1
1
2
3 SENATE/HOUSE OF REPRESENTATIVES
4 THE 21ST LEGISLATURE
5 INTERIM OF 2001
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7
8
9 JOINT SENATE-HOUSE INVESTIGATIVE COMMITTEE HEARING
10 JULY 13, 2001
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12
13
14 Taken at the State Capitol, 415 South Beretania,
15 Conference Room 325, Honolulu, Hawaii, commencing at
16 9:17 a.m. on Friday, July 13, 2001.
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18
19
20
21 BEFORE: SHARON L. ROSS, CSR No. 432
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Honolulu, Hawaii (808) 524-2090
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1 APPEARANCES:
2
3 Senate-House Investigative Committee:
4 Co-Chair Senator Colleen Hanabusa
5 Co-Chair Representative Scott Saiki
6 Senator Sam Slom
7 Senator Jan Yagi Buen
8 Senator Norman Sakamoto (when noted)
9 Vice-Chair Representative Blake Oshiro
10 Representative Ken Ito
11 Representative Bertha Kawakami
12 Representative Bertha Leong
13 Representative David Pendleton
14
15 Also Present:
16 Special Counsel James Kawashima
17 Marion M. Higa
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25
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Honolulu, Hawaii (808) 524-2090
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1 I N D E X
2
3 WITNESS: MARION M. HIGA
4 EXAMINATION BY: PAGE
5 SPECIAL COUNSEL KAWASHIMA............. 8
6 VICE-CHAIR REPRESENTATIVE OSHIRO...... 47
7 SENATOR BUEN.......................... 54
8 REPRESENTATIVE ITO.................... 57
9 REPRESENTATIVE KAWAKAMI............... 59
10 REPRESENTATIVE LEONG.................. 62
11 REPRESENTATIVE PENDLETON.............. 64
12 SENATOR SAKAMOTO...................... 69
13 SENATOR SLOM.......................... 76
14 CO-CHAIR REPRESENTATIVE SAIKI......... 84
15 CO-CHAIR SENATOR HANABUSA............. 87
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25
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Honolulu, Hawaii (808) 524-2090
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1 PROCEEDINGS
2 CO-CHAIR SENATOR HANABUSA: The Joint
3 Senate-House Investigative Committee to investigate the
4 State's efforts to comply with the Felix Consent Decree
5 will come to order.
6 Will Co-Chair Saiki please call the roll?
7 CO-CHAIR REPRESENTATIVE SAIKI: Co-Chair
8 Hanabusa?
9 CO-CHAIR SENATOR HANABUSA: Here.
10 CO-CHAIR REPRESENTATIVE SAIKI: Co-Chair
11 Saiki is present. Senator Kokubun is excused.
12 Representative Oshiro?
13 VICE-CHAIR REPRESENTATIVE OSHIRO: Here.
14 CO-CHAIR REPRESENTATIVE SAIKI: Senator Buen?
15 SENATOR BUEN: Here.
16 CO-CHAIR REPRESENTATIVE SAIKI:
17 Representative Ito?
18 REPRESENTATIVE ITO: Here.
19 CO-CHAIR REPRESENTATIVE SAIKI:
20 Representative Kawakami?
21 REPRESENTATIVE KAWAKAMI: Here.
22 CO-CHAIR REPRESENTATIVE SAIKI:
23 Representative Leong?
24 REPRESENTATIVE LEONG: Here.
25 CO-CHAIR REPRESENTATIVE SAIKI: Senator
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1 Matsuura is excused.
2 Representative Pendleton?
3 REPRESENTATIVE PENDLETON: Present.
4 CO-CHAIR REPRESENTATIVE SAIKI: Senator
5 Sakamoto is excused.
6 Senator Slom?
7 SENATOR SLOM: Here.
8 CO-CHAIR REPRESENTATIVE SAIKI: We have nine
9 members present, three excused.
10 CO-CHAIR SENATOR HANABUSA: So, we have a
11 quorum?
12 CO-CHAIR REPRESENTATIVE SAIKI: Yes.
13 Members, the first item that we would like to
14 take up this morning before going into testimony from
15 witnesses is the approval of Special Counsel for the
16 investigative committee.
17 I would like to note that Hawaii Revised
18 Statute Section 21-5 authorizes this Committee to employ
19 such professional, technical, clerical, or other
20 personnel as necessary for the proper performance of its
21 duties to the extent of funds made available to it for
22 such purpose and subject to such restrictions and
23 procedures relating thereto.
24 Given the statutory authority to disclosures,
25 I would like to recommend that the Investigative
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1 Committee approve James Kawashima as Special Counsel to
2 this Committee. Is there any discussion?
3 If not, we'll -- if not, we'll take a vote.
4 CO-CHAIR SENATOR HANABUSA: Members, we are
5 voting on the approval of Special Counsel James
6 Kawashima.
7 Co-Chair Hanabusa, aye.
8 Co-Chair Saiki?
9 CO-CHAIR REPRESENTATIVE SAIKI: Aye.
10 CO-CHAIR SENATOR HANABUSA: Senator Kokubun
11 is excused.
12 Vice-Chair Oshiro?
13 VICE-CHAIR REPRESENTATIVE OSHIRO: Aye.
14 CO-CHAIR SENATOR HANABUSA: Senator Buen?
15 SENATOR BUEN: Aye.
16 CO-CHAIR SENATOR HANABUSA: Representative
17 Ito?
18 REPRESENTATIVE ITO: Aye.
19 CO-CHAIR SENATOR HANABUSA: Representative
20 Kawakami?
21 REPRESENTATIVE KAWAKAMI: Aye.
22 CO-CHAIR SENATOR HANABUSA: Representative
23 Leong?
24 REPRESENTATIVE LEONG: Aye.
25 CO-CHAIR SENATOR HANABUSA: Senator Matsuura
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1 is excused.
2 Representative Pendleton?
3 REPRESENTATIVE PENDLETON: Aye.
4 CO-CHAIR SENATOR HANABUSA: Senator Sakamoto
5 is excused.
6 Senator Slom?
7 SENATOR SLOM: Aye.
8 CO-CHAIR SENATOR HANABUSA: Thank you,
9 Members. The recommendation is approved.
10 Members, we are now going to proceed on the
11 agenda to the witnesses that we have asked to appear.
12 The first person on the agenda is Mrs. Marion Higa who,
13 as we all know, is our legislative auditor. I would
14 like to call Mrs. Higa forward.
15 Members, as you know, in accordance with
16 Section 2.7 of our rules that we adopted, testimony
17 before this Committee is to be given under oath or
18 affirmation; and we are not dispensing with this
19 requirement at this time. So, Mrs. Higa will be sworn
20 under oath.
21 Also, Members, in accordance with 26 -- 2.6B
22 of our rules, the Chairs may have the witnesses examined
23 by other members of the Committee or the Committee's
24 counsel. At this time, the Chairs will recommend and
25 have Mr. Kawashima do the examination first of
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1 Mrs. Higa.
2 Mr. Kawashima?
3 CO-CHAIR SENATOR HANABUSA: Oh, yes. First,
4 Mrs. --
5 (Discussion off the record.)
6 CO-CHAIR SENATOR HANABUSA: Oh, I'm sorry. I
7 thought the court reporter does that.
8 Members, apparently the Chairs put Mrs. Higa
9 under oath, not the court reporter in this case.
10 Do you want to do it? We're jun ken po'ing
11 here. Okay. I'll do it.
12 Mrs. Higa, do you solemnly swear or affirm
13 that the testimony you're about to give will be the
14 truth, the whole truth, and nothing but the truth?
15 THE WITNESS: Yes, I do.
16 CO-CHAIR SENATOR HANABUSA: Thank you very
17 much. Mr. Kawashima?
18 SPECIAL COUNSEL KAWASHIMA: Thank you.
19 EXAMINATION
20 BY SPECIAL COUNSEL KAWASHIMA:
21 Q. Mrs. Higa, good morning.
22 A. Good morning.
23 Q. Will you please state your name and business
24 address?
25 A. Yes. My name is Marion M. Higa. My office
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1 address is 465 South King Street, Room 500, Honolulu,
2 Hawaii, 96813.
3 Q. And you are the state auditor for the State
4 of Hawaii, are you not?
5 A. That's correct, yes.
6 Q. Before we get into the details of your
7 testimony, Mrs. Higa, people have asked why these
8 investigative hearings are being held. What is your
9 understanding of the reason why we're here today?
10 A. Well, from the history of the work that we
11 have done on the subject of the Felix Consent Decree and
12 the State's efforts, I believe I was asked to appear to
13 recount for the Committee and to highlight the issue
14 that's before it, which is: Why haven't we been able to
15 know how effectively the money has been spent
16 considering the huge amount of money that's been spent
17 and considering the fact that the State has not been in
18 compliance despite the fact that it has received these
19 extensions?
20 Q. Now, Mrs. Higa, when you say "huge amount of
21 money," of what nature or realm are we talking about?
22 A. It's been reported to be about a billion
23 dollars so far.
24 Q. Now, have investigations been attempted?
25 A. We have done three audits that have a close
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1 nexus to Felix.
2 Q. Okay.
3 A. We have earlier done some other work.
4 Q. All right. Now, let me then get into some
5 background information.
6 A. Yes.
7 Q. Will you please explain to the Committee what
8 the responsibilities of the state auditor are?
9 A. Hawaii's auditor is a constitutional officer.
10 The position dates back to 1950 when our Constitution
11 was first crafted so we could petition for statehood.
12 At that time, we were one of the few
13 states -- in fact, there were only four others -- that
14 provided for an auditor in the legislative branch; and
15 this is because a function of the auditor is to serve as
16 the public's watchdog and the Legislature's watchdog.
17 The thinking there is the majority of the
18 expenditures are made by the executive branch. We
19 wanted to keep the watchdog function in the legislative
20 branch, and the Constitution provided for a number of
21 protections to make sure that the auditor has the
22 independence necessary to carry out that watchdog
23 function.
24 Q. And how do you actually carry out that
25 watchdog function, Mrs. Higa?
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1 A. We conduct audits and do other studies as
2 requested by the Legislature. We issue those reports,
3 and we make recommendations.
4 The protections that we have in place that
5 allow us to do this include an eight-year term, which is
6 longer than that of any elected official. It includes
7 the provision that removal must be for cause and is more
8 difficult than appointment. It takes a two-thirds vote
9 of each House sitting in joint session to remove an
10 auditor but only a majority vote to appoint an auditor.
11 We have subpoena powers. We have power to
12 compel testimony as well as documents; and by statute,
13 we also have had some confidentiality provisions for the
14 work that we do.
15 Q. You mentioned the term "audits." What power
16 does your office have to initiate audits?
17 A. Yes, we do have that power as well.
18 Q. All right. Now, are you familiar with the
19 Felix versus Cayetano case?
20 A. Yes.
21 Q. What is your understanding about what that
22 case is about?
23 A. Originally, this was Felix v. Waihee. It was
24 a case filed on behalf of an individual student which
25 became a class action suit.
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1 The case alleged that the State was derelict
2 in carrying out two federal laws, the IDEA, which is the
3 Individuals with Disabilities Education Act, and 504 of
4 the Vocational Rehabilitation Act.
5 Both of those required that the State have in
6 place a system of care that allows for a free and
7 appropriate public education that would allow a child
8 with mental disabilities to benefit from his or her
9 education.
10 (Senator Norman Sakamoto is now present.)
11 Q. (SPECIAL COUNSEL KAWASHIMA) Now, are you
12 familiar with what is known as the Consent Decree --
13 Felix Consent Decree?
14 A. Yes.
15 Q. What is the purpose, to your understanding,
16 of that decree?
17 A. The purpose of that -- because the State
18 believed that it was in a difficult position at the time
19 this case went to trial, the State agreed to a number of
20 conditions, the primary condition being that it have in
21 place the system of care and have it in place by
22 June 30, 2000. That deadline has since been extended to
23 December of this year.
24 Q. All right. Now, has your office assessed the
25 State's efforts related to Felix versus Cayetano?
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1 A. Yes, we have done three reports specifically
2 related to this case.
3 Q. How have your efforts to obtain information
4 been met?
5 A. We've had some difficulty in getting the
6 information that we would like. By the government
7 auditing standards that we subscribe to, independence of
8 our work is a very large tenet that we must be able to
9 attest to.
10 Q. When did your office, Mrs. Higa, first begin
11 its audits related to the Felix Consent Decree?
12 A. Our first audit was the one on the Big Island
13 Pilot Project. This was dated in January, '98, Report
14 98-1.
15 This started because in an attempt to get --
16 get going with the system of care, the State had
17 contracted with Kapiolani Health Hawaii for the
18 implementation of the system on the Big Island and had
19 contracted to the tune of almost $9 million per year for
20 a three-year contract.
21 The Legislature was concerned that it
22 immediately was asked for an emergency appropriation of
23 $3 million within the 9 million and was also getting
24 reports that already the system of care was broken and
25 running into problems on the Big Island. We were asked
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1 to look at it.
2 Q. All right. Was there any concern about how
3 the money was being spent, for example?
4 A. Yes. One of our conclusions was that the
5 Department of Health, which was the contract monitor
6 here, was not doing a very good job of monitoring that
7 contract.
8 As an example, it did not have the required
9 documentation of services provided despite the fact
10 payment was made and did not impose that requirement on
11 Kapiolani Health Hawaii despite the fact the contract
12 required it.
13 Q. As far as audits are concerned, though,
14 Mrs. Higa, what were some of the specific questions that
15 the Legislature had?
16 A. From the very beginning, the Legislature has
17 been concerned that each time they would be promised by
18 the executive branch that we need to appropriate only
19 this amount of money and that would be sufficient but
20 within -- sometimes within weeks of the close of a
21 session, already they would be told, "Well, it's not
22 going to be enough. We're going into deficit spending."
23 There is a new term being crafted more
24 recently. It's called "forward spending" --
25 SENATOR SLOM: Forward funding.
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1 A. -- "forward funding."
2 THE WITNESS: Thank you, Senator.
3 A. It, in effect, is deficit spending of money
4 that they don't have.
5 Q. (BY SPECIAL COUNSEL KAWASHIMA) All right.
6 Now, was there a question about whether or not there was
7 an appropriate system in place to assure an acceptable
8 level of accountability?
9 A. No, because the legislators as well as we
10 were receiving reports.
11 Q. We'll get into that in a little bit, ma'am.
12 A. Okay.
13 Q. So, what were the basic findings, though, of
14 your office as you started your audits?
15 A. Well, that first one was followed by another
16 audit that was done in-house; and this one was December,
17 '98.
18 We did that one, again, because there was
19 some concern about the money; and, in fact, we found
20 that when you look more closely at the expenditures of
21 the two major departments here, we had a good deal of
22 difficulty getting information, for instance, from the
23 Department of Health. Ultimately, and in the report,
24 all we could report was the general fund expenditures
25 because they never gave us the federal fund
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1 expenditures.
2 On the part of the Department of Education,
3 they gave us the information; but when we took a close
4 look at that information, there were some anomalies.
5 For instance, A+, which is an after-school
6 program for all children, not limited to Felix
7 children -- the entire cost of A+ was attributed, in
8 fact, to Felix in the reports that DOE gave us.
9 So, these are the kinds of anomalies that
10 made us suspicious about the reported expenditures and
11 the fate of the appropriations for Felix.
12 Q. All right. Well, what did you find, if
13 anything, ma'am, about the definition of what a Felix
14 child was?
15 A. That was another problem area. It's -- when
16 we trace problems, we try to trace their cause; and it
17 seemed to us that this was a cause of many of the
18 problems in this system of care.
19 The definition that was relied upon was
20 simply the statutory definition, which was also then the
21 Consent Decree definition in some ways. It was a very
22 broad definition.
23 For people on the ground to have just the
24 statutory definition or the Consent Decree definition
25 repeated back to them did them no good. They couldn't
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1 tell, for instance, at what level of a certain kind of
2 diagnosis qualified a child for Felix, what level did
3 not qualify a child for Felix. They weren't sure what
4 kinds of services would be appropriate, whether there
5 could be any kind of criteria attached to an exit from
6 the class. None of this was in place. There was no
7 training program for the people on the ground.
8 Q. Thank you. Mrs. Higa, you mentioned
9 expenditures.
10 A. Yes.
11 Q. Now, how do those expenditures, to your
12 understanding, impact the State of Hawaii?
13 A. Well, the problem is -- well, let's look at
14 it first from the impact on the children. If you
15 mistakenly diagnose a child into the class, you've done
16 that child a disservice because the child will carry
17 that label for the rest of his or her life.
18 If you misdiagnose and not include a child
19 who is supposed to be in the class, then, obviously, of
20 course, the services aren't going to be provided for
21 that child; and you may have a long-term impact on
22 society as a consequence.
23 So, I think the first concern should be the
24 impact on the children; but then if you started looking
25 at the fiscal impact, then you have to look at what
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1 other programs can't be funded because there are
2 expenses being paid on behalf of Felix that are either
3 undeserved or inappropriate or simply waste.
4 Q. You did say "can't" -- other programs "can't"
5 be funded?
6 A. That's right, because the State's resources
7 are somewhat finite; and the Legislature is well aware
8 of what they have to wrestle with each year.
9 The problem with what's happened in the last
10 few years is that, in most cases, the funding for Felix
11 comes first. It comes off the top.
12 Q. All right.
13 A. And everyone else has to share the rest.
14 Q. Did you have any other findings, Mrs. Higa?
15 A. Yes. As to that first -- that second report,
16 the December, '98 report, we did find that there's some
17 leadership problems and coordination problems between
18 the two departments.
19 There were some problems in defining what the
20 State's obligation would be in the long term because we
21 were obligated to have a maintenance of effort baseline
22 set and there was no way to set the baseline because the
23 monitor decided that until all children were identified,
24 we could not set that baseline.
25 Now, it could be argued that since then,
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1 that's an irrelevant issue because we've way exceeded
2 what we were spending at that time.
3 Q. I see. Any other findings that came out of
4 these audits that you had your office perform?
5 A. There was the third audit that was done with
6 the help of the consultants from the University of
7 Pennsylvania, and that was widely reported in January of
8 this past year.
9 Q. What were the findings, if they were any
10 different, in this most recent report?
11 A. They concluded pretty much that there's still
12 a definitional problem.
13 Part of the problem was that within the
14 leadership of the State system of care, there were
15 differences of opinion as to whether we were obligated
16 to provide effective services or just simply services.
17 Our consultants maintained that the Decree requires
18 effective services.
19 Their point was that everyone needs to
20 understand that this obligation is a much heavier
21 obligation than just simply providing services and that
22 the State needs to look at what's going to happen beyond
23 the Consent Decree because at some point, the State will
24 be in compliance and the Federal Court will be out of
25 the picture, at least in its current form.
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1 But what we need to -- if there are problems
2 in the way the program is currently being implemented,
3 those problems need to be addressed because, otherwise,
4 you're going to create a system that's got run-away
5 expenses.
6 Q. Now, Mrs. Higa, did your audits reveal
7 anything in the way of conflicts of interest?
8 A. Yes, in this last report.
9 Q. What did they reveal?
10 A. First of all, among other things -- and some
11 of this was coming from the people out in the field to
12 our consultants, confirmed by their review of the
13 records -- psychologists were the ones who were making
14 the diagnoses of children and putting them into the
15 class and sometimes were also the ones providing those
16 services themselves.
17 Another area of conflict -- we did not name
18 this individual in the report, but the information has
19 since become public -- had to do with a member of the
20 Technical Assistance Panel.
21 The Technical Assistance Panel was a part of
22 the Consent Decree. It was an entity that was to help
23 design the system of care. It consisted of the court
24 monitor and two other individuals.
25 One of those individuals also had other
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1 contracts with the State to put into place elements of
2 the system that she helped design. This individual has
3 since been indicted twice in North Carolina for a
4 federally funded $91 million project in that state.
5 She is -- she was an official with the North
6 Carolina Department of Health & Human Services, has
7 since been removed from that position. Her -- the
8 position that was created for her as a result of the
9 elimination of her first job has just recently also been
10 eliminated by their Legislature.
11 Q. And this person -- you mentioned a person who
12 was indicted. For what was that person indicted?
13 A. The indictments concerned embezzlement, wire
14 fraud -- several indictments. I don't remember offhand
15 what they were, but they were along those lines. It
16 concerned the moving of money.
17 As I understand it, it had to do with, among
18 other things, the implementation of MST, which is the
19 Multisystemic Therapy, which is a program that is also
20 now in place here; but it involved the moving of money
21 between the State payments and the federal payments and
22 back and forth.
23 Q. And this person, to your understanding and
24 knowledge, was a member of the Felix Technical Advisory
25 Panel?
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1 A. Yes, Technical Assistance.
2 Q. Are you aware of whether or not that person
3 is now a member?
4 A. No. That panel was eliminated, as I
5 understand it, in late 2000.
6 Q. Now, what else did you find, if anything, in
7 terms of conflicts of interest of those involved with
8 the program?
9 A. Another area we found had to do with the
10 court monitor.
11 Q. What did you find, ma'am?
12 A. The Consent Decree requires the State to use
13 an instrument that is the property of the company of
14 which the court monitor is part owner.
15 Q. This court monitor is paid by whom?
16 A. He is paid through Felix Monitoring, Inc.;
17 but Felix Monitoring, Inc.'s expenses are borne entirely
18 by the State.
19 Q. And when you say this company -- what type of
20 services was this company asked to perform, for pay, I
21 assume?
22 A. As I understand it, the company has just this
23 one product that was designed for Hawaii's use. They
24 also provide training.
25 That leads me to the second individual
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1 involved with this company. He is also part owner. He
2 comes here and serves as a leader of the service testing
3 team sometimes; and as part owner, then, of course, he,
4 I would imagine, shares in the profits of the mandate
5 that the State use that company's instrument. He also
6 serves as a trainer when he comes.
7 Q. In other words, to your understanding, he is
8 paid as a trainer whenever he trains here in Hawaii?
9 A. I would assume so, yes.
10 Q. And, also, I assume if the company is
11 profitable, as a part owner, he benefits there also?
12 A. I would assume so, yes.
13 Q. Now, what, though, is the problem, as far as
14 you're concerned, with this existence of these conflicts
15 of interest?
16 A. Well, as our consultants pointed out, you're
17 lacking here an independent oversight. You have no
18 checks and balances.
19 The State is at the mercy of some of these
20 practices, and it's especially egregious when you
21 consider that State employees themselves are bound by
22 ethical standards and we have provisions for ethical
23 conduct in the State.
24 You know, we have an Ethics Commission which
25 does training for all new employees, rules on questions
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1 of ethics placed before it; and as these kinds of abuses
2 go unchecked -- and these reports are coming to us from
3 the field, and I understand they are also going to
4 legislators -- there's a great deal of angst out there
5 by people who say Felix is creating a culture of profit.
6 These kinds of abuses, if they become the
7 norm, has, again, long-term implications for the State.
8 Q. Now, given the number of audits your office
9 has been involved in over the years, how would you
10 characterize, then, the findings of your office
11 concerning the expenditure of funds pursuant to this
12 Felix Consent Decree?
13 A. I think it's been somewhat frustrating for
14 us, but it's also been surprising and disappointing that
15 some of these problems continue. It's been
16 disappointing in some ways at -- well, we've been
17 disappointed at some of the responses to our audits, the
18 attempts to deny that there's a problem.
19 Q. What have you found in terms of the people on
20 the frontline, the teachers, as far as what they have
21 been doing, what their results have been?
22 A. There's no doubt that the system as a whole
23 has made progress from the very beginning, and we have
24 to acknowledge that. It's a tough job, and it's
25 probably toughest for the people on the frontlines.
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1 And I think from the records that we saw and
2 from our consultants' own conclusions, the schools have
3 come very far in their record keeping, for instance.
4 On the procedural side, I think we've made a
5 good deal of progress. We're not as late as we once
6 were. In our '98 report, we found still the State was
7 very much out of compliance on the procedural
8 requirements. Those things have improved.
9 Our consultants found the records, for
10 instance, relatively neat. There -- they marveled at
11 the amount of handwriting in there, the amount of time
12 that must have taken to keep those records by hand.
13 Q. Now, you mentioned the audits that you
14 performed.
15 A. Uh-huh.
16 Q. What, if any, type of resistance did your
17 people meet in terms of obtaining information to
18 complete these audits?
19 A. What we have run across is the executive
20 branch's interpretation of the federal FERPA -- which I
21 can't quote to you right offhand what the acronym means,
22 but it requires that only a State audit agent -- an
23 educational audit agency have unfettered access to the
24 files.
25 It's our contention that we are the sole
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1 state audit agency and that we should have access as we
2 please and as we choose because we also have other
3 statutes that govern our work. For instance, the
4 Uniform Information Practices Act requires that
5 government agencies make information available to us;
6 and we're bound by the same rules of confidentiality as
7 they are.
8 However, in the case of Felix files -- and
9 here we're talking primarily about individual student
10 files -- we have been unable to get them without either
11 parental permission or redaction.
12 At the time our consultants were here and
13 they first presented us with the kind of data they would
14 like to have, the kind of access they would like to
15 have, we discussed these requirements with the two
16 departments. They told us they would first have to get
17 parental permission; and we said, "No, first of all, we
18 want to know what the universe is because our
19 consultants have no familiarity with the files and then
20 we need to have the consultants make their own selection
21 for valid sample."
22 Ultimately, it resulted in my issuing a
23 precept. At that time, our statutory language called
24 for a precept rather than subpoena. "Precept" is old
25 comptroller language; but it does the same thing. It
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1 forces testimony or a document.
2 The departments came back and said, "Well,
3 this precept is no good because it's not a subpoena"
4 but, nevertheless, sought the protection of the Circuit
5 Court and took us there.
6 Ultimately the judge did not want to rule on
7 that and asked us to work out some compromise, which we
8 did. We took that avenue because here we had
9 consultants here twiddling their thumbs looking for the
10 data that had not come. So, rather than fight a
11 protracted legal battle, we opted to take the compromise
12 and at least get something of a selection by the
13 consultants; and we did -- we did manage to complete.
14 Subsequently, the Legislature has asked me to
15 do another follow-up on the State's Felix effort. That
16 report is probably going to be issued within the next
17 two months.
18 Again, we tried to get individual student
19 files. Again, we were told that FERPA prevented us from
20 the unfettered access. There again, we issued a
21 subpoena this time because after the experience in
22 2000 -- fortunately, that occurred while the Legislature
23 was in session; and I was able to get the statute
24 changed from precept to subpoena and all the other
25 provisions that go with subpoena language. So, this
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1 time we had a subpoena. So, that argument could not be
2 lodged against us.
3 The department then proceeded -- we
4 identified the districts in which we wanted to pull the
5 files. The department proceeded to inform parents and
6 gave them the option to object, which, to me, is still a
7 skewing of our sample because then those children's
8 files were not available to us to pull the kind of
9 sample that we would like to pull that we can defend.
10 So, this is where we are.
11 Q. Well, you mentioned the word "redaction."
12 What were you referring to?
13 A. Redaction means to cross out identifiers.
14 The first redaction that was done with our consultants
15 took out not only name but, you know, an address --
16 which is fine with us; we weren't interested in names
17 and addresses -- but also took out birth date and
18 diagnosis, et cetera; and that made no sense. It gave
19 us a file that meant nothing and we couldn't do anything
20 with.
21 So, then, we asked for -- and this was
22 another compromise that was worked out. We asked for
23 files that took out only birth dates and names and
24 addresses -- no, I'm sorry -- names and addresses. We
25 needed birth dates because that was a valid criteria.
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1 And those were eventually provided to us in that form.
2 Q. Why is it important, though, in your work to
3 have that type of information as you perform your audit?
4 A. Well, for instance -- I'll give you an
5 example of how you could do this. If we're trying to
6 find effectiveness of services, all right, you look at a
7 child's IEP file, which will say the diagnosis is this
8 and these services are recommended.
9 Well, you want to know, first of all, if the
10 services were, in fact, provided, did we pay for them?
11 In other words, did we get our money's worth and how
12 effective were those services?
13 But you can't do this for sure unless you can
14 match up a child's file and you look at the expenditure
15 records and see what you can see. You can't do this
16 unless you have the child's name because you don't know
17 for whom a service was performed unless you can do that
18 kind of match.
19 Q. You mentioned the phrase "IEP." What does
20 that stand for? Explain to us what that means.
21 A. This is a very key portion of the program.
22 That's the Individualized Education Plan. Some people
23 call it the Individualized Education Program.
24 This is like the plan of action for a child.
25 Once a child is identified and certified to be a Felix
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1 child, then, all relevant parties, from parent to child
2 sometimes to teachers to psychologists to family
3 guidance center people, district people -- everyone who
4 might have an interest in this child's Welfare must get
5 together and decide on the plan of action for this
6 child, must meet at stated times thereafter to see what
7 progress is being made. This becomes part of the record
8 of what happens to this child.
9 Q. And what nature are we talking about in terms
10 of the size of some of these groups, these IEPs?
11 A. We have found some of the groups to number
12 19.
13 Q. And of -- what nature of problems would you
14 have when you have an IEP group of that size or similar
15 size?
16 A. Well, unless someone agrees -- usually it
17 would have to be the parent or the child and usually
18 it's the parent -- agrees to a reduction or the absence
19 of any one of them, the meetings don't go forward until
20 everyone is there.
21 Q. All right. Now, there have been questions
22 raised about the State's effort -- the Legislature's
23 effort to obtain information to do these audits and the
24 question of whether or not this would hinder the State's
25 efforts to comply with this Consent Decree which, as you
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1 have already testified, has already been extended at
2 least once.
3 A. Uh-huh.
4 Q. Now, do you believe that a request for this
5 type of information to do your job would, in fact,
6 interfere with the State's efforts to comply with the
7 decree?
8 A. I don't see how they're related.
9 Q. Why do you say that?
10 A. Because if it's a production of records that
11 we're asking for, it would be the staff who would be
12 putting these together.
13 And that's true -- I mean, you could always
14 argue that you would rather be doing something else if
15 you were a staff member or, if you were a manager, you
16 would want your staff doing something else; but I can't
17 see how, with $1 billion or even the $350 million that
18 we're now spending this year, how people couldn't be
19 spared to answer the questions of this Committee or
20 answer the data requests that my office might have.
21 Q. Well, you mentioned $350 million. Now, that
22 was for this year; is that correct?
23 A. Yes.
24 Q. And what is your understanding of the nature
25 of requests in the future?
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1 A. There's no telling what those requests are;
2 and the 350 million, as I understand it, is only what
3 was appropriated to the two departments, DOE and DOH.
4 My understanding is within weeks after the
5 end of this past session, the Legislature was already
6 informed of the departments' intent to spend something
7 like maybe another 35 million in forward funding despite
8 the fact that this money was not appropriated and the
9 departments' intent to come back to the 2002 session
10 with an emergency request for authorization for money
11 they had already spent.
12 Q. Now, if we might quickly, Mrs. Higa, go over
13 the separate audits that your office has performed.
14 A. All right.
15 Q. We'll start with the Big Island audit in
16 1997. What was the purpose of that audit?
17 A. This one was partly the concern of the --
18 over the $3 million but, also, because of the concern
19 over reports received that, in fact, services were not
20 being delivered.
21 There were problems in the way DOH was
22 managing its contract with Kapiolani Health Hawaii. We
23 did find, in fact, that, for instance, the -- there were
24 services being provided that had not been authorized;
25 and payments had already been made.
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1 Q. All right. How about the second audit in
2 December of 1998 you referred to?
3 A. The second audit was done by my own staff.
4 Although, the analyst in charge was a Ph.D. in
5 psychology.
6 We found here that, again, there was a
7 definitional problem; and people in the field were
8 saying, "We don't know what a Felix child is. So, we're
9 just putting them all in."
10 If I could, I would like to read you
11 something from our report; and these were direct quotes
12 from our working papers and from our interviews.
13 Someone said to us, "There's really no sense
14 in having criteria at all. The State might as well just
15 write a blank check and hand it to the providers."
16 Another one said, "The mandate under IDEA and
17 504 are clear, but the local interpretation of that
18 mandate has made the definition of the Felix class
19 totally unclear."
20 This is what people in the field were telling
21 us. That was one of the conclusions of that audit.
22 Another conclusion had to do with the money.
23 Again, as I said earlier, the two departments were
24 reporting different amounts. The Legislature couldn't
25 tell for sure what it was spending and what it would
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1 have to spend.
2 Q. Well, when you say the agencies "were
3 reporting different amounts," what do you mean by that?
4 A. Well, for instance, DOH was counting all the
5 students under the term "presumptive eligibility" and
6 the costs for those students. "Presumptive eligibility"
7 means that as soon as a child is a potential Felix
8 child -- the teacher says, "There's a problem with this
9 child. Let's have this child tested." All those
10 children were counted as Felix. All those costs were
11 put in as Felix.
12 DOE did not consider those children to be
13 Felix until they were actually Felix certified. So,
14 there are definitional differences and, therefore,
15 differences in the way they track the money.
16 Q. And what was the result of that, though, as
17 far as the Legislature is concerned?
18 A. Well, the Legislature was still faced with
19 what appeared to be a black hole where they were being
20 asked to fund it without the answers to these kinds of
21 questions.
22 Q. All right. Now, how about the third audit,
23 the one that was delivered in January of this year?
24 What is the purpose of that?
25 A. This one was done partly because -- and this
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1 was also done by legislative request. We were asked to
2 get national expertise partly because of the criticism
3 leveled at us for the prior report that we didn't have
4 national expertise. We only had our in-house staff.
5 So, we set about procuring -- with our usual
6 procurement methodology, sent out nationally our RFP,
7 got responses, and selected a vendor, the School of
8 Social Work, Center for Youth Policy, the University of
9 Pennsylvania.
10 Q. We hadn't -- I hadn't asked you this before,
11 but each and every audit you have been referring to were
12 audits that were requested by the Legislature; is that
13 correct?
14 A. In this case, yes.
15 Q. Now, so, whom -- you mentioned these
16 consultants. Whom did you actually retain?
17 A. The two principals were Ira Schwartz, who was
18 the Dean of the School of Social Work. He has a
19 national and international reputation in child behavior,
20 in mental health issues with children. He himself has
21 served as a monitor in mental health cases.
22 Q. A court monitor?
23 A. Yes, a court monitor.
24 Q. Go on, please.
25 A. The second principal was Professor Richard
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1 Gelles, who is also co-director of that Center for Youth
2 Policy. He also has an international reputation. He
3 holds an endowed chair at the School of Social Work.
4 He's worked at -- in Congress on IDEA-type
5 legislation, has been on the faculty for a number of
6 years in various places, also internationally well
7 regarded.
8 They had other members on their team to round
9 themselves out. They had a child psychiatrist who was
10 on the faculty of their University's medical school.
11 They had a special ed teacher and administrator. They
12 had other members to do other work with them.
13 Q. All right. Now, to your understanding,
14 Mrs. Higa, the University of Pennsylvania School of
15 Social Work, how is it regarded throughout the country?
16 A. They have a very high reputation.
17 Q. All right. Now, you mentioned problems that
18 were -- that you ran into in obtaining information in
19 the second audit. Will you give us a little more detail
20 about what those problems were?
21 A. I believe you mean this third audit --
22 Q. I'm sorry. Third audit.
23 A. -- this particular one? Yes, this particular
24 one.
25 In addition to the kinds of things that I
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1 mentioned before, the consultants were looking for other
2 instances where there seemed to be some questionable
3 placements. They were concerned that we were resorting
4 to out-of-state placements as much as we were. They
5 didn't see that we were developing a local capacity.
6 There wasn't enough of an attempt to get therapeutic
7 foster homes in place, and it seemed like out-of-state
8 placement was too easy.
9 One of their data requests had to do with the
10 files of all out-of-state placements, and it was rather
11 curious that the number of students placed from day to
12 day changed. And there was one example where the
13 student was actually, I believe, on Oahu; but they
14 thought he was on a neighbor island or something to this
15 effect.
16 Now, of course, numbers will change from day
17 to day but there was this kind of range and no one could
18 be sure exactly what numbers we were being given.
19 This was also the time that the Pearl City
20 Residential Facility was in the news, and they were
21 interested in knowing -- or seeing the case files of
22 those students.
23 Their concern with out-of-state placements
24 is: What's going to happen after the students are
25 released? What's going to happen when they come back
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1 here?
2 Their preference is for local placement at
3 all times and local development of what they call
4 indigenous capacity. They didn't see enough work being
5 done at the University to develop this indigenous
6 capacity.
7 Some "thinking out of the box" -- they kept
8 talking about "thinking out of the box," internships,
9 trying to get students into the field with various kinds
10 of enticements.
11 Q. So, if you might recap for us, Mrs. Higa,
12 what were the principal findings of this third audit?
13 A. They still found some definitional problems;
14 and their contention was that the State was obligated to
15 provide "effective" services, not just services.
16 When they talked to leaders in the system of
17 care, there was a range in understanding about this
18 requirement. They cited specific language from the
19 Consent Decree that requires effective services.
20 Nevertheless, they were getting a range from
21 denial that we needed to provide effective services to
22 another leader saying, "Yes, I recognize we have to, but
23 we're not there yet" to another leader who says "No, we
24 don't have" to but then a month later changes his mind
25 and says, "Well, I guess we do have to." So, they
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1 weren't sure what kind of leadership we were going to
2 have in the system.
3 Q. What kind of findings, if any, were there in
4 terms of independent oversight?
5 A. Again, partly because of what they found with
6 the conflicts of interest, they were concerned that
7 there was no independent oversight. We didn't have a
8 capacity to do independent evaluation.
9 And this was especially a concern of
10 Professor Gelles because he was familiar with MST, the
11 Multisystemic Therapy program.
12 They were here at the time the Legislature
13 was considering the emergency request from DOH -- and
14 this was in the 2000 session -- the emergency request
15 that included $1.2 million for MST.
16 Dr. Gelles found it curious that this program
17 was already in place, was already started and, yet, they
18 were coming in for it as an emergency. That was one
19 problem.
20 He also said that MST was not intended to be
21 used as DOH was planning to use it or had already
22 started using it. It was designed for a different kind
23 of population.
24 The third concern he had was that there was
25 no pilot test of this different application of it. So,
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1 he suggested to the legislators then that they require
2 that DOH set aside 10 percent of any money appropriated
3 for MST for an independent evaluation.
4 And the Legislature did adopt this
5 recommendation in the 2000 session and put a restriction
6 on the 1.2 million, that 10 percent had to be spent for
7 an evaluation.
8 Now, as I understand it, the department came
9 back this session, this past session, for additional
10 money for it, even though the evaluation that was
11 contracted for was inconclusive. So, we now have a $2
12 million program that Dr. Gelles felt was problematical
13 for us.
14 Now, what we have been hearing from the field
15 is this program has now been mandated. In the first
16 year, the participation level was low. It's a family
17 oriented program. It says that if you have a problem --
18 a certain kind of problem with the children, then, you
19 bring in -- and this is where multisystemic comes in --
20 you bring in programs from all over. You can be able to
21 pick and choose from the menu of services. The problem
22 is: If you don't have those menu of services available
23 in your community, then what do you do?
24 A number of families apparently in the first
25 year refused to take part. So, the numbers who were
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1 participating were lower than were necessary for
2 evaluation, as I understand it.
3 With the additional money that was
4 appropriated this year bringing it to $2 million, my
5 understanding now is that the department has mandated
6 that MST be the exclusive program and replace some of
7 the other more a la carte type programs that families
8 had been getting. That's causing some upset. We have
9 been receiving reports.
10 Q. By the way, you mentioned that the MST had
11 been designed for a different kind of population. Do
12 you remember that? What is the different kind of
13 population you're referring to?
14 A. As I understand it, Dr. Gelles said that it
15 was designed for juvenile delinquents, not necessarily
16 children with mental disabilities or emotional
17 disabilities.
18 Q. Now, what was the reaction, then, Mrs. Higa,
19 to these audit reports, especially the third one?
20 A. Basically something of a denial of the
21 findings, a challenge, even of the consultants from the
22 University of Pennsylvania and essentially, in some
23 cases, a nonresponse to some of the findings and
24 recommendations.
25 Q. What about the reaction that the consultants
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1 from the University of Pennsylvania were not qualified?
2 Do you agree with that?
3 A. No. I don't know how you could find people
4 that were more qualified for the job.
5 Q. Now, you are aware of efforts to obtain
6 information from Ivor Groves for this Investigative
7 Committee?
8 A. Yes.
9 Q. And what role or roles does Mr. Groves have
10 in the Felix Consent Decree realm?
11 A. Uh-huh. He is the court monitor, of course,
12 appointed by the Federal Court. He also is a member of
13 the board of directors of Felix Monitoring Project,
14 Inc., which is the nonprofit entity that was set up by
15 the Court to carry out the monitoring function. He
16 serves as president of Felix Monitoring Project, Inc.
17 Q. Would Mr. Groves have any important
18 information for this Committee?
19 A. I believe so, yes.
20 Q. What about this person named Juanita Iwamoto?
21 Who is she, to your knowledge?
22 A. She is the executive director of Felix
23 Monitoring Project, Inc., therefore, is a staff member
24 but is also a member of the board of directors of Felix
25 Monitoring Project, Inc. and serves as its secretary.
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1 Q. Are you aware, Mrs. Higa, of the Federal
2 Court's ruling yesterday on the subpoenas that were
3 issued to be served on Mr. Groves and Ms. Iwamoto?
4 A. Yes.
5 Q. What is your reaction to that?
6 A. Well, I think it's unfortunate because I
7 think we're all on the same page with the Federal Court
8 in looking for information. And as, I believe, the
9 media were reporting, the Judge said he would want to
10 know if there were -- if there is mismanagement, for
11 instance; but I'm not sure we're simply talking about
12 mismanagement. But I think it's in everybody's interest
13 to get at the truth because, you see -- and as I said
14 earlier, what we're looking at is a sustainability here.
15 We're not just looking at this year's expenditures; and
16 even if you looked at this year's expenditures, the $350
17 million is not the total expenditure. That's just for
18 the two departments. You've got other departments
19 spending money on behalf of Felix children.
20 Q. Now, you are aware, Mrs. Higa, of a Form 990
21 request on the Felix Monitoring Project?
22 A. Yes.
23 Q. Will you explain to us in lay terms what a
24 Form 990 request is?
25 A. As a condition of becoming a nonprofit
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1 organization, the IRS requires, under Federal Rules and
2 statute, that certain information be prepared by that
3 entity and be made public or be available to members of
4 the public. Anybody can ask for this information.
5 When we became aware of the corporate
6 structure of Felix Monitoring Project, Inc. and found
7 that, in fact, it was registered with DCCA and, in fact,
8 that the Form 990 rule was in place, it seemed to us
9 that, well, this was another piece of information we
10 could get, just as we ordinarily would get information.
11 So, I had one of my staff deliver a letter to
12 Felix Monitoring Project, Inc.'s offices which asked for
13 copies of this information; and the person who received
14 the letter opened it and said, "Oh, all right, it will
15 take me a while to get it together; and I'll have to
16 make copies. Can you come back?"
17 And he said, "Fine. How about two hours?"
18 And she said, "Okay. That's fine."
19 He went back two hours later. The door was
20 locked. He knocked. They recognized him and left --
21 let him in, took him then to see the executive director;
22 and she said to him, "We have nothing for you."
23 And he said, "Well, but this is supposed to
24 be information available to the public."
25 And she said -- she repeated, "We have
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1 nothing for you."
2 So, he said "thank you" and left.
3 Q. Who was this executive director you're
4 referring to?
5 A. Ms. Iwamoto.
6 Q. Now, what is your understanding, Mrs. Higa,
7 of the type of information that would be contained on a
8 990 report?
9 A. It would include information such as their
10 tax returns for the last three years. It would include
11 information on the five highest-paid recipients or
12 employees on their payroll.
13 Q. And their officers and directors also?
14 A. And their officers and directors, yes.
15 Q. All right. Now, are you currently in the
16 process of gathering information for a further report?
17 A. Yes. As I alluded to earlier, the
18 Legislature asked us to stay on the Felix oversight
19 task; and that's the report that will be imminently
20 issued within maybe two months.
21 Q. Would you be willing to return to address
22 this Committee with such further findings as you may
23 make?
24 A. Oh, yes, uh-huh. I'm at the Committee's
25 disposal.
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1 Q. Thank you very much, Mrs. Higa. I have no
2 further questions.
3 A. Thank you.
4 CO-CHAIR SENATOR HANABUSA: Members, as you
5 know, under our Rules in 2.8, we have to keep a record.
6 And I know it's very unusual but we have a court
7 reporter there; and out of practice, we kind of break
8 every hour for her to rest her fingers. So, I'm
9 recommending that we take a short recess. Is five
10 minutes enough for you? Five minutes, Members. So,
11 don't wander; and we'll be back.
12 Mrs. Higa, thank you.
13 THE WITNESS: Thank you.
14 CO-CHAIR SENATOR HANABUSA: Return in five
15 minutes.
16 THE WITNESS: Yes.
17 (Brief recess.)
18 CO-CHAIR SENATOR HANABUSA: Members, calling
19 the hearing back to order, Members, in -- under our
20 rules, again, Rule 2.6 regarding the hearing process
21 itself, it's -- Co-Chair Saiki and I have determined
22 that we will now permit the questioning of the Committee
23 members. However, in all fairness to all members and in
24 an orderly conduct of this hearing, you will be asked to
25 limit your questions to ten minutes on this go-round;
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1 and if there is anyone who has additional questions,
2 Co-Chair Saiki and I will entertain a second round of
3 questioning.
4 With that, we will begin first with
5 Vice-Chair Representative Oshiro.
6 VICE-CHAIR REPRESENTATIVE OSHIRO: Thank you.
7 EXAMINATION
8 BY VICE-CHAIR REPRESENTATIVE OSHIRO:
9 Q. Mrs. Higa --
10 A. Yes.
11 Q. -- when I was reviewing one of the reports, I
12 had some questions and clarifications I would like to
13 talk to you about.
14 A. Yes.
15 Q. Specifically the January, 2001 audit, the
16 No. 3 audit I think you had --
17 A. Yes.
18 Q. -- in looking at Page 12 -- do you have it
19 with you?
20 A. Yes.
21 Q. Page 12 is where the consultants were talking
22 about the need for an independent oversight and
23 evaluation?
24 A. Yes.
25 Q. And about halfway through the page, they say
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1 that "At present, neither the Legislature, the
2 Departments of Education and Health, nor the court
3 monitor are available to make evidence-based decisions
4 as to what services are effective, what services are
5 essential and, thus, what services merit funding and
6 which do not."
7 A. Yes.
8 Q. Do you agree with that statement that
9 essentially neither the Legislature, DOE, DOH, nor even
10 the court monitor itself is able to make a proper
11 evidence-based decision making?
12 A. Yes. Because I believe so much emphasis is
13 in place first on procedural compliance; but more than
14 that, there seems to be some reluctance on the part of
15 the executive branch to try other things geared to
16 proving effectiveness of the services.
17 As I said earlier, there seems to have sprung
18 up a culture of profit; and that profit was based pretty
19 much on procedures. And what the consultants are
20 talking about here was that as they saw the situation in
21 Hawaii, no one had the kind of concentration of
22 technical expertise that is, as they saw, needed here
23 before we got much further into the system of care.
24 Q. Okay. And I think the consultants go on to
25 recommend that a center for service and program
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1 evaluation should be established in Hawaii and that they
2 recommend the Legislature hold monthly oversight
3 hearings to learn about the progress of compliance
4 pursuant to the court order. So, given those two
5 recommendations, are you in agreement that we need some
6 kind of independent service and program evaluation as
7 well as Legislature -- the Legislature holding monthly
8 meetings or monthly hearings in order to monitor the
9 progress?
10 A. Between the two, I think the first is more
11 important. Whether you actually needed to have monthly
12 meetings might still be something that you could decide.
13 I don't think one should be substituted for the other.
14 Especially you shouldn't substitute the meetings for an
15 independent capacity to evaluate.
16 I think what they had in mind was even
17 something much more technical than what we could do
18 ourselves and what -- they didn't see any kind of
19 capacity already in existence in either the executive
20 branch or in the monitor's office, which, of course, has
21 a limited shelf life.
22 Q. Okay. And, further, I think they state
23 that -- they recommend that the Legislature should also
24 require the center or that independent evaluator to seek
25 and secure funding from the Federal Government and
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1 appropriate foundations.
2 I wanted to get a little bit more into the
3 funding aspect because in trying to understand the
4 background on this issue, as I understand it, when the
5 Federal Government passed the IDEA or the Individuals
6 with Disabilities Education Act, essentially wasn't
7 there an indication that they were going to be providing
8 about 40 percent of the funding to the states in order
9 to achieve the goals that were established by that Act?
10 A. That's right. That was a promise made but a
11 promise not delivered.
12 Q. Okay. So, up to this time, about what
13 percentage, instead of the 40 percent, has the Federal
14 Government been providing to the states?
15 A. I've heard estimates somewhere between 8 to
16 12 percent.
17 Q. Okay. And that's pretty much across the
18 nation that --
19 A. Yes.
20 Q. -- that same funding has been going on?
21 A. Uh-huh, yes.
22 It was Professor Gelles who said, because of
23 his background in Congress, that, yes, that was a
24 promise; but there hasn't been enough, I suppose, of a
25 pressure on the part of the states.
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1 As the states now are finding that they have
2 had to bail out the local school systems that have been
3 faced with complying with IDEA and Section 504, the
4 school systems are turning increasingly to the state to
5 provide that portion of the load that they cannot carry
6 themselves. Now, the states are taking it on. That's
7 something they've got to address.
8 IDEA is up for reauthorization this coming
9 year. So, I believe that this is a subject ripe for
10 discussion from the state level on up.
11 Q. Okay. Thank you. And, lastly, I just am
12 trying to get a real concept on where the Felix Consent
13 Decree is going to be taking us. And I was wondering if
14 you had any opportunity to review one of the quarterly
15 legislative reports. The latest one, I think, came to
16 us in May 18th; but it's for the April, 2001 quarter of
17 the report.
18 I would just like to cite some of the
19 conclusions there and then ask you some questions.
20 Specifically, what it states is that a total of 23,453
21 students have been identified for special education
22 services as of March 30th, 2001; but it goes on to say
23 that, at present time, only 20 of the 41 complexes have
24 achieved full or provisional compliance. So,
25 essentially only about half of the schools have achieved
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1 the compliance.
2 I recognize that there were a lot of problems
3 with identifying the class and really saying, what is
4 compliance? Are we going to be going on a procedural
5 level versus a substantive level and the best practices
6 compliance? But in light of that, considering that
7 we've only achieved approximately, by this estimation,
8 50 percent compliance and we've spent about a billion
9 dollars thus far, would it be fair to say in some
10 approximation that given the current status of how
11 things are going, if we don't do anything different, we
12 could potentially spend another billion dollars to reach
13 the full compliance?
14 A. I'm not sure you can do a straight-line
15 extrapolation like that, but I don't think I'm in a
16 position to tell you how much more it would take to get
17 to the other 50 percent or 40 percent that remains
18 without compliance because I'm not sure exactly what
19 compliance is meant and what partial compliance is meant
20 and how valid the determinations were for compliance.
21 Q. Okay. And, briefly, can you extrapolate a
22 little bit more on the compliance aspect between -- I
23 think the consultants were saying they recommended that
24 compliance be measured more by best practices compliance
25 rather than in the past it's been procedural. Can you
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1 detail that a little bit more for us?
2 A. Best practices is almost a buzz word for
3 effective services. So, their concern was that -- that
4 the system has to -- should have to shift its focus.
5 I'll give you an example. In the hundred
6 cases that Dr. Steinberg, the child psychologist -- a
7 child psychiatrist reviewed, she found, for instance,
8 that there -- in virtually no case was there an exit
9 strategy. There was no definition there of how you
10 could get this child to the point where you could say --
11 depending on the diagnosis, because in some cases,
12 diagnosis are time driven -- at what point you could say
13 that this child no longer need be a Felix child -- or
14 the step down. What does it take to step down the
15 services and at what points can you say that, you know,
16 this level is sufficient and the next level is
17 sufficient? There's none of that in the files.
18 So, the consultant's concern was the State
19 had an incomplete system. It didn't look beyond the
20 procedural compliance. It didn't look beyond pouring
21 resources in; and it didn't look beyond asking the
22 question, "What did you get for having poured all this
23 money in?"
24 Q. Okay. Thank you very much.
25 CO-CHAIR SENATOR HANABUSA: Thank you,
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1 Representative Oshiro.
2 Senator Buen?
3 EXAMINATION
4 BY SENATOR BUEN:
5 Q. Okay. I attended a meeting -- public
6 meeting on Maui the first week of July. This meeting
7 was for the parents to inform them of the transition
8 from DOH to DOE on July 1st, and some of the district --
9 Department of Education district specialists and the
10 deputy superintendent of education was there from the
11 Maui District. And there were many parents there very
12 concerned about the transition. They didn't know what
13 to expect.
14 One of the district's specialists talked
15 about having just about $3 million allocated to the Maui
16 County District Department of Education for the hiring
17 of psychologists and socio -- social workers and other
18 professionals to service the kids, the special needs
19 Felix kids.
20 And my question is that -- well, he also told
21 the audience that they didn't have enough money from the
22 Legislature and that -- to ask the Legislature for more
23 money to hire more personnel. And after hearing what,
24 you know, you said earlier about the waste and other --
25 the funding going to maybe inappropriate services, what
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1 do you think about that kind of statement that the DOE
2 is giving out to the public?
3 A. I think it's unfair. First of all, maybe for
4 the edification of other people here, the transition the
5 Senator is talking about is the transition of
6 approximately 7,000 students, I believe, from DOH's
7 jurisdiction -- they're called low-end minimal services
8 children -- from DOH to DOE so that all the services are
9 delivered at the school level; and the money was to
10 follow the students.
11 I don't know how well DOE is set up to take
12 on this responsibility, whether there are people there
13 they could even hire with the money -- the $3 million,
14 for instance, with the Maui District.
15 Considering the difficulty the departments
16 have had in getting the kind of technical and
17 professional help that they've needed all along, I'm not
18 so sure that even throwing more money at them is going
19 to solve the problem.
20 The other problem is: You have a management
21 information system that's still not in place. DO -- and
22 that's been one of the problems for DOE, in particular,
23 that's been cited by the Court as a reason for deeming
24 the system in noncompliance.
25 This is a computer system that was supposed
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1 to have been in place quite a few years ago, actually.
2 I believe as of the last hearing, the deadline for its
3 implementation had moved again. So, I don't know what
4 its status is. So, again, without a decent system in
5 place, you're not going to be able to track. It's not a
6 question always of more money.
7 Q. Thank you.
8 CO-CHAIR SENATOR HANABUSA: Senator Buen, do
9 you have any further questions?
10 SENATOR BUEN: No, I think she answered my
11 question.
12 When it was brought out in public meeting
13 like that and knowing that I was there and pleading to
14 the parents -- to the audience there that we don't have
15 enough moneys to hire more professionals and, you know,
16 call the legislators and ask them for more money, I
17 didn't think myself that it was an appropriate thing for
18 him to do.
19 This person does the hiring for the Maui
20 County District; and so, I wanted to know whether it
21 really is an issue -- money is an issue here or are we
22 providing the services that are appropriate to these --
23 the kids out there.
24 So, you answered my question. Thank you.
25 THE WITNESS: You're welcome.
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1 CO-CHAIR SENATOR HANABUSA: Thank you.
2 Representative Ito?
3 REPRESENTATIVE ITO: Thank you, Madam Chair.
4 EXAMINATION
5 BY REPRESENTATIVE ITO:
6 Q. Good morning, Mrs. Higa.
7 A. Good morning.
8 Q. You know, one of the problems of -- I think
9 you mentioned was the working definition of Felix?
10 A. Yes.
11 Q. You know, who is responsible for clarifying
12 that definition? Is it the Federal Government, the DOE,
13 the Department of Health? I don't know. Can you
14 elaborate on that?
15 A. It should have been both DOE and DOH with the
16 assistance of the Attorney General but primarily the two
17 field offices, the DOE and DOE -- DOE and DOH.
18 Subsequent to our consultants' report being
19 done, the DOE adopted Chapter 56, which does have some
20 definitions in there. I don't know how these have been
21 received by the people in the field and how they've been
22 implemented.
23 Q. Do you think it would help if the Legislature
24 come up with a definition?
25 A. We looked at that, and that was a
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1 recommendation of the consultants. We're still looking
2 at the viability of that because there's a number of
3 legal implications; and that was among the issues for
4 which, I believe, the Legislature asked me to get legal
5 counsel.
6 Q. This way, we can, once and for all, find a
7 definition and move on?
8 A. Uh-huh.
9 Q. I have another question. You know, you said
10 that 8 to 12 percent of the federal money is allocated
11 to special education?
12 A. Well, it's about 8 to 10 -- 8 to 12 percent
13 of our costs are borne by the Federal Government.
14 Q. Okay. So, how does the funding stream work
15 as far as the federal moneys go?
16 A. I don't understand your question.
17 Q. The Federal Government allocates "X" amount
18 of dollars to this special ed program?
19 A. Right.
20 Q. And the problem right now is we cannot
21 account for a lot of the moneys?
22 A. No, it's simply that not enough has been
23 appropriated, at least not up to the level that was once
24 promised, the 40 percent that was promised.
25 Q. And Congress is working on that right now?
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1 A. It's become an issue that Congress has to
2 confront, yes, because the states are starting to push
3 them to consider it.
4 Q. So, it's basically a funded mandate --
5 A. That's right.
6 Q. Okay. Thank you very much.
7 CO-CHAIR SENATOR HANABUSA: Representative
8 Ito, are you finished?
9 REPRESENTATIVE ITO: Yes. Thank you, Madam
10 Chair.
11 CO-CHAIR SENATOR HANABUSA: Thank you.
12 Representative Kawakami?
13 REPRESENTATIVE KAWAKAMI: Thank you, Co-Chair
14 Hanabusa.
15 EXAMINATION
16 BY REPRESENTATIVE KAWAKAMI:
17 Q. I'd just like to ask this question. It had
18 been, you know, broiling over all these years; and I
19 wanted to get your opinion.
20 Should not the departments have done a master
21 plan of something so compelling as this Consent Decree
22 so that expectations, kinds of services, personnel,
23 training, et cetera, was looked at? There's nothing.
24 A. That's right.
25 Q. And I think at this point we still should
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1 force some kind of master plan because we're coming up
2 now with a continuum of care and this whole thing joins
3 together.
4 A. Uh-huh.
5 Q. You know, you're looking down the future.
6 So, I still believe the department should have and must
7 do a master plan.
8 The people in the field tell me a different
9 story. They're not really sure what is -- what you're
10 going after. It's hit or miss sometimes, and they try
11 their darnedest.
12 A. Uh-huh.
13 Q. So, what's your opinion?
14 A. I think you're absolutely correct. Our
15 conversations with our University of Pennsylvania
16 consultants revolved around that issue as well; and they
17 even said, you know, it's actually not too late.
18 This was not in the report; but in our
19 conversation, they said, you know, "You might want to
20 see if the Governor would also get on board." But it's
21 not too late to convene a group of experts nationally
22 and force some kind of plan so we have other opinions
23 that we can deal with aside from those that have already
24 been through here.
25 Because the Legislature's been at a huge
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1 disadvantage. It was not part of the picture from the
2 very beginning. All you were left with was the money
3 request, and you have had no capacity to ask the
4 questions. So, if, at least, there were some kind of
5 convening of a group like this, which may then
6 ultimately result in a master plan or some road map for
7 us -- because we're looking at what's to happen beyond
8 Felix, beyond the lifting of the Consent Decree, you're
9 right.
10 Q. Thank you. Thank you. I've been worried
11 about that. The other question I have is on the service
12 testing.
13 A. Uh-huh.
14 Q. You mentioned in there that it is not a
15 reliable and a valid tool, and could we have your
16 delineation of that?
17 A. No, I think it -- the more correct statement
18 is that it has not been scientifically validated. It
19 was designed specifically for use here and not subjected
20 to the kinds of ordinary testing that an instrument
21 would undergo.
22 Q. Okay. Would you say that instrument needs to
23 be tinkered with, needs to be relooked at, make it more
24 comprehensive?
25 A. Our consultants just made a general statement
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1 along those lines that it was not valid -- it had not
2 been validated. I don't know if they were willing to do
3 anything else about it or to opine anything further on
4 it as to whether it really was valid and how valid was
5 it or wasn't it. That was not part of the scope of the
6 contract with them.
7 Q. Uh-huh.
8 A. And it would take, I think, a lot more work
9 than was required at that time.
10 Q. Okay. Maybe we can follow up when the DOE
11 comes on. Thank you very much, Auditor.
12 REPRESENTATIVE KAWAKAMI: Thank you.
13 CO-CHAIR SENATOR HANABUSA: Thank you,
14 Representative Kawakami.
15 Representative Leong?
16 REPRESENTATIVE LEONG: Thank you.
17 EXAMINATION
18 BY REPRESENTATIVE LEONG:
19 Q. This is somewhat in line with the question
20 before from Representative Kawakami; but I know that in
21 the recent teacher strikes, so many people talked about
22 accountability on the part of the teachers.
23 And it seems to me accountability seems to be
24 lacking in terms of who is going to be responsible for
25 this Felix Decree. Is it a coordinating effort or where
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1 is it? And I think this, to me, seems to be a problem.
2 There seems to be a plan of action for accountability on
3 that.
4 Secondly, I had a question in your page -- on
5 your Page 9, you talked about the CSSS; and I wondered
6 that -- because some funds were being sent for that
7 Comprehensive Support Services System and you indicated
8 that it did not reflect any best practices; and I
9 wondered, how were you able to detect this in your
10 report?
11 A. CSSS has been something of an anomaly, as far
12 as we're concerned. It's been very difficult to define
13 what it is. It preceded actually a good deal of Felix.
14 The intent here was that you would bring an
15 array of services to the school, decide which service
16 the child needed; and that would be provided at the
17 school.
18 Part of the problem is in the Legislature's
19 attempt to track the Felix expenditures, it created a
20 new program identification called EDN 150. And the
21 special ed expenditures were to be placed there so that
22 it was easier to track.
23 The problem has become one where CSSS
24 expenditures are now also in that program. So, you
25 don't know. Your funding stream is getting even
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1 murkier.
2 Now, I don't know how you're going to
3 validate the impact of having done CSSS because you also
4 have Felix money in there and special ed money in there
5 as well. I don't know.
6 Q. I see. Thank you.
7 CO-CHAIR SENATOR HANABUSA: Thank
8 you, Representative Leong.
9 Representative Pendleton?
10 REPRESENTATIVE PENDLETON: Thank you, Senator
11 Chair.
12 EXAMINATION
13 BY REPRESENTATIVE PENDLETON:
14 Q. Thank you, Mrs. Higa, for being here.
15 A. Good morning.
16 Q. I appreciate your very professional and
17 candid briefing this morning.
18 A. That's my job.
19 Q. Yes, and you performed it well, as you always
20 do before this Committee.
21 The third audit, I found very helpful; and on
22 Page 33 are the recommendations --
23 A. Yes.
24 Q. -- from that third audit enumerated as seven
25 on that page.
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1 A. Uh-huh.
2 Q. I wanted to ask you if you continued to agree
3 with these or are there ones that you might not
4 necessarily embrace or are there additional ones --
5 recommendations from your office that are not listed
6 here that we should be aware of?
7 A. I think we would still support all seven of
8 them. No. 1, the question of the statutory definition,
9 as I said earlier, was still being looked at legally.
10 It depends on what we finally conclude from our legal
11 team's work on this and whether there are other options
12 that may yield us the same result.
13 Q. Okay. Now, they have listed them and
14 numbered them one through seven.
15 A. Uh-huh.
16 Q. Was this intended to be the level of
17 priority? Assuming we can't do all of them
18 instantaneously and at once, would you say that No. 1 is
19 something that we should do first; or are these numbers
20 not necessarily in the order of priority?
21 A. When we do our reports -- and although this
22 was the consultants' work, we did have some role in
23 shaping it and doing some editing.
24 In our work, our recommendations are ordered
25 in the order of the discussion that precedes. The
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1 discussion is usually ordered by order of importance.
2 So, yes, there is a correlation in the numbering. So,
3 you would assume that the first recommendation addresses
4 what we would consider to be the most serious problem,
5 yes.
6 Q. Okay. Real quick, on the first one, which
7 says, "The Legislature should consider establishing a
8 statutory working definition for special education
9 eligibility," what are the considerations -- the basic
10 considerations in terms of whether we should proceed
11 with No. 1? Is it that defining it ties our hands in
12 the future because we are now tied to the statute?
13 There's insufficient flexibility for course alterations
14 in the future because now there's kind of an
15 entitlement?
16 A. Yes, that's part of the problem; and you
17 would have to be careful that you're not either
18 constricting yourself vis-a-vis the federal requirements
19 or expanding the class unnecessarily vis-a-vis the
20 federal requirements.
21 Q. On page 13 of this very audit is listed some
22 of the factors which could possibly be included in a
23 statutory definition.
24 A. Uh-huh.
25 Q. Do you still agree with those or have you
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1 ever -- or do you believe that these are the things the
2 Legislature should look at should we make the policy
3 decision to go forward with the statutory definition?
4 A. I believe this list came out of both IDEA and
5 504.
6 Q. Okay. Are there other jurisdictions that use
7 this same -- I think you listed one state maybe that has
8 a statutory definition?
9 A. There is one state that has a definition. I
10 think it was Kentucky.
11 Q. Kentucky?
12 A. Uh-huh.
13 Q. But how did the other states handle providing
14 services to this group of students? I mean, we're not
15 the only state with these kinds of students.
16 A. They've gone to working definitions at the
17 field level and training for their staffs on how to
18 interpret those.
19 In the report that we're working on now,
20 we're trying to look at the per-pupil expenditures and
21 how we compare with other states to see if our per-pupil
22 expenditures are in line, too low, too high.
23 Q. Do we know at this point? Do we have an
24 idea? I mean, I would imagine that we're spending a lot
25 more per pupil.
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1 A. I'm afraid I don't discuss findings until
2 they're released.
3 Q. Very well. Final question, Chair: Item
4 No. 4 discusses the possibility of DOE and DOH assessing
5 the feasibility of providing service vouchers to parents
6 of children in the Felix class.
7 One of the concerns is, you know, are we just
8 kind of shuffling them away to someone else and kind of
9 washing our hands of the problem, as it were; but
10 another way to interpret that recommendation is if we
11 don't develop the indigenous capacity, as you say, then,
12 we will be forced to send away students that we can't
13 service here. Could you comment a little bit more on
14 Recommendation 4?
15 A. All right. Their intent in Recommendation 4
16 was, I think, a little broader than you might be reading
17 it. Their thinking was that if you empowered parents
18 with vouchers of some sort for some portion of the
19 services that might be agreed upon in their child's IEP,
20 then you have parents being able to take that slip and
21 shop around among various providers. You introduce an
22 element of competition here.
23 Q. Competition.
24 A. You might have more satisfaction among
25 parents because now they've had some say in who provides
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1 services to their children much more so than they do
2 now. That was the idea.
3 Q. This is not necessarily a recommendation, but
4 the -- those teams that we discussed, some of them as
5 large as 19 --
6 A. Uh-huh.
7 Q. -- what would you suggest in terms of
8 modifying that or addressing that problem? I know we
9 need as much input as possible, but I can't imagine a
10 team of 19 being the most efficient way to operate. I
11 don't think we have 19 people here on this Committee.
12 A. I really don't know that you can do that on a
13 top-down basis. It still has to be something that's
14 decided on a child-by-child basis.
15 Q. Okay. Thank you very much.
16 CO-CHAIR SENATOR HANABUSA: Thank you,
17 Representative Pendleton.
18 Senator Sakamoto?
19 SENATOR SAKAMOTO: Thank you.
20 EXAMINATION
21 BY SENATOR SAKAMOTO:
22 Q. I guess, your first audit -- so, those issues
23 are now resolved?
24 A. You're talking about the Big Island?
25 Q. Big Island.
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1 A. The Big Island one.
2 Q. The handling of that issue.
3 A. We're not sure. We think so. The -- it was
4 a three-year contract, as I said earlier.
5 After the second year, by mutual agreement,
6 Kapiolani Health Hawaii pulled out of the contract; and
7 the function was returned to DOH. Between the first and
8 second years, there is a good deal of money that was
9 still in Kapiolani Health Hawaii's hands that, in our
10 view, had not been used. In effect, this was an
11 advance.
12 We have not gone back to reaudit, but it's
13 our belief that most of it has been resolved in the
14 sense that services were subsequently provided in the
15 second year or that enough justification was provided
16 for the moneys having been spent; but as I said, we have
17 not specifically audited those books.
18 Q. In that specific case, the Department of
19 Health did acknowledge some of your findings and did
20 respond that they would follow up, I would assume?
21 A. Well, my recollection is there is still
22 some -- some denial of the problem that, in fact, this
23 was -- the string of money that was still unresolved was
24 going to be resolved and that we were unnecessarily
25 casting aspersions on Kapiolani Health Hawaii.
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1 Q. Okay. The second audit dealt with
2 definition. We've talked about it on many different
3 times. Obviously we have a federal law; and, yes, next
4 year IDEA comes up for reauthorization.
5 This year, as you mentioned, the Elementary
6 and Secondary School Act is looking for more dollars and
7 hopefully moving Hawaii and other states up to the 40
8 percent in some time certain, be it six years or
9 otherwise; but my understanding in some of the
10 discussion was, perhaps, we're defining a class of
11 children because we agreed to the Consent Decree
12 different, not because of the federal law but because of
13 the Consent Decree. Is that part of your findings?
14 A. Our consultants did talk to us about that.
15 They believed that our definitions were broader than
16 they needed to be because we were coupling mental health
17 services with educational progress, and that imposed a
18 heavier burden on the State than other states might
19 interpret the burden to be.
20 Q. Is that a coupling that the Consent Decree
21 mandated on us?
22 A. Yes.
23 Q. So, when -- and I agree with you. We will
24 get beyond Felix, and I can see us operating after that.
25 At that point in time, are there outcomes that we, as a
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1 State, should have in place, such as transition to the
2 workplace or transition somewhere, such as graduation
3 rates, such as attendance in school? Are there outcomes
4 that would not depend on the Felix Monitoring Project,
5 Inc. or Ivor Groves or Marion Higa or Mr. Glasser (sic)?
6 Are there outcomes that we can all look to that would
7 show us all that we are, indeed, making progress?
8 A. I would hope there would be; and, perhaps,
9 it's part of that master planning process Representative
10 Kawakami mentioned; but there has to be some kind of
11 explication of what it is we're trying to achieve here
12 in terms of the students.
13 Q. Let me clarify. You're not claiming to be an
14 expert --
15 A. No.
16 Q. -- but you're expounding what the experts
17 have found in your audit?
18 A. That's right.
19 Q. As far as management process/financial
20 process, those, you can be an expert based on your years
21 of auditing different management and funding mechanisms?
22 A. Yes, and, to some extent, our reliance on
23 other experts for those as well.
24 Q. Okay. In the independent oversight, does
25 that mean we need to have -- after Ivor Groves or Felix
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1 Monitoring, Inc. is gone, does that mean our State would
2 have to hire or find another body or can that be
3 something we do ourselves, I mean, within our structure?
4 A. Well, it should -- if you're going to do it,
5 you should do it independent of whether there is or
6 isn't a Felix Monitoring, Inc. in existence. This is
7 something that you would want to do. How you set it up
8 is still something you can design for yourself.
9 Q. I guess -- I'm a building contractor, and we
10 do our own punch lists prior to the architect or owner
11 saying, "These are the things that you need to do, right
12 or wrong."
13 A. Uh-huh.
14 Q. But can't the Department of Education,
15 Department of Health -- can our own system do our own
16 punch list as opposed to saying, "We need to hire
17 someone else to come and do our punch list on our job"?
18 A. Well, it goes to the question of how much you
19 want to have in place for yourselves an instrument that
20 carries out a basic tenet of oversight; and that tenet
21 is independence. If you have an oversight arm within
22 any of those offices or departments that are carrying
23 out the program, what is your assurance that this basic
24 tenet of independence is, in fact, being met? I'm not
25 so sure.
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1 Q. What if we're actually measuring attendance
2 in school, graduation rate, less disciplinary problems,
3 effective transition to the work force or to some other
4 program?
5 A. You can get that kind of data; but you may
6 still want to have someone to tell you if, in fact, this
7 data is good data.
8 Q. Would your office be the type of office that
9 would do that?
10 A. It would fit with our mission; but it would
11 require, I think, a very dedicated separate kind of
12 staffing because you really have to build up some
13 technical expertise.
14 And I don't want this to sound like I'm
15 trying to build a kingdom here. I have plenty enough
16 work to do. Thank you very much.
17 Q. Thank you. And I guess all of us in the room
18 are here because of interest in this issue.
19 A. Uh-huh.
20 Q. Certainly you stated -- and I think,
21 hopefully, most of us see that, indeed, we've improved a
22 lot since way back when?
23 A. Uh-huh.
24 Q. At the current time -- I guess, how can this
25 effort, from your perspective, help us improve faster?
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1 A. I think this Committee's push for information
2 is the right way to go because with the powers of the
3 Investigative Committee which are not available to you
4 under ordinary circumstances as legislators, you can get
5 information -- or you ought to be able to get
6 information that's going to help you begin to answer the
7 questions you haven't had answered before.
8 I know I've sat through budget hearings.
9 I've talked to your many staffs; and there's a good deal
10 of frustration there that as much as people have tried,
11 they have not been able to get information.
12 And the key information is still the kind of
13 information that we need to be able to get; and that is
14 tying what was delivered with what was ordered and what
15 was paid for. Because here -- let me ask you the
16 question. If it was your money, wouldn't you want to
17 know that what you paid out was deserved?
18 Q. Well, when we hire an auditor for our company
19 and he has -- they have access to all of our records to
20 assure us that we're doing things correctly; and they
21 come back with suggestions so that our bank and our
22 bonding company will be assured that everything is done
23 with the right information, so, yes.
24 A. That's right. So -- and it is our money.
25 It's your -- Felix money is your money and my money and
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1 everybody else's money, so, 102 million people's money.
2 Q. So, we'll get there. Thank you.
3 SENATOR SAKAMOTO: Thank you, Chair.
4 CO-CHAIR SENATOR HANABUSA: Thank you,
5 Senator Sakamoto.
6 Senator Slom?
7 SENATOR SLOM: Thank you, Madam Co-Chair.
8 EXAMINATION
9 BY SENATOR SLOM:
10 Q. Thank you, Mrs. Higa, for the dissertation
11 on Money 101.
12 A. You're welcome.
13 Q. You have been the state auditor for how many
14 years now?
15 A. Nine years.
16 Q. And during that period of time, you have been
17 responsible for approximately how many legislatively
18 requested audits?
19 A. Oh, gosh, we average about 20 to 25 reports a
20 year. So, that times nine; but not all of them are
21 legislatively requested.
22 Q. And they cover a wide range of departments,
23 agencies, and programs, I presume?
24 A. Yes.
25 Q. Do you always get complete cooperation from
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1 the people that you're auditing?
2 A. Not always, no.
3 Q. Have you ever, in the nine years that you've
4 done audits, had as difficult a time trying to get
5 information as you had on this particular subject?
6 A. Probably not. This is probably been our
7 greatest challenge. We've become more and more
8 creative.
9 Q. How many other states are under federal
10 consent decree regarding special education?
11 A. Oh, gosh, I really don't know because in most
12 cases, it's not the state. It's the local school
13 systems. I couldn't tell you right offhand.
14 Q. And that's because we are the only state in
15 the Union --
16 A. Yes.
17 Q. -- with a single statewide school district?
18 A. Uh-huh.
19 Q. You know, a question was alluded to earlier
20 by two of the representatives, one about accountability,
21 one responsibility. If someone were to ask you,
22 Mrs. Higa, who is -- has the overall responsibility for
23 Felix today, what would your answer be?
24 A. I would have to say it's still DOE and DOH
25 together.
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1 Q. Is there any one individual that you would
2 point to?
3 A. Ultimately it would have to be the Governor.
4 Q. And what role has both the Governor and the
5 Attorney General played in the past eight years on this
6 issue?
7 A. Well, there was an attempt about four years
8 ago -- because part of the problem in getting to
9 compliance was a lack of coordination between DOE and
10 DOH. There was an attempt to create a super body in the
11 Office of the Governor. It was the Felix' operations
12 manager, I think her position was. It was a small
13 staff.
14 The superintendent and the director of
15 health, with the approval of the AG, signed off some of
16 their authority to this super power. It was popularly
17 called the Felix Czar.
18 It lasted for about two years maybe. It
19 didn't seem to us that the office carried out the kind
20 of authority that it had. It didn't do a whole lot of
21 coordination, and it may have stalled some of the
22 compliance effort to some degree at that time.
23 There was a training institute that it ran,
24 and maybe that was the main function of the office. I
25 don't know. We didn't -- we didn't really audit that as
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1 a special entity.
2 Q. But your personal opinion, do you think it
3 was because of lack of ability and experience of the
4 individuals that were involved or motivation by the
5 executive branch?
6 A. I think it's hard to tell. I don't think it
7 would be fair to say what the cause was.
8 Q. In your third audit report when you discuss
9 conflicts of interest -- and you mentioned here this
10 morning the Technical Assistance Panel. Who appointed
11 the members to the Technical Assistance Panel?
12 A. I believe it was the Court.
13 Q. The Court. And how many were on that panel?
14 A. Three.
15 Q. Three, of which -- the one individual you
16 spoke about that has since been indicted in the State of
17 North Carolina?
18 A. Yes.
19 Q. Was there any indication that that individual
20 was involved in any of the financial decisions as a
21 member of that assistance panel here?
22 A. Financial decisions in terms of actual
23 spending of the money, maybe not, except that this panel
24 also decided which programs would implement the Consent
25 Decree. So, ultimately, yes, the decisions had fiscal
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1 implications; but did the Technical Assistance Panel
2 decide which check should be cut? I don't think so.
3 However, there may have been a role of -- on
4 the part of individuals in, for instance, recommending
5 trainers. That's a possibility.
6 Q. And you mentioned that the psychologists,
7 many of whom made diagnoses, were also the same
8 psychologists that then provided the services. Who made
9 that decision as to who would provide the services?
10 A. The IEP team as a whole.
11 Q. Was there a -- was there a large or small
12 pool of participating psychologists?
13 A. It varied from community to community. There
14 were communities where there weren't enough
15 professionals on board. That's true.
16 Q. And if someone -- if someone in the
17 profession, for example, wanted to be considered to
18 provide services, what would he or she have to do?
19 A. I believe the process was to -- first of all,
20 they had to be professionally certified and present
21 themselves as a potential vendor. Many of these people
22 worked for nonprofit organizations. They didn't have
23 their own practices. Some people did have their own
24 practices. So, either way, then, if it was the
25 organization that was the vendor, these people were just
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1 on staff. So, it was the organization, then, that had
2 the contract.
3 Q. You mentioned that the court monitor is a
4 part owner of the company that provided the product that
5 must be used?
6 A. Yes.
7 Q. And what is that product?
8 A. It's called service testing. That's the
9 instrument. It's a set of what looks like workbooks
10 that the testers take. They will pull a sample of
11 student files and go through them and see if they meet
12 the various criteria enumerated in that workbook.
13 Q. And was that product used in any other state?
14 A. Not to our knowledge, no. It may have been
15 subsequently used, but it was designed for Hawaii.
16 Q. Designed for Hawaii. Did you -- by the way,
17 were you ever successful in getting a copy of the 990
18 tax form?
19 A. No.
20 Q. And that is a requirement of the Internal
21 Revenue Service, is it not --
22 A. Yes.
23 Q. -- for a continuation of nonprofit status?
24 You talked about money, and is it your
25 knowledge or your belief that all of the emergency
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1 appropriations that were sought were provided by the
2 Legislature?
3 A. Yes and no. I think there is a series of
4 negotiations sometimes to see if, in fact, the entire
5 amount was necessary. In some cases, there is a
6 deferral, I think, of a portion of the amounts; but by
7 and large, the moneys were given to the departments.
8 Q. The program that you identified as MST,
9 Multisystemic Therapy --
10 A. Uh-huh.
11 Q. -- it was your testimony that originally this
12 program was designed for juvenile delinquents; is
13 that --
14 A. Yes, that was according to our consultants.
15 Q. And how widespread is this program in Hawaii?
16 A. Oh, in Hawaii?
17 Q. Yes.
18 A. It's only been used by DOH under this now
19 $2 million appropriation.
20 Q. Okay. And, finally, Mrs. Higa, you said that
21 in the things that you've investigated and you've seen
22 thus far, that you're not simply talking about
23 mismanagement?
24 A. No.
25 Q. Could you elaborate on that?
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1 A. Mismanagement conveys, I think, a rather
2 narrow activity. You know, you think in terms of fraud.
3 You think in terms of specific actions where money
4 didn't go where it was supposed to go.
5 I think what we're talking about here and
6 what this Committee is interested in is how effectively
7 the money was spent and were there areas where money was
8 spent undeservedly, whether there is untoward profit,
9 whether the State has been held hostage in having to
10 fund items simply because someone interpreted that these
11 things had to be paid for.
12 As I said earlier, there seemed to be this
13 culture of profit. Our consultants said somewhat
14 facetiously that Felix has become the State's full
15 employment act for certain -- for mental health
16 professionals.
17 Their observation was -- and this is from
18 their conversations with people in the field -- that
19 Felix has attracted a number of people and -- because we
20 had a need; but it also attracted people into
21 communities or out of, say, other kinds of jobs into
22 some of these mental health areas at very lucrative
23 remuneration and that this contributes to the cost to
24 the State.
25 And their solution, of course, is that, you
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1 know, we may simply be stuck with the situation as far
2 as the lack of professional capacity is concerned until
3 we really focus on building our own. They did not see a
4 very active involvement of the University in our trying
5 to get our professional capacities up.
6 Q. Thank you, Mrs. Higa.
7 SENATOR SLOM: Thank you, Madam Chair.
8 CO-CHAIR SENATOR HANABUSA: Thank you,
9 Senator Slom.
10 Co-Chair Saiki?
11 CO-CHAIR REPRESENTATIVE SAIKI: Thank you.
12 EXAMINATION
13 BY CO-CHAIR REPRESENTATIVE SAIKI:
14 Q. Mrs. Higa, you testified that you and your
15 office began investigating Felix expenditures in -- was
16 it 1996 or 1997?
17 A. The Big Island project was ordered by the '96
18 Legislature, I think it was.
19 Q. So, that's when you initially began your work
20 on Felix?
21 A. On Felix, yes; but prior to that, we had done
22 a couple of audits, one on the DOH's contract
23 management.
24 You see, we've had a State law for a number
25 of years that required mental health services to
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1 children; and it required a memorandum of agreement
2 between DOE and DOH as to who was to do what.
3 In this earlier audit that we did, we found
4 that that memo of agreement was very much out-dated.
5 And, in fact, we went back to look at it subsequently;
6 and it was still not updated or, if it had been updated,
7 it was a very skimpy update.
8 We also found that in managing its contracts
9 overall, DOH was quite deficient. They didn't have the
10 capacity to manage contracting. So, we knew that there
11 would be problems going into the Big Island audit in
12 DOH's contract management capacity.
13 So, we did have a history of looking at DOH;
14 and, of course, we've had a long history of looking at
15 DOE.
16 Q. You know, this Committee has been publicly
17 criticized for, quote, deliberately sabotaging
18 implementation efforts of the Consent Decree. I just
19 wanted to ask, since you began your work on Felix up
20 until the present time on behalf of the Legislature, is
21 it your understanding or your belief that the
22 Legislature has attempted to sabotage or delay
23 implementation efforts?
24 A. I don't think so. I can't see that asking
25 questions can be characterized as a sabotage on
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1 compliance.
2 These are questions that are very legitimate
3 as the branch of government responsible for taxing the
4 people and appropriating the moneys; and if you go back
5 to look at the constitutional debates -- and there's no
6 question in our American system with the three branches
7 of government.
8 The heart of the debate in putting the office
9 of the auditor in the legislative branch was based on
10 the assumption that the legislative branch was the
11 branch that taxed and spent money. And by spending, I
12 mean, allocated it out. The executive branch, of
13 course, as the one that implemented the programs then
14 was cutting the checks. That's right.
15 Q. That relates to my last question. Because we
16 are spending approximately 350 million to $400 million
17 per year on special education --
18 A. Uh-huh.
19 Q. -- and the bulk of that is State tax dollars,
20 the Federal Government reimburses the State a very small
21 portion --
22 A. That's right.
23 Q. -- for special education.
24 So, I guess my question is based more on your
25 individual capacity as a State taxpayer. I assume
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1 you're a state taxpayer?
2 A. Yes, I'm a taxpayer. That's true.
3 Q. What is your -- as a taxpayer, do you believe
4 that the Legislature should investigate this situation?
5 A. Well, yes, because if you're looking at this
6 huge amount of money, not only are you obligated to
7 track the money, you are also obligated to ask: Did it
8 buy the services? Did it buy effective services?
9 That's your obligation under the Consent Decree.
10 And even if it weren't in the Consent Decree,
11 that should still be your obligation. It's not just
12 simply a matter of spending the money for the sake of
13 spending the money. You're spending the money because
14 you want children to benefit from education.
15 Because if it's your money and if it's my
16 money, I certainly want you to do that; and so, whatever
17 it takes and whatever it takes to get the information, I
18 think we're going to get it.
19 Q. Okay. Thank you very much.
20 CO-CHAIR SENATOR HANABUSA: Thank you,
21 Co-Chair Saiki.
22 EXAMINATION
23 BY CO-CHAIR SENATOR HANABUSA:
24 Q. Mrs. Higa, there's a couple things that you
25 said that I would like to follow up on.
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1 A. Uh-huh.
2 Q. You had said something about hiring an
3 attorney to look into the recommendation as to whether
4 the Legislature should do this definition and what the
5 implications are.
6 A. Uh-huh.
7 Q. Before I get to that question, can I ask you,
8 was there anything that made it necessary for you, other
9 than a question like that, to retain the services of an
10 attorney when you looked at the Felix issue?
11 A. We already have had contract counsel.
12 Several years ago -- up until several years ago, we were
13 obliged to have as our counsel someone from the AG's
14 office; and it seemed to me that as part of a separate
15 branch of government, that was inappropriate.
16 And we had come across some instances where
17 our interest was different from the executive's
18 interest. So, I did come to the Legislature and seek
19 permission to hire our own counsel; and we have done so.
20 However, when it came to the Felix issues in
21 early on this session, when our report was issued and
22 there was a fire storm of controversy over the issue of
23 a statutory definition, challenges on the capability of
24 our consultants, the Legislature itself on its own
25 initiative inserted into my budget an appropriation for
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1 $500,000 to seek legal help anticipating that it may
2 come to that.
3 Q. So, can you -- because the public isn't quite
4 familiar with your procurement process and what you're
5 bound by --
6 A. Uh-huh.
7 Q. -- can you tell us what process that you go
8 through to hire an attorney?
9 A. Uh-huh. Oh, we draft up an RFP, which is a
10 request for proposal. Because we knew this contract --
11 even with the appropriation of a half a million dollars,
12 it was my intention not to spend the entire amount on
13 legal services. I reserved $150,000 for expertise in
14 case we needed it.
15 So, we drafted an RFP with a ceiling of
16 approximately $350,000, solicited and advertised the
17 availability of this contract locally, received six
18 responses.
19 My usual practice is to form a committee of
20 my staff, which includes people with some expertise in
21 the area that we're contracting for, have them review
22 the proposals, score them; and the scoring is
23 available -- the criteria are available to those who are
24 interested in responding in the first place. They did
25 the scoring, gave me their scores; and the final choice,
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1 however, is still mine as to who gets our contracts.
2 Q. Okay. You said something else of interest to
3 me when you discussed a separation of powers and how the
4 legislative auditor's position came to be part of the
5 Legislature.
6 A. Uh-huh.
7 Q. There -- we do have another entity that sort
8 of sits with the Department of Education that, I think,
9 has had a role or should have had a role in this whole
10 Felix issue; and that's the Board of Education.
11 A. Uh-huh.
12 Q. Can you tell me that -- in the investigations
13 and the audits that you've done, whether you have been
14 able to draw any conclusions about, one, the role that
15 the Board of Education played or should have played and,
16 two, what they actually did in this process?
17 A. The Board of Education is something of an
18 anomaly.
19 In the '78 Con Con, the discussion was had
20 over the Board of Education; and over the years, even --
21 you know, I have been with the auditors office for over
22 30 years. And so, back even in the '70s, there was a
23 discussion over whether to have an appointed board or an
24 elected board and the various formulas you had to have
25 if you had an elected board.
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1 The problem has always been -- with an
2 elected board is to define where it sits here because as
3 a board elected statewide or by districts, what role
4 does it have vis-a-vis the elected Legislature and the
5 rest of the department which is a member of the
6 Governor's cabinet?
7 In '78 we were asked to do some of the staff
8 work for the Constitutional Convention, and this was an
9 issue that I worked on a little bit. We never could
10 quite put our finger on it.
11 The final compromise was, I think, something
12 to the effect that the Board of Education shall have
13 authority over the management subject to law or as
14 provided by law which should be interpreted to mean
15 ultimately the policy decision is still the
16 Legislature's and not the Board's.
17 Q. So, when the Board of Education members
18 basically tell us in the Legislature that they are the
19 policy makers, it is your understanding from working on
20 the 1978 Con Con that, in fact, the policy of the
21 Department of Education or education area is ultimately
22 with the Legislature and not the Board of Education?
23 A. That's my understanding.
24 Q. So, do you have an opinion of exactly what
25 this Board is supposed to do then? I mean, if they're
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1 not making policy and the management -- the ultimate
2 management authority is the Governor in the sense that
3 they are in the Governor's cabinet, then, what does this
4 anomaly called a Board of Education do, if anything?
5 A. I think that's still a problem. I'm not sure
6 what the answer is.
7 If you look at the language in the
8 constitutional amendment, they are responsible for
9 internal management -- well, it was a combination of the
10 constitutional amendment and the statutory change that
11 followed. And to some extent, the statutory change that
12 followed may have confused matters even more because it
13 gave certain kinds of autonomy to DOE to parallel the
14 autonomy that had been given to the University; but the
15 constitutional bases for the two are different.
16 So, I'm not sure what the answer could be for
17 the role of the Board. I think that's maybe another
18 discussion we need to have.
19 Q. And then just following up on one last
20 question along that line, they still have some
21 management, internal management --
22 A. Yes.
23 Q. -- responsibility; and I would assume that
24 the concept of whether or not the DOE is in compliance
25 or the State is in compliance with the Felix Consent
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1 Decree, that that would still fall as part of their
2 responsibility because it still is somehow an internal
3 issue within the Department of Education and it still is
4 a management issue as well?
5 A. That's right. And to the extent that the
6 Legislature holds ultimate responsibility because of the
7 language as provided by law, whatever you permit the
8 Board to handle within its jurisdiction is up to you,
9 even if it were of a policy-making nature; but they are
10 not the ultimate authority on policy.
11 Q. One last area. It seems to me from your
12 testimony that we have, for lack of a better
13 description -- I remember, I think it was, 60 Minutes or
14 20/20 who did the series about the tobacco litigation
15 nationwide and how you had a -- like, a group of people
16 that -- or a group of lawyers -- you know, Scott and
17 my -- everyone keeps reminding us, Pendleton down there;
18 but we have a group of lawyers who sort of go around and
19 do this litigation.
20 Now, do you find that the same situation is
21 occurring in your discussions about how Felix-type
22 issues are being handled across the United States? We
23 have this one person who was part of the Technical
24 Assistance Program or plan who has problems in North
25 Carolina. So, I assume that this person also has some
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1 ties there or a role there.
2 Do you find a repeat of people throughout the
3 United States trying to get every place in compliance?
4 A. It's been reported that this individual, in
5 particular, has consulted in 22 states; and I know
6 Dr. Groves has done some consulting in Arizona. Arizona
7 is under some kind of consent decree for mental health
8 services. I'm not sure that it's tied to education in
9 some way.
10 I know Dr. Groves at one time was part of the
11 executive branch in Florida in a position similar to a
12 position held by the person under indictment in North
13 Carolina.
14 If you will look at where some of the people
15 have come from who are serving here or have served here,
16 they seem to cluster from particular states.
17 Q. And I guess, in all fairness, our -- the
18 experts that you hired have also had experiences
19 elsewhere as well in this area. Like, I believe you
20 said that -- was it Dr. Schwartz who also served in a
21 monitor capacity somewhere?
22 A. Yes, he was a monitor; but I don't know where
23 for sure.
24 Q. Thank you.
25 CO-CHAIR SENATOR HANABUSA: Do you have any
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1 further questions, Counsel?
2 SPECIAL COUNSEL KAWASHIMA: I have no further
3 questions. Thank you.
4 (Discussion off the record.)
5 CO-CHAIR SENATOR HANABUSA: Thank you,
6 Mrs. Higa. And I think it's time for us to take
7 another break for the court reporter. Members, five
8 minutes and --
9 (Discussion off the record.)
10 CO-CHAIR SENATOR HANABUSA: Thank you,
11 Mrs. Higa. We'll take a short recess for the court
12 reporter. Five minutes, Members.
13 (Brief recess.)
14 CO-CHAIR SENATOR HANABUSA: The hearing is
15 reconvened.
16 Members, as you know, on the agenda we have
17 two remaining witnesses. However, as everyone is
18 probably very well aware, on July 12th, yesterday, the
19 United States District Court for the District of Hawaii
20 quashed two subpoenas that we issued pursuant to your
21 authorization on the Committee hearing of June 19th.
22 As you know, those subpoenas were directed at
23 the Felix monitor, Dr. Ivor Groves, and the executive
24 director of the Felix Monitoring Project, Inc.,
25 Ms. Juanita Iwamoto.
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1 We -- and this Committee, as well as your
2 co-chairs, are not in receipt of any written order. As
3 you know, the Court said that it would write an order;
4 and then it would make it public. However, that order
5 has not been entered as of this date. Because we
6 believe that we should review that order before any type
7 of formal recommendation is made as to any action that
8 we will take, we will recommend that the matter be
9 deferred for now.
10 The Court did indicate, however, that
11 compelling Dr. Groves and Ms. Iwamoto to testify before
12 this Committee would impede the implementation of the
13 Consent Decree. As Mrs. Higa also stated, it's not
14 clear to us how a couple hours of testimony could impede
15 the implementation of the Consent Decree or to prevent
16 this State from reaching compliance.
17 And with that, we will review the order and
18 ask for Committee action at a later time.
19 CO-CHAIR REPRESENTATIVE SAIKI: Thank you.
20 Members, at this time, we would like to request that the
21 Committee go into executive session, basically, for
22 purposes -- two purposes: First, to receive a briefing
23 from our Special Counsel on the proceedings that
24 occurred yesterday in the U.S. District Court and,
25 second, to examine a list of witnesses and documents to
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1 be subpoenaed by this Committee in the future.
2 Section 21-10 of the Hawaii Revised Statutes
3 and Committee Rule 1.1 vests this Committee with the
4 authority to enter into executive session upon a
5 two-thirds vote of this Committee's authorized
6 membership. Committee Rule 1.1 defines "executive
7 session" as, quote, "a session in which only members of
8 the Committee, staff personnel, the witness, and counsel
9 for the witness are permitted to be present."
10 Accordingly at this time, the Co-Chairs would
11 like to move that this Committee convene in executive
12 session to consult with our Special Counsel to discuss
13 Committee procedures that are planned for future
14 hearings.
15 Is there any discussion? Senator Sakamoto?
16 SENATOR SAKAMOTO: Clarification, I guess,
17 for the people who are here: Is it our intention to
18 reconvene or is it an hour or ten minutes --
19 CO-CHAIR REPRESENTATIVE SAIKI: Yes.
20 SENATOR SAKAMOTO: -- so they can understand
21 if they're going to stay or leave?
22 CO-CHAIR REPRESENTATIVE SAIKI: We're going
23 to announce we're going to recess for approximately 15
24 minutes in Room 329, and we will return to this room to
25 finish our hearing.
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1 Is there any other discussion? If not,
2 Co-Chair please take the roll.
3 CO-CHAIR SENATOR HANABUSA: Thank you. This
4 is the motion to meet in executive session.
5 Co-Chair Hanabusa is aye.
6 Co-Chair Saiki?
7 CO-CHAIR REPRESENTATIVE SAIKI: Aye.
8 CO-CHAIR SENATOR HANABUSA: Vice-Chair
9 Kokubun is excused.
10 Vice-Chair Oshiro?
11 VICE-CHAIR REPRESENTATIVE OSHIRO: Aye.
12 CO-CHAIR SENATOR HANABUSA: Senator Buen?
13 SENATOR BUEN: Aye.
14 CO-CHAIR SENATOR HANABUSA: Representative
15 Ito?
16 REPRESENTATIVE ITO: Aye.
17 CO-CHAIR SENATOR HANABUSA: Representative
18 Kawakami?
19 REPRESENTATIVE KAWAKAMI: Aye.
20 CO-CHAIR SENATOR HANABUSA: Representative
21 Leong?
22 REPRESENTATIVE LEONG: Aye.
23 CO-CHAIR SENATOR HANABUSA: Senator Matsuura
24 is excused.
25 Representative Pendleton?
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1 REPRESENTATIVE PENDLETON: Aye.
2 CO-CHAIR SENATOR HANABUSA: Senator Sakamoto?
3 SENATOR SAKAMOTO: Aye.
4 CO-CHAIR SENATOR HANABUSA: Senator Slom?
5 SENATOR SLOM: Aye.
6 CO-CHAIR SENATOR HANABUSA: Mr. Saiki, we
7 have the appropriate numbers; and the motion is carried.
8 CO-CHAIR REPRESENTATIVE SAIKI: Thank you,
9 Members. Please convene to Room 329. We'll return in
10 15 minutes. Thank you.
11 (Brief recess.)
12 CO-CHAIR REPRESENTATIVE SAIKI: Okay.
13 Members, we would like to convene our hearing.
14 At this time, we would like to take up the
15 last item on our agenda, which is the issuance of
16 subpoenas in this investigation. The Co-Chairs would
17 like to recommend that we approve a list of individuals
18 to be subpoenaed -- and we'll go over the names of the
19 individuals -- both for purposes of providing testimony
20 and documents.
21 And the individuals are as follows: The
22 first one, the Department of Education superintendent,
23 Paul LeMahieu; deputy superintendent, Patricia Hamamoto;
24 Douglas Houck; Linda Unten; Robert Golden; Debra Farmer.
25 From the Department of Health, director Bruce
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1 Anderson; Anthony Ching; Anita Swanson; Christina
2 Donkervoet; Loretta Fuddy; John Donkervoet; Cynthia
3 Cabot; Ann Nguyen.
4 From the Attorney General's office, Eric
5 Rolseth; and from the technical advisory group, Lenore
6 Behar and Judy Schrag.
7 And, finally, from the Board of Education,
8 the chair of the Board, Herbert Watanabe.
9 At this time the Co-Chairs would like to move
10 that the Committee approve issuance of subpoenas to
11 these individuals requiring their testimony and/or
12 documents at a time and date to be specified by the
13 Co-Chairs. And this is pursuant to H -- Hawaii Revised
14 Statute Section 21-8 and Committee Rule 2.2.
15 Is there any discussion? If not, we'll take
16 a vote.
17 CO-CHAIR SENATOR HANABUSA: Members, this is
18 for the issuance of subpoenas -- a Subpoena Duces Tecum
19 of the list of individuals as read earlier by Co-Chair
20 Saiki. Vice -- Co-Chair Hanabusa is aye.
21 Co-Chair Saiki?
22 CO-CHAIR REPRESENTATIVE SAIKI: Aye.
23 CO-CHAIR SENATOR HANABUSA: Vice-Chair
24 Kokubun is excused.
25 Vice-Chair Oshiro?
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1 VICE-CHAIR REPRESENTATIVE OSHIRO: Aye.
2 CO-CHAIR SENATOR HANABUSA: Senator Buen?
3 SENATOR BUEN: Aye.
4 CO-CHAIR SENATOR HANABUSA: Representative
5 Ito?
6 REPRESENTATIVE ITO: Aye.
7 CO-CHAIR SENATOR HANABUSA: Representative
8 Kawakami?
9 REPRESENTATIVE KAWAKAMI: Aye.
10 CO-CHAIR SENATOR HANABUSA: Representative
11 Leong?
12 REPRESENTATIVE LEONG: Aye.
13 CO-CHAIR SENATOR HANABUSA: Senator Matsuura
14 is excused.
15 Representative Pendleton?
16 REPRESENTATIVE PENDLETON: Aye.
17 CO-CHAIR SENATOR HANABUSA: Senator Sakamoto?
18 SENATOR SAKAMOTO: Aye.
19 CO-CHAIR SENATOR HANABUSA: Senator Slom?
20 SENATOR SLOM: Aye.
21 CO-CHAIR SENATOR HANABUSA: Thank you,
22 Members. The motion is adopted.
23 CO-CHAIR REPRESENTATIVE SAIKI: Okay.
24 Members, we will adjourn at this time. We will provide
25 the date of our next hearing in the future. We're not
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1 really sure yet when we want to return, but we will
2 provide notice pursuant to our Committee Rules. Thank
3 you very much.
4 (The hearing was adjourned at 12:20 p.m.)
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1 C E R T I F I C A T E
2 STATE OF HAWAII )
3 ) SS:
4 CITY AND COUNTY OF HONOLULU )
5 I, SHARON ROSS, Notary Public, State of Hawaii,
6 do hereby certify:
7 That on Friday, July 13, 2001, at 9:17 a.m., the
8 above-described hearing was taken down by me in machine
9 shorthand and was thereafter reduced to typewriting
10 under my supervision; that the foregoing represents, to
11 the best of my ability, a true and correct transcript of
12 the proceedings had in the foregoing matter.
13 I further certify that I am not attorney for any
14 of the parties hereto, nor in any way concerned with the
15 cause.
16 DATED this 17th day of July, 2001, in Honolulu,
17 Hawaii.
18
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20 SHARON ROSS, CSR NO. 432
Notary Public, State of Hawaii
21 My Commission Expires: 4-8-05
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