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| Congressman Neil Abercrombie, D-Hawaii, First District |
Congressman Neil Abercrombie, D-Hawaii, First District, launched an all out verbal attack on City Council Member Charles Djou, Communications Pacific President Kitty Lagareta and Gov. Linda Lingle on the KHVH Mike Buck radio show Wednesday afternoon, elaborating on his diatribe at a Thursday press conference held at City Hall.
Abercrombie lashed out at Djou for filing a petition for investigation with the Inspector General of the U.S. Department of Transportation of the city’s procurement of a $10 million study for the proposed multi-billion dollar rail system without first notifying himself and Hawaii’s three other congressional delegates.
He accused Djou of conspiring with the governor and her friends to stop the project from being constructed on Oahu, as Honolulu Mayor Mufi Hannemann, seven of nine council members and Abercrombie are advocating.
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| Honolulu City Council Member Charles Djou |
"If you're going to step into my kuleana and try to associate me with being indifferent or not paying attention to whether something is corrupt or inappropriate, then you better have the evidence at hand or you better shut up or back up," Abercrombie said at his press conference. "If this is grand standing, then I want it pointed out and this kid can go back in his corner and try to do something useful."
On KHVH, Abercrombie also accused Gov. Linda Lingle of trying to undermine the rail project, saying she is secretly opposed, even though she allowed a bill to pass without her signature that enabled the City Council to raise Hawaii’s General excise tax by 12.5 percent to fund the rail project.
Hannemann at a noon press conference today said he disagrees with Abercrombie and believes Lingle is still supportive of the rail, noting that in 2006 she's up for re-election and would have to explain to people sitting in traffic why she pulled her support for the project. Hannemann did agree with Abercrombie that Djou should have gone to the Congressional delegation with his concerns about the rail project before going to the Inspector General.
Countering the accusations and personal attack in his own press conference that followed Abercrombie’s, Djou said the governor did not know of his plans, noting he is not required to inform anyone of his petition.
Djou maintains he is not opposed to a rail system being built in Hawaii, though he fought against the current proposal because it calls for a record increase in taxes to pay for the project -- the largest public works project in the state’s history. "I would rather see the rail be built with private funds or through a public-private partnership," Djou says.
Hannemann said Djou is trying to kill the rail project because he is opposed to it and that Djou's comments are the most disingenious he's heard since coming to City Hall in January 2005.
Defending his petition, Djou says he has two concerns: The $10 million contract, which funds a study for the mass transit project, was not competitively bid out by the city; and there are credible allegations of corruption in the contract awarding process by three companies.
"First, the city never asked any bidders on this $10 million study to compete on price. This is a huge amount of money to just give to a firm for a study without any price competition. Although this study contract was set out to bid, the city picked a contract value of $10 million and did not ask any contractor to compete on price," Djou says.
There also is a "dark cloud" concerning inappropriate behavior and possible corrupt conduct hangs over the treatment of subcontractors by Parsons Brinkerhoff Quade & Douglas, the company that won this mass transit contract, Djou says.
"I am asking the federal government to review and carefully investigate how Parsons Brinkerhoff handled this contract," Djou says, noting the federal funds constitute nearly 80 percent of the $10 million contract awarded to Parsons Brinkerhoff. While the city initiated the project, the federal government has jurisdiction over this project, Djou says.
Controversy Could Affect All Future Procurement by Counties, State Government
The petition for investigation -- combined with a separate investigation and petition filed by subcontractors last week with the state Procurement Board -- will likely have a major impact on the way the city procures all projects in the future.
The background on the controversy: The city awarded a $10 million study contract to Parsons Brinkerhoff, with Communications Pacific, Limtiaco & Company, and Belt Collins as subcontractors. After a discussion with the city, however, Parsons Brinkerhoff without explanation dropped these subcontractors and awarded a nearly $900,000 subcontract to Community Planning, Inc., a company owned by Joe Pickard, a major supporter and fundraiser for the mayor during his 2004 election bid. This despite the fact that Pickard’s company was never a part of the original bidding process.
Lagareta of Communications Pacific attempted to get information from the city as to why her company and two others were squeezed out of the contract award, which would have totaled almost $1 million between the three companies. When she got no response initially from Honolulu Mayor Mufi Hannemann, she wrote a letter to the mayor and accused him and the city administration of dirty politics.
Hannemann told reporters in a press conference held a few weeks ago that the city did nothing wrong and that there was no dirty politics involved in the award, though he declined to discuss any of the details of the procurement, noting pending litigation by the subcontractors.
However, today in the press conference Hannemann said that Parsons Brinkerhoff had every right to switch the subcontractors and would get more bang for the buck with Community Planning, Inc. because it's more than a "public relations" firm.
Communications Pacific filed a legal petition on Nov. 23, 2005, with the state Procurement Policy Board requesting a ruling on whether the city violated the law.
Specifically, CommPac seeks a ruling on the proper interpretation and application of the Hawaii Procurement Code.
"The city interprets this provision to allow a back-room award of contract work to subcontractors who were never evaluated by a selection committee and never participated in the competition for the contract work. We don’t," Lagareta says.
City Says State Procurement Board Should Stay Out of Controversy
The city argued in a letter to the state Procurement Board that this contract is off limits to the state and that the procurement board is precluded from considering CommPac’s petition because it has no authority to rule on "disputes."
But Lagareta and her attorney, Terry Thomason, an expert in procurement law who helped craft the existing procurement legislation that went into effect in 2003, says the city is simply misstating the law.
"CommPac’s petition is intended to ensure the Hawaii Procurement Code rules are followed and corruption from sloppy procurement practices is prevented. If the city thinks these issues are ‘petty,’ we can only say that we think the city is wrong," Lagareta says.
Thomason says what the state Procurement Board decides will likely affect all future procurement in the state. "Either the board will require the city to follow the law or it won’t. No matter what the current administration says it has done in the past, the city is not allowed to order contractors to use specific subcontractors. It just isn’t legal."
The petition by Lagareta also was a sore subject with Abercrombie, who took a stab at Lagareta and accused Gov. Lingle of attempting to thwart the contract award because she allegedly wanted the contract to go to Lagareta, a supporter and an officer of the Republican Party of Hawaii.
However, observers of this dispute Abercrombie’s accusations are not substantiated because Pickard, who got the city contract, also is a major supporter of Lingle. Pickard has received nearly 80 percent of the construction work for the state Department of Hawaiian Homelands -- or an estimated $60 million -- since Lingle was elected in 2002, in addition to other government work -- a fact Abercrombie did not acknowledge.
Lagareta says Abercrombie and the city administration are presenting the concerns of subcontractors as "petty" and says CommPac does not consider "non-competitive, back-room awards of government work and money to be petty."
The city’s history of corruption under previous administrations as well as under Hannemann’s new administration as in the recent case of the Rutledge family winning a city beach boy concession contract despite pleading guilty to federal felony charges calls for careful scrutiny of the city, Lagareta says.
Hannemann maintains there was no wrong doing in the procurement process and challenges Djou to show him "where's the beef?" He added that Djou should stop being a "lackey" for his political supporters.
Reach Malia Zimmerman, editor and president of Hawaii Reporter via email at mailto:Malia@hawaiireporter.com
