WASHINGTON — The city of Honolulu has missed a federal deadline to review financial records of a Wahiawa senior center under investigation for possible misuse of $7.9 million in federal funds.
If the city can’t satisfy the Department of Housing and Urban Development by the end of the month that ORI Anuenue Hale is in compliance with federal grant requirements, the city will have to pay back the money.
According to an Oct. 11 HUD letter obtained by Civil Beat, city officials already missed one federal deadline and the center is still out of compliance. Honolulu officials, in an Oct. 14 reply to HUD, said they were still developing detailed plans they are required to submit.
For months, Honolulu has promised to take corrective action to meet Community Development Block Grant requirements. The corrective action was required after routine HUD monitoring found that ORI was failing to comply with a slew of grant eligibility standards. But the city is approaching an Oct. 31 compliance deadline with several issues still unresolved.
City Budget Director Michael Hansen, in his Oct. 14 letter, said the city missed a Sept. 30 deadline to review ORI’s financial ties to other organizations because the nonprofit’s chief financial staffer was “on leave.”
“Unfortunately, (ORI) has not yet been able to respond to further inquiries as their chief financial contact has been out on leave,” Hansen wrote.
Hansen wrote that “she has recently returned,” and that the city remains “committed” to resolving the issue.
Another critical issue that HUD raised was the appearance of underutilization of ORI’s facilities. A federal investigator reported seeing only five clients at a center that received funding to serve at least 50. ORI had rejected HUD’s claims about underutilization, but after long failing to offer specifics on utilization, city officials are now formally acknowledging that the facility is not regularly serving 50 clients.
In the Oct. 14 letter, Hansen wrote that the city and ORI are “preparing a detailed plan to increase the utilization of the Wellness Center to at least 50 eligible elderly and adults with disabilities during all normal hours of operation.”
Hansen said ORI is partnering with outside senior organizations to recruit clients, as well as marketing its facilities. Since August, Hansen said the center attracted “5 new elderly persons attending classes,” and that the city will verify this increase before HUD’s Oct. 31 deadline for the city to resolve all outstanding issues related to the investigation.
Another major issue that the city addressed was HUD’s concern about how ORI was using its Camp Pineapple 808 cabins. In previous correspondence, the city was ambiguous about whether ORI charges fees that would preclude low- and moderate-income clients from renting its Camp Pineapple 808 cabins.
In the Oct. 14 letter, Hansen wrote that ORI is drawing up a list of fees charged to individuals and groups that have rented the cabins. It was not clear whether ORI plans to identify the renters. HUD reported two potential usage violations of the camp, based on outside groups using it for scheduled events. A brochure for the camp says it can be rented for weddings and graduations, parties, banquets, corporate events, family reunions and more.
The city has already resolved some of the issues uncovered in HUD’s investigation but HUD made it clear that ORI and the city are still “not complying” with several federal eligibility requirements. The city has less than two weeks to change that.