Updated 5 p.m. 7/14/15

The Honolulu City Council’s history is pockmarked with ethical lapses when it comes to how members spend their annual contingency allowances.

A Civil Beat review of nearly $180,000 in expenses during the 2015 fiscal year, which ended June 30, shows significant improvements have been made.

None of the nine members currently on the council is routinely billing taxpayers for expensive meals, the subject of a major investigation five years ago. Nor does anyone appear to be getting double reimbursements by using campaign funds and city allowances to cover the same transportation costs, a big issue last year.

Honolulu City Councilwoman Ann Kobayashi spent over $1,200 of her allowance on charitable donations.

Cory Lum/Civil Beat

But there are still items that fall into a gray area that the current guidelines either don’t address or that differ from the rules that state lawmakers and county councils on the neighbor islands must follow, like whether charitable donations and appreciation lunches are an acceptable use of public money.

Council members each received $20,000 last year to use for official city purposes, which the council’s administrative manual defines as “reasonable and necessary for city business, and related to the conduct of official duties and activities of a member.”

That’s up from the $19,400 they each got the previous two years and more than double what they received a decade ago. State lawmakers, by contrast, each had an annual allowance of $13,000 last year.

The current council does not include any of the members who made headlines in recent years for how they used their allowances, the most notable being former Councilman Rod Tam.

The Honolulu City Council tightened up its spending allowance policy after former Councilman Rod Tam was fined for misusing his funds.

Nick Castele/Civil Beat

He was convicted of theft and other charges for misusing nearly $12,000 in public funds for meals unrelated to city business in 2010.

City Auditor Edwin Young reviewed the council’s policies after the Tam scandal and issued a report in December 2012 recommending changes. 

The council tightened things up a bit, but the fund was still abused.

In 2012, former Councilman Tom Berg was criticized by his former chief of staff, Eric Ryan, for using his allowance to pay for “Team Berg” campaign shirts.

Two years later, former Councilman Romy Cachola, now a state legislator, was busted for using his allowance for $9,450 in vehicle expenses. Normally, that’d be fine if the use was for city business. But he was also being fully reimbursed for the same expenses from his political campaign fund.

He paid a record $50,000 fine to settle a long list of alleged ethics violations. The Honolulu Ethics Commission said at the time that he should have known better, in part by learning from the examples of Tam and other former council members, including Nestor Garcia and Rene Mansho.

Honolulu Ethics Executive Director Chuck Totto told Civil Beat that the annual contingency allowance policy has been significantly improved since it was initially reviewed by the commission in Tam’s case.

The commission hasn’t had any complaints submitted regarding the misuse of the fund other than the Cachola case, which was settled. The commission asked the council to review the vehicle allowance allotment so that similar misconduct would not occur. 

Donating to Charitable Groups

Some questions have not been brought to the commission, such as using the city allowance to donate to charitable groups.

The state Ethics Commission has nixed this practice for members of the Legislature. Maui and Hawaii county council members are similarly prohibited from making donations to community organizations and nonprofits.

Honolulu City Council members are allowed to make donations to charitable groups, something Councilwoman Ann Kobayashi regularly does. She donated just over $1,200 last year to 10 groups.

She made a $360 donation to the Manoa Waioli Lions Club Benefit Breakfast last month at Manoa Elementary School. And she’s used her allowance to make donations to Project Graduation, Totally Against Graffiti, Children & Youth Day and the Manoa Youth Baseball League, among others.

Kobayashi, who used all but $426 of her allowance last year, told Civil Beat that she uses the fund to make donations to charities and other groups in her district — but not during an election year. She said she uses her own money to make donations to groups outside her district, which stretches from Kaimuki to Kakaako.

What she doesn’t do is deduct the vast majority of her food expenses, something state lawmakers frequently use their allowance to cover.

Kobayashi’s biggest expenses, like most members on the council, were for traveling. She and a staff member went to a National Association of Counties conference in New Orleans last July; the total cost was $3,100. She also went on a $2,372 trip to San Fransciso in December to learn about homelessness.

Honolulu Ethics Commission Executive Director Chuck Totto says some questions on how Honolulu City Council members should spend their allowances have not been raised with the commission.

Nick Grube/Civil Beat

Another big expense was a community cleanup in Kaimuki in November. It cost more than $1,000 to print 4,000 flyers to advertise the event, plus a few hundred dollars for fruit, water, truck rentals and gas.

Kobayashi, who has represented District 5 since 2002, believes the current policies on the allowance are working.

“If we ask for a reimbursement, it’s thoroughly checked by the accounting staff here to ensure it’s allowable,” she said. “We have a lot of checks and balances.”

Transparency helps too, Kobayashi said, noting that all nine members’ expense reports are available on the council’s website.

Totto said the question of whether council members should be able to use their allowance to make donations to charitable groups depends on the facts of each case.

“The general City ethics law is that City taxpayer funds may only be used for City government purposes,” he wrote in an emailed response. “The (Annual Contingency Allowance) funds are City taxpayer monies. So, the question would be whether the donation of ACA funds to a charity is directly related to carrying out the official duties of the councilmember.”

Flying to Mainland Conferences

Council members use their discretion to a large degree on how to use their allowances.

For Councilman Brandon Elefante, charitable donations and staff appreciation lunches are a “big no-no.”

“That’s a gray area that I don’t walk into at all,” he said.

Elefante started with $11,418 in his account after being elected in November and went on to spend all but $3,351 by June.

“These are taxpayer dollars that we are spending,” he said. “It’s very important that we continue to act as stewards of their money.”

Honolulu City Council members, from left, Kymberly Marcos Pine, Brandon Elefante, Carol Fukunaga and Ikaika Anderson listen to testimony during a hearing Feb. 18.

Cory Lum/Civil Beat

His biggest expense was traveling to a National Association of Counties legislative conference in Washington, D.C., in February. Most of the rest of his allowance went toward office supplies.

Elefante said he got a lot out of the conference, which he detailed in his travel report on the council’s website. All the council members have to submit reports explaining their trips.

He said meeting with other council members from around the country who are facing similar challenges was helpful, underscoring the importance of identifying best practices and solutions to problems.

“That’s information that we usually can’t get here locally,” Elefante said.

Council Chair Ernie Martin and council members Ikaika Anderson, Trevor Ozawa and Joey Manahan frequently used their allowance to travel to conferences on the mainland.

Traveling to the National Association of Counties annual conference in New Orleans last July was one of the top expenses for Martin at $3,800, which included flights for himself and his chief policy adviser, Laura Figueira.

He also traveled to Minneapolis for the “Rail-volution” conference; Kauai for the inauguration of Mayor Bernard Carvalho Jr. and county council members; Maui for NACo’s fall board meeting; Washington, D.C., for NACo’s legislative conference; Los Angeles for NACo’s transportation and infrastructure peer roundtable; Japan for the Nagaoka Yukishika Festival, which Honolulu’s sister city reimbursed him for; Kauai again for NACo’s Western Interstate Region Conference and Maui for a meeting with Gladys Baisa, a council member.

He didn’t have to rely on his allowance for all of his traveling though. The Hawaii State Association of Counties, for instance, reimbursed him for his airfare to the NACo conference in New Orleans.

Martin, who had $726 left in his account at year’s end, put much of the rest of his allowance toward Xerox copies, frames for presentations, leis and certificates. 

Communicating with Constituents

Councilwoman Kymberly Marcos Pine has a different philosophy when it comes to travel.

Instead of spending thousands of dollars to travel to the mainland for conferences, she goes online to do research and picks up the phone to talk to city officials from other states.

Pine puts most of her allowance toward communicating with constituents, sending informational newsletters to her District 1 constituents in Waianae and Kapolei. In June, this cost $8,521 for 13,533 newsletters and postage.

City Council Chairman Ernie Martin used his allowance mainly for travel.

Cory Lum/Civil Beat

The mailers detail what actions the council has taken, budget issues and construction projects.

Pine, a former journalist, said the decision to target most of her allowance to communicating with her constituents is based on their feedback. She’s started compiling an email list, now with over 4,000 names, but she said many continue to tell her that “they don’t do email.”

“Everything for us is information driven,” she said. “This is what my district wants so we had to cut out all travel.”

She said she thinks the current guidelines on how the allowance should be used are working well.

“Each council member will spend their allowance based on what their personal beliefs and needs are,” she said.

Councilwoman Carol Fukunaga strikes a balance between traveling and mailers to constituents.

A postcard mailer she sent in September, for instance, cost $7,370. But she carved out some of her allowance to also go to San Francisco last December to learn more about homelessness.

Lessons in Frugality

One small expense Pine made last year would potentially be a big deal if she were a state lawmaker instead of a council member.

Her $31.29 expense for half of a sheet cake for an outgoing staff member would not be allowed at the Legislature under the Hawaii State Ethics Commission’s new guidelines that frown upon “appreciation meals.”

“When someone serves the city with such distinction, it’s almost the same as giving them a plaque,” Pine said. But instead of a plaque, which could have cost triple the amount, she said the decision was made to celebrate with everyone via a cake.

Pine spent all but $1.61 of her allowance last year. But one other council member managed to spend more.

Anderson went $1,161 in the red, primarily due to traveling expenses.

Councilman Ron Menor spent less than half of his allowance.

Cory Lum/Civil Beat

He went to the Rail-volution conference in Minneapolis last September, with side trips to D.C., Baltimore and New York City. He also went to Baltimore in January for a Smart Growth conference, spending an extra $160 to upgrade to an “extra comfort” seat on his flight.

Much of the rest of his expenses were for copies, leis, certificates and renting public facilities for community meetings. He spent $20 to rent the Waimanalo Library as a venue to discuss commercial activity at Waimanalo Beach Park last October.

Even those small expenses add up, including the $8.37 he spent on a dog bone for a Dec. 10 presentation.

Update Anderson said Tuesday that his additional responsibilities as members of state and national boards caused him to spend more than his allotted $20,000 allowance last year.

“Now that I am Honolulu’s representative to HSAC as well as a member of HSAC’s executive committee and a member of NACo’s board of directors, I attend the Western Interstate Region as well as NACo annual conferences,” he said. “In years past, I’d never gone to a NACo annual conference or WIR conference.”

Anderson said he gets a lot out of the NACo legislative conference in D.C. due to the conference itself and the opportunity to meet with Hawaii’s congressional delegation and Federal Transit Administration officials about rail.

Councilman Ron Menor was the most frugal with his allowance last year, leaving an ending balance of $10,272 in June.

He evidently has an amazing lei hookup, reporting an expense in March for 97 leis at a cost of just $22.50.

One of his biggest expenses was the $300 monthly car allowance that council members use to cover mileage and travel on island.

The council members said they believe the current allowance rules are working well.

“I don’t think that anybody’s been misusing the money or done anything questionable in the past few years,” Kobayashi said.