Pua Aiu, the head of Hawaii’s State Historic Preservation Division, has resigned amid strong criticism from federal officials that she failed to address operational problems that have put the department’s federal certification and funding at risk.

William Aila, chair of Hawaii’s Department of Land and Natural Resources, which oversees SHPD, said in a statement that the department needed a change of leadership in the wake of a critical report from the National Park Service that said the agency was still failing to meet its responsibilities.

“We believe that SHPD has made progress in a number of areas, including hiring of qualified staff and addressing a backlog of review and compliance tasks,” he said. “However, we take this report seriously, and given the importance of SHPD to the state, we need to change the leadership in order to move forward to implement the recommendations. So we’ve accepted Pua’s resignation.”

The National Park Service placed SHPD on high-risk status in 2010 and gave it two years to complete a long list of improvements, including hiring staff, clearing out a backlog of permit applications and digitizing records. But the agency satisfied just over one-fifth of the federal plan’s requirements and recommendations, according to the recent report.

The division could have lost its federal certification and funding, likely delaying billions of dollars of projets in Hawaii that entail federal funding or permits, including the $5.2 billion Honolulu rail project. However, federal officials seemed reluctant to take such a serious action and gave SHPD another year to improve.

National Park Service officials took the position that it was not their place to interfere with personnel decisions. Still, the report accused Aiu of lacking strategic vision and not understanding office administration and finances. SHPD office morale was low and Aiu struggled to attract and retain staff, according to the report. Park service officials also said Aiu wasn’t transparent with the public.

Aiu, who led SHPD for five years, did not immediatley return a call for comment.

National Park Service officials tried to help SHPD in the past few years, something they said turned into a “full-time engagement” because Aiu continually failed to meet requirements in a timely manner.

DLNR also awarded a $186,000 contract to Honolulu firm, Solutions Pacific, to help the department meet the federal requirements. Solutions Pacific was given additional funding to bring in temporary staff to help clear out a backlog over 400 unprocessed permit applications that were delaying projects.

But SHPD still struggled. A mid-term review found that the department wasn’t meeting benchmarks, such as hiring for a significant number of vacancies. And Civil Beat reported last year, that Aiu took a $600,000 appropriation from the Legislature intended to beef up staff and instead used much of it to purchase new vehicles and iPads. At the time, one-third of SHPD’s staff positions were still vacant, according to DLNR.

Aila said he intends to hire an interim administrator to oversee SHPD by the end of this month, while conducting a search for Aiu’s permanent replacement.