefings on how the university is run and general advice on Sarbanes-Oxley should have been in public session. Only advice and discussion on specific legal issues can be held in executive session, OIP attorney Jennifer Brooks wrote.
Keever said she stood outside the door during the four-hour meeting and watched through a window as the university’s chief financial officer, Howard Toto, presented a series of computer-generated slides, but she was not allowed to hear the discussion.
From what she could tell, “this would have been an interesting and informative discussion for all sorts of people,” who are interested in learning how the university is run, she said.
“They (the regents and university lawyers) should realize we’re in the information age,” Keever said.
“It’s the wrong attitude,” she added. “They (government officials) should assume the public is interested and wants to be informed.”
Kirimitsu said last week that he believes that his general legal advice to the regents on how to best comply with Sarbanes-Oxley is protected by attorney/client privilege and it would have been difficult to separate out the legal advice from the briefing given to the regents….
“I don’t think the opinion is wrong, but I don’t think it applied to the actual situation and facts of our meeting,” Kirimitsu said.
Regents Chairwoman Kitty Lagareta said, “We’re all a little surprised by this one. It was a legal briefing on Sarbanes-Oxley and the financial risk issues that I think the regents need to understand.
“We made no decision (during the meeting),” she said, adding that the Sunshine Law does allow for executive session for legal and personnel matters. “There must be reasons where it is better to do it in closed session,” she said.
Keever agreed that a portion of the meeting dealing with specific legal advice can be closed.
However, she said, “you can’t close 95 percent of the meeting for just a very brief period for which that exemption is really in force.”
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October 16, 2004
Details emerge on
UH public relations
deal in Dobelle ouster
A consultant was paid $275 an hour
for legal advice and strategies
By Craig Gima, Star-Bulletin
A law firm hired by the University of Hawaii Board of Regents released a partial list of services provided by a public relations consultant that led to an $89,743 bill in connection with the dismissal of former UH President Evan Dobelle.
Rick Zwern, a former boss of Board of Regents Vice-Chairwoman Kitty Lagareta, billed at a rate of $275 an hour for 294 hours of work between June 25 and Aug. 10. The rest of the bill went for taxes and expenses….
“All I know is, it’s lower than my rate,” said attorney Bill McCorriston, who hired Zwern after consulting with the regents and who charged the university $350 an hour for his legal services….
“I think it’s consistent with top-rate public relations services. It’s certainly not out of line,” he said….
Zwern, who is also international training director for the public relations firm of Hill & Knowlton, also billed for work with Jim Jennings, a former Hill & Knowlton executive and former executive vice president of America’s Promise, the national youth development organization begun by Colin Powell and current and former U.S. presidents in 1997.
The full bill for Zwern’s and Jennings’ services was not released.
In a written statement, McCorriston said that much of Zwern’s services was related to his legal work for the university, which is protected from disclosure by attorney-client privilege.
The list released yesterday is for public relations activities for non-legal matters, McCorriston said.
The list includes media coverage review, research, developing communications strategy, drafting potential news media statements and planning and review for the release of documents after an OIP opinion that the public should have access to many of the documents and meeting minutes that led to Dobelle’s dismissal.
He said Zwern consulted on public relations strategies for UH on Dobelle and the transition to a new president. Zwern also coordinated news media inquiries and managed public communications from the university regarding the mediation efforts, potential litigation, the settlement and Office of Information Practices issues.
Lagareta has said that while she participated in the discussion over hiring Zwern during a June 15 board meeting, she did not make the final decision and disclosed her relationship with him.
Zwern was a co-owner of Communications Pacific when Lagareta was hired in the late 1980s. Zwern and his partner sold the company in 1993 to Hill & Knowlton, and Lagareta and her partner bought the firm from Hill & Knowlton in 1998.
Lagareta said she hires Zwern as a vendor to provide training services at Communications Pacific. But she said Zwern has not had a financial interest in the company since 1994.
University general counsel Walter Kirimitsu also said he does not see a conflict since McCorriston hired Zwern and there is no financial relationship between Lagareta and Zwern.
December 31, 2005
Audit Slams UH Budget
By Mary Vorsino, Honolulu Star-Bulletin
The University of Hawaii at Manoa’s $300 million operating budget is underscrutinized, providing little confidence that funds are managed adequately and impeding the”efficient and effective use of resources,” a state audit released yesterday says.
“In the course of our audit, we identified issues within the budget process … that do not fully ensure fiscal accountability,” state Auditor Marion Higa wrote in the report.
“At Manoa, these issues include an unsubstantiated base operating budget and a budget request that is not justified to the Legislature. Further, the campus does not have a formal mechanism for monitoring program use of general and tuition funds, resulting in little assurance that the campus has an adequate understanding of its fiscal condition.”
The audit also criticized the university’s “cost per student” calculation, which UH officials used to justify a 140 percent tuition increase approved by the Board of Regents in May.
Higa contended the formula has “limited value for decision-making” and is “reported without regard for its reliability and accuracy.”
In a 17-page response sent to Higa on Dec. 19, interim UH President David McClain rebuffed many of the audit’s conclusions and said he was “concerned with the quality of work reflected” in the report.
“After all the effort that went into this audit and the ensuing discussion at the exit conference,” McClain said in a news release issued yesterday, “we’re frankly puzzled as to how and why these distortions of our intentions remained in the final version.”
McClain also said that “while we do not concur with a number of the findings and conclusions in the report, we do agree there is room for improvement.”…
The state Legislature asked for the financial audit of UH-Manoa in the last session. It was conducted between June and October….
In the audit, Higa said UH-Manoa bases the bulk of its budget requests on previous budgets, focusing attention on additions or deletions – program change requests and workload increases – rather than the performance of programs funded in the past.
In this fiscal year, for example, only about $13 million of the nearly $200 million in state funds that UH-Manoa received from the state Legislature “required justification.”
“Thus, a significant portion of the funds requested avoids scrutiny,” the audit says. “No information is provided on what was accomplished with this money in the previous year or what is expected to be accomplished with this money in the current year.”
The audit also said “tax controls” could lead to inappropriate use of tuition funds. In fiscal 2005, UH-Manoa got about $100 million in tuition revenues. Under state law, that money can be used only to “maintain or improve the university’s programs or operations.”
The university’s guidelines for spending tuition funds were drafted in 2003 but have yet to be implemented, the audit said.
October 1, 2004
UH sees no conflict of interest
with PR contract
By Craig Gima, Star-Bulletin
University of Hawaii regents awarded a nearly $90,000 public-relations contract to a former boss of board Vice Chairwoman Kitty Lagareta during this summer’s dispute over then-UH President Evan Dobelle’s dismissal.
The contract went to consultant Rick Zwern, who was a co-owner of Communications Pacific Inc. when Lagareta worked for the firm early in her career.
Lagareta said that while she had a say in the hiring of Zwern, she did not make the final decision, and university lawyers agreed that there was no conflict of interest.
“Rick has had no financial interest in Communications Pacific since 1994,” Lagareta said, noting that he was not an owner when she purchased the firm in 1998.
Zwern sold Communications Pacific to Hill & Knowlton in 1993. Lagareta and current company President Al Hoffman bought the company from Hill & Knowlton.
Lagareta, who is the firm’s chairwoman and chief executive, said the regents decided in June that they needed professional public relations help with the dispute. She said she participated in the discussion about several consultants, including Zwern, with regents’ attorney Bill McCorriston. McCorriston made the final decision on which firm to hire.
McCorriston said he selected Zwern because he was familiar with his work. “He gave me my original media training,” he said.
He added that Board of Regents Chairwoman Pat Lee approved the decision.
Lagareta said she disclosed her relationship with Zwern to the other regents.
UH Vice President and General Counsel Walter Kirimitsu said he did not see a conflict with Zwern’s relationship to Lagareta because there was no financial interest, McCorriston did the hiring and Lagareta disclosed her relationship.
Zwern, an international training director for the public relations firm of Hill & Knowlton, bought Communications Pacific with co-owner Clifton Kagawa in the early 1980s. Lagareta was hired at that time by Kagawa, she said.
Zwern, who maintains a home in Hawaii and continues to do public relations consulting work here, also does training for Communications Pacific.
His contract with McCorriston and the regents was part of the legal bills released Sept. 23.
“It was a good value,” McCorriston said. “It freed my time up,” he said, noting that Zwern’s hourly rate is much lower than his. McCorriston said Zwern also gave the regents advice on other matters, including transition issues.
The Board of Regents fired Dobelle on June 15. Dobelle hired his own attorneys, and after a successful mediation, the regents took back the firing and Dobelle resigned.
Dobelle got about $1.3 million in severance and salary for two years, instead of the $2.26 million called for in his contract.
Legal bills for the university and Dobelle’s lawyers, who were paid by UH, totaled more than $1 million.
For more, GO TO > > > The Firing of Evan Dobelle
September 4, 2003
Lingle picks Maui Petroleum exec and
GOP ally for UH board
By Gary T. Kubota, Honolulu Star-Bulletin
WAILUKU >> A Maui businessman who rose from an accountant to business owner on the Valley Isle and the Big Island has been appointed to the University of Hawaii’s Board of Regents by Gov. Linda Lingle.
James Haynes II, a University of Hawaii graduate, was named yesterday to succeed Maui building developer Everett Dowling, who resigned to end any conflicts of interest that could hinder building a new astronomy complex on land he owns.
Haynes’ appointment, which takes effect immediately, will need to be confirmed by the state Senate in the next legislative session. His selection appears to increase the influence of Lingle and the Republican Party on the 12-member Board of Regents, which can hire and fire the University of Hawaii president.
Haynes is the seventh member appointed by Lingle and the sixth with ties to Lingle and the GOP.
Lingle has criticized the fiscal performance of University President Evan Dobelle, who supported her Democratic opponent, Mazie Hirono, in last year’s election.
Haynes, a part-Hawaiian and Punahou School graduate, has been a supporter of the Republican Party of Maui for decades, helping to finance political campaigns for the GOP.
Richard Tuell, a chairman of the Republican Party of Maui in the late 1980s, recalled how he would call Haynes when the GOP needed money.
“He was on my to-call list. He’d write me a check,” Tuell said….
William Wilmore, a former building contractor, recalled that Haynes worked for him for three to four years as an accountant at Global Contractors on the Valley Isle in the mid-1970s….
Lingle said she came to know Haynes through his work in the community, including his service as vice president of the Maui Arts & Cultural Center.
He has also served as past president of the Maui Historical Society and trustee of the Nature Conservancy of Hawaii.
Lingle said she was aware Haynes was a graduate of the University of Hawaii and had expressed an interest in helping the institution….
“Jim’s ongoing efforts to improve Hawaii, whether through enhancing the business climate or being actively involved in local community organizations, make him ideally suited to serve on the Board of Regents,” Lingle said….
Haynes, president of Maui Petroleum Inc. and vice president of Hawaii Petroleum Inc., is also president of Minit Stop Stores on Maui and the Big Island.
He previously served as president of Big Island Petroleum, which merged with Hawaii Petroleum in 1998.
Haynes was also former president of Maui Disposal Co. Inc., as well as former president of JBG Corp., the parent company of McCabe, Hamilton & Renny, the state’s largest stevedoring company.
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For more on James Haynes, GO TO > > > Woo vs. Harmon: Witness James Haynes
MORE TO COME
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Last Updated on August 3, 2006 by The Catbird