The investigation by a Hawaii House of Representatives committee looking into two state audits this fall has often resembled a courtroom — the calling of witnesses, sworn testimony, the subpoenaing of documents.

On Wednesday, the committee’s work ended up in a real courtroom, the 1st Circuit Court on Oahu.

Judge Lisa Cataldo determined that working documents related to recent audits of the Agribusiness Development Corp. and the Department of Land and Natural Resources special land and development fund are confidential under state statute and do not have to be shared with the House committee.

But the office of State Auditor Les Kondo must disclose its Manual of Guides that lay out the policies and procedures that were in use when the two audits were conducted between June 2017 and March 2020.

Kondo’s office also must share copies of contracts and any amendments to his office’s contracts with two accounting firms, KKDLY and Accuity, related to the audits.

Those documents are referred to as No. 1 and No. 2, respectively.

Rep. Della Au Belatti leading the House investigative committee
Rep. Della Au Belatti is leading the House investigative committee. Screenshot

Still, Cataldo determined that three other documents subpoenaed by Majority Leader Della Au Belatti, who chairs the investigative panel, may not be disclosed publicly because they are categorized as confidential working documents under HRS 23-9.5.

Those documents — known as Nos. 3, 4 and 5 — concern KKDLY’s schedule of expenditures, a schedule of all accounts to and from the special land and development fund prepared by KKDLY, and the complete schedule of cash receipts, disbursements, transfers and fund balance for that same fund and accounting firm.

Cataldo told Kondo’s attorney, Richard Naiwieha Wurdeman, to turn over documents Nos. 1 and 2 to the House panel by Monday. Wurdeman had asked for a week’s time to do that, while Deputy Attorney General Lori Tanigawa — representing the House committee — argued that there was no reason for further delay, given that the panel had issued its subpoena over a month ago.

At that time, Belatti warned that Kondo might be held in contempt unless he responded. On Oct. 14, Kondo filed a motion with the court to quash Belatti’s subpoena and/or to allow him more time to respond.

That request got mixed results on Wednesday.

‘Innuendo, Statements’

Belatti and Kondo followed the court proceedings via Zoom, along with two committee members, Reps. Dale Kobayashi and Linda Ichiyama, reporters and others.

“The judge basically conferred what we have been telling the committee from Day 1 — that working papers are confidential,” Kondo told Civil Beat after the proceedings.

He also said he hoped the ruling would cause the House committee to focus on the audits of the DLNR fund and the ADC.

“There has been a lot of innuendo and statements about how we should have included other things in our audit. We don’t agree with that, and I have spent hours explaining to the committee to get to our audit objectives,” he said.

Kondo called his office’s findings “meaningful and significant” and noted that neither agency disputed them.

“And I think that is really important. They have to talk about how they are addressing the findings and to implement the recommendations we made to improve their operations,” he added.

Belatti said in an interview that the court had “recognized and validated the committee’s work by validating the committee’s request for documents.”

“We are looking forward to the auditor complying with the court’s order and the committee’s subpoena so that we can continue our work and meet our deadlines in crafting our findings and recommendations, and report to our legislative colleagues as well as the public,” she added.

Asked about Kondo’s statement that the committee is not focused on the audits’ findings, Belatti said, “I am perplexed by his comments, because we are in fact following up on the audits.”

More To Come

Gary Yamashiroya, special assistant to the attorney general, said a determination had not been made whether to appeal Cataldo’s ruling.

In the meantime, the House investigative committee’s work continues in a public briefing on Tuesday. The agenda calls for scheduling more witnesses and issuing more subpoenas, including to board members of the ADC and the DLNR.

Belatti has said the committee may hold additional briefings through December. A report is expected to be delivered to the Legislature in January, when the 2022 session convenes.

What Belatti’s report might say is not clear. But she has said several times that her committee will examine whatever evidence it receives related to the audits. She also has raised concerns that the audits in question may have omitted important information.

Kondo, however, has said repeatedly that the committee has gone far beyond the House resolution that chartered its work and now is actually investigating whether the state auditor is doing the job properly. His attorney, Wurdeman, said the committee has made it difficult for Kondo’s office to do its work, especially as the new legislative session nears.

But Belatti says the resolution, which includes the words “and any other matters” as part of its scope, gives her committee the authority to investigate what it deems necessary.

Kondo initially told the committee he agreed that documents Nos. 1 and 2 were public documents. But Wurdeman indicated that Kondo effectively had second thoughts after consulting with his staff and legal counsel.

Wurdeman also pointed out that the state Senate is not involved in an inquiry into the auditor’s office, something that stands in contrast to the House’s lengthy and extensive work.

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