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1 SENATE/HOUSE OF REPRESENTATIVES
2 THE 21ST LEGISLATURE
3 INTERIM OF 2001
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7 JOINT SENATE-HOUSE INVESTIGATIVE COMMITTEE HEARING
8 November 3, 2001
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12 Taken at the State Capitol, 415 South Beretania,
13 Conference Room 325, Honolulu, Hawaii, commencing at
14 9:04 a.m. on Saturday, November 3, 2001.
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19 BEFORE: JESSICA R. PERRY, CSR No. 404
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1 APPEARANCES:
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3 Senate-House Investigative Committee:
4 Co-Chair Senator Colleen Hanabusa
5 Co-Chair Representative Scott Saiki
6 Vice-Chair Senator Russell Kokubun
7 Vice-Chair Representative Blake Oshiro
8 Senator Jan Yagi Buen
9 Representative Ken Ito
10 Representative Bertha Kawakami
11 Representative Bertha Leong
12 Representative Barbara Marumoto
13 Senator Norman Sakamoto
14 Senator Sam Slom
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17 Also Present:
18 Special Counsel James Kawashima
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1 I N D E X
2 WITNESS: CHRIS ITO
3 EXAMINATION BY: PAGE
4 SPECIAL COUNSEL KAWASHIMA.............. 7
5 VICE-CHAIR REPRESENTATIVE OSHIRO....... 49
6 VICE-CHAIR SENATOR KOKUBUN............. 51
7 REPRESENTATIVE ITO..................... 55
8 SENATOR BUEN........................... 59
9 REPRESENTATIVE KAWAKAMI................ 62
10 SENATOR SLOM........................... 69
11 REPRESENTATIVE LEONG................... 72
12 SENATOR SAKAMOTO....................... 74
13 REPRESENTATIVE MARUMOTO................ 78
14 CO-CHAIR SENATOR HANABUSA.............. 83
15 CO-CHAIR REPRESENTATIVE SAIKI.......... 90
16 REPRESENTATIVE KAWAKAMI................ 92
17 CO-CHAIR SENATOR HANABUSA.............. 93
18 SENATOR SAKAMOTO....................... 95
19 REPRESENTATIVE MARUMOTO................ 96
20 SENATOR SAKAMOTO....................... 98
21 CO-CHAIR SENATOR HANABUSA.............. 99
22 REPRESENTATIVE ITO..................... 102
23 WITNESS: VALERIE AKO
24 EXAMINATION BY:
25 SPECIAL COUNSEL KAWASHIMA.............. 105
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1 I N D E X, (Continued)
2 WITNESS: VALERIE AKO
3 EXAMINATION BY:
4 VICE-CHAIR SENATOR KOKUBUN............. 141
5 VICE-CHAIR REPRESENTATIVE OSHIRO....... 146
6 SENATOR BUEN........................... 147
7 SENATOR SAKAMOTO....................... 148
8 REPRESENTATIVE KAWAKAMI................ 152
9 REPRESENTATIVE LEONG................... 156
10 CO-CHAIR REPRESENTATIVE SAIKI.......... 158
11 CO-CHAIR SENATOR HANABUSA.............. 161
12 SENATOR SAKAMOTO....................... 164
13 CO-CHAIR REPRESENTATIVE SAIKI.......... 167
14 WITNESS: CHRISTINA DONKERVOET
15 EXAMINATION BY:
16 SPECIAL COUNSEL KAWASHIMA.............. 167
17 VICE-CHAIR REPRESENTATIVE OSHIRO....... 229
18 VICE-CHAIR SENATOR KOKUBUN............. 234
19 REPRESENTATIVE KAWAKAMI................ 238
20 SENATOR SLOM........................... 244
21 REPRESENTATIVE LEONG................... 248
22 SENATOR SAKAMOTO....................... 251
23 CO-CHAIR REPRESENTATIVE SAIKI.......... 257
24 CO-CHAIR SENATOR HANABUSA.............. 261
25 SENATOR SAKAMOTO....................... 269
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1 I N D E X, (Continued)
2 WITNESS: CHRISTINA DONKERVOET
3 EXAMINATION BY:
4 VICE-CHAIR REPRESENTATIVE OSHIRO....... 272
5 CO-CHAIR SENATOR HANABUSA.............. 273
6 CO-CHAIR REPRESENTATIVE SAIKI.......... 279
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8 E X H I B I T S
9 1. Loveland Academy 10/3/01 memo.................. 196
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1 P R O C E E D I N G S
2 CO-CHAIR REPRESENTATIVE SAIKI: Good morning.
3 We'd like to convene our joint investigative committee to
4 investigate the state's compliance with the Felix consent
5 decree. We'll begin with roll call.
6 CO-CHAIR SENATOR HANABUSA: Co-Chair Saiki?
7 CO-CHAIR REPRESENTATIVE SAIKI: Present.
8 CO-CHAIR SENATOR HANABUSA: Vice-Chair
9 Kokubun?
10 VICE-CHAIR SENATOR KOKUBUN: Here.
11 CO-CHAIR SENATOR HANABUSA: Vice-Chair Oshiro?
12 VICE-CHAIR REPRESENTATIVE OSHIRO: Here.
13 CO-CHAIR SENATOR HANABUSA: Senator Buen?
14 SENATOR BUEN: Here.
15 CO-CHAIR SENATOR HANABUSA: Representative
16 Ito?
17 REPRESENTATIVE ITO: Aye. Here.
18 CO-CHAIR SENATOR HANABUSA: Representative
19 Kawakami?
20 REPRESENTATIVE KAWAKAMI: Present.
21 CO-CHAIR SENATOR HANABUSA: Representative
22 Leong?
23 REPRESENTATIVE LEONG: Present.
24 CO-CHAIR SENATOR HANABUSA: Representative
25 Marumoto?
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1 REPRESENTATIVE MARUMOTO: Here.
2 CO-CHAIR SENATOR HANABUSA: Senator Matsuura,
3 Senator Sakamoto. Senator Slom?
4 SENATOR SLOM: Here.
5 CO-CHAIR SENATOR HANABUSA: We have quorum.
6 CO-CHAIR REPRESENTATIVE SAIKI: Thank you.
7 Members, our first witness this morning is Mr. Chris Ito.
8 Mr. Ito, please be seated at the witness table and
9 we'll administer the oath at this time.
10 CO-CHAIR SENATOR HANABUSA: Mr. Ito, do you
11 solemnly swear or affirm that the testimony you're about to
12 give will be the truth, the whole truth, and nothing but the
13 truth?
14 MR. ITO: I do.
15 CO-CHAIR SENATOR HANABUSA: Thank you,
16 Mr. Ito.
17 Members, we'll follow our usual protocol. We'll
18 begin with Mr. Kawashima.
19 SPECIAL COUNSEL KAWASHIMA: Thank you, Madam
20 Chair.
21 EXAMINATION
22 BY SPECIAL COUNSEL KAWASHIMA:
23 Q. Please state your name and business address.
24 A. Chris Ito, 1390 Miller Street, Honolulu.
25 Q. And that is the address of the Department of
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1 Education?
2 A. Yes.
3 Q. And what position do you hold, sir, with the
4 department?
5 A. I'm the accounting director for the Department of
6 Education.
7 Q. Accounting director?
8 A. Yes.
9 Q. And what are your duties generally, sir, as
10 accounting director?
11 A. I'm the director of the business services branch of
12 the department. The business services department -- services
13 section consists of the accounting, payroll, vouchering, mail
14 room services, inventory, procurement, store room, printing,
15 and the fiscal part of the SBBH services.
16 Q. What is that last thing you mentioned?
17 A. The school based behavioral health services, and I
18 also have a school support section that would help the
19 schools in all of my areas.
20 Q. I'm not sure if I heard you mention expenditures?
21 A. Accounting.
22 Q. Accounting is expenditures?
23 A. Right.
24 Q. I see. Is that the greater part of your duties,
25 related to the accounting aspect?
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1 A. No. I don't think it's a greater part. It's just
2 one section of my branch.
3 Q. If I might, Mr. Ito, just briefly go back and ask
4 you a few questions about your background. Will you tell us
5 what the extent of your formal education has been?
6 A. Yes. I have a bachelor's in math, I have an MBA,
7 and I passed the CPA certificate. I didn't practice CPA
8 accounting.
9 Q. A CPA certificate?
10 A. Yes.
11 Q. What does that mean, sir?
12 A. I did pass parts of the exam.
13 Q. I see. So you needed the practical experience
14 before you could actually be --
15 A. Right.
16 Q. -- given a CPA?
17 A. Right.
18 Q. And you just did not fulfill, for your own reasons,
19 that part of it?
20 A. Right.
21 Q. All right. Were these degrees, the BS in math and
22 the MBA, obtained from the University of Hawaii?
23 A. No.
24 Q. From where?
25 A. Pacific University and Portland State University.
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1 Q. Pacific in Forest Grove?
2 A. Right.
3 Q. So when did you obtain these degrees, Mr. Ito?
4 A. '69 and '71.
5 Q. And have you been employed full-time since 1971?
6 A. Yes.
7 Q. Where have you been employed? It's a long period,
8 but hopefully there's not too many employers.
9 A. I started with Servco Financial in '71 to '77. I
10 was the comptroller there. In '77 I started with the state
11 as a budget specialist in the budget office, and in '86 I
12 became the accounting director.
13 Q. And has it always been with the Department of
14 Education?
15 A. Yeah, from 1977 in the budget office it was with
16 the Department of Education.
17 Q. I'm sorry, department of what?
18 A. Education.
19 Q. All right. So you've been the accounting director
20 since '86, then, the last five years?
21 A. 15.
22 Q. Thank you. 15 years. Now, who -- perhaps you
23 could assist us, Mr. Ito, and tell us who has which
24 responsibilities for budget preparation, budget execution,
25 and budget accountability? You can take them one at a time,
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1 if you can. I'll break it down if you want.
2 A. Well, the budget office is responsible for all that
3 you mentioned right there, so the budget preparation
4 office -- I mean section and then there's a budget execution
5 section in the budget branch.
6 Q. And that is not your branch, obviously?
7 A. No, it's not.
8 Q. Do you get involved, Mr. Ito, in any part of that
9 budgetary process?
10 A. Only in supplying reports or expenditure reports
11 that's required by the different offices and sections.
12 Q. Sure. Now, you are talking about reports of
13 expenditures that were already had, right?
14 A. Right.
15 Q. And is this -- is this something that is provided
16 by your office in the normal course of what you do or is it a
17 situation where you provide them with that information only
18 upon request?
19 A. It's a normal course of action. If there's
20 additional needs that are required, then we'll work with that
21 office to get the additional reports if they need be, but
22 there's monthly reports, there's on-line reports that they
23 can look at from the financial management system.
24 Q. I see. So would it be fair to say, then, your
25 branch is responsible for keeping track of expenditures?
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1 A. Right.
2 Q. And does your branch or anyone in your branch do
3 any analysis in terms of actual expenditures versus budgeted
4 amounts?
5 A. No, we don't.
6 Q. You do not do that?
7 A. Right.
8 Q. Does someone do that, to your knowledge?
9 A. Not to my knowledge, unless the program managers
10 themselves would be the ones that would analyze their reports
11 at the end of each quarter or at the end of the year or when
12 they're doing actual budget preparations for the biennial
13 budget or for the supplemental budget.
14 Q. Since you don't work on that aspect, you wouldn't
15 know?
16 A. No, I wouldn't know.
17 Q. But there must be -- I would think, Mr. Ito, there
18 must be some type of report or reports that might be looked
19 at simultaneously that would give one the information as to
20 in one area, or one line item even, what was budgeted as to
21 that item, for example, and what was spent actually?
22 A. Yes. Each of the reports -- we have various
23 financial management reports, so those reports are sent to
24 the schools and offices for their review. So it does show
25 the allotments in comparison to the expenditures to date.
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1 Q. You know, I'm glad you mentioned that word, because
2 I've heard that term used before and I just wanted to make
3 sure we understood how the Department of Education uses that
4 term. I've heard the term allocation. I've heard the term
5 allotments. Will you explain to us what that means with
6 regard to budgeted items and expenditures?
7 A. Allocations are made by the budget branch during
8 their budget execution period, so they would allocate the
9 funds to the various offices and schools. As they prepare
10 expenditure plans from their allocations, the expenditure
11 plans are placed into a budget system as expenditure plans
12 which are transferred to the FMS system as allotments.
13 Q. And once it -- FMS stands for what, sir?
14 A. Financial management system.
15 Q. Is this a computer system?
16 A. Yes, it is.
17 Q. So what does it mean, then, if once it's placed
18 into the FMS system as an allotment, what does that mean in
19 terms of the ability for the division or branch to spend the
20 money?
21 A. That gives them the authority to spend the money.
22 Q. Up to that amount?
23 A. Right.
24 Q. I see.
25 A. So purchase orders are prepared on line and
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1 validated that the allotments are there. If allotments are
2 not there, then the purchase order would be rejected.
3 Q. I see. So you cannot complete a purchase order
4 without an allotment amount being there already?
5 A. Right.
6 Q. And then you testified that even from the budgeted
7 amounts, an allocation is made from the budgeted amount, and
8 maybe you can explain to us that part of it. Is it because
9 sometimes the expenditures go out quarterly or semi-annually
10 as opposed to all at once that you have that allocation
11 aspect of the process?
12 A. No. The allocation amount is the total dollars
13 that those -- that office or that school will receive for
14 that particular program. The allocation may differ from the
15 appropriation or from the budgeted amounts because of changes
16 by -- when the budget was prepared to when it was
17 appropriated to when the financial situation of allocations
18 were made. A lot of the allocations are made maybe per pupil
19 according to number of students there. So if enrollment
20 changes, then the allocation will change.
21 Q. I see. I see. So that the allocations have
22 nothing to do with the appropriated amounts necessarily?
23 A. Well, it relates directly to it, but it depends on
24 the rationale of how the appropriations are allocated, in
25 what form or what rationale they're using.
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1 Q. I see. So the appropriations may have an effect on
2 allocations or it may not?
3 A. It does. It does have an effect.
4 Q. In other words, the budgeted amount may not be the
5 appropriated amount also?
6 A. Yeah, because the appropriated amount is the amount
7 appropriated by the legislature.
8 Q. All right. So if we were to ask for reports that
9 would have what is budgeted and what was spent as to any item
10 or items, there are such reports that make that comparison?
11 A. Well, our financial reports would show you the
12 allotments versus the expenditures and encumbrances, not the
13 budgeted amounts.
14 Q. Oh, I see.
15 A. Because that's --
16 Q. If one were to get the budget and then compare it
17 with what you have, which are the allotments and the
18 expenditures, you would have that picture, would you not?
19 A. We would have the expenditure records. We would
20 not have the budgeted records.
21 Q. Now, do you know if someone -- obviously not in
22 your branch -- someone actually does that? In other words,
23 they take your figures and they take what they get from the
24 budget section and the allocations and make a comparison as
25 to what was budgeted, what was allocated, what was allotted,
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1 and ultimately what was spent?
2 A. I would think that the budget office in preparing
3 their biennium budget will be looking at the actual
4 expenditures for the prior years in order to prepare their
5 budgets for the supplemental or for the biennial budgets.
6 Q. But you have not seen such reports, have you? I'm
7 not suggesting you should have. Perhaps in your branch you
8 don't see it.
9 A. I don't see it now, yes, but I recall seeing it
10 when I was with the budget office.
11 Q. How long ago was that, sir?
12 A. During the '70 through '86 years.
13 Q. All right.
14 A. So I don't know if they are still continuing to do
15 the same process as we did back then.
16 Q. You would expect, though, someone at a higher level
17 than yourself would make that type of comparison during the
18 normal course of their job?
19 A. I would think in the budget office when they
20 prepared budgets.
21 Q. Or even higher than the budget office to see what
22 was -- what was budgeted, what was appropriated, what was
23 allocated, what was allotted, what was spent.
24 A. I think we're maybe discussing what levels you're
25 talking about. If you're talking about at the EDN level,
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1 maybe things like that can be looked at, but if you're
2 talking about the detail level of how each school spent their
3 money and how each office spent their money, I think that
4 those people would be looking at it from that --
5 Q. Sure. Of course. I think we're probably talking
6 at the EDN level, but we'll see. Now, for the current fiscal
7 year, '02, the general fund appropriations for the Felix
8 response plan was $43,253,000 -- try again -- $43,253,988,
9 but the Department of Education allotted -- I'm sorry,
10 allocated $61,263,677, an increase of 18 million plus. Do
11 you know where the additional funds are coming from?
12 A. No, I do not.
13 Q. Were you aware of what I just stated as a --
14 assuming it's a fact and it's correct?
15 A. No, I was not.
16 Q. That's not your branch that would look at items
17 like that. Do you, though -- do you actually look at the
18 expenditures to see if in fact you are spending it in
19 accordance with what was budgeted?
20 A. The system would look at overexpenditures in the
21 area of our -- under current expenses, so like I said
22 earlier, POs, purchase orders, cannot be made unless there is
23 allotments in the expenditure plan. So in that area, the
24 system would make sure that POs, purchase orders, are not cut
25 beyond the allotments.
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1 Q. I see. I see. It's actually a pure mechanical
2 function in that sense, then?
3 A. Right.
4 Q. Are you involved, Mr. Ito, with the department
5 coming to the legislature for emergency appropriations?
6 A. Only to the extent of reporting expenditures, prior
7 year expenditures.
8 Q. In other words, only to the extent of providing
9 information to those above you to use, perhaps, in putting
10 together a package to seek emergency funds?
11 A. That has been my extent at this point in time.
12 Q. Do you sit in meetings where the amount of the
13 emergency appropriations, how much to ask for, is being
14 discussed?
15 A. Not to my knowledge.
16 Q. In other words, if I were to ask you, Mr. Ito, for
17 the current year, '02, 2002 legislative session, if the
18 department is planning to ask for additional emergency funds,
19 would you know that, if in fact it were true?
20 A. Not to the extent of the total Felix response plan.
21 Like I said, one of my responsibilities is the fiscal part of
22 the school behavior health part, and that's FRP-3. So we are
23 looking at FRP-3 in the area of school-based behavioral
24 health, in that budget there, so one of my sections is
25 responsible for looking at expenditures in that area.
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1 Q. I see. For example, last year when emergency
2 appropriations were sought -- in fact, let me ask you,
3 Mr. Ito, to your understanding, whenever the department seeks
4 emergency appropriations from the legislature, does that in
5 your mind mean that the amount being sought has already been
6 spent?
7 A. Well, this is the first year I think we asked for
8 an emergency appropriation, that I'm familiar with. I think
9 the request for the emergency appropriations was because of
10 the consent decree and that because of the benchmarks certain
11 things had to be done. We had -- for an example, we had to
12 do the SBBH part of the -- and transfer that from the
13 Department of Health. So part of the emergency appropriation
14 request was to get the start-up cost going. So we
15 established positions for program coordinators and for
16 contract specialists in order for us to start the program by
17 July 1.
18 We had difficulties in hiring, but yet we needed
19 the approval to hire the positions first before we can start
20 hiring. So because of the difficulties in hiring, we did not
21 spend all the money that we expected to spend. So when you
22 say expenditures were made, I think we need authorization to
23 hire people before we can expend. So without the
24 authorization, we cannot hire. So if we say that we want
25 authorization starting from September 1st, but yet we cannot
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1 hire anybody until March 1st, then we'll have six months of
2 salaries that we didn't pay for.
3 Q. Okay.
4 A. So when we spend the monies, we spent monies only
5 from March to June in those areas, but we need authorization
6 to hire before we can hire.
7 Q. I understand what you're saying. I understand what
8 you're saying, Mr. Ito. Were you part, then, of the team
9 that came to the legislature to seek those emergency
10 appropriations?
11 A. No, I was not.
12 Q. You hesitated.
13 A. Well, I came -- I mean, we were looking at what the
14 request was, you know, being part of that. That's why I
15 think I did attend some of the meetings to look at what the
16 requests were, and I think the requests -- as the session
17 came down, the requests came down too, you know. As the
18 session came down toward the end, to a close, the request
19 came down because of these people that we couldn't hire.
20 Q. Was that the reason why, Mr. Ito -- strike that.
21 So you can speak to the reason why the emergency
22 appropriations came in initially at a fairly high level and
23 then very quickly dropped down large amounts?
24 A. I can speak only for our FRP, which is FRP-3. The
25 other program managers in the other FRP areas may have done
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1 the same thing.
2 Q. In your area, FRP-3 you say, what percentage of the
3 reductions was involved with your area, percentage of the
4 total reductions each time?
5 A. I think the example I gave you was pretty much
6 accurate. I think we started hiring from February or March,
7 I think, in the areas of the program coordinators and the
8 contract specialists.
9 Q. When were the benchmarks filed, actually became
10 effective?
11 A. I'm not familiar with that.
12 Q. About?
13 A. I would think about August.
14 Q. Of last year?
15 A. Yes.
16 Q. And you're saying that after August of last year
17 work was done to try and comply or meet the benchmarks and
18 therefore money was spent -- first of all, money was spent
19 above the budgeted amounts, right?
20 A. That's my understanding.
21 Q. And then -- it must be, then, that when the
22 department came into the legislature and asked for a certain
23 amount, which, of course, subsequently on a number of
24 occasions was reduced substantially, they were making
25 predictions, then, on how much they needed to meet these
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1 benchmarks?
2 A. I would think the budget would be updated as new
3 things happened, yes.
4 Q. And do you understand that whoever spoke for the
5 department then explained to the legislature that this is
6 what was happening, we're estimating this amount, we don't
7 know if we need it, but if we need it, we've got to have it?
8 Do you understand what I'm saying?
9 A. I hope that -- I don't know.
10 Q. They should have, right?
11 A. Yeah.
12 Q. Based on what you're explaining to me -- or to us
13 about how this happened, that's what they should have
14 explained, right?
15 A. Because that's my understanding of the process. I
16 may be wrong, but that's my understanding of the process, and
17 we need approvals before we can start.
18 Q. What you're saying is if you don't have the money
19 appropriated and you go out and hire people, you can't pay
20 them without the money appropriated and then, of course, as
21 you say, allocated and so on?
22 A. Right.
23 Q. And as far as you're concerned, then, the downward
24 movement in that amount sought was based upon not being able
25 to find the number of employees that had been originally
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1 anticipated?
2 A. Right.
3 Q. And who made these -- if you know, who made these
4 estimations as to the number of employees that the department
5 expected to be able to hire?
6 A. The program managers in each of the different FRP
7 areas were the people.
8 Q. So you did your FRP area?
9 A. Well, I was in there after FRP-3 was actually
10 developed.
11 Q. By the budget people?
12 A. Well, and other program people.
13 Q. I see. Now, we've heard the phrase EDN 150, which
14 we understand to be Felix-related expenditures.
15 A. I think it's more than Felix-related expenditures.
16 Q. Maybe you can explain to us what -- in your
17 experience and knowledge and understanding, what expenditures
18 are accounted for under EDN 150?
19 A. I don't know all the terminology, but, you know,
20 basically it's special ed, you know. So special ed students
21 are all not Felix students, so EDN 150 includes all special
22 ed.
23 Q. All special ed?
24 A. Right.
25 Q. So to your understanding, is there one item that is
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1 dedicated only to Felix?
2 A. No.
3 Q. So that based on -- well, strike that.
4 When you look at expenditures, Mr. Ito, in your
5 position, then, you cannot distinguish between an
6 expenditure -- as to whether or not it was spent on special
7 ed on the one hand or Felix on the other?
8 A. Well, we compile expenditures by program IDs, so as
9 the program IDs are compiled, that's how expenditures are
10 compiled.
11 Q. I see. But those program IDs are not done by you,
12 are they?
13 A. They are done through the budget process and
14 submitted here, yes.
15 Q. So what you do is you compare the expenditures to
16 the program ID and then --
17 A. Well, the funds are allocated by program ID. As
18 the allocations are coming down, those monies are allocated
19 according to that program ID and allotted that way and
20 expenditures are captured to that program.
21 Q. So you don't get involved, actually, with that
22 process?
23 A. No.
24 Q. So if I were to ask you what amounts have been
25 expended for Felix only, expended now, you would not be able
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1 to tell me that?
2 A. I would need to know what program IDs were related.
3 Q. Let me ask it this way. To your knowledge, other
4 than EDN 150 -- because we've established that EDN 150 is one
5 program ID under which Felix items are spent, right? Is that
6 correct?
7 A. Right.
8 Q. So what other program IDs are you aware of under
9 which a Felix-type expenditure might fall?
10 A. In explanation, EDN 150 is not a program ID. It's
11 an EDN. The program IDs are lower level capturing of
12 information.
13 Q. How are they designated?
14 A. How are they designated?
15 Q. How are the program IDs -- are they given numbers?
16 A. Numbers, yes, yes. I mean, there's certain names,
17 like special ed in regular schools is a program.
18 Q. I see. Well, how about using the EDN 150 type of
19 designation, are there other types of similar designations
20 under which Felix expenditures might fall?
21 A. Well, there's about maybe 100 different program IDs
22 in EDN 150.
23 Q. Within EDN 150?
24 A. Right.
25 Q. I see. But these about hundred program IDs are not
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1 designated Felix necessarily, though, are they?
2 A. Not all of them.
3 Q. How many of them? What percentage?
4 A. Well, whether they're all Felix or not -- you know,
5 I don't know if you can say that this program ID is a Felix
6 program ID. It may cover more than Felix-related
7 expenditures. So the designation of the program IDs needs to
8 be worked with the program people on how they define that and
9 how to budget.
10 Q. Since the consent decree was entered and you were
11 with -- you were in your position when the consent decree was
12 entered, about 1994, has there been discussion where you were
13 present about trying to break out the Felix-related
14 expenditures only so that you can get a handle on how much
15 was being spent for Felix on one hand, how much was being
16 spent for special ed on the other hand, and, of course, how
17 much was spent for general ed?
18 A. Yes, there was, but I think there are difficulties
19 in breaking it up into that strict category.
20 Q. Where were these -- when and where were these
21 discussions had?
22 A. I think with the budget office.
23 Q. When?
24 A. I would think in the last year.
25 Q. Only the last year?
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1 A. Yeah.
2 Q. Do you know why it was only the last year that they
3 had those types of discussions?
4 A. Well, I think there seems to be a stricter
5 relationship to try to isolate Felix expenditures directly.
6 Q. Just that, to your knowledge, nobody thought about
7 doing that before? I'm not suggesting they should have. I'm
8 just asking you.
9 A. Yeah, I guess, to my knowledge.
10 Q. And were any conclusions reached during those
11 discussions, to your knowledge, as to let's try it or it's
12 impossible or what?
13 A. I think a lot of things overlap between Felix and
14 regular special ed instruction, so it was difficult in saying
15 this is Felix only and this is not. If you look at a regular
16 school special ed class, they may not all be Felix kids in
17 that special ed class, so how do you segregate the
18 requirements of the special ed class between Felix and
19 non-Felix, because you have five kids or ten kids in there
20 and three may be Felix and seven may not be Felix, so the
21 expenses of that class -- that class will be difficult to
22 determine how much is a Felix cost and a non-Felix cost.
23 Q. I see what you're saying. And those numbers are
24 dynamic, also, right?
25 A. Right.
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1 Q. They move from month to month maybe?
2 A. Or week to week or day to day even.
3 Q. But obviously a teacher can be asked in a class
4 size of 30 if five were special ed and the number moves up
5 and down in a given semester, quarter, year, what is the
6 average amount of special ed students you have or Felix
7 students and therefore get that -- have that information move
8 up ultimately so you can have those items segregated? That
9 could be done, couldn't it?
10 A. I would think it would be very difficult because of
11 the movement of the Felix kids, the number of Felix kids that
12 come in for two weeks or three weeks and go out. I think it
13 would be very time consuming.
14 Q. You don't think that's something that could be
15 entered into a computer and then computerized as long as
16 reports are submitted on a weekly basis?
17 A. I think it would need to -- I think a system needs
18 to be developed with inputs from --
19 Q. Do you think the department is trying to develop
20 such a system?
21 A. It hasn't been talked about yet.
22 Q. So am I to understand, then, the department would
23 not be able to identify the difference between a
24 Felix-related expenditure versus a special ed expenditure
25 versus a CSSS expenditure?
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1 A. We can identify expenditures by the different
2 program IDs that the funds were expended for.
3 Q. So we would need to give you the program ID to --
4 for you to then go and retrieve the information?
5 A. Right.
6 Q. So that Felix, then, you're saying it's under a
7 multitude of program IDs?
8 A. I guess an example I can use probably is the
9 special ed teacher that has a Felix child or two Felix kids
10 in that classroom, the salaries are all charged to the
11 special ed program ID and not to the -- it's not a
12 Felix-related expenditure.
13 Q. But it is because they are giving attention to a
14 Felix student?
15 A. Right, because that child may go out to do
16 something else with another person in order to get other
17 types of services, but the bulk of the services are with that
18 special ed class.
19 Q. So are there expenditures, then, that could be
20 attributed to a Felix student that would be under an EDN
21 other than EDN 150?
22 A. Not my knowledge.
23 Q. Okay. So within EDN 150, then, the program IDs --
24 there are different expenditures under different program IDs?
25 A. Right.
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1 Q. Now, I'm not sure if you're aware of this, Mr. Ito,
2 but we had testimony from the internal auditor for your
3 department and he testified that there were -- there was $12
4 million in unspent funds as of March 31st of this year in the
5 Felix response plan internal figures. Are you aware of that?
6 A. Yes.
7 Q. Do you know why that was the case, why there was
8 $12 million in unspent funds?
9 A. Well, that -- we have a yearly allotment, so that
10 expenditure should have been made in the fourth quarter.
11 Q. You believe that the entire $12 million was
12 expended in the fourth quarter?
13 A. I know there were meetings on expenditures
14 throughout the fourth quarter.
15 Q. Meetings by whom?
16 A. By the deputy superintendent at that time,
17 Ms. Hamamoto, and the appropriate program managers.
18 Q. And am to understand that these meetings were for
19 the purpose of deciding or figuring out how to spend that $12
20 million?
21 A. Well, I think the actual requirement -- I mean the
22 actual purpose of the funds were already there. You know, it
23 was just continuing on spending, but whether they could spend
24 all of it or not would be the question. Again, I go back to
25 vacant positions, whether positions were filled or not would
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1 determine whether or not savings would be -- were there at
2 the fourth quarter. So I think that the program managers
3 with the deputy superintendent at the time would be looking
4 at their requirements and their costs for the fourth quarter.
5 Q. Sure, but to your understanding, though, these
6 meetings were designed for the purpose of seeing how they
7 could spend the $12 million in the fourth quarter, though,
8 right?
9 A. Yes, along with their current requirements that
10 they need.
11 Q. Sure, but there was this extra $12 million that had
12 not been spent that theoretically should have been spent by
13 then?
14 A. No, no. It was all the way to June 30. The $12
15 million was for --
16 Q. There's some items, Mr. Ito, for example, a couple
17 hundred, I think, laptop computers were purchased in that --
18 in that time frame. Are you aware of that?
19 A. Yes.
20 Q. And those laptops actually were, I understand, for
21 some vacant positions?
22 A. Well, one of the benchmarks was to have all special
23 ed teachers having laptop computers, so that funds were
24 allocated to someone centrally to purchase all the laptop
25 computers. So the negotiations was to purchase the laptop
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1 computers in bulk so that if we had 5,000 teachers that we
2 had to buy laptop for, it was centrally purchased. So it was
3 just a number of teachers that we had to purchase computers
4 for.
5 Q. Was it 200?
6 A. No. 200 was the vacant positions. We purchased
7 for all the teachers that were filled, so those computers
8 were given to those teachers.
9 Q. Well, I'm sorry, I thought I saw somewhere that the
10 number 200 or so laptops were purchased for vacant positions.
11 No?
12 A. Well, if you look at the total number of teachers
13 that we had and is authorized for special ed, that was the
14 number of computers that should be purchased. So at that
15 time that Mr. Koyama did the audit maybe, maybe there may
16 have been 200 vacant teacher -- special ed teacher positions
17 that computers were purchased -- laptops were purchased for.
18 Q. Okay. I see what you're saying.
19 A. So I don't know the number, but if we had 5,000
20 that we had to buy because there were 5,000 teachers out
21 there to buy for, we bought that much, but of that 5,000
22 maybe 200 teachers were vacant.
23 Q. All right.
24 A. That's my understanding.
25 Q. No, I think your understanding is probably correct.
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1 So that it does end up, though, that laptops were purchased
2 for a number of teachers that were anticipated to be in place
3 at some point in time in the future?
4 A. Right.
5 Q. But we're not filling those positions yet?
6 A. Right.
7 Q. And frankly, we have no idea when those positions
8 will be filled, do we? I mean, I'm sure they have some idea
9 or some hopes as to when.
10 A. Right.
11 Q. Yet not sure. So where did those laptops go, then,
12 that were purchased for these vacant positions where there
13 was nobody there to utilize the machinery?
14 A. I wasn't aware -- I don't know really. I don't
15 know, but it could have gone to the substitute teachers.
16 Because if a position is authorized, there may be substitutes
17 there, there could be some emergency hire positions. Because
18 if there are students out there, there's a need for a class,
19 there is a teacher there. So if there was a substitute
20 teacher and a long-term sub maybe and that long-term sub was
21 there, the computer may have gone to that sub.
22 Q. Because that long-term sub would need to utilize
23 the laptop?
24 A. Right. So if it was in there in March, then from
25 March till June the long-term sub may have gotten it.
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1 Q. But the other subs wouldn't get a laptop, would
2 they?
3 A. Not the daily subs, no.
4 Q. So that your -- your information, the information
5 that you received doesn't necessarily tell you where the
6 laptops went?
7 A. No.
8 Q. All your information allows you to know and to
9 testify about is that these items were purchased and were
10 purchased as allocated?
11 A. Right.
12 Q. Right?
13 A. Right.
14 Q. And that's all. As to who they were given to after
15 that, that's not your kuleana, or is it?
16 A. Well, part of my responsibility is inventory, so I
17 need to make sure that these laptops are on someone's
18 inventory.
19 Q. I see. Do you actually do that, do those types of
20 audits, check inventory?
21 A. Well, what happens is when a fixed asset is
22 purchased, it automatically goes to a hold file, and that
23 hold file needs to be cleaned up and sent to wherever that
24 equipment is. So if it's purchased at a state office and
25 given to a school, then that equipment needs to be
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1 transferred to that school.
2 Q. And placed on their inventory list?
3 A. Right.
4 Q. So if someone were to ask you, Chris Ito, how many
5 of those laptop computers that were purchased for vacant
6 positions were still undesignated or unassigned, you should
7 know that, right? I mean, not right here, but you should be
8 able to get that information?
9 A. I would have to go to the program manager that
10 purchased the laptops to see whether they made a distribution
11 of -- to the schools.
12 Q. That wouldn't be on any of your inventory lists?
13 A. Not at this point, no.
14 Q. When would it come onto your inventory list?
15 A. Well, it's in the hold file of the office that
16 purchased it. So when they transferred the amounts that they
17 purchased to the different schools, then it would come on
18 there.
19 Q. So who would have physical possession of that
20 computer right now? Let's say it hasn't been given to
21 anybody yet. Who would have possession?
22 A. I would think that the person -- the program
23 manager that purchased it.
24 Q. I see. Now, the $12 million was part of $17
25 million, actually, that had been unspent for -- as of --
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1 well, that should have been spent by June 30th, 2001, are you
2 aware of that, part of a $17 million figure?
3 A. I thought it was 27 million.
4 Q. Well, what we understand is there was $17 million
5 in unspent EDN 150 funds. Were you aware of that?
6 A. As of June 30?
7 Q. Well, as of -- should have been reported for June
8 30, 2001, this year. The audit that was done showed that.
9 A. By --
10 Q. Mr. Koyama. I believe that's where we got those
11 figures. I could be wrong. The question I'm asking you --
12 maybe it might be easier this way, Mr. Ito. I wanted to see
13 if you knew what was part of the $17 million in unspent EDN
14 150 funds? In other words, did the department end up this
15 fiscal year -- this past fiscal year with additional surplus
16 money in other EDNs besides the $17 million in EDN 150?
17 A. Yes. My understanding is there were unspent monies
18 in other EDNs as of June 30.
19 Q. The 17 million figure, you agree with that, then?
20 A. As of June 30.
21 Q. As of June 30?
22 A. Correct.
23 Q. Has been unspent?
24 A. To my recollection.
25 Q. And designated for EDN 150?
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1 A. Yes.
2 Q. So you say -- well, what, then, if you know, would
3 comprise this 15 -- $17 million amount?
4 A. Well, in EDN 150, as in all EDNs, there's various
5 program IDs, and that program ID that is in 150 there are
6 some of those that did not spend all their funds.
7 Q. This might be an unfair question for you, Mr. Ito,
8 right now, but off the top of your head, do you know which
9 program ID numbers they were that did not spend the amounts
10 that would total close to $17 million?
11 A. I know that the regular schools -- special ed in
12 regular schools had some monies that was not spent, but
13 that's --
14 Q. Special ed?
15 A. In the regular school population. That's the
16 regular special ed teachers and EAs there.
17 Q. When you say regular special ed teachers, as
18 opposed to what?
19 A. I guess the special ed teachers.
20 Q. The special ed teachers?
21 A. Right.
22 Q. Because they couldn't hire them?
23 A. I don't know that.
24 Q. I see. What other items might comprise the $17
25 million in unspent funds that came under EDN 150?
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1 A. Off the top of my head, I'm not sure.
2 Q. You did say, though, there were -- you believe that
3 there were additional surplus money -- there was additional
4 surplus money in other EDNs other than 150 besides this $17
5 million in EDN 150?
6 A. No. In EDN 150 there's $17 million. We have EDN
7 200, 300, 400, and 500.
8 Q. That's what I'm asking you.
9 A. Yeah, there were some funds there in those EDNs
10 also.
11 Q. In other EDNs?
12 A. Right.
13 Q. What EDNs were they?
14 A. All of it, 200, 300, 400 and 500.
15 Q. And how much in each of those EDNs has been
16 unspent, approximately?
17 A. I would -- I would say a couple million dollars
18 each.
19 Q. Each?
20 A. (Witness nods.)
21 Q. Is that usual?
22 A. I would think so.
23 Q. I mean, in your --
24 A. Yeah.
25 Q. -- in your experience, based upon the years you've
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1 been there, is that what usually happens at the end of the
2 fiscal year?
3 A. That's usual. It goes to the budget office for
4 them to review the requirements. From there, I think in
5 prior years, we were asked to spend the money in EDN 100.
6 Those funds were transferred over to EDN 100 to be expended
7 there because we do have a -- carryover privileges in the EDN
8 100 and EDN 150.
9 Q. Mr. Ito, will you define for us the department's
10 understanding of the term encumbrance as it fits into the
11 explanation of the other previous items and other phrases you
12 defined for us, such as allocations, allotments? Will you
13 kind of place it in context for us?
14 A. Encumbrance is when a purchase order is made. So
15 in our system it is encumbered. Until such time that the
16 actual bill is paid, it's still an encumbrance.
17 Q. So it has to be set aside because in your system
18 it's been spent, that money has been spent?
19 A. Right.
20 Q. So there is that additional, I guess, level of --
21 other than what we've talked about -- I'm not sure where it
22 would fit, but maybe after allotments it becomes encumbered
23 and then ultimately spent?
24 A. Right.
25 Q. My understanding, Mr. Ito, is in addition to the
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1 $17 million surplus in EDN 150, the department had also
2 encumbered $13 million by the end of fiscal '01. Are you
3 aware of that?
4 A. I don't know the exact figures, but there are
5 encumbrances as of June 30.
6 Q. And $13 million of encumbrances as of June 30th,
7 based on your years of experience, is that usual or unusual,
8 just encumbered money?
9 A. I didn't see anything unusual about those
10 encumbrances.
11 Q. Would one have to see a contract or a lease
12 agreement or some type of written evidence of an item being
13 purchased before you can encumber an amount for that
14 purchase?
15 A. Yes.
16 Q. You need some type of written document like a
17 purchase order?
18 A. A commitment.
19 Q. Commitment, but it would have to be evidenced by
20 what, contract or what, invoice?
21 A. Could vary, but yeah, I think a contract or a
22 requirement that it needs to be done.
23 Q. So it's your understanding there has to be that
24 specific document before it can be encumbered, then? For an
25 amount to be encumbered, there has to be some specific
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1 document, such as a contract or lease agreement, something
2 like that?
3 A. Something like that.
4 Q. Now, Mr. Ito, does the department's authority, to
5 your knowledge, to spend excess impact aid contribute -- does
6 that contribute or did that contribute to the $17 million
7 surplus in EDN 150?
8 A. Not to my knowledge.
9 Q. You were aware that the department has had excess
10 impact aid ranging from 9 to $12 million a year for the past
11 three years?
12 A. Yes.
13 Q. How is the use, then, of those impact funds --
14 excess impact funds, how is that reported?
15 A. It's reported as additional program IDs. So as the
16 funds are allotted to the various offices, different program
17 IDs are created, so it's expended that way. So once we
18 expend -- as the expenses are made through that program ID,
19 it's reported that way.
20 Q. Is it a new program ID?
21 A. Yes.
22 Q. Why is that?
23 A. Just to keep separate records.
24 Q. Because it's federal funds?
25 A. No, because it's more project granted and you would
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1 like to keep that as separate programs.
2 Q. Are you saying the excess impact aid is project
3 granted?
4 A. Well, I think that the funds are determined -- how
5 the funds are used are determined by the superintendent and
6 staff.
7 Q. I see. So that is there a report, then, that shows
8 how this excess impact aid was expended?
9 A. Yeah, that was one of the requirements in the
10 request.
11 Q. You have it here?
12 A. Yes.
13 Q. Thank you. We'll take that from you. What else
14 did you bring, Mr. Ito?
15 A. The three things that I brought was the impact aid
16 expenditures, the Felix response plan positions, and the
17 expenditures for '94 to present by ten and 20, by program,
18 personal services, and others.
19 Q. And is that how you were asked to bring those
20 items?
21 A. That was my interpretation of the subpoena.
22 Q. And were those items, if I may ask, readily
23 available or did that take time to retrieve?
24 A. It took time to retrieve.
25 Q. Because it wasn't in a form that you could easily
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1 retrieve it?
2 A. Right. Well, the impact aid expenditures was by
3 this program ID, so we could get that fairly quickly. The
4 '94 to present was in archives, so we had to restore it from
5 the archives to get that information from archives.
6 Q. Mr. Ito, if you can, can you tell us how many
7 positions by types of positions, for example, special ed
8 teacher, an EA, or counselor, how many positions are employed
9 by the DOE to fulfill the requirements of the Felix consent
10 decree? Can you tell us that?
11 A. No, I cannot.
12 Q. Not even an estimate?
13 A. No.
14 Q. How about -- how about if I were to ask you what
15 the costs are by cost categories for the Felix -- that have
16 been expended for the Felix consent decree, would you be able
17 to tell us that?
18 A. Again, definitions really is -- needs to be looked
19 at and what is your definition of the Felix consent decree.
20 I think we have -- in this expenditure record we have --
21 through the DLTSS office have looked at the program IDs and
22 determined which program IDs are Felix related, and this is
23 what we show here, the different expenditures.
24 Q. I guess once we've had a chance to look at that
25 information, perhaps someone from the auditor's office may
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1 call you and ask for more detailed breakdown or even some
2 explanation. You should be able to provide that?
3 A. Sure, sure. Maybe not '94, '95 kind of stuff,
4 but --
5 Q. More recent?
6 A. Right, we need more time for the things that are in
7 archives.
8 Q. I think they are interested -- we're interested
9 more in the last three or four years.
10 A. We have two years at least on line, so we can get
11 those things fairly quickly.
12 Q. On line on what system?
13 A. On our FMS.
14 Q. You mentioned the ISPED system, or did you not?
15 A. I did not.
16 Q. Is the system up and running?
17 A. To my understanding it is.
18 Q. What is your role in that system? Providing
19 expenditure information, for example?
20 A. No, no. My role isn't -- I don't have any role on
21 ISPED per se, but I think we need information for the
22 school-based behavioral health part of it, so we need
23 information from ISPED.
24 Q. Oh, I see. What is, then, the current status, to
25 your understanding, of where ISPED is? It's up and running
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1 you say, but is that all you --
2 A. That's all I know.
3 Q. Do you know how much has been spent on that system,
4 putting in that system and getting it operational, how much
5 has been spent on ISPED?
6 A. Not offhand I can't.
7 Q. Do you know how many positions, for example, have
8 been appropriated for ISPED?
9 A. Not offhand.
10 Q. Now, if I were to ask you how much the Department
11 of Education has paid the court monitor personally on the one
12 hand and the court monitor's office on the other since fiscal
13 '93, would you be able to provide that information?
14 A. Yes, I could.
15 Q. It's not within the -- I'm not suggesting we asked
16 for it, but it's not within the documents you brought?
17 A. No. It's got to be a vendor look up, so we
18 would -- the court monitor has a vendor code that we have.
19 Q. Do you know if that vendor code is such that it's
20 broken down, for example, on the one hand as to the office,
21 the Felix monitoring project, we might call it, and then
22 another code for Ivor Groves?
23 A. No, I don't think so. I think it's only one.
24 Q. And it would be probably under the Felix monitoring
25 project?
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1 A. Right.
2 Q. So it's not broken down any further than that as
3 far as you're concerned?
4 A. For payments to be made?
5 Q. Yeah.
6 A. I think it's only to one.
7 Q. So am I to understand, to your understanding, that
8 for the project you make a lump sum payment at different
9 intervals of time and then they expend it or pay it out to
10 the individuals?
11 A. To my knowledge.
12 Q. So that there should be no Department of Education
13 draft or check that goes directly to any one of those people?
14 A. To my knowledge, no.
15 Q. So the same with what they call the technical
16 assistance panel, have you heard of that term?
17 A. No, I haven't.
18 Q. So you wouldn't know whether the technical
19 assistance panel persons, Ivor Groves, Judy Schrag, Lenore
20 Behar, any one of them would have been paid directly from the
21 department? You don't know that?
22 A. I don't know that.
23 Q. I'm not sure if you have those items before you,
24 but in the Felix response plan for the 2001 emergency
25 appropriations -- appropriation request, an amount of 27
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1 million, it shows three items totaling almost $1 million to
2 the court monitor, and I guess -- I think what we're saying
3 is to the project, but do you know what those two -- three
4 items consisted of that totaled $1 million?
5 A. Yes, it's the court monitor's costs.
6 Q. I understand that, but you don't know what
7 specifically they were for?
8 A. No.
9 Q. Do you understand the Felix monitoring project to
10 actually have a base budget that is part of the department's
11 budget? In other words, is there an amount allocated in the
12 budget itself to Felix monitoring project?
13 A. I don't -- I'm not aware of it.
14 Q. You're not aware of that?
15 A. No.
16 Q. Are you aware as to whether or not the department
17 has paid any amounts to either Ivor Groves or Ray Foster or
18 any companies, if you are aware of the companies that they
19 own, any amounts for a service testing instrument?
20 A. I'm not aware of that.
21 Q. I think I've covered this. I just need to ask you
22 directly, then. So the department does not pay directly for
23 the staff who administer service testing or who are part of
24 the monitoring project?
25 A. I don't know. I mean, like I said, from our side
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1 we pay POs, approve vendors, approve -- when we receive
2 proper documentation for payment, we would pay. Now, I don't
3 know -- I didn't look at -- I don't have the vendors, so I
4 didn't check. I don't know if they're paid or not.
5 Q. Sure.
6 A. If you tell me who they are and you want to find
7 out if they got paid, I can go back and check our vendor
8 table, our vendor system to see if these guys were paid.
9 Q. It wouldn't be something that would be right there?
10 A. Because we don't from our side say to pay this.
11 It's already -- it's from the program people, the program
12 managers say this is an authorized payment to be made and
13 then we'll pay it accordingly if proper documentations are
14 there.
15 Q. Thank you. One last area, sir. Do you know,
16 though, how much was spent, for example, on the contract with
17 Columbus Educational Services for this current fiscal year,
18 '01?
19 A. Not offhand, but yeah, we have -- as a vendor,
20 Columbus allowed vendor, I can get you what the total payment
21 was.
22 Q. As you sit here -- I'm not saying you should be
23 able to, but you can't give me an estimate on --
24 A. No.
25 Q. -- how much was spent?
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1 A. No.
2 Q. And how much is intended to be spent for fiscal
3 years '02 and '03, you would --
4 A. I wouldn't have that.
5 Q. -- you would not have that.
6 Thank you, Mr. Ito. That's all I have.
7 CO-CHAIR REPRESENTATIVE SAIKI: Thank you,
8 Mr. Kawashima.
9 Members, we'll take a short recess to give our
10 court reporter a break, and we'll take a five minute recess.
11 Recess.
12 (Recess taken.)
13 CO-CHAIR REPRESENTATIVE SAIKI: Members, we'd
14 like to reconvene our hearing, and we'll proceed with
15 questioning by members beginning with Vice-Chair Oshiro,
16 followed by Vice-Chair Kokubun.
17 VICE-CHAIR REPRESENTATIVE OSHIRO: Thank you,
18 Co-Chair Saiki.
19 EXAMINATION
20 BY CO-CHAIR REPRESENTATIVE OSHIRO:
21 Q. Good morning, Mr. Ito.
22 A. Good morning.
23 Q. I wanted to get a little more clarification in
24 terms of the emergency appropriation request. Could you
25 clarify for us again what was your role? I remember you sort
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1 of saying you didn't really have a role, but then later on
2 providing clarification that you did provide some information
3 to support the request; was that correct?
4 A. Other than expenditures, but if not, the SBBH FRP-3
5 is where I was involved in.
6 Q. And what is the FRP-3?
7 A. The FRP-3 is the school-based behavioral health
8 portion. That is the portion that was transferred from the
9 Department of Health to the Department of Education on July
10 1st. It deals with the direct services of the students in
11 the schools for behavioral health services. Our area -- my
12 area was basically the contract specialist area, so that we
13 would be working on the contracts that would be given out to
14 the different private providers.
15 Q. And do you have any kind of estimation on the
16 amounts or the positions that were required for this FRP-3 at
17 the time when you were looking at that emergency
18 appropriation?
19 A. See, a part of it was transferred from the
20 Department of Health, that $21 million that was in the
21 Department of Health's budget at that time was transferred to
22 the Department of Education. On top of that we need another
23 5.7 million, I think, in order for us to comply with the
24 FRP-3.
25 Q. Okay. Are you at all familiar with the amounts of
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1 the overall emergency appropriation being requested and the
2 significant, I guess, minimization that occurred over time?
3 A. No, not -- I know a little bit about it, but not in
4 total, no, because I wasn't involved in the initial request,
5 because normally, in DOE's situations, how we organize is
6 that the program people are responsible for the program, and
7 this is a little different in that on FRP-3 we're using
8 contract specialists under me in order to do that part of it.
9 Normally it's all under the program people.
10 Q. So who would be the best person to talk to to find
11 out how the breakdown of the whole appropriation came about?
12 A. I think Laurel, who should have been testifying
13 yesterday, would be the best. She's the assistant
14 superintendent, Laurel Johnston.
15 Q. Thank you very much.
16 CO-CHAIR REPRESENTATIVE SAIKI: Vice-Chair
17 Kokubun, followed by Representative Ito.
18 VICE-CHAIR SENATOR KOKUBUN: Thank you,
19 Co-Chair Saiki.
20 EXAMINATION
21 BY VICE-CHAIR SENATOR KOKUBUN:
22 Q. Mr. Ito, you know the branch that you're working
23 in, I guess accounts branch, can we call it that?
24 A. It's business services branch.
25 Q. Business services, okay. And there's a separate
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1 budget branch?
2 A. There is a separate budget branch, yes.
3 Q. But you are -- both of these branches are under,
4 what, the division of administrative services?
5 A. No. The budget branch is under the division of
6 planning and budget under Laurel Johnston. My branch is
7 under Alfred Suga.
8 Q. I see. And both of these would come directly under
9 the superintendent?
10 A. Yes, assistant -- they are the assistant
11 superintendents under the superintendent.
12 Q. I see. Mr. Suga, you mentioned?
13 A. And Laurel Johnston.
14 Q. Ms. Johnston?
15 A. Yes.
16 Q. Okay. Now, you've had background in the budget
17 side, you indicated, in your experience?
18 A. Yes.
19 Q. And now you're in the expense side?
20 A. Right.
21 Q. Is this -- just your opinion. Is this an efficient
22 way to be dealing with so much money? Shouldn't there be
23 more of a common ground where people can get a better
24 understanding of each other's functions?
25 A. No, it can work this way. I mean, the budget is --
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1 like I mentioned earlier, I think the budget is a big
2 function of the department. In working with the budget
3 appropriation and the budget execution side and with the
4 planning branch, I think that division works that way. Once
5 the appropriations and allocations are made and determined,
6 then it comes over to the accounting side, so that can be
7 done. It can work.
8 Q. So would you think that the roles, then, of
9 Mr. Suga and Ms. Johnston would -- are they where the
10 communication takes place between these two functions?
11 A. Well, we work together with the budget office too,
12 you know, so it does not have to be at the assistant
13 superintendent level.
14 Q. So there is additional communication going on?
15 A. Sure.
16 Q. Sharing of information?
17 A. Sure.
18 Q. I wanted to thank you, too, for doing the
19 research -- the archival research to come up with this
20 information from '94 to present. Not having had a chance to
21 review it yet, I did want to ask a couple questions about
22 that. You mentioned various program IDs within EDN 150. I'm
23 concerned about tracking some of the expenses, for instance,
24 the plaintiff attorney fees. Is that something that could be
25 traced through the EDN programs, the EDN 150 ID programs?
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1 A. The program IDs are programs. The plaintiff
2 attorneys -- or the fees that you're saying is vendor codes.
3 So if you tell us which vendor you want to -- we have vendor
4 table information. So if you want to know a particular
5 vendor, what that vendor was paid, we can search it through
6 that code. We have a vendor code for each of the payments
7 that we made.
8 Q. And would there be follow up in terms of like an
9 invoice? Would they submit an invoice?
10 A. Sure.
11 Q. Would the vendor submit an invoice?
12 A. Sure.
13 Q. And the invoice is fairly detailed or does it vary?
14 A. It varies.
15 Q. Have you happened to see any of these particular
16 invoices from any of the plaintiff attorneys?
17 A. Not personally, no, I haven't.
18 Q. But that is something -- would that be found in the
19 information that you turned in today?
20 A. No.
21 Q. That would be additional work that would need to be
22 done?
23 A. Well, it's a different thing. What I turned in
24 today was pretty much expenditures at the personnel services
25 level and the department program IDs for the years from '94
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1 to present. What you're asking for is detailed vendor table
2 information, that is vendor by vendor, and that's very
3 detailed, but as long as we could identify the vendor, that
4 could narrow the scope.
5 Q. You would have to do that?
6 A. Right, yes. And again, how much we have on line
7 and how much we have in archives would be able to determine
8 the length of time it takes to get that information.
9 Q. Again, I appreciate you, you know, doing the
10 background work and providing this information. My intention
11 was not to take you away necessarily from your regular
12 functions, but I think this information is important for us
13 to have. So I thank you for doing that.
14 A. Thank you.
15 VICE-CHAIR SENATOR KOKUBUN: Thank you,
16 Co-Chair.
17 CO-CHAIR REPRESENTATIVE SAIKI: Thank you.
18 Representative Ito, followed by Senator Buen.
19 REPRESENTATIVE ITO: Thank you, Co-Chair.
20 EXAMINATION
21 BY REPRESENTATIVE ITO:
22 Q. Good morning, Mr. Ito.
23 Co-Chairs and Members, I just want to let the
24 members know that we're not related. They say Mr. Ito, and
25 I'm looking around.
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1 Anyway, good morning.
2 A. Good morning.
3 Q. You know, I just want to follow up on Senator
4 Kokubun. You know, you mentioned budget and accounting and
5 it's separated. You know, you say that you were a controller
6 at one time, and do you say it's efficient, you know,
7 separated like this?
8 A. Is it efficient?
9 Q. Yes.
10 A. Well, I think the volume -- the number of -- the
11 size of the department makes -- it can work separately, you
12 know, because what we're doing is we're accounting for funds.
13 So once the allotment comes over to us, I think we can work
14 with the allotments. The allotments, again, are expenditure
15 plans that the program managers prepare once the allocations
16 are given to them. So our inputs that come to us would be at
17 the point in time where program managers determine that this
18 is how I want to spend the money for this year. So once that
19 is determined, then we would account for it and see how they
20 spend the money according to the allotments or expenditure
21 plans that they prepare once they know how much funds that
22 they have. So from the budget process all the way to the
23 expenditure process, it's a long time. In determining the
24 amounts and requirements from budget preparation to budget
25 allocation to the actual expenditures is a progressive step
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1 and it is involved.
2 Q. Throughout this hearing it seems like the left hand
3 don't know what the right hand is doing, you know, sometimes,
4 and I was wondering about reorganization, you folks ever
5 thought of reorganizing the -- where is the budget department
6 located?
7 A. The budget branch is part of the division of
8 planning and budget, which is Laurel Johnston's --
9 Q. Personnel?
10 A. No. Planning and budget.
11 Q. Oh, planning and budget.
12 A. Personnel is part of the department of -- division
13 of administrative services, which is Mr. Suga. So we have
14 the personnel branch as part of administrative services.
15 Q. So how many members in your office?
16 A. In my branch, I have about a hundred.
17 Q. And what about the district, that includes the
18 district?
19 A. No, it does not include the district.
20 Q. But the district works with you, right, within the
21 line?
22 A. Right. We have in my area, like I said, the
23 school-based behavioral health section, have people under me
24 but physically at the district office.
25 Q. And what about the schools?
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1 A. Nothing at the schools.
2 Q. At the school level?
3 A. No.
4 Q. You know, you mentioned program managers, who
5 oversees the program managers?
6 A. It depends on which program it is. They are
7 under their respective divisions, under DLTSS for most of the
8 educational programs. If it's business areas, the program
9 managers are under the division of administrative services.
10 So it depends on the type of program that we're talking
11 about. So most of the program managers are part of DLTSS.
12 Q. You know, the chief counsel mentioned that you
13 folks passed out laptop computers to teachers, you know,
14 special ed, which is okay, but what about the principals, why
15 was it -- how come the principals get computers, laptop
16 computers?
17 A. I cannot answer that. It was part of the -- it
18 could have been part of the benchmarks. I'm not sure.
19 Q. Well, that was $531,000. 531,300. I mean 531,300,
20 yeah, okay. You know, in your department, how many people
21 have CPA degrees?
22 A. I don't know.
23 Q. Or MBA?
24 A. I don't know. I'm not sure.
25 Q. You know, your division manager, what you call
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1 that, specialist level what? Besides you.
2 A. I know Charles Tagawa has.
3 Q. MBA?
4 A. (Witness nods.)
5 Q. What about the rest of them?
6 A. I think that's about -- I'm not sure. I think
7 that's about it.
8 Q. Thank you very much.
9 REPRESENTATIVE ITO: Thank you, Co-Chair.
10 CO-CHAIR REPRESENTATIVE SAIKI: Thank you.
11 Senator Buen, followed by Representative Kawakami.
12 SENATOR BUEN: Thank you.
13 EXAMINATION
14 BY SENATOR BUEN:
15 Q. Mr. Ito, thank you for coming today. I have a
16 question on the EDN. You mentioned that there's 200, 300,
17 400, 500. In all these areas there were unspent monies, and
18 that was as of when?
19 A. June 30.
20 Q. June 30th?
21 A. Yes.
22 Q. And I understand that there are a couple of million
23 dollars in each of these EDN?
24 A. To my best estimate. I'm not really positive on
25 what the dollar amounts were, yes.
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1 Q. I see. And you also mentioned that it's not
2 unusual?
3 A. I don't think it's unusual.
4 Q. In previous years, have these monies been all
5 expended for each of these EDNs?
6 A. In previous years, to my understanding, these funds
7 were requested to be transferred to EDN 100 or 150 to be
8 expended in those EDNs.
9 Q. I think that's what you mentioned earlier. And
10 that's not unusual?
11 A. No.
12 Q. The other question that I had was in relation to
13 the vendor codes. You mentioned that, you know, the Felix
14 monitoring project, the monies went out there in lump sum?
15 A. Well, there is an invoice. There's request for
16 payment, and we would pay according to the request on the
17 invoice in making sure there's proper documentation.
18 Q. But then you don't know how much Schrag and Behar
19 and the monitor were paid by the Department of Education, if
20 that was ever paid by the department?
21 A. If the department paid any of them, we had to
22 create a vendor code for them. I don't know offhand if we
23 did, but if we paid one of them, we would create a vendor
24 code for them and then I can research the documents to see if
25 those were paid.
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1 Q. I see. So --
2 CO-CHAIR REPRESENTATIVE SAIKI: Excuse me,
3 Mr. -- excuse me. I'm sorry to interrupt, Mr. Ito. Could
4 you please provide us with the vendor code numbers --
5 THE WITNESS: Could you give me who you want
6 it for?
7 CO-CHAIR REPRESENTATIVE SAIKI: Dr. Ivor
8 Groves, Dr. Judith Schrag, Dr. Lenore Behar, Dr. Ray Foster.
9 And I'll repeat that. Dr. Ivor Groves, Dr. Judith Schrag,
10 Dr. Lenore Behar, Dr. Ray Foster, and Human -- a company
11 called Human Systems & Outcomes.
12 CO-CHAIR SENATOR HANABUSA: I believe Senator
13 Kokubun had a request on attorneys.
14 VICE-CHAIR SENATOR KOKUBUN: Can that just be
15 included with those, Co-Chair Saiki, and if we come up with
16 additional --
17 CO-CHAIR SENATOR HANABUSA: You wanted
18 specific attorneys as well and their codes?
19 VICE-CHAIR SENATOR KOKUBUN: That's correct, I
20 did.
21 CO-CHAIR SENATOR HANABUSA: So the attorneys,
22 then. Plaintiffs' attorneys?
23 VICE-CHAIR SENATOR KOKUBUN: That's correct,
24 plaintiffs' attorneys.
25 CO-CHAIR SENATOR HANABUSA: So it would be
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1 Eric Seitz, Shelby Floyd, or the law firm of Alston Hunt
2 Floyd & Ing, Cades Schutte Fleming & Wright, Susan Cooper.
3 Anyone else?
4 VICE-CHAIR SENATOR KOKUBUN: Jeff Portnoy.
5 CO-CHAIR SENATOR HANABUSA: Jeff Portnoy or
6 the law firm -- oh, yeah, part of the law firm of Cades
7 Schutte Fleming & Wright.
8 Anyone else, Senator Kokubun?
9 THE WITNESS: What is Human Systems?
10 CO-CHAIR REPRESENTATIVE SAIKI: It's called
11 Human Systems & Outcomes. It's a Florida-based corporation.
12 Thank you.
13 Sorry for interrupting, Senator Buen.
14 SENATOR BUEN: No, no. I'm glad that you
15 asked for it because that's exactly what I was thinking of
16 also, so thank you. I have no further questions. Thank you.
17 CO-CHAIR REPRESENTATIVE SAIKI: Thank you.
18 Representative Kawakami, followed by Senator Slom.
19 REPRESENTATIVE KAWAKAMI: Thank you, Chair
20 Saiki.
21 EXAMINATION
22 BY REPRESENTATIVE KAWAKAMI:
23 Q. Hi, Chris. I wanted to ask, you know when the
24 allotments are given to schools and then comes the allocation
25 notice that they can spend and do their POs, am I correct,
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1 from what you said? How often do schools -- is there a time
2 frame in getting their data on the FMS?
3 A. Because of I guess -- I guess the response time of
4 the system, we allow them to put it on the system, but we
5 cannot post it every day, so there are certain days that they
6 can post and certain days -- you know, like two or three
7 times a week that they would be assigned to --
8 Q. So it could be daily, it could be monthly?
9 A. Most of the time I think it's three times a week.
10 Q. Three times a week?
11 A. Yeah, every other day.
12 Q. So that data can be picked up from you any time?
13 A. Yes.
14 Q. The reason I ask is because the system took a long
15 while getting up.
16 A. Right.
17 Q. And finally you're getting it up, so is it timely
18 now?
19 A. I think so.
20 Q. You think so?
21 A. Yes.
22 Q. Okay. So you pretty much get the data that you
23 need?
24 A. Right.
25 Q. The other question I wanted to ask is the district
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1 business specialist, how do they input to you?
2 A. Well, there's no district business specialist right
3 now.
4 Q. The district business specialist, they have them.
5 There are only three districts. The neighbor islands that
6 don't have them.
7 A. No, there's no district business specialist right
8 now.
9 Q. Who are these business people, then, that handle
10 the business in the district? They're called district
11 business specialists, at least when I was there.
12 A. Yeah, when you were there, there were district
13 business specialists.
14 Q. So you don't have them?
15 A. No, we don't.
16 Q. Who handles it, then? Who makes sure they're on
17 top of all this spending that goes on?
18 A. Well, it's -- the principals are responsible for
19 their expenditures.
20 Q. They've got so much on their plate, and that's
21 where the complaints are.
22 A. I think the legislature gave us some positions in
23 the last session which we're trying to implement.
24 Q. In the last session we gave you -- and I don't know
25 what we really called them, but there were some business --
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1 A. 42 of them. We're trying to put it in.
2 Q. They are going to take the place of specialists, is
3 that it, that normally were in districts? I don't think so.
4 These were additional.
5 A. We also have seven district business specialists --
6 I mean business managers that were also given to us this
7 year, so there's those and the 42 that we have.
8 Q. So what's the distinction between the business
9 managers and the district specialists?
10 A. Well, with the 42 that we have, we're going to try
11 to use complexes or groups of complexes to put somebody there
12 to do the business functions. So we'll have somebody
13 overseeing a district and also someone overseeing a complex
14 or a group of complexes.
15 Q. I see.
16 A. That's in the plans right now with the positions
17 that were given to us in the last session. We're still
18 working on that right now.
19 Q. So you're going to have a hand in it?
20 A. Right.
21 Q. In terms of selection?
22 A. It's going to be part of my branch, yes.
23 Q. Hopefully you get CPAs, too. The other question
24 was on the -- when schools don't spend all their money, okay,
25 they do an allotment plan and so forth and they don't spend
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1 their money, we gave them -- they can carry over funds.
2 A. Right.
3 Q. What does it look like? I mean, most schools keep
4 a chunk?
5 A. It varies from school to school.
6 Q. Varies from school. So if things were not
7 encumbered, they just carry it over?
8 A. For one year.
9 Q. I just wanted to know -- I mean, you could really
10 wait and do nothing, just get the funds, you know what I
11 mean, and just spend just so much because you can always
12 carry over and buy some big things?
13 A. Right, that's what -- I guess the biggest advantage
14 of the carryover privilege is for you to plan beyond one
15 year. So if you wanted to combine the allotments --
16 Q. Certain kinds of big purchases.
17 A. Right.
18 Q. And, let's see, you said there are 100 or so plus
19 IDs for Felix, am I correct?
20 A. For EDN 150.
21 Q. Under 150. Isn't that confusing?
22 A. No. It depends on the number of programs that you
23 would want and how to spend those funds according to those
24 program objectives.
25 Q. Give me an example of what kind of programs go in
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1 that 100 categories.
2 A. EDN 150?
3 Q. Yeah.
4 A. Like we have the special ed in regular schools, so
5 that's the bulk of it, where the special ed teachers -- their
6 B&C monies, their supply monies would be part of that EDN
7 150, which is a program in itself.
8 Q. Well, the reason I ask is because it's difficult to
9 yank out to see how that money is being spent.
10 A. In the --
11 Q. Because you have carryovers in those --
12 A. Well, if we do have carryover, we just continue to
13 use the same program ID for that same carryover program.
14 Q. So you add to it new monies?
15 A. But we also keep it separate.
16 Q. You keep it separate?
17 A. Yeah, because it's by fiscal year.
18 Q. It's just that to me, it's not a clean fund. I
19 mean, you know what I'm saying, because you have so many IDs
20 and they can always keep money in it and move it around,
21 whatever they want to do. Do they?
22 A. But I think that's the flexibility that I think --
23 Q. It's what they want?
24 A. This body also gave in the lump sum budgeting.
25 Q. Okay. My last question, Chris, is when the
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1 students move from special ed and back to regular ed and back
2 to special ed, et cetera, does that money follow the student?
3 A. The money was allocated during the year, so if the
4 child moved during the year, then the money would not follow
5 them. I mean, we have a point in time when we make the
6 allocation, so if --
7 Q. So it stays with that teacher who gets it?
8 A. It goes to the school.
9 Q. Yeah, but I mean normally -- let's say you have ten
10 kids in there, that money goes to that teacher, right? That
11 spending is tied to that -- those students and that teacher.
12 So let's say five move out, that money doesn't follow them?
13 A. To a different school or to a different -- I mean
14 to a different class in the same school?
15 Q. In that school. Let's say they move them back --
16 they're doing well so they go into regular ed now, does that
17 money go into the regular ed?
18 A. It would be the principal's decision.
19 Q. So it's the principals?
20 A. Right, because the funds are allocated to the
21 school and the school --
22 Q. Thank you. My time is up.
23 REPRESENTATIVE KAWAKAMI: Thank you, Chair.
24 CO-CHAIR REPRESENTATIVE SAIKI: Thank you.
25 Senator Slom, followed by Representative Leong.
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1 SENATOR SLOM: Thank you, Co-Chair
2 EXAMINATION
3 BY SENATOR SLOM:
4 Q. Good morning, Mr. Ito.
5 A. Good morning.
6 Q. Did you say earlier that the checks are paid from
7 DOE on Felix projects specifically by invoices?
8 A. As invoices come in, we would make payments, yes.
9 Q. If there was a request for payment but not an
10 invoice, would that raise a question or what would be the
11 procedure there?
12 A. We would need the original invoice. We need an
13 invoice to make a payment.
14 Q. I'm looking at some documents that Mr. Koyama
15 provided for us that we just got today, and there are three
16 checks listed there for vendor number 115818, Felix
17 monitoring project. The first check was dated January 2,
18 2001 in the amount $628,542. It says there is no invoice
19 number and it gives a description. The invoice description
20 says, court ordered B, and it's actually a letter from
21 Dr. Groves. There also is one dated 9/20/2001 in the amount
22 of $126,746, and here it says there's no invoice number and
23 no invoice description. Could you explain that to me?
24 A. It's probably just that letter from the court
25 monitor. My understanding is there is a memorandum of
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1 understanding between the court and the departments, so that
2 memorandum of agreement is what is being used to make the
3 payments after a letter like this is given to us to make the
4 payment.
5 Q. So in other words, if there's no specific formal
6 invoice, no number, and no description on the invoice, you'll
7 pay it anyway because it came from the court monitor?
8 A. I think there is -- when they said no description,
9 I think they just didn't put anything down, but I can provide
10 you the letter, probably, that would be attached to the
11 payment document.
12 Q. But I guess that's my point. If, for example,
13 Dr. Groves wrote a letter and said due $275,000, would you
14 pay that on the basis of that letter?
15 A. It would be reviewed by proper people. You know,
16 the program manager -- program person who is responsible for
17 that would be reviewing it. We have what we call an approval
18 to pay document which is done by the computer -- or comes out
19 of the computer which the program manager or representative
20 signs before we make the payment.
21 Q. So you're not part of that approval process?
22 A. No, I'm not part of the approval process. The
23 program manager is part of the approval process, who would in
24 turn create another document for an approval to pay and would
25 send that in to my staff to make the payment.
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1 Q. Has that occurred very frequently, where there have
2 been approvals required, additional approvals?
3 A. It's always required. A program manager's
4 responsibility is to approve the payment. They need to --
5 they need to make sure that the services or the supplies or
6 the equipment was received. We don't know whether you
7 received your computer or not, so the school -- the program
8 manager needs to tell us, yeah, I did receive this, go ahead
9 and pay.
10 Q. Well, just to be clear, because I'm a little
11 confused now, if an invoice comes in and it has a description
12 on it, then are you telling me that every invoice is still
13 reviewed by the program managers and then you get a separate
14 sheet that says approved?
15 A. The invoice goes to the program manager.
16 Q. Okay.
17 A. Who in turn reviews it, whether it should be paid.
18 So then they would enter, yeah, okay, it's okay to pay, I'll
19 enter it into the FMS system. Normally there's a purchase
20 order that was made. So with the purchase order, you would
21 enter your invoice. So then there's another document that
22 comes out saying, okay, I'll pay this vendor for this amount,
23 proper codes. They'll sign off. They'll send it over to our
24 voucher section.
25 Q. So in addition to the program people, is there one
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1 specific individual in the Department of Education that would
2 always be on that review and would always have his or her
3 signature on that approval document?
4 A. Once the program manager approves it, it comes to
5 my section and I have pre-audit clerks that would review it
6 and we would make the check out for that. So it may not go
7 to one person, but it goes to several of the clerks to make
8 the payment.
9 Q. I guess what I'm trying to get at, though, is there
10 one central person that would be involved in the review and
11 approval process before it comes to you?
12 A. Not for all the payments. They would review their
13 programs only.
14 Q. Thank you, Mr. Ito.
15 SENATOR SLOM: Thank you, Co-Chair.
16 CO-CHAIR REPRESENTATIVE SAIKI: Thank you.
17 Representative Leong, followed by Senator Sakamoto.
18 REPRESENTATIVE LEONG: Thank you, Chair.
19 EXAMINATION
20 BY REPRESENTATIVE LEONG:
21 Q. Mr. Ito, I want to turn back to that EDN 150 and
22 all these programs that surface, and they are not
23 necessarily -- they're all special ed, but not necessarily
24 Felix children?
25 A. Right.
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1 Q. And because there could be so many that come up,
2 who determines the title of these programs?
3 A. I guess in -- normally it comes from a request for
4 budgets, you know, so I need this much for this program. So
5 at that time a title would be probably done at that point.
6 Q. And there is no redundancy on these titles?
7 A. If there's redundancy, then I would think that as
8 the budget requests comes through, it should be part of an
9 existing program. That can be determined.
10 Q. So which group sets up these programs? Is there a
11 group that looks at it and decides whether it's really a good
12 program or not?
13 A. I guess it depends when. I mean, the thing is if
14 it's a budget request, then I think it would be coming from
15 the budget office.
16 Q. I see. And at the same time you talked about it
17 was hard to -- I mean that -- to differentiate these
18 children. I wondered if there was ever some duplicate
19 expenses for these children or definite payments made to
20 Felix or special ed children or are they delineated as such
21 that you know for sure? Is it possible?
22 A. I think like when we say it's hard it's because
23 people -- the students may move in and out of the Felix
24 class. You know, they may not need the services this month,
25 however, three months from now then they may need the
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1 services again, but you still need to provide services for
2 them in the regular setting. You need to have the special ed
3 teacher provide services. That's why it's difficult to
4 delineate the costs.
5 Q. And the same thing relating to the teachers in
6 charge?
7 A. Sure.
8 Q. Because they are designated as special ed or Felix
9 teachers, is the pay the same for them?
10 A. Sure, it's the same.
11 Q. It is?
12 A. Yes.
13 Q. I guess that's all I was concerned about, those
14 different programs and whether there was duplicate expenses
15 for them. Thank you, Mr. Ito.
16 REPRESENTATIVE LEONG: Thank you, Chair.
17 CO-CHAIR REPRESENTATIVE SAIKI: Senator
18 Slom -- I'm sorry. Senator Sakamoto, followed by
19 Representative Marumoto.
20 SENATOR SAKAMOTO: Thank you, Chair
21 EXAMINATION
22 BY SENATOR SAKAMOTO:
23 Q. Hello, Mr. Ito.
24 A. Hello.
25 Q. I guess you've seen my hearings. Please give brief
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1 answers because we only have a short time to do this.
2 A. Yes.
3 Q. And sorry if I go over some things that you've gone
4 over, but I just want to kind of get the big picture here.
5 The legislature appropriates, then it's allocation, then it's
6 allotment. From that point, you know, you do your vendor
7 codes, is there a point where you take a specific budgeted
8 item from the department and whatever was given and break it
9 down into sort of an activity code to say this much is
10 personnel, this much are outside vendors, this much is
11 equipment, this much are material and other costs so that you
12 have a where you're going to have items that you're going to
13 pay out?
14 A. Within the program itself -- the program ID as it's
15 allocated to the schools, they prepare expenditure plans, and
16 that expenditure plan will break down the objects of
17 expenditures that they want to spend the money in. So that's
18 their budget that they want to spend.
19 Q. The schools do that?
20 A. All program managers would do that. So you can say
21 that this much is for personnel, this much is for
22 substitutes, this much is for office supplies, this much is
23 for educational supplies. There are all different object
24 codes that is available for them to prepare their expenditure
25 plan. Once that is prepared in their expenditure plan, it is
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1 transferred over to FMS in that same categories.
2 Q. And who would oversees in terms of the quality or
3 the performance of a particular item? You said the program
4 manager, so for Felix that would be Mr. Houck?
5 A. Well, I think it goes further -- below that. I
6 mean, each program will have somebody else responsible for
7 the program itself.
8 Q. So if --
9 A. Somebody from DLTSS or --
10 Q. Depending where the expense was in their budget?
11 A. Right.
12 Q. I guess in state government many people complain
13 about the timeliness of payment. So I was kind of curious,
14 in documents that were provided, there's this invoice from
15 the monitor dated March 15th for 276,850, and then it's
16 stamped and then received March 15th, and then apparently
17 Doug Houck signed it on March 15th, and on March 16th a
18 department approval to pay document, Doug Houck signed it
19 March 16th, which is one day later, and then March 24th I see
20 a copy of a check. So is this typical that -- the quickness
21 of this particular payment?
22 A. I cannot answer that. I think that we -- the
23 proper -- just getting it through the mail -- if you walk
24 everything down, then we're in the same building, things
25 could have happened that quickly.
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1 Q. I mean, many vendors would like it if this was the
2 system, where they send their invoice in, the day it arrives
3 someone says I understood and this is approved and a week
4 later the check is in the mail. Is that something that -- I
5 mean, I'm not questioning the validity of this particular
6 one. I'm asking if that's typical of your response as far as
7 your kuleana?
8 A. I don't think it's typical because of the volume
9 that we have. You know, with the staff that we have, we can
10 just do the payments according to the proper review process.
11 Q. Then why was this one so quick, nine days for
12 276,000?
13 A. They probably walked -- they walked it through the
14 process.
15 Q. Well, I guess my understanding is that further
16 looking at the invoice with no number, as Senator Slom
17 pointed out, dated December 15th, it sort of said partial
18 balance of that amount to be due April 1st. So I guess in
19 terms of cash flow wise, why wasn't the check dated March
20 30th as opposed to the 24th, if indeed we're looking at
21 conserving dollars and paying in a timely manner still?
22 A. I cannot answer that directly on that particular
23 instance, but, I mean, we try to make payments as quickly as
24 we can.
25 Q. This one was super quick is what you're saying?
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1 A. I guess we look at the due date. I mean, you know,
2 if it was -- if it was late, then we would be in contempt or
3 whatever.
4 Q. Changing the subject, since my time is probably
5 almost running out, we also were provided with a list of
6 costs in terms of the cost for Felix '94, '95, '96, '97, and
7 so forth and the percentages have been increasing. Whose
8 responsibility is it to determine if in deed the performance
9 and quality of a particular item is where we want it?
10 Because you pay the bills. Normally in companies, them who
11 pay the bills kind of say no, we want to hold this one back
12 because the quality or performance isn't up to a standard we
13 like. So as far as I heard, it's not you; is that right?
14 A. It's the program -- once the program people say
15 this bill is okay to pay, we will pay it.
16 Q. So you just pass the peanuts around. You don't
17 care how old they are or how fresh they are, you just say, if
18 we owe ten peanuts, we'll pay them?
19 A. If proper documentation is there.
20 Q. Thank you.
21 SENATOR SAKAMOTO: Thank you, Chair.
22 CO-CHAIR REPRESENTATIVE SAIKI: Representative
23 Marumoto, followed by Co-Chair Hanabusa.
24 REPRESENTATIVE MARUMOTO: Thank you.
25 EXAMINATION
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1 BY REPRESENTATIVE MARUMOTO:
2 Q. Mr. Ito, maybe you could just educate me about
3 federal funds. Are there different rules regarding the use
4 of federal funds?
5 A. Yes, there is.
6 Q. So you keep them segregated?
7 A. Sure. The program manager that manages the federal
8 funds would determine and follow what the rules are from the
9 federal government standpoint and would relay that message to
10 the people that would implement and expend the funds.
11 Q. So I'm just wondering what you do with the surplus.
12 Is the surplus ever commingled with the regular funds or
13 still kept separate?
14 A. It's usually kept separate. Again, it depends on
15 the federal funds because there are certain guidelines that
16 the federal funds would determine.
17 Q. Okay. I'm just wondering, you know, if we
18 appropriate X amount of federal funds and you allocate them
19 according to your budget process and if more funds come in
20 than anticipated, how do you handle that problem? It's a
21 good problem to have, but --
22 A. If more funds are received -- we work with the
23 cash, you know. What's -- the appropriation for the federal
24 funds is just a guesstimate of what we expect to receive. We
25 would make that best guesstimate to come to the legislature
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1 to get the appropriation, but we would work with what the
2 actual grant award is, and that's the amount that we would be
3 able to spend.
4 Q. Even though we didn't appropriate it or authorize
5 it for certain EDNs?
6 A. I don't know what the law says, but I think right
7 now the governor can approve the excess federal funds.
8 Q. The governor can?
9 A. Yes. So the request to the governor is made to
10 expend the excess.
11 Q. Because we're never sure how much comes in and when
12 it comes in, correct? It doesn't come in on a certain day.
13 A. Most of it does, like Title 1 and things like that.
14 It depends on the federal government, right, so if they do
15 pass it on a timely basis, then we would receive our federal
16 grants on a timely basis.
17 Q. Where does the money reside? Where does the
18 federal money go? What fund do you keep it in?
19 A. We keep separate programs for each of the federal
20 funds, so Title 1 would have their own, but the cash itself
21 is what you're talking about? The cash itself is drawn down
22 off from the federal government and put into the state
23 treasury and then we expend --
24 Q. Would some special ed or Felix money be in the
25 office of the superintendent or under the control of the
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1 superintendent?
2 A. It depends on the federal grant, yes.
3 Q. Could --
4 A. What the federal grant is for.
5 Q. Could the superintendent allocate the money or
6 spend the money even if it wasn't budgeted using super
7 powers?
8 A. I don't think so. I think it has to be
9 appropriated or at least the grant award, if it exceeds the
10 appropriation act, needs to have approval by the governor to
11 expend the fund.
12 Q. So any extra money that you spend would have to be
13 okayed by the governor?
14 A. That's my understanding. Maybe Laurel Johnston may
15 be a better person to ask that, but that's an appropriated --
16 the federal fund appropriated which the grant award exceeds
17 the amounts.
18 Q. We noticed that the PREL contract was -- federal
19 funds were utilized for this particular contract, and I'm
20 wondering whether that was allocated through the budget
21 process or whether this was at the superintendent's
22 discretion?
23 A. I'm not sure. I can't answer that question.
24 Q. But as part of his super powers, could he not
25 utilize any --
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1 A. I think it was more on the purchasing end, though.
2 It wasn't -- the purchasing end where he could be exempted
3 from the procurement law so he didn't have to go out to bid,
4 you know, that was the super powers.
5 Q. But his powers were broader than procurement, were
6 they not? He could write contracts.
7 A. Well, that's procurement. Contracts is
8 procurement.
9 Q. Okay. But he could use the money to purchase
10 services or goods?
11 A. If the money was available to expend.
12 Q. But there probably were extra federal funds
13 available, and I'm wondering whether they were properly
14 allocated through the budget process, whether they were used
15 in accordance with federal funds, and do you have any idea
16 whether this in deed was the case?
17 A. I don't. I mean, because once it's appropriated --
18 I mean once it's allocated, it comes over to FMS as an
19 allotment. So if there was an allotment there, then the
20 purchase order could have been cut with the allotment there.
21 Q. Okay. Well, I'll leave it with that. Thank you
22 very much.
23 CO-CHAIR REPRESENTATIVE SAIKI: Thank you.
24 Co-Chair Hanabusa.
25 CO-CHAIR SENATOR HANABUSA: Thank you.
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1 EXAMINATION
2 BY CO-CHAIR HANABUSA:
3 Q. Mr. Ito, you mentioned that you were responsible
4 for FRP-3.
5 A. Only in the area of the contract specialist. Not
6 the program.
7 Q. Are you responsible in terms of all the FRPs and
8 the expenditures?
9 A. No.
10 Q. Not at all?
11 A. I mean, when you say responsible, what do you mean?
12 Q. To oversee it.
13 A. Not in the program manner, no. I would -- to
14 record expenditures and things like that, that would be a
15 part of any program.
16 Q. You would be responsible for that in terms of the
17 money?
18 A. Yes, recordation of expenditures.
19 Q. What's your understanding in terms of the FRP which
20 has 12 different categories, correct, and the benchmarks, are
21 there a separate accounting for both of them?
22 A. Well, my understanding is that the FRP was
23 additional funds needed to implement the benchmarks.
24 Q. So, you know, you said like there's a hundred
25 program IDs. For example, FRP-3 has a program ID I think of
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1 15686 or something like that, so are you saying that the
2 benchmarks have program IDs as well or just the FRPs have
3 program IDs?
4 A. Just the FRPs have program IDs.
5 Q. Just the FRPs. So whatever is in the consent
6 decree under benchmarks, you would somehow be covered under
7 the FRPs; is that your understanding?
8 A. Well, maybe not only the FRPs, but could have been
9 covered under the other funds that were appropriated earlier.
10 Q. Other than the emergency funding that came in?
11 A. Right, other than the emergency funding.
12 Q. So it's your understanding that when the Department
13 of Education and Department of Health came to the legislature
14 to ask for emergency funds, it was to fund the FRPs; is that
15 your understanding?
16 A. Yes.
17 Q. Now, you made a comment about encumbrances. You
18 said that as long as a purchase order is made, then it's
19 encumbered?
20 A. Right.
21 Q. Is that correct?
22 A. At the point of the purchase order being made,
23 those funds are encumbered.
24 Q. Now, let me ask you something. Columbus contract,
25 for example, at the point that you make a -- if you make a
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1 purchase order -- so say you need 30 teachers or something,
2 you don't necessarily have those teachers but you anticipate
3 30 teachers, is that considered a purchase order or do you
4 know how that works?
5 A. No, it's not considered a purchase order at that
6 time. The contract itself may be for 30 teachers, yes, so
7 it's the contract and not the purchase order.
8 Q. But how is it reflected in terms of an encumbrance?
9 It's not reflected as an encumbrance until when?
10 A. In this situation the program manager may encumber
11 or cut a purchase order only for ten teachers because that's
12 what she estimates or they estimate to receive in the next
13 three months.
14 Q. So if the program manager anticipates or expects to
15 receive a hundred teachers in the next three months, they
16 could arguably cut a purchase order for a hundred teachers?
17 A. If the funds are available.
18 Q. Right.
19 A. Yes.
20 Q. So you don't know when you encumbered $13 million
21 at the end of last fiscal year for EDN 150 whether part of
22 that money was for anticipated teachers at the end of that
23 period of time? In other words, at the time of June 30th,
24 that they anticipated that they would have X number of
25 teachers, it could be included in that 13 million?
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1 A. If it's an encumbrance, yes.
2 Q. So how can we get a breakdown of EDN 150's
3 encumbrances of $13,254,207.79? Can you do that?
4 A. I think that was given to the committee.
5 Q. The encumbrances, what was encumbered?
6 A. I think so.
7 Q. Could you double check for that, and if it wasn't,
8 can you give us that information? And also, just while we're
9 on that, Mr. Ito, the vendor codes that were requested, I
10 want to make it very clear that the committee, when they are
11 asking for vendor codes, they would also like for you to run
12 the total amounts associated with the codes.
13 A. Sure. For two years, I hope?
14 Q. Huh?
15 A. For two years?
16 Q. We'll start with two years, and then if there's any
17 questions after that, we will impose upon you.
18 A. So 2000, 2001, to current?
19 Q. 2000-2001.
20 A. 2000-2001, 2001-2002? It's up to now.
21 Q. You actually have it all the way back to '94,
22 right?
23 A. It's in archives, so --
24 Q. Whatever is accessible.
25 A. Sure.
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1 Q. Okay. And then also what we will do is fax you if
2 there are any other members who have other vendor names that
3 they'd like you to run. We will fax you that information.
4 A. Sure.
5 Q. The other question that I have is as I look at
6 this -- what basically was lapsed over the period of time,
7 EDN 150 had a balance of 17,554,000, and out of that amount 8
8 million was lapsed and 9 million was carried over. You said
9 that you didn't think that that was an unusual amount. The
10 reason I ask is because, you know, it's like $154 million
11 appropriation for EDN 150 and over 10 percent is actually in
12 the category of balance. That's not an unusual amount?
13 Because no other category has that kind of percentage.
14 A. Well, I think the question was the 2, 3, 4 and 500,
15 whether those were unusual. I think those were not unusual.
16 I think this is unusual.
17 Q. This is unusual, isn't it?
18 A. I think the strike committed -- I mean a lot of it
19 is -- not a lot, but there's a strike savings also in there
20 too.
21 Q. Well, in this particular graph that I'm looking at
22 there is no strike savings attributed to it. The strike
23 savings is attributed to EDN 100, and even at that, EDN 100's
24 appropriated amount is $779 million and the balance is only
25 39 million and you have the 23 million of strike savings. So
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1 it's still an unusual amount proportionately, isn't it?
2 A. Right.
3 Q. And my last inquiry to you, this is from the
4 information you gave us, it's called impact aid expenditures,
5 and I think it's along the line of what Representative
6 Marumoto was asking you. In your first page on here called
7 impact aid expenditures, we notice in the fiscal year 2000
8 there is nothing in this category called amount over
9 appropriation, because I believe you said you were not -- you
10 meaning the Department of Education was not afforded the
11 right to keep any amounts over appropriation, isn't that
12 correct, on federal impact aid money?
13 A. We didn't have any -- it's carried over. Okay.
14 The 2000 one is being spent in 2001.
15 Q. But in fiscal year 2000, the DOE was not given the
16 right to hold excess federal impact aid money?
17 A. That's the '99 year.
18 Q. So 2000 you were able to do it?
19 A. Right.
20 Q. You just didn't have any excess or you carried it
21 over?
22 A. It carried over, so the excess that -- expenditures
23 that you see here is the 2000 carryover.
24 Q. Okay. So the appropriation in fiscal year 2001 is
25 $24,195,000. That's impact aid appropriation, correct?
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1 A. Right.
2 Q. Then you have amount over appropriation. See that?
3 And it totals another 9 million.
4 A. Right.
5 Q. I think the question really was, this amount over
6 appropriation is not appropriated by the legislature,
7 correct?
8 A. No. Right.
9 Q. Right?
10 A. Right.
11 Q. So who determines that these amounts will be spent
12 for this category, various categories that you've listed
13 totaling 9 million?
14 A. I cannot answer that. I think it should be Laurel,
15 the budget.
16 Q. Laurel?
17 A. With the superintendent's office, yes.
18 Q. So do you know on the category 15903 called
19 school-based technical tech service assistance - Felix, and
20 the reason I'm asking you is because I think that's FRP-3, it
21 has a $2.8 million there, and do you know what that was for?
22 A. I don't think it's FRP-3. I don't know what it's
23 for.
24 Q. So you don't know if that in fact is not the PREL
25 contract?
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1 A. I don't know.
2 CO-CHAIR SENATOR HANABUSA: Thank you. My
3 time is up. Co-Chair Saiki.
4 CO-CHAIR REPRESENTATIVE SAIKI: Thank you.
5 EXAMINATION
6 BY CO-CHAIR REPRESENTATIVE SAIKI:
7 Q. Mr. Ito, I have just a few questions in a couple of
8 areas. First, on the Felix monitoring project, are you
9 generally familiar with how that office was set up?
10 A. No, I'm not.
11 Q. Or the parameters that were funding that office?
12 A. No, I'm not.
13 Q. Do you know whether or not the court basically has
14 ordered the state to fund that office?
15 A. I know we have a memorandum of agreement with them.
16 That's how we were making the payments.
17 Q. I guess the point I wanted to ask about was whether
18 or not the Department of Education has ever rejected or
19 modified an invoice that is submitted by that office for
20 payment?
21 A. That would be before it comes to my office, so I'm
22 not sure, because once it comes to my office, it's being
23 approved by the program manager to be paid.
24 Q. So you have no idea whether or not it's ever been
25 modified?
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1 A. No, I don't.
2 Q. The second area was on encumbrances, and I just
3 wanted to clarify. Is -- are funds ever encumbered before
4 the actual amount is realized by the department? I guess I'm
5 asking whether or not funds are ever encumbered on a
6 hypothetical basis?
7 A. They should not.
8 Q. Do you know if they ever are?
9 A. Not to my knowledge.
10 Q. So there's --
11 A. On a hypothetical basis -- not on a hypothetical
12 basis. They should have some ideas of what the expenditures
13 are for to enter what vendor. We encumber by vendors, so you
14 should know at least who you're going to pay.
15 Q. Is there a policy as far as the time lag between an
16 encumbrance and the point in time when the funds are actually
17 paid to the vendor?
18 A. When -- during the fiscal year or at any time?
19 Q. For example, could you encumber funds today with
20 the intent of paying it in two years?
21 A. No, you shouldn't.
22 Q. But is there a policy to that effect?
23 A. Yeah, because we need to have -- unless it's --
24 unless it's a formal contract with a contract number, funds
25 lapse. So if you don't make any payments in that time, the
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1 money's lapsing.
2 Q. Even if they are encumbered?
3 A. Yes. There's a time limit for lapsing of funds.
4 Q. Okay, thank you.
5 CO-CHAIR REPRESENTATIVE SAIKI: Members, we'll
6 take follow-up questions at this point. First, from special
7 counsel.
8 SPECIAL COUNSEL KAWASHIMA: I have none.
9 CO-CHAIR REPRESENTATIVE SAIKI: Members, any
10 follow-up questions? Vice-Chair Kokubun.
11 VICE-CHAIR SENATOR KOKUBUN: No, I have none.
12 CO-CHAIR REPRESENTATIVE SAIKI: Oh, I'm sorry.
13 Representative Kawakami.
14 EXAMINATION
15 BY REPRESENTATIVE KAWAKAMI:
16 Q. Just one question. Mr. Ito, when is ISPED supposed
17 to be on line?
18 A. It should be on line, to my knowledge. I can't
19 answer that question. I don't know.
20 Q. I'm asking because they are -- I think they have
21 some new positions in Felix and they wanted to make them
22 12-month people and there's some fuss about it, and they are
23 supposed to be doing ISPED this summer to make sure the
24 system is up and running.
25 A. Well, one of the benchmarks was to have ISPED up
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1 and running. I think there were some things that needed to
2 be done by the deadline for the benchmarks, and I think some
3 of the staff was needed to do some of the things. I think it
4 was to enter the IEPs into the system.
5 Q. That would be for every school?
6 A. For every school for every student.
7 Q. So by this summer?
8 A. No. I think it was supposed to be done by -- the
9 benchmark was, I think, now.
10 Q. Thank you.
11 REPRESENTATIVE KAWAKAMI: Thank you.
12 CO-CHAIR REPRESENTATIVE SAIKI: Thank you.
13 Members, any other follow-up questions?
14 CO-CHAIR SENATOR HANABUSA: I have one.
15 CO-CHAIR REPRESENTATIVE SAIKI: Co-Chair
16 Hanabusa.
17 EXAMINATION
18 BY CO-CHAIR SENATOR HANABUSA:
19 Q. Mr. Ito, when Mr. Koyama did his internal audit,
20 were you afforded a copy of that internal audit?
21 A. Yes.
22 Q. Did you review that audit?
23 A. Yes.
24 Q. Mr. Koyama testified that he really didn't have any
25 feedback on it. Did you provide him any feedback on it where
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1 you thought items in here that he identified were incorrect
2 to your knowledge?
3 A. If I recall correctly, he said that he didn't have
4 any feedback from the draft to the final report. So we did
5 respond to the final report to him.
6 Q. But weren't you given a copy of the draft as well?
7 A. Yes, we did.
8 Q. So you did not respond to the draft report?
9 A. I think the response to the draft report is if
10 there's anything that we can tell him that is not correct.
11 Q. Yes.
12 A. Right.
13 Q. So --
14 A. So, I mean, we didn't -- on one point I didn't
15 agree with him, but it's facts, so I can't do anything about
16 it. I can respond to the audit saying I don't agree with you
17 on this particular item and it would be determined by the
18 higher-ups on whether we have to do it or we don't have to do
19 it.
20 Q. That's right. But as far as what he put in here,
21 you believe that it's factually correct? You may not agree
22 with his conclusions where he may say this needs to be
23 improved or that needs to be improved, but in terms of the
24 numbers and everything that was in here you found nothing
25 wrong with it as far as you were concerned?
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1 A. The numbers, no.
2 Q. Thank you.
3 CO-CHAIR REPRESENTATIVE SAIKI: Senator
4 Sakamoto.
5 EXAMINATION
6 BY SENATOR SAKAMOTO:
7 Q. Following up on Senator Hanabusa, I believe
8 Mr. Koyama had 38 or so different points, recommendations.
9 How many of those 38 were in your sphere of responsibilities?
10 A. I don't know the exact number, but quite a few.
11 Q. Would you say most of them would be?
12 A. Between the budget office and us, we look -- we
13 have to look at the reporting side, but there's other things
14 that were in my area, yes.
15 Q. And at this point whether you agree with each
16 individual item, I guess I understood Mr. Koyama to feel that
17 the 38 would be corrected, so to speak; is that your
18 understanding?
19 A. I mean, we've been looking into it, you know, yeah.
20 We still need to meet amongst the different offices to come
21 up with how we're going to address those problems.
22 Q. The past problems as well as future?
23 A. We can, yes.
24 Q. So that's still in progress?
25 A. Yeah. I think like breaking down the program IDs.
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1 I think in one of the recommendations was in FRP 12 there
2 were too many -- I mean only one program ID for lots of
3 programs. I think that can be done, but that can't be done
4 until next year because this year is already three months,
5 four months over already, that we need to do that next year
6 to create more program IDs and to create more areas where we
7 will be concentrating our efforts on.
8 Q. When will be a finality into, okay, we'll do this
9 in July, we'll do this in January, these are already done,
10 when will that be? Is that two weeks from now or --
11 A. I'm not sure what Mr. Koyama's time lines are.
12 Q. Your time line for your sphere of responsibility.
13 A. I think we still need to meet with other offices in
14 the department.
15 SENATOR SAKAMOTO: Thank you.
16 CO-CHAIR REPRESENTATIVE SAIKI: Thank you.
17 Members, any other follow-ups? Representative Marumoto.
18 EXAMINATION
19 BY REPRESENTATIVE MARUMOTO:
20 Q. Just a minor one. The office of human resources in
21 Kapolei, is that part of the Felix EDN 150?
22 A. Human resources?
23 Q. Resource management, office of resource management
24 in Kapolei?
25 A. I'm not familiar with that. You know an
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1 individual? You have a person's name.
2 Q. Well, I just got a report that there were at least
3 three flat screen monitors purchased for that office with
4 extra Felix money, and so I was just wondering if this was a
5 special ed office. I wasn't sure.
6 A. I'm not sure. There is a Leeward district office
7 and other offices in Kapolei. I know that, but I don't know
8 to that particular office if that's there.
9 Q. These are very expensive monitors, and I wish we
10 had monitors like that and higher capacity computers here in
11 the capitol. I don't have one, anyway.
12 A. I can't answer that.
13 Q. Okay. Thank you very much.
14 CO-CHAIR REPRESENTATIVE SAIKI: Senator
15 Sakamoto.
16 SENATOR SAKAMOTO: Sorry, Chair. Thank you.
17 EXAMINATION
18 BY SENATOR SAKAMOTO:
19 Q. I was looking again at the appropriation amount,
20 over appropriation, and I was curious, you know, looking at
21 the EDNs we have them all listed as 100. However, the item
22 pointed out by Senator Hanabusa, school-based tech service
23 assistance, seems to me that's supposed to be 150. The next
24 item says autism services, seems to me that's supposed to be
25 150, and I don't know about all of the rest, but I was
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1 curious why are those 100 versus 150?
2 A. The impact aid monies are primarily budgeted under
3 EDN 100.
4 Q. I'm not asking that. The question I'm asking is
5 when you went over the appropriations, those two items in
6 specific seems to me globally to be 150 items as opposed to
7 100 items. So I'm wondering why they're not listed as 150,
8 or is this an error on this particular spread sheet?
9 A. I don't think there's an error. I think that's the
10 way it was coded and we would -- we would report where the
11 expenditures are.
12 Q. Then in the report that you gave us delineating
13 Felix expenses, so these expenses are not only 150, these
14 include 100 as well?
15 A. Yes -- not 100, but --
16 Q. I guess, then, it calls into question if we're
17 sending some to 100, which would include tech services, then
18 it would be confusing to me to determine if in deed the lists
19 you gave us are comprehensive in all that should go to Felix
20 and special ed and CSSS?
21 A. I'm sorry, it is including 100. The 110 would be
22 100.
23 Q. So maybe these two should have been 150 or not?
24 A. I think we expend the money where we would have
25 approval to expend the money, and this approval I think
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1 was -- the excess impact aid funds was approved to be
2 expended in EDN 100 as a lump sum, okay, so we would be
3 requesting to the governor to expend -- and again, maybe
4 Laurel can answer this better than I do, but the basic
5 request to get the use of the additional funds to the
6 governor would determine where the funds are spent. Now,
7 after the approval is made, how it's spent, it may be by
8 appropriation.
9 Q. I guess my frustration is I thought you're the bean
10 counter and you put the beans in the right boxes, but if
11 you're saying now it's not your job to make sure the beans'
12 in the right boxes, then it calls into question what are you
13 doing, because you're saying you're not responsible for how
14 well the product is going, but I thought you were responsible
15 for putting the beans or the peanuts in the right boxes?
16 A. But like I said, the approval to expend these funds
17 is going through the budget office to the governor in the
18 area of what EDN it's going to be spent on.
19 Q. But your job is to make sure they go in the right
20 boxes irrespective of what someone else thinks. That's your
21 job. Well, thank you.
22 CO-CHAIR REPRESENTATIVE SAIKI: Thank you.
23 Co-Chair Hanabusa.
24 EXAMINATION
25 BY CO-CHAIR SENATOR HANABUSA:
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1 Q. Mr. Ito, what I think Senator Sakamoto is
2 passionately saying to you, let me put it to you a different
3 way, if these were in fact EDN 150 expenditures, is it your
4 position that the excess funds under the federal impact
5 aid -- that the DOE is only authorized to expended it under
6 EDN 100; is that what you're saying?
7 A. I don't know if that's what I'm saying. I think
8 that's where we got approval to spend.
9 Q. So in other words, when you go to the governor, are
10 you saying to expend the excess federal impact aid money,
11 you've got to go to the governor and the governor gave you
12 authority to expend it in EDN 100; is that what you're
13 saying?
14 A. That's my --
15 Q. So in order for the DOE -- irrespective of whether
16 the superintendent is exercising super powers or not, in
17 order for you to then use these monies, you would have to
18 identify them as EDN 100 because the governor did not give
19 you approval to expend these funds as EDN 150?
20 A. Right.
21 Q. That's what you are saying?
22 A. (Witness nods.)
23 Q. So because you don't know what the $2.8 million is,
24 and we suspect from testimony we received is the PREL
25 contract for the technical assistance -- or targeted
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1 technical assistance coordinators, which are clearly part of
2 the FRP and part of the benchmark, which makes it 150, since
3 you don't know that, you can't say, but if in fact it was, it
4 should have been 150 designation, correct?
5 A. Yes.
6 Q. And that you did not have authority for, according
7 to the governor's release of those federal impact monies, for
8 you to expend; that's correct, right?
9 A. That's how it was allocated -- appropriated and
10 allocated and expended, yes.
11 Q. But you folks don't have the right to change EDN
12 150 and 100 whenever you want to, right? As an accountant,
13 you want to be sure that your categorization of the
14 expenditure is correct, right?
15 A. Right.
16 Q. And you represented to the governor this is going
17 to be EDN 100 monies, correct?
18 A. Right.
19 Q. So, again, we would like to ask you to tell us what
20 that money was spent for, and if it was in fact an EDN 150
21 category versus an EDN 100 category, I guess we can let the
22 governor know that you expended monies outside what he
23 authorized.
24 CO-CHAIR SENATOR HANABUSA: I have nothing
25 further.
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1 CO-CHAIR REPRESENTATIVE SAIKI: Thank you.
2 Members, any follow-up questions?
3 REPRESENTATIVE ITO: Just one more.
4 CO-CHAIR REPRESENTATIVE SAIKI: Representative
5 Marumoto, followed by Representative Ito.
6 REPRESENTATIVE MARUMOTO: Just a comment. I'm
7 sorry if I sounded flippant about wanting a flat monitor. I
8 just -- I think I -- this committee would like the money well
9 spent and spent for direct services for the children who are
10 in need, and I didn't want to be misunderstood.
11 CO-CHAIR REPRESENTATIVE SAIKI: That's okay.
12 I think Co-Chair Hanabusa has one of those monitors in her
13 office.
14 CO-CHAIR SENATOR HANABUSA: Yeah, right.
15 CO-CHAIR REPRESENTATIVE SAIKI: Representative
16 Ito.
17 REPRESENTATIVE ITO: Thank you, Co-Chair
18 Saiki.
19 EXAMINATION
20 BY REPRESENTATIVE ITO:
21 Q. Mr. Ito, you know when you mentioned the governor's
22 office, is that budget and finance?
23 A. The request goes through budget and finance, yes.
24 Q. So the budget and finance people give
25 recommendations to the governor?
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1 A. Right.
2 Q. So it's budget and finance?
3 A. Yes.
4 Q. Thank you.
5 CO-CHAIR REPRESENTATIVE SAIKI: Thank you.
6 Members, any follow-up questions?
7 If not, Mr. Ito, thank you.
8 THE WITNESS: What was the last request? You
9 wanted to -- on the 2 million -- on these two program IDs you
10 wanted -- what did you want?
11 CO-CHAIR SENATOR HANABUSA: I would like for
12 you, since you're going to do it anyway, on the excess --
13 well, what's called the category -- you identify it as amount
14 over appropriation, and then that's kind of a misnomer
15 because I understand that to mean that we didn't appropriate
16 that. That's the excess federal impact aid monies that you
17 were given discretionary use over. So what we would like to
18 ensure, this is following up with what Senator Sakamoto is
19 saying, is you've identified them as EDN 150. I'm
20 particularly interested in the school-based technical service
21 assistance - Felix, and the autism services is the other one
22 that Senator Sakamoto pointed out. We would like for you to
23 go back and see what those funds were actually expended for
24 and if in fact they should have been EDN 150. We understand
25 your predicament that the governor only permitted the
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1 appropriation for EDN 100 monies, but we want to know if in
2 fact they should have been EDN 150 monies. Okay?
3 THE WITNESS: Okay.
4 CO-CHAIR REPRESENTATIVE SAIKI: Mr. Ito, could
5 you also add the reading improvement projects to that list?
6 I believe there's a reading project connected to Felix.
7 THE WITNESS: 15902?
8 CO-CHAIR REPRESENTATIVE SAIKI: Yes.
9 THE WITNESS: So 15902, 03, and 04, you would
10 like to have -- to see if it should be coded as EDN 150?
11 CO-CHAIR SENATOR HANABUSA: Exactly. Thank
12 you very much.
13 CO-CHAIR REPRESENTATIVE SAIKI: Thank you.
14 And, Mr. Ito, thank you for your testimony today.
15 CO-CHAIR SENATOR HANABUSA: Thank you very
16 much, Mr. Ito.
17 Members, we're going to take a quick five-minute
18 recess to give the court reporter some time, but we would
19 like you to return immediately so we can begin with
20 Ms. Ako. Thank you very much.
21 (Recess taken.)
22 CO-CHAIR REPRESENTATIVE SAIKI: Members, we'd
23 like to reconvene our hearing. At this time we'd like to
24 call our second witness, Ms. Valerie Ako. We'll administer
25 the oath at this time.
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1 CO-CHAIR SENATOR HANABUSA: Ms. Ako, thank you
2 for coming. Do you solemnly swear or affirm that the
3 testimony you're about to give will be the truth, the whole
4 truth, and nothing but the truth?
5 MS. AKO: I do.
6 CO-CHAIR SENATOR HANABUSA: Thank you,
7 Ms. Ako.
8 Members, we'll follow our usual process, beginning
9 with Mr. Kawashima.
10 SPECIAL COUNSEL KAWASHIMA: Thank you, Madam
11 Chair.
12 EXAMINATION
13 BY SPECIAL COUNSEL KAWASHIMA:
14 Q. Will you please state your name and business
15 address.
16 A. Valerie K. Ako, 1250 Punchbowl Street.
17 Q. And that is the offices of Department of Health for
18 the state of Hawaii?
19 A. Correct.
20 Q. Ms. Ako, will you tell us what your position is at
21 the Department of Health?
22 A. I am officially the business management officer
23 which is the head of the Administrative Services Office of
24 the Department of Health.
25 Q. So you're the chief of the Department of Health
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1 administrative services, correct?
2 A. Correct.
3 Q. And how long have you held that position, ma'am?
4 A. Oh, Gosh. Since 1984.
5 Q. Now, if you might just briefly, ma'am, give us your
6 educational -- formal educational history.
7 A. I graduated high school at Kailua and I got my BBA
8 and master's from the University of Hawaii.
9 Q. And in what years did you obtain those two degrees,
10 the BBA and the master's from the UH?
11 A. '71 and '73.
12 Q. The master's was in what?
13 A. It's a master's -- it's just a general --
14 Q. General --
15 A. Yeah, more like operations research.
16 Q. Am I to understand you started your professional
17 employment in 1973?
18 A. Yes, at -- this was on Kauai.
19 Q. I'm sorry?
20 A. On Kauai.
21 Q. I see. With whom?
22 A. With the County of Kauai Economic Development
23 Office.
24 Q. As -- what was your position there, ma'am?
25 A. I was a CO worker. It was just a researcher.
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1 Q. And how long did you serve in that position?
2 A. Let's see. I take that back.
3 Q. Okay.
4 A. It was from '75 to '77 that I was there.
5 Q. All right.
6 A. From '73 to '75 I was with the Hawaii Housing
7 Authority. They had a housing management improvement
8 program.
9 Q. And then if we might jump forward to 1977, where
10 did you go from the county of Kauai in 1977?
11 A. I went for about two months at DPD.
12 Q. DPD?
13 A. Yes.
14 Q. Right.
15 A. That's what it was called at the time, and then the
16 Department of Health, the Administrative Services Office in
17 September of '77 as a program evaluation analyst for the
18 budget office.
19 Q. Then did you move, then, from an ASO to the chief
20 of the Department of Health administrative services in 1984?
21 A. Yes. I was in budget from '77 to '81. I was a PA
22 from '81 to '84. I was the budget officer for the
23 department, and then from '84 to about eighty -- I don't
24 know, 1990 or so, I was sort of in a limited term appointment
25 because the former administrative services officer had
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1 returned rights to his job, and thereafter I became the
2 permanent one.
3 Q. I see. But still, since 1984, you were the chief
4 of the Department of Health administrative services?
5 A. Office, yes.
6 Q. Office. Would you then be responsible for
7 preparing the budget for the Department of Health?
8 A. Yes.
9 Q. And perhaps you can describe for us, Ms. Ako, who
10 has what responsibilities for the budget preparation, the
11 budget execution, and accountability afterwards?
12 A. Okay. Basically what happens is we receive the
13 instructions from the Department of Budget and Finance. We
14 issue those instructions under the director's signature. We
15 give guidelines -- policy guidelines to the various divisions
16 and offices in our department and they -- and we -- you know,
17 afterwards we review their budgets when they submit it, then
18 we basically send it over to budget and finance for their
19 review.
20 Q. When you say you receive instructions from the
21 budget and finance, what do you mean there?
22 A. It's a document which is I think usually signed off
23 by the governor with basic parameters as to what's to be
24 included in the budget, what qualifies, what doesn't.
25 Q. Amounts?
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1 A. Not necessarily. It's -- sometimes they give us,
2 you know, a ceiling, sometimes -- lately they haven't.
3 They've just basically given us parameters under which we can
4 request --
5 Q. I see, and these parameters are not necessarily
6 financial parameters?
7 A. They usually are because they talk about the
8 economy and how we have to be responsible and things like
9 that.
10 Q. So if you know, ma'am, does the B&F people -- do
11 they actually put together something based on historical
12 data, or maybe looking into the future even, but do they
13 actually put together what would be a very, very preliminary
14 budget for you folks?
15 A. I'm not sure. I think they look in terms of a
16 financial plan. You know, they look at the economy, they
17 review with the counsel on revenues, and then basically I
18 think that's what they formalize their instructions on.
19 Q. So the instructions come to you, and then under the
20 director's signature goes out, requests to the various
21 sections or divisions?
22 A. Offices.
23 Q. Offices, and then they come back to you with
24 proposals?
25 A. Correct, and it's usually reviewed by their
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1 respective deputies. Then what our office does is it reviews
2 it in light of the budget instructions, and then we make
3 recommendations to the director and then after the director's
4 office review and discussion with us and the program
5 sometimes, sometimes there's not enough time, we submit it to
6 the -- to budget and finance.
7 Q. Under the director's signature, of course?
8 A. Yes.
9 Q. So you are in charge, then, of handling your
10 office's part of that process?
11 A. Yes.
12 Q. I assume there are situations where whatever you in
13 the -- towards the end of that process present to B&F, that
14 they don't approve it?
15 A. Correct.
16 Q. What happens when that happens?
17 A. There's usually some time where we can rebut, and
18 we may rebut singly with them, the budget and finance group,
19 or it may be jointly with the governor, and then they -- the
20 governor makes a decision, I guess in conjunction with budget
21 and finance, and then it's then presented to the legislature.
22 Q. Is it your understanding that you -- say you come
23 up with an amount that's gone through that entire process as
24 you've just described and the amount that ultimately budget
25 and finance approves is not the amount the department had
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1 sought, in other words, it's less, can the department then go
2 into the legislature and seek appropriations in the amount
3 that they want as opposed to what B&F approved?
4 A. In the past it was frowned upon. It depended, you
5 know, I guess on the administration. Lately it's almost been
6 a free-for-all.
7 Q. Lately meaning how many past -- how recent past?
8 How many years?
9 A. I don't know. It just varies, I think, too, with
10 the director that we may have.
11 Q. So at least for the past at least few, if not
12 several, years you've been in that essentially free-for-all?
13 A. Well, I wouldn't say free -- it's just been that if
14 the programs feel that, you know, they need, you know, the
15 money, they try and go to their legislators.
16 Q. Now, in your position, ma'am, as chief of the
17 Department of Health Administrative Services Office for the
18 Department of Health, is it part of your office's
19 responsibility to review contracts that have been entered
20 into by the Department of Health?
21 A. We don't really review the contracts. What
22 we've -- what we do is we coordinate with the attorney
23 general, and for the most part the contracts come through our
24 office and we just review them for form and look to see
25 whether the scope of services is reasonable and things like
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1 that. We only have one person who reviews -- who does this.
2 Q. Is that a normal part of the process, though,
3 contracts that are entered into by the department that, first
4 of all, the attorney generally reviews and approves as to
5 form? Is that your understanding?
6 A. Well, they have a set format, the attorney --
7 Q. Sure.
8 A. And so we send out that set format to the programs
9 in our department and they put together -- they go through
10 the process of obtaining approvals, whether it be through the
11 103 D or 103 F process, and then they come to us, you know,
12 for the review of the contracts and then we submit that to
13 the attorney general.
14 Q. I see. The attorney general comes in the sequence
15 of things after you folks make your review?
16 A. Uh-huh.
17 Q. Yes?
18 A. Yeah, and at certain times we send them sort of
19 like boilerplate contracts, because there's some where it's
20 similar to the previous years, so we send it to them first
21 and then they come back and they have --
22 Q. With the contract filled in?
23 A. Yeah, and we kind of look to see that all the forms
24 that are needed to go with the contracts are there.
25 Q. I noticed that I've seen some contracts where the
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1 attorney general -- deputy actually signs off approving as to
2 form. You've seen that, have you not?
3 A. Uh-huh.
4 Q. That's part of the standard process, is it not?
5 A. Right.
6 Q. Is there a place where your department signs off on
7 the contract or somehow designates that they've reviewed
8 it -- that you've reviewed it?
9 A. Our office?
10 Q. Yes.
11 A. No. We just do it on the route slip.
12 Q. Now -- but you said you reviewed these contracts
13 for one scope?
14 A. Well, we review it in terms of if the scope is
15 reasonable. We rely mostly on the program to know what it is
16 that they want.
17 Q. All right. But do you review anything else other
18 than whether or not the scope is reasonable? How about the
19 amount?
20 A. Like if they -- if they need governor's approval
21 for consultant services or if they had to go out with an RFP
22 or whatever it is, you know, we review it to see that they've
23 done all that. You know, if it's like an exempt sole source
24 kind of contract, we make sure that they get all the proper
25 approvals and things like that.
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1 Q. So actually your review -- your office's review is
2 more for procedural purposes, is it not?
3 A. Right.
4 Q. Not necessarily for substance of the contract?
5 A. Correct.
6 Q. But can you give me an example of what you mean
7 when say you review the scope to see whether it's reasonable?
8 A. Well, in some cases, I guess because our reviewer
9 has looked at a lot of contracts, you know, when it doesn't
10 seem like it's understandable, you know, then she'll just ask
11 questions, and that's all I mean.
12 Q. Have you had situations where this reviewer has
13 expressed concern about the scope of a contract after having
14 made the appropriate number of inquiries that can be made and
15 still have a concern about the scope, situations like that?
16 A. Yes.
17 Q. What do you do in those cases?
18 A. We return it to the program and ask the questions
19 and then it's up to the program to respond to that. Then if
20 they insist that, you know, there is, you know -- that it's
21 okay, then we'll, you know, submit it with our comments to
22 the attorney general.
23 Q. I see. So the attorney general would know you have
24 a concern about a particular part of that contract; is that
25 correct?
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1 A. Uh-huh.
2 Q. Yes?
3 A. Uh-huh.
4 Q. You have to say yes.
5 A. Yes, yes. I'm sorry. I'm a floor person, too, and
6 I'm supposed to know this. Sorry.
7 Q. Right now?
8 A. Yes, Grand Jury.
9 Q. Do you have a role, Ms. Ako, in reviewing CAMHD
10 contracts?
11 A. Well, we do not do the contracts anymore because
12 our office has only one person and they have five assigned to
13 this and one head, so we ask the attorney general if they
14 could just, you know, work with CAMHD --
15 Q. Directly?
16 A. -- directly, and they've said -- after training
17 with CAMHD, they took it on from July 1st of this year.
18 Q. What since July 1st of this year, what happened?
19 A. Where CAMHD works directly with the attorney
20 general on the contracts.
21 Q. Only since July 1st of this year?
22 A. Right.
23 Q. Up to July 1st of this year, then --
24 A. We did the same thing that we normally do.
25 Q. For everybody else?
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1 A. Right.
2 Q. So the fact that there was a Felix consent decree
3 in place in 1994 or so didn't change your office's functions,
4 at least up to July 1st of this year?
5 A. Correct.
6 Q. Do you know why as of July 1st of this year the
7 policy changed?
8 A. Oh, no, we asked for that, because a lot of times
9 they would come in and would rush, and, you know, since we
10 only have one person doing this, it was felt that -- and
11 since they have, you know, so many others, that we asked the
12 attorney general to see if they would be amenable to this.
13 Q. I see. So from your standpoint, it has nothing to
14 do with the consent decree?
15 A. No.
16 Q. And you mentioned you had five assigned to this and
17 one head --
18 A. They do. They in child and adolescent has five
19 program specialists.
20 Q. Assigned to do what your office would do, at least
21 that part of it?
22 A. I believe they actually help put the contracts
23 together.
24 Q. Okay. Where was this service performed before
25 CAMHD had these people in place?
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1 A. They used whatever program staff that they had.
2 Q. I see, and then those programs passed it on to your
3 office?
4 A. Uh-huh.
5 Q. And you would do it, but just because of the --
6 A. Volume.
7 Q. -- the volume of contracts --
8 A. And the urgency that they said that they wanted the
9 contracts to go through, we thought it would be best that --
10 if the attorney general agreed to work with them, then.
11 Q. But in your mind, there was somebody performing the
12 review you folks performed, it wasn't just done away with?
13 A. No.
14 Q. Somebody else was doing it from a different place?
15 A. Right.
16 SPECIAL COUNSEL KAWASHIMA: Thank you.
17 CO-CHAIR REPRESENTATIVE SAIKI: Members, we'd
18 like to take a break at this point. We will -- we would like
19 to make a motion to move into executive session for 30
20 minutes to discuss the documents that were produced this
21 morning, to discuss the testimony of witnesses scheduled for
22 future hearings, and to receive an overview of the
23 investigation. So we will convene in room 329, and we will
24 reconvene this public hearing at 12:35 in this room. Is
25 there any discussion? If not, we'll take roll call vote.
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1 CO-CHAIR SENATOR HANABUSA: Co-Chair Saiki?
2 CO-CHAIR REPRESENTATIVE SAIKI: Yes.
3 CO-CHAIR SENATOR HANABUSA: Vice-Chair
4 Kokubun?
5 VICE-CHAIR SENATOR KOKUBUN: Aye.
6 CO-CHAIR SENATOR HANABUSA: Vice-Chair Oshiro?
7 VICE-CHAIR REPRESENTATIVE OSHIRO: Aye.
8 CO-CHAIR SENATOR HANABUSA: Senator Buen?
9 SENATOR BUEN: Aye.
10 CO-CHAIR SENATOR HANABUSA: Representative
11 Ito?
12 REPRESENTATIVE ITO: Aye.
13 CO-CHAIR SENATOR HANABUSA: Representative
14 Kawakami?
15 REPRESENTATIVE KAWAKAMI: Aye.
16 CO-CHAIR SENATOR HANABUSA: Representative
17 Leong?
18 REPRESENTATIVE LEONG: Aye.
19 CO-CHAIR SENATOR HANABUSA: Representative
20 Marumoto?
21 REPRESENTATIVE MARUMOTO: Aye.
22 CO-CHAIR SENATOR HANABUSA: Senator Sakamoto?
23 SENATOR SAKAMOTO: Aye.
24 CO-CHAIR SENATOR HANABUSA: Senator Slom?
25 SENATOR SLOM: Aye.
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1 CO-CHAIR SENATOR HANABUSA: The motion is
2 carried.
3 CO-CHAIR REPRESENTATIVE SAIKI: Thank you.
4 Members, we'll continue with Ms. Ako's testimony when we
5 return. Thank you. Recess.
6 (Recess taken.)
7 CO-CHAIR SENATOR HANABUSA: Members, we're
8 resuming the hearing. Mr. Kawashima.
9 SPECIAL COUNSEL KAWASHIMA: Thank you, Madam
10 Chair.
11 Q. Ms. Ako, where we left off, let me ask this
12 question, does your office's responsibilities include
13 reviewing or monitoring expenditures of all divisions of the
14 Department of Health?
15 A. Yes.
16 Q. And up to July of this year, part of that would
17 have been reviewing and monitoring expenditures of CAMHD?
18 A. Yes.
19 Q. To your knowledge -- well, let me ask you, have you
20 heard the term or phrase super powers mentioned?
21 A. Yes.
22 Q. To your knowledge, did the implementation of the
23 super powers as ordered by Judge Ezra, that had nothing to do
24 with the change on July 1, did it?
25 A. No.
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1 Q. So up to July 1, up to that point in time, the
2 CAMHD contracts with private providers, those contracts, were
3 they set up with, for example, overall ceilings for each year
4 for how much a provider could charge?
5 A. I believe they -- they may -- they were on a per
6 unit cost a lot of them.
7 Q. What does that mean?
8 A. Basically for a type of service they were given a
9 certain amount based upon, I guess, what they submitted as
10 what they did.
11 Q. Give me an example, Ms. Ako, if you can.
12 A. Well, I --
13 Q. Just to the best of your ability, very roughly.
14 A. I guess like if they were contracted for day
15 treatment and they were contracted for a slot, say, and the
16 IEP recommended that a certain person go to a provider to
17 have day treatment services, then they would get that certain
18 per unit cost amount per day once they submitted their
19 billing to the child and adolescent mental health division.
20 Q. But that unit, though, I'm not sure what that unit
21 comprises or consists of?
22 A. That would be part of the contract.
23 Q. I understand.
24 A. It would be explained in the contract.
25 Q. I see.
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1 A. What was included in that.
2 Q. What about say, for example, use of a therapeutic
3 aide, would that be included within this type of thing we're
4 talking about?
5 A. It may be. I'm not sure.
6 Q. I see. Now, would the per unit cost, though, might
7 that vary from provider to provider?
8 A. Yes.
9 Q. So --
10 A. Because it's a different unit. I mean, there's
11 different kinds of services that are being performed, so the
12 unit cost would be different for each kind of service.
13 Q. I would understand that, but I'm sure there's some
14 services that are generally generic?
15 A. I believe if the service was, you know, the same, I
16 believe that the per unit cost was --
17 Q. Had to be the same?
18 A. Yes.
19 Q. I see. So there was in a sense -- for one type of
20 service, one item, there would be a limit -- a DOH limit that
21 they would pay for that service?
22 A. Yes. It's basically negotiated by the Child and
23 Adolescent Mental Health Division, and I believe when they
24 sent out their RFPs they would have indicated what --
25 Q. What that rate was?
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1 A. Yes.
2 Q. I see what you're saying. What you're also saying,
3 though, I think, is depending on what service is provided,
4 they may not -- there may be not only differences in rates,
5 but differences in total amounts that is charged because of
6 different types of services?
7 A. Correct.
8 Q. Have you seen, for example, some of the statements
9 that Loveland Academy has submitted to the department?
10 A. No, I don't personally that.
11 Q. Not even before?
12 A. No.
13 Q. Why not?
14 A. Basically child and adolescent does most of the --
15 their billing. I mean, they receive the invoices, they
16 process them, and then process it for payment.
17 Q. And you -- in other words, it bypasses you?
18 A. No, it doesn't come up to us.
19 Q. Oh, I see. But --
20 A. We just generally look overall for the programs.
21 We don't do individual monitoring of each contract.
22 Q. I see.
23 A. And then --
24 Q. Your function is budget, then, essentially?
25 A. We do a pre-audit, and so if it basically matches
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1 the contract, then we process the payment.
2 Q. Matches, though, are you talking about probably the
3 contract price, huh, amount, huh?
4 A. Right, but a lot of their contracts don't have a
5 ceiling because it's based on a unit cost.
6 Q. But the contract doesn't have a ceiling?
7 A. Correct.
8 Q. But a service that's provided may have a ceiling,
9 though?
10 A. It's a by unit cost, so if, say, we contract for --
11 we just do it -- well, I think child and adolescent does it
12 by unit cost, so they may put on the purchase order a
13 ceiling, you know. Say it's per hundred dollars per day per
14 client, and they estimate maybe about 300 days, then, you
15 know, they put a ceiling on that contract, but then it can
16 change because they don't put a ceiling -- I'm sorry, not on
17 the contract, they put a ceiling on the purchase order, and
18 then if it changes, and, you know, they still have to -- if
19 they are still referring the client to that contractor, then
20 it gets paid.
21 Q. Even though if it's over that ceiling amount? Even
22 though ultimately --
23 A. Well, then they would have to issue another
24 purchase order.
25 Q. I see. No, because we've seen some statements from
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1 Loveland for one child, for example, a student, multiple
2 things that they claim that they treated the child on a
3 certain day, and question is, well, are those items such that
4 there are limits as to how much can be paid for those types
5 of treatment, those items of treatment?
6 A. Right now the child and adolescent -- and I don't
7 know what they call themselves, but they have a receiving
8 group that reviews the -- I guess they request diskettes from
9 each of the contractors as far as what it is that they've
10 done and then they do the review and then my understanding is
11 if it matches the contract and -- you know, then they process
12 the invoice for payment.
13 Q. And you have nothing to do with that?
14 A. We don't.
15 Q. And the way you learned of this, as you've
16 testified just now, the things you've testified about just
17 now, was from asking the CAMHD people how they do their
18 thing?
19 A. Right. They've shown us basically what they've
20 done.
21 Q. I see. That's what your knowledge is based on?
22 A. Uh-huh.
23 Q. So to your knowledge, do they actually review what
24 has been actually paid to each private provider?
25 A. That's my understanding, yes.
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1 Q. So am I to understand also, then, you receive no
2 reports from CAMHD as to what they spend money on, things of
3 that nature?
4 A. Well, we generate reports through the FAMA system,
5 and it's by object codes.
6 Q. How do you get that data?
7 A. It's -- when they input the information, it's --
8 and it's just general, broad -- like for contracts it may be
9 like for 79 -- the object code would be 7190 and it's like
10 for other services.
11 Q. I see.
12 A. Mostly those are through contracts for contract POS
13 type providers.
14 Q. So what you're saying is there are these broad
15 categories that - --
16 A. Very broad and so we rely on the information from
17 them.
18 Q. But the information you get, then, do you then
19 create a report?
20 A. No. It's created in the system monthly.
21 Q. I see.
22 A. And it comes out about 20 days after the close.
23 Q. What, then, would be within that system in terms of
24 items that are reported on, just how many contracts are out,
25 how much a contract is for?
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1 A. Not even how much a -- not even that.
2 Q. Give me some categories, if you can. What kind of
3 categories?
4 A. Electricity, water, supplies, very general
5 categories, rent, rental of land and building.
6 Q. I'm talking about these contracts with the private
7 providers, you know. The question I'm asking you is what
8 kind of reports might you get from CAMHD as to what they are
9 doing in items of contracts?
10 A. We don't --
11 Q. You don't get that?
12 A. No.
13 Q. How about audited financial statements, for
14 example, from entities that the department contracts with, is
15 there any requirement that such statements be submitted to
16 the department, for anything now, not just CAMHD?
17 A. Especially for federal -- federal monies that flow
18 through the department, for those contracts that we have
19 above $300,000, we require an audited financial statement.
20 For those under, it's a matter of the departmental staff --
21 actually, the program staff having to monitor, go through
22 monitoring -- a monitoring checklist.
23 Q. That is part of the checklist, for those items over
24 $300,000 or federal money --
25 A. Yeah, if we have a contract over $300,000, it's a
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1 requirement that it has an independent audit done. Under,
2 it's just a matter of the departmental staff -- each program
3 staff going out to monitor the contract.
4 Q. Do you -- do you know or do you understand that if
5 CAMHD let's a contract out in excess of $300,000 that they
6 have the same requirement?
7 A. I do not believe so.
8 Q. Why not?
9 A. Only if it's federal are we required to have an
10 independent.
11 Q. Why does CAMHD not have to -- like all other
12 segments of the department, have to have audited financial --
13 A. No, no. It's only for federal dollars above --
14 Q. I'm sorry. Wait, wait. Federal contracts in
15 excess of $300,000?
16 A. Right.
17 Q. So if it's a state contract --
18 A. It's not a requirement in our boilerplate.
19 Q. But do you ask for it in certain situations, do
20 you --
21 A. Not --
22 Q. -- request that?
23 A. Not normally. We ask that the programs do fiscal
24 monitoring, some kind of fiscal monitoring.
25 Q. Now, federal funds, though, does the department or
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1 any branch thereof have any management controls in place to
2 ensure that these federal funds are appropriately spent?
3 A. Yes, it's our --
4 Q. Yours?
5 A. It's our ultimate responsibility.
6 Q. Yours meaning your branch?
7 A. Our office, yes.
8 Q. Same with state funds, then, other than CAMHD, I
9 guess?
10 A. We rely primarily on the individual programs.
11 Q. I see. So actually, you don't really supervise it,
12 do you? You don't -- they are not accountable to you
13 necessarily, except for some very broad parameters?
14 A. Right.
15 Q. Now, we understand that some of the Felix students
16 are being transitioned from the DOH to DOE as we speak here,
17 so from clinical-based to school-based services, right? Is
18 that your understanding, students have been transferred from
19 the care of the Department of Health to the Department of
20 Education? Are you aware of that?
21 A. You're talking about the, what do they call it, low
22 end?
23 Q. Yeah, lower end Felix students, right.
24 A. I think they have already all been transferred.
25 Q. Okay. Now, what effect, if any, has this had on
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1 the DOH's budget?
2 A. The last session we did transfer some monies over
3 to the DOE.
4 Q. How much?
5 A. Geez, I think -- I believe it was in the
6 neighborhood of 19 to 20 million for that.
7 Q. Were you part of the process in determining how
8 much ought to be transferred?
9 A. Part of the process.
10 Q. And how was that determined, how much was to be
11 transferred?
12 A. Well, basically the child and adolescent mental
13 health division basically indicated --
14 Q. That's how much it was?
15 A. Yeah, based on what they -- how they kept their
16 information.
17 Q. And you --
18 A. Because our -- because our categories are so broad
19 in the FAMA accounting records.
20 Q. Do you know if DOE was conferred with on that
21 amount of 19 to $20 million, in coming up with it?
22 A. I don't know.
23 Q. Am I to understand, then, because of these students
24 being transferred, that the expenditures from DOE are less?
25 A. For that category, hopefully.
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1 Q. Well, you haven't seen that occur yet?
2 A. Only because it's -- like I said, it's not kept
3 according to those kinds of categories.
4 Q. Maybe, so what you're saying is while the last
5 fiscal year ended, right?
6 A. Uh-huh.
7 Q. What you are waiting for, the next point where you
8 might look at expenditures to see if you have impact overall
9 decrease, the next fiscal year maybe or quarters or what?
10 A. It's really hard to put a --
11 Q. Based on what you know of the process, Ms. Ako, as
12 far as expenditures, as far as personnel in the Department of
13 Health are concerned, as far as case loads in the department,
14 all of those should decrease because a certain number of
15 lower end Felix students were transitioned from the DOH to
16 the DOE?
17 A. That was our assumption.
18 Q. Do you know if it will become reality?
19 A. I believe they're working on it. Let me say this,
20 it was -- when we developed the requests for care
21 coordinators, there was a work load ratio for each type of
22 student, and I guess during the legislative -- this past
23 legislative session the question was asked if, in fact, we
24 are transferring the low end kids to the DOE, why is not a --
25 you know, the number of care coordinator positions decreased,
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1 and I think that was one of the reasons that the legislature
2 cut a certain amount of positions because at that point in
3 time the division did not answer the question.
4 Q. Were you part of that process of responding to the
5 question?
6 A. Well, we try to coordinate the responses with
7 the -- with division, CAMHD.
8 Q. And do you agree with the legislature that the --
9 their inquiries were not adequately responded to?
10 A. At that point in time, yes.
11 Q. Would you say maybe now they would be able to, the
12 department?
13 A. We had a meeting after the legislature made their
14 decisions after conference -- the conference was done with
15 and the legislature was done with, and the division itself
16 said that they needed the 33 positions.
17 Q. They needed what?
18 A. They needed the 33 positions, and so we had a
19 meeting with the budget and finance to see what could be
20 done.
21 Q. And what as done?
22 A. Pardon?
23 Q. What came of it?
24 A. Basically they kind -- they -- budget and finance
25 said, well, let's try and get this information over to the
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1 legislature, that you need these positions, and I don't know
2 that we ever fully got back to the legislature on this
3 information.
4 Q. So that, am I to understand, then, the legislature
5 did not reconsider -- was not able to reconsider that issue?
6 A. No.
7 Q. Am I correct?
8 A. Yes, yes.
9 Q. Was that -- was that amount or that matter that you
10 just spoke of, I understand at the end of that -- this year's
11 legislative session the department -- your department
12 informed the legislative money committees, finance and ways
13 and means, that the department intended to spend the monies
14 that were denied by the legislature, denied to be
15 appropriated by the legislature. Do you recall that matter?
16 A. Yes.
17 Q. Were these monies in fact spent?
18 A. Well, this is beginning this fiscal year, some of
19 the 33 positions have been abolished, well, the civil service
20 ones, and each of the civil service positions, though, also
21 have what we call a replacement exempt position. Those have
22 not all been abolished.
23 Q. But to your understanding, Ms. Ako, because the
24 legislature appropriated a certain amount to the
25 department --
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1 A. Uh-huh, yes.
2 Q. -- did the department, as it threatened, spend the
3 money anyway that was not appropriated?
4 A. They did.
5 Q. How much of that?
6 A. I can't say. I can't tell you off the top of my
7 head. I mean, they are continuing to expend some of the
8 dollars that were deleted for the 33 positions.
9 Q. Do you know where they got the money from to do
10 that?
11 A. No. I believe they're anticipating some of it
12 being gotten through some future emergency appropriation.
13 Q. And you don't know how much that is right now?
14 A. No.
15 Q. And let me ask you, you just used the term
16 emergency appropriations, and I've heard the term forward
17 funding used, deficit spending used, what term does your
18 department use?
19 A. Well, what we have done in the past, because
20 they've wanted emergency appropriations -- in fact, last year
21 was probably the worst year. What we've done is we've taken
22 some monies from fourth quarter and moved it to the first or
23 second quarter, in the quarter which they need it, and
24 then -- or borrow from other programs.
25 Q. But the -- is it your understanding, though, when
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1 the Department of Health goes to the legislature, as it did
2 this year, and seeks emergency appropriations, that it is --
3 the department is seeking, in a sense, reimbursement for cost
4 items that have already been spent?
5 A. Sometimes, yes.
6 Q. Well, in times where the --
7 A. I mean part of it is already spent, yeah.
8 Q. And, what, the rest of it is already committed or
9 encumbered or something?
10 A. No. If you continue -- like, say, if you continue
11 to expend for the 33 positions, if you don't cut them off,
12 you know, you will continue to incur those costs.
13 Q. It will catch up with you at some point during the
14 year, right?
15 A. Yes.
16 Q. Because you're spending the fourth quarter's money
17 in the first quarter?
18 A. Or whatever quarter, yeah.
19 Q. Okay. But your understanding is, though, that when
20 your department seeks emergency appropriations, that phrase
21 is defined by monies that have already been spent?
22 A. Sometimes yes, and sometimes -- like I said, you
23 know --
24 Q. What would it be, then, if it's not already spent?
25 A. Well, say if you had -- you seek appropriations for
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1 the 33, during the year you're only going to spend, say, up
2 until the time you're seeking it, right, and then if you
3 don't let the staff go, you will continue to incur the cost
4 but you haven't spent it yet.
5 Q. I see. Well, I guess in that -- I don't mean to
6 put you on the spot, ma'am, but I guess in the example you
7 gave, then, of people for whom appropriations were not given
8 because for whatever reason the legislature felt that it
9 wasn't warranted, what the department did is maintain at
10 least some of these people with the intent of going back --
11 coming back next year to seek emergency appropriations for
12 those same people? Is that what is being done?
13 A. That's my understanding.
14 Q. You must be aware, then, when the department was
15 asked to identify priorities for these emergency
16 appropriations earlier this year -- actually last two
17 sessions, 2000 and 2001 legislative sessions, your
18 department's position was that MST was the priority over all
19 other public health needs. Were you aware of that?
20 A. No.
21 Q. That something of that nature was said?
22 A. No.
23 Q. Okay. Would you know whether or not, knowing the
24 various priorities that the department has had for the past
25 two years, whether or not it appears that MST was a priority?
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1 A. Well, in our department it seemed that anything
2 that had to do with consent decrees was considered a high
3 priority. We did not number them.
4 Q. MST -- excuse me. Consent decree benchmarks,
5 perhaps, have you heard that term?
6 A. Yes.
7 Q. Those items were in a different category you're
8 saying?
9 A. No.
10 Q. They were given priority?
11 A. Yes.
12 Q. Over everything else?
13 A. Yes.
14 Q. And was it explained to you why that was the case?
15 I'm not sure if it was.
16 A. I don't know that our department wanted to
17 prioritize from one to ten or numerically, so a lot of the
18 requests -- I'm talking about our whole department was put
19 into several different high priority categories, one of them
20 being the consent decrees that we have.
21 Q. I see. You have more than one, actually?
22 A. Yes, we do.
23 Q. So, Ms. Ako, do you know what -- where the funds
24 that was appropriated for the MST continuum program -- do you
25 know what I'm talking about?
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1 A. Yes, I do.
2 Q. Where those monies that were appropriated for that,
3 where that money went, because I understand the program
4 terminated abruptly mid this year?
5 A. Okay. Some of those monies were from positions --
6 those positions -- part of the 33 positions. Basically what
7 they did is they took positions from the various centers that
8 they deemed were not needed and created missed MST positions,
9 therapists, and used those monies. They had overtime and,
10 what is that, stand-by pay that was included in the --
11 Q. Request?
12 A. -- emergency appropriation of last year, which I
13 believe was approved. However, it was not approved this
14 year.
15 Q. Oh, I see. 2000 was approved, 2001 was not?
16 A. Well, this year meaning fiscal year 2002.
17 Q. Okay. I'm sorry. The one we're in right now?
18 A. Yes.
19 Q. Do you know if there was any surplus from the MST
20 home-based program this past year?
21 A. I'm not certain.
22 Q. If I were to ask you, Ms. Ako, if you could tell us
23 approximately how much DOH has spent on Felix since the
24 consent decree was enacted in 1994, how much has been spent,
25 would you have that at your fingertips?
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1 A. I can tell you that in fiscal year '95 we spent
2 about 32.5 million. Now, this is only for Child and
3 Adolescent Mental Health.
4 Q. What year, I'm sorry?
5 A. Fiscal year '95. It's an approximate amount. This
6 is general funds only.
7 Q. Why only fiscal year '95?
8 A. No, I'm going to go into fiscal year '01. Sorry.
9 Fiscal year '01 is about $133.8 million in general funds.
10 Q. One other area, Ms. Ako. Do you know whether or
11 not the Department of Health hired a Lenore Behar as a
12 consultant?
13 A. I believe so.
14 Q. What kind of consultant?
15 A. I'm not certain. She did come -- she was part of
16 the technical assistance panel.
17 Q. Right. Were you here when Mr. Ito was testifying?
18 A. Part of the time, yes.
19 Q. There were some questions asked and answers given
20 relating to how various people were compensated for what they
21 did, and Mr. Ito gave us information that much of the
22 payments to consultants were actually run through the Felix
23 monitoring project so that --
24 A. I believe that's correct.
25 Q. So, for example, they would not show up anywhere in
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1 the DOE records as persons retained by the DOE because the
2 monitoring project would give a one lump sum, one line item
3 statement to the Department of Education for, for example,
4 $20 million or $1 million and then the department would pay
5 it. So only Felix would be paying out to these people
6 directly. You heard that?
7 A. I didn't hear that part, but I kind of got the
8 gist.
9 Q. Understanding that, is that the same with the
10 Department of Health or has the Department of Health
11 contracted with and paid any of these consultants directly?
12 A. I believe they were going to pay Dr. Behar this
13 year.
14 Q. How do you spell that?
15 A. Behar, B-E-H --
16 Q. Oh, Behar?
17 A. Yes.
18 Q. This year?
19 A. I believe it was this year or last fiscal year. I
20 can't -- it's this calendar year, but normally we -- as
21 Mr. Ito said, it's through the Felix monitoring project.
22 Q. How about a person by the name of Judy or Judith
23 Schrag, S-C-H-R-A-G?
24 A. I think that was more or less -- we hardly -- I
25 don't -- I don't believe we use her, the Department of
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1 Health.
2 Q. You certainly don't recall making any payments
3 directly to her?
4 A. No.
5 Q. How about Ivor Groves, the court monitor?
6 A. No. We -- I believe we pay him through the Felix
7 monitoring project.
8 Q. So the only one you think you might have paid or
9 you have paid directly would be a Lenore Behar?
10 A. Right. I think it's after she left the technical
11 assistance panel.
12 Q. Yeah, the technical assistance panel, to my
13 understanding, was disbanded in late 2000. So you do know
14 that Ms. Behar was paid for some services here in Hawaii
15 during this calendar year 2001?
16 A. There was a request to the governor for her
17 consultant services, and that's the only --
18 Q. How much?
19 A. I can't recall.
20 Q. When was that about, best of your recollection?
21 A. That's why I said it was this calendar year that
22 they had the request.
23 Q. It could have been last fiscal year?
24 A. It could have been last fiscal year.
25 Q. And do you know what the services were, though,
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1 that were performed?
2 A. I'm not sure.
3 Q. How they were described?
4 A. I'm not sure. It was some kind of technical
5 assistance that were probably needed or wanted.
6 Q. And not necessarily part of the technical
7 assistance panel?
8 A. No.
9 Q. Because, to your knowledge, by the time you saw
10 that statement, the panel had already been disbanded?
11 A. That's correct.
12 Q. That's all I have. Thank you very much, Ms. Ako.
13 CO-CHAIR SENATOR HANABUSA: Thank you.
14 Members, we'll begin first with Vice-Chair Kokubun,
15 five-minute rule, followed by Vice-Chair Oshiro.
16 VICE-CHAIR SENATOR KOKUBUN: Thank you,
17 Co-Chair Hanabusa.
18 EXAMINATION
19 BY VICE-CHAIR SENATOR KOKUBUN:
20 Q. Ms. Ako, I wanted to ask about the super powers.
21 To the best of your knowledge, is it your understanding that
22 the super powers were also bestowed upon the director of the
23 Department of Health as well as the superintendent of the
24 Department of Education?
25 A. That's correct.
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1 Q. Has the director of the Department of Health ever
2 exercised his super powers?
3 A. Well, part of what the super powers says is that
4 basically they do not have to go through the chapter 103 D
5 and 103 F process, and we have used those -- or he has used
6 those powers.
7 Q. Can you describe what the purpose of those
8 contracts or whatever --
9 A. 103 F is actually by going through the process
10 whereby you purchase health and human services, so in other
11 words, we purchase services for health mainly as far as CAMHD
12 is concerned, so they have not -- they have put aside the RFP
13 method or request for proposals and basically use that in
14 some instances, and the same for 103 D, which is basically a
15 regular purchasing of other kinds of services.
16 Q. And when did that occur?
17 A. It's at various times. Mainly I think if they felt
18 that they just needed to get some things done right away and
19 they didn't -- it was -- they felt it was too much of a
20 burden to go through the process, it took too long.
21 Q. So this is in addition to the change in the policy
22 that was instituted on July 1st?
23 A. Well, that was -- that was just the procedure as
24 far as we were concerned where they felt that -- or we felt
25 that they were asking us to rush their contracts. They
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1 didn't give us enough of a time frame and, you know, there's
2 five of them or so working on these contracts and we've only
3 got one person, so we asked the AG if they could after some
4 training basically work directly with the AG rather than
5 coming through us, so that's a little different.
6 Q. I see. It would seem to me, though, that with the
7 super powers that the director had, that division could
8 accomplish that same goal without changing any policy,
9 couldn't they, as long as it was approved by the director?
10 A. But it's a matter of the AG reviewing the contracts
11 too.
12 Q. I see.
13 A. I mean, it didn't relinquish that the AG would not
14 review. It was just a matter of the procedure of going
15 through and obtaining the services of, you know, their
16 contractors.
17 Q. I see.
18 A. In fact, up until recently, too, we would have to
19 go by policy to the governor to get approvals for consultant
20 services, which is not the same as that super power, so --
21 but the -- and the child and adolescent was able to get an
22 exception to that policy from the governor.
23 Q. With respect to the AG's role in this --
24 A. No, with respect to the governor giving approval
25 for consultant contracts.
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1 Q. My question was going to be with respect to the
2 AG's role in terms of reviewing contracts and signing off.
3 When the super powers were utilized by the director, did the
4 AG sign off on those contracts?
5 A. Ours did, ours still does.
6 Q. Meaning what?
7 A. According to my understanding, they still sign off
8 on all contracts.
9 Q. And you're aware that in the Department of
10 Education the AG did not sign off?
11 A. I'm not -- I'm sorry, I --
12 Q. That's fine. Can you give me an idea of what the
13 scope of the contracts were that were utilized by the super
14 powers by the director?
15 A. Well, basically just a regular purchase of service
16 type.
17 Q. I mean the magnitude of scale of the contracts.
18 A. I'm sorry, I don't know that.
19 Q. How are the vendors handled in the Department of
20 Health? Are you able to provide me with some information in
21 terms of like expenses and how those accounts are tracked in
22 the department?
23 A. We can provide probably a list of the vendors and
24 how much they were paid for the department -- from the
25 department. The problem would be, though, it may take a
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1 while to get that if you want to isolate it according to
2 child and adolescent versus, say, one of our other divisions.
3 Q. But as long -- excuse me.
4 A. Because we don't -- I'm not sure if we have it
5 according to the account, the program ID, because --
6 Q. Just for clarification, my time is up, but just for
7 clarification, in other words, if we could identify a vendor,
8 you could, through research, come up with the information
9 with respect to --
10 A. How much was paid?
11 Q. -- how much was paid and for what purposes,
12 invoices?
13 A. Well, I don't know for what purposes, but we could
14 come up with the vendor and how much was paid.
15 Q. Okay. One last question. Is the Child and
16 Adolescent Division the only division in the department that
17 had a policy change with respect to contracts?
18 A. Yes.
19 Q. Thank you.
20 VICE-CHAIR SENATOR KOKUBUN: Thank you, Madam
21 Chair.
22 CO-CHAIR SENATOR HANABUSA: Representative
23 Oshiro, followed by Senator Buen.
24 VICE-CHAIR REPRESENTATIVE OSHIRO: Thank you,
25 Co-Chair Hanabusa.
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1 EXAMINATION
2 BY VICE-CHAIR REPRESENTATIVE OSHIRO:
3 Q. I just wanted to follow up on some of the questions
4 asked by Senator Kokubun. When it comes to the billing
5 protocol for the department, is that a department-wide sort
6 of practice or can each individual division sort of create
7 their own different billing practices? Specifically what I'm
8 asking is when it comes to like the vendor codes, is that
9 something that each division handles or is that something
10 they have to get department approval higher up through the
11 ladder?
12 A. The vendor codes themselves are put on a form and
13 then submitted to DAGS, and then they issue the vendor codes.
14 Q. And in terms of controlling the actual vendor codes
15 or services under each vendor code, so as I understand it,
16 there are varying services to break down which services are
17 being provided by the certain vendor. So in terms of the
18 service codes, is that controlled by the department or is
19 that controlled by the --
20 A. No, the service codes are controlled by child and
21 adolescent.
22 Q. So if they wanted to change it, then that would be
23 something they could do on their own, then, they don't need
24 to go higher up in the department to get it?
25 A. That's correct.
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1 Q. Thank you very much.
2 CO-CHAIR SENATOR HANABUSA: Senator Buen,
3 followed by Representative Ito.
4 SENATOR BUEN: Thank you.
5 EXAMINATION
6 BY SENATOR BUEN:
7 Q. Ms. Ako, did you say that Lenore Behar was hired by
8 the DOH?
9 A. I believe she was. I mean, there was a request
10 to -- for consultant -- for her consultant services, and I
11 believe it was this calendar year. However, I don't know
12 whether child and adolescent actually, excuse me, went
13 through with it or not.
14 Q. With the vendor -- the vendor list, can that -- can
15 you look that up? Can you provide the -- can you provide to
16 the committee information on that, whether the -- how much
17 Lenore Behar was paid and for what services?
18 A. Yes, and I believe our -- your next witness can
19 probably speak to that too.
20 Q. What about Ivor Groves, did you say that Ivor
21 Groves was also paid by the Department of Health or did I
22 hear wrong?
23 A. We pay Ivor Groves through the Felix monitoring
24 project. In fact, we have a budget for his office per year
25 and we pay them by court order. There is a court order.
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1 Q. Can that also be -- information through the vendor
2 list -- given to the committee on the amount that was paid
3 out?
4 A. Yes. How far back do you want to go?
5 SENATOR BUEN: I'll ask the committee chairs
6 if it's okay to ask for that.
7 CO-CHAIR SENATOR HANABUSA: What we'll do is
8 usually as the questioning goes on, Ms. Ako, other senators
9 or representatives may add on, so we will notify you what the
10 total list is. Thank you.
11 SENATOR BUEN: Thank you. I don't have any
12 other questions.
13 CO-CHAIR SENATOR HANABUSA: Thank you, Senator
14 Buen.
15 Representative Ito, followed by Senator Sakamoto.
16 REPRESENTATIVE ITO: Thank you, Madam Co-Chair
17 Hanabusa. I don't have any questions at this time.
18 CO-CHAIR SENATOR HANABUSA: Thank you.
19 Senator Sakamoto.
20 SENATOR SAKAMOTO: Thank you, Chair.
21 EXAMINATION
22 BY SENATOR SAKAMOTO:
23 Q. Hi, Ms. Ako.
24 A. Hi.
25 Q. I guess your main responsibility is budget. To
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1 what extent do you in the budget side make value judgments on
2 vendors or if in deed a certain program should expand to the
3 degree they below you request to expand?
4 A. We make recommendations to the director.
5 Whether -- you know, then it's up to the director's office to
6 either, you know, go with those recommendations or do what he
7 wants to do.
8 Q. And normally will the director follow budget's
9 recommendations or the various CAMHD or other programs below?
10 A. It depends on what the issue is.
11 Q. Changing the line of questioning to your pre-audit,
12 what does that involve?
13 A. Basically reviewing the requests for payments and
14 processing the requests for payments to DAGS.
15 Q. So if there was a purchase order for $100,000 to do
16 certain services and the first payment of 50,000 was
17 requested, the pre-audit would -- was there any value
18 judgment or are you just saying --
19 A. No. Basically if there is an existing contract,
20 they would look -- they would -- there is a contract and
21 they, you know -- and there is a dollar amount, as long as
22 that dollar amount falls within that contract, the dollar
23 amount on the thing, then they just minus it out and process
24 it.
25 Q. Why does budget side need to do that versus
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1 expenditure side?
2 A. No. In our office we have budget, fiscal, and
3 facilities management.
4 Q. So you're not like the Department of Education --
5 A. No, we're not.
6 Q. -- left hand, right hand. You both in the same
7 office?
8 A. Yes.
9 Q. Is there someone who does value judgment on the
10 vendors saying we've had a problem with vendor A, therefore,
11 they are on a watch list or a black list or a not contract
12 with type of list?
13 A. Normally for the state I don't believe there is.
14 Q. So who determines --
15 A. Basically it's when we review the request for
16 proposals or when the programs review the request for
17 proposals, that's when it's really decided by the programs
18 whether they've been performing or not.
19 Q. So not so much your office but the program --
20 A. We rely, yes, mostly on -- because they would know
21 what services that they want.
22 Q. So last type of question. So since your office
23 does both budget and then ultimately paying for the different
24 provisions, do you come up with some -- I guess a term
25 Mr. Koyama used was activity-based sort of costing where
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1 maybe 2 million was budgeted for a certain program ID, some
2 of that is personnel, some may be outside vendors, some may
3 be material or equipment and then coming up with a system
4 that has different cost codes including vendor codes but --
5 and then tracks to say so much spent to date, so much
6 anticipated to be required?
7 A. In our department, take child and adolescent, there
8 are two IDs, one is HTH 460, which is basically their family
9 guidance centers and where most of their services are
10 provided. We have activity codes which actually break them
11 out into different family guidance centers and I think the
12 family liaison branch plus maybe two or -- maybe three or
13 four activity codes for broad categories of their purchases
14 of service, and very broad.
15 Q. So it's --
16 A. So say for the activity code for a particular
17 family guidance center, there's -- within that you have it
18 broken down between personnel and other costs and equipment,
19 other costs being things like supplies, electricity, water,
20 and things like that.
21 Q. So the family guidance centers would have the
22 ability to say --
23 A. To see --
24 Q. -- to move within, we're not paying as much
25 personnel, maybe we'll contract this out, this service, or
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1 not?
2 A. Well, in our department it's more difficult to do
3 that. We -- they would request, you know, movement down from
4 personnel to other services and then we would need to get
5 approval from budget and finance to do that.
6 Q. So the request would come to your office and then
7 they would say you may or may not?
8 A. Then we would transfer that request over to B&F and
9 they also review that.
10 Q. Thank you.
11 SENATOR SAKAMOTO: Thank you, Chair.
12 CO-CHAIR SENATOR HANABUSA: Thank you.
13 Representative Kawakami, followed by Representative Leong.
14 REPRESENTATIVE KAWAKAMI: Thank you, Chair
15 Hanabusa.
16 EXAMINATION
17 BY REPRESENTATIVE KAWAKAMI:
18 Q. Just a few questions, kind of like to follow up on
19 that. So when you were doing -- you're talking about
20 contracts, the -- you have a cost schedule?
21 A. We don't have a cost schedule. We have -- we just
22 keep track of contracts coming through our office. We have a
23 log.
24 Q. So you log the kinds of costs, is that what you're
25 saying?
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1 A. No, we don't even -- that's totally different. We
2 have a log of what contracts come through our office and what
3 contracts are let out by the department. That's one thing.
4 Now, the -- that listing of what the contracts have been
5 paid, I'd have to go and, you know, do some research. It's
6 not normally kept.
7 Q. Well, I was curious, for the same type of service,
8 the costs would be the same, I mean, from this contract to
9 another or is it different? Does it differ?
10 A. For the same type of service I believe it's the
11 same.
12 Q. So you have a -- you don't --
13 A. A contract may have more than one service in it.
14 Q. Uh-huh, but I'm saying for similar services you
15 would have a same cost estimate, the same or --
16 A. Per unit cost --
17 Q. -- or does it vary?
18 A. -- I believe.
19 Q. Does it change? It varies?
20 A. I don't think it varied.
21 Q. It stays the same?
22 A. Uh-huh.
23 Q. Maybe when they come up later -- okay. When you
24 ask for, let's say, emergency funding and we chop it, okay,
25 you might get not even half of it or maybe half, how do you
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1 make up that difference if you really needed that service?
2 A. This is the first time we're going to be doing
3 that.
4 Q. This is the first time?
5 A. First time I think we faced --
6 Q. That you're going to face this, is that what you're
7 saying?
8 A. Yes.
9 Q. So in the past when you give us a figure, that's
10 not the right figure because you can live with a lesser
11 amount?
12 A. No. I believe in the past it's based -- budget is
13 based on a plan, basically.
14 Q. But you're saying that if we cut it, you will live
15 with it, you don't --
16 A. We will try. Normally --
17 Q. You don't move funds from some place else?
18 A. No.
19 Q. You never do?
20 A. I didn't say -- I said, well, when we were faced
21 with this last emergency, we had to move funds to so call
22 forward fund it because they are incurring the costs and they
23 didn't have any, you know --
24 Q. So this is where you took from the 33 positions?
25 A. No, no, no.
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1 Q. No?
2 A. That was -- I'm talking about last year where we
3 had to, you know, move monies from, say, one program ID to
4 another, like for child and adolescent we had to move it from
5 I believe 495 and either 420 or 430 to help pay for costs
6 that are being incurred while the --
7 Q. Ongoing costs?
8 A. Yes.
9 -- while the emergency appropriation is being
10 debated or decided upon.
11 Q. The other question was how closely you work with
12 the AG's office, you said --
13 A. Myself, I'm --
14 Q. Well, whoever does it in terms of the scope and,
15 you know, kinds of services?
16 A. If the AG's office has questions on the scope of
17 services, you know, they normally work directly with the
18 program where they have the questions.
19 Q. The program manager, the program who?
20 A. Program manager or whoever is in charge of those
21 contracts.
22 Q. I see.
23 REPRESENTATIVE KAWAKAMI: That's all. Thank
24 you, Chair Hanabusa.
25 CO-CHAIR SENATOR HANABUSA: Thank you.
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1 Representative Leong, followed by Senator Slom.
2 REPRESENTATIVE LEONG: Thank you.
3 EXAMINATION
4 BY REPRESENTATIVE LEONG:
5 Q. I just have a couple of questions. I noticed
6 earlier you stated that you don't do contracts anymore
7 because there's so few of you working there. You send them
8 now to the AG's office; is that correct?
9 A. Well, what we did in the past was make sure that
10 all the necessary documents accompanied the contracts that go
11 over to the AG or basically the scope seems okay or more or
12 less to what is included in the contracts to make sure that,
13 you know, the AG gets at least a fairly decent contract to
14 work with, but because child and adolescent has been, you
15 know, having more and more contracts and wanting faster
16 turnaround and they are not the only, you know, program in
17 the department, there are a lot of other programs, because we
18 run at least 300 contracts or more a year and we only have
19 one person doing this, and we felt that since they had more
20 staff than us --
21 Q. I understand.
22 A. -- that if the AG was amenable to that, where we
23 wouldn't do the review, so to speak, that if they were
24 amenable, that, you know, we'd have child and adolescent work
25 directly with the deputy AG.
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1 Q. So this is still occurring along that same route?
2 A. No, for child and adolescent it changed. Child and
3 adolescent is working directly with the AG now.
4 Q. I see. And you also stated that any contract that
5 was more than $300,000 needed auditing?
6 A. With federal dollars needs an independent audit.
7 Q. So how large do these contracts go?
8 A. Well, see, the bulk of child and adolescent
9 contracts are not federal dollars.
10 Q. But if they were federal, how large could they go?
11 A. Depending on how much federal dollars we get in for
12 the program.
13 Q. I see. I see. So that's my line of questioning.
14 Thank you very much.
15 REPRESENTATIVE LEONG: Thanks, Chair.
16 CO-CHAIR SENATOR HANABUSA: Thank you.
17 Senator Slom, do you have any questions?
18 SENATOR SLOM: Thank you, Co-Chair Hanabusa.
19 No, I'll pass at this time.
20 CO-CHAIR SENATOR HANABUSA: Co-Chair Saiki.
21 CO-CHAIR REPRESENTATIVE SAIKI: Thank you.
22 EXAMINATION
23 BY CO-CHAIR REPRESENTATIVE SAIKI:
24 Q. I just have a couple of questions, Ms. Ako. First
25 on Dr. Behar's involvement with the health department. What
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1 is the extent of her involvement with the health department
2 as far as -- I think you said as a consultant?
3 A. I believe she was from the very beginning on the
4 technical assistance panel, and I think her expertise was
5 supposed to be in the mental health arena where Dr. Schrag
6 was in the education arena.
7 Q. Was there an involvement outside of her role --
8 outside of her being a member of the technical assistance
9 panel as far as being a consultant?
10 A. Before? Before this last --
11 Q. Or at any time.
12 A. I'm not sure. I don't believe so.
13 Q. Because I think you said earlier that the health
14 department was -- had intended to pay Dr. Behar this calendar
15 year through the Felix monitoring project?
16 A. No, no. That wasn't through the Felix monitoring
17 project. That was a separate contract.
18 Q. Okay. What kind of contract was that?
19 A. No, that's why -- I think it was some kind of
20 technical assistance to child and adolescent, but I can --
21 Q. But that was -- that was outside of her role as --
22 that was outside of her being a member of the technical
23 assistance panel?
24 A. Yeah, because I believe that was --
25 Q. So this is like a side contract, a private
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1 contract?
2 A. Yeah, contract with --
3 Q. Providing technical assistance to CAMHD?
4 A. Yes.
5 Q. And that was this past calendar year?
6 A. I believe it was this calendar year, yes.
7 Q. Were there any contracts like this prior to this
8 calendar year?
9 A. I'm not sure. I don't think so, but then I don't
10 see all the -- I mean, I don't -- our office sees them, but I
11 haven't looked.
12 Q. Do you know whether or not if this contract was
13 suspended because of the recent indictment of Ms. Behar in
14 North Carolina?
15 A. I don't know that.
16 Q. Actually, I just have a request for information, a
17 follow up, on the Felix monitoring project --
18 A. Yes.
19 Q. -- issue. Does your office receive copies of
20 invoices and/or financial statements or any other kind of
21 document that shows the expenses of the FMP?
22 A. We have not, not our office. Supposedly, I think
23 through the court, the consent decree, I believe he's
24 supposed to give that kind of information to the AG.
25 Q. So nothing is submitted to the health department?
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1 A. No. We pay off of the court order.
2 Q. So all you receive is a quarterly or periodic
3 invoice for a lump sum amount?
4 A. I don't know if we receive an invoice. As I said,
5 we pay off -- in the past I know we've paid off the court
6 order.
7 Q. Do you know what amount the health department pays
8 for the FMP?
9 A. In the last year it was 600,000, and I believe we
10 requested another 150,000 because the program believed that
11 he was going to need consultant -- more consultants, so
12 150,000 additional was added to the budget. That was our 50
13 percent share between us and Department of Education.
14 Q. Could you check to see whether or not you have in
15 your possession, meaning the department's possession, any
16 kind of detailed statements, invoices, work sheets, that
17 have -- that indicate the expenses of the FMP? The
18 Department of Education actually submitted a packet of
19 information to us yesterday and we were wondering if the
20 health department has anything.
21 A. I will have to research that, because I know our
22 office does not.
23 Q. Okay. Thank you very much.
24 EXAMINATION
25 BY CO-CHAIR SENATOR HANABUSA:
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1 Q. Ms. Ako, you gave some figures to Mr. Kawashima and
2 you were saying in '95 the general fund expenditures for
3 Felix was 32.5 million, I believe?
4 A. Actually, budget.
5 Q. That was the budget amount?
6 A. That includes the emergency appropriation for that
7 fiscal year.
8 Q. And that was '95?
9 A. (Witness nods.)
10 Q. And then you gave, I think, '01 and general fund
11 was 133.95.
12 A. I said 133.8.
13 Q. .8. The years between '95 and '01, is there an
14 average amount that was --
15 A. No. It just kept going up. I'm sorry, I'd have to
16 get that for you if you want that.
17 Q. I just wanted to make sure the 133.8 wasn't the
18 cumulative between '95 --
19 A. No.
20 Q. So that's just for --
21 A. That fiscal year.
22 Q. Can you tell me with the Department of Education,
23 if you were here and hearing their testimony, they don't
24 really have a clear -- like your HTH whatever, 460 or
25 whatever, they don't have a clear line item or budgetary code
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1 relating to Felix. Does the Department of Health have that?
2 A. Well, we consider HTH 460 all of it.
3 Q. Felix?
4 A. Yes.
5 Q. Any other --
6 A. And then 495 HF and HC.
7 Q. That's also considered Felix?
8 A. Yes. That's just the child and adolescent piece.
9 Q. Okay.
10 A. For the early intervention, it's 530 CO and CG and
11 550 CT.
12 Q. For early intervention?
13 A. Yes.
14 Q. There's a -- is Healthy Start considered separate?
15 A. That's CT.
16 Q. That's CT?
17 A. Yeah, 550 CT.
18 Q. So if we were to go back to the budgets and we
19 added all of this, this should add up to like 133.8?
20 A. No. That 133.8 is only child and adolescent, 460
21 and 495.
22 Q. Okay. So these would add to that figure?
23 A. Correct.
24 Q. Let me ask you another question just relating to
25 the contracting which you said that you dealt with. It was
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1 very interesting what you said. The Department of Health did
2 not do away, even under super powers, with the attorney
3 general's approval of contracts.
4 A. Yeah, they still review it, yes.
5 Q. Do you still go through like, for example, good
6 standing checks, like all taxes paid up for?
7 A. Yes.
8 Q. You do do that. Do you remember a contract to an
9 entity called Kaniu 1, LLC, by any chance? Do you know that
10 entity?
11 A. I've heard of it.
12 Q. We also know it as Na Laukoa. Do you have it down
13 as Na Laukoa?
14 A. I believe we may have it as Kaniu, LLC.
15 Q. 1, LLC?
16 A. Yeah.
17 Q. Do you recall whether or not there was ever an
18 issue as to the payment for Kaniu 1, LLC?
19 A. No. It was not brought to my attention.
20 Q. You don't recall any questions as to whether or not
21 it could make tax clearances?
22 A. My staff didn't bring it to my attention.
23 Q. Do you know how many years the Department of Health
24 has been contracting with Kaniu 1, LLC?
25 A. No.
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1 Q. No idea?
2 A. I can check.
3 Q. Maybe we'll ask you to check on that. And so you
4 don't know whether any monies were withheld from that entity
5 or anything?
6 A. Not at this time, no.
7 Q. One of the latest, I guess, analysis that we have
8 or that I have says that it received about $1.28 million in
9 terms of payments from CAMHD. Do you know if that's true or
10 not?
11 A. No, I don't.
12 Q. So I'll ask that you check on that as well. I have
13 nothing further of you.
14 CO-CHAIR SENATOR HANABUSA: Any other
15 follow-up questions?
16 SPECIAL COUNSEL KAWASHIMA: I have none.
17 CO-CHAIR SENATOR HANABUSA: Senator Sakamoto.
18 EXAMINATION
19 BY SENATOR SAKAMOTO:
20 Q. Following up, let me -- I guess Mr. Koyama,
21 apparently, is the internal auditor for the Department of
22 Education. Does the Department of Health have that?
23 A. No. We have a slim and trim staff.
24 Q. He's slim and trim, but seems like he needs help
25 from what he testified. So is it your feeling that with you
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1 and your staff, you can do whatever an internal auditor
2 normally would do?
3 A. With our staff, no.
4 Q. Do you need an internal auditor in the Department
5 of Health?
6 A. We could probably use one, but --
7 Q. I'm a small business person, and many times our
8 financial person in the company or sometimes we ask our
9 accountant to help us with ratios, numbers to see if our
10 operation is within the ballpark of the general type of
11 operations that we do. Who does that within the Department
12 of Health?
13 A. Well, all we have is an independent auditor right
14 now, and that's Grant Thorton.
15 Q. Do they provide like longitudinal ratios --
16 A. No.
17 Q. -- sometimes showing --
18 A. I guess because we haven't asked and we are a
19 government agency, and so --
20 Q. It's our money.
21 A. I know. We feel the same way too.
22 Q. I'm not on your case, so to speak, but as of this
23 time, you're not doing that internally nor have you
24 specifically asked for the type of performance or some
25 guidelines to --
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1 A. No.
2 Q. Thank you.
3 SENATOR SAKAMOTO: Thank you, Chair.
4 CO-CHAIR SENATOR HANABUSA: Any follow-up
5 questions?
6 VICE-CHAIR SENATOR KOKUBUN: I do.
7 CO-CHAIR SENATOR HANABUSA: Yes.
8 VICE-CHAIR SENATOR KOKUBUN: I wanted to ask
9 the chairs if -- co-chairs if we were going to be putting
10 together a list of additional information we're going to
11 request.
12 CO-CHAIR SENATOR HANABUSA: Yes. If everyone
13 will try and get that to us by Monday, then we can forward it
14 to Ms. Ako. Any other follow-up questions? No? Co-Chair
15 Saiki.
16 EXAMINATION
17 BY CO-CHAIR REPRESENTATIVE SAIKI:
18 Q. Ms. Ako, I just have one follow-up question. In a
19 situation where a provider -- private provider has dual
20 contracts, one with DOE and one with DOH, to provide
21 Felix-related services, are there controls within DOH to
22 ensure that there isn't in effect double billing through both
23 departments?
24 A. I don't believe so.
25 Q. Thank you.
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1 CO-CHAIR SENATOR HANABUSA: Any other
2 follow-ups?
3 If not, thank you very much, Ms. Ako.
4 Members, we will take a five-minute break and
5 resume at about 2:05 with Ms. Donkervoet.
6 (Recess taken.)
7 CO-CHAIR REPRESENTATIVE SAIKI: Members, we'd
8 like to reconvene our hearing. It's time to hear from our
9 third witness, Christina Donkervoet. We'll administer the
10 oath at this time.
11 CO-CHAIR SENATOR HANABUSA: Ms. Donkervoet, do
12 you -- let me get my thoughts. Sorry. Do you solemnly swear
13 or affirm that the testimony you're about to give will be the
14 truth, the whole truth, and nothing but the truth?
15 MS. DONKERVOET: I do.
16 CO-CHAIR SENATOR HANABUSA: Thank you.
17 Members, we'll be following our usual protocol.
18 We'll begin with Mr. Kawashima.
19 SPECIAL COUNSEL KAWASHIMA: Thank you, Madam
20 Chair.
21 EXAMINATION
22 BY SPECIAL COUNSEL KAWASHIMA:
23 Q. Please state your name and business address.
24 A. My name is Christina Donkervoet, and I work at the
25 Child and Adolescent Mental Health Division, 3627 Kilauea
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1 Avenue in Honolulu.
2 Q. And that is the department -- the address of the
3 Department of Health, is it not?
4 A. It is, but it's the Child and Adolescent Mental
5 Health Division.
6 Q. And what is your position with the Child and
7 Adolescent Mental Health Division?
8 A. I am the division chief.
9 Q. If you might, ma'am, before we go on, give us a
10 brief summary of your formal education.
11 A. I have both my bachelor's and my master's degree in
12 nursing. My master's degree is in specifically child and
13 adolescent psychiatric mental health nursing.
14 Q. And those two degrees, the bachelor's and the
15 master's, were obtained where, ma'am?
16 A. My master's degree is from the University of Rhode
17 Island in 1980 -- I'm sorry, 1993. My bachelor's degree is
18 from Salisbury State College, the state college in the state
19 of Maryland, 1985.
20 Q. What were you doing between 1985 and '93? Part of
21 it, I'm sure, was for the master's, but were you working
22 somewhere?
23 A. I was. Immediately following my undergraduate
24 degree I began work in child and adolescent mental health
25 nursing. I worked as a staff nurse on an older adolescent
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1 acute unit, and I worked on a children's unit, both of those
2 for three years. I did the adolescents for two years,
3 children ages two and a half to eleven. I worked with
4 them -- this was an acute long-term hospital, so the kids
5 were actually there for 18 months to two years, although the
6 hospital defined that as acute care at the time. Severely
7 emotionally disturbed children and their families. I then
8 became the nurse manager of a younger adolescent unit, which
9 was 12 to 15 year olds from -- I believe that was '88 to '90,
10 and again, similar lengths of stay, severely emotionally
11 disturbed kids.
12 Q. Where was this, ma'am?
13 A. At Shepard Nina Pratt Hospital in Maryland,
14 Baltimore.
15 Q. Baltimore?
16 A. Yes. It's affiliated with the University of
17 Maryland and Johns Hopkins academic tracks.
18 Q. Did you pursue any other formal education?
19 A. I did not.
20 Q. So when did you become associated with the
21 Department of Health?
22 A. That would not be until July of 1996.
23 Q. And --
24 A. Actually, I think it was September of '96. We came
25 in July and I took the summer off while we got settled.
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1 Q. So officially you started September of '96?
2 A. Yes.
3 Q. What, then, were you doing between 1990 and 1996?
4 Where were you employed?
5 A. From 1990 to 1993 I was in Rhode Island. I was the
6 nursing supervisor for about a year and a half of that time
7 and a nurse manager of an adolescent unit program in Rhode
8 Island, the Bradley Hospital and Residential Treatment
9 Program affiliated with Brown University, and again, similar
10 populations, severely emotionally disturbed children and
11 adolescents, and this hospital had a specific program also
12 for developmental disabilities.
13 In addition to working as the program manager for
14 the last year and a half, I also provided outpatient
15 individual, family, and group services under the Harvard
16 Community Health Plan, which is a managed HMO in New England,
17 on an outpatient basis. In '93 I moved to South Carolina.
18 Initially '93 to '94 I was the utilization management
19 coordinator for all of psychiatric services, including
20 adults. I negotiated payment plans with the Medicaid
21 services in South Carolina as well as private payers and did
22 data analysis on lengths of stay and particular patterns and
23 trends that were of interest to the hospital. I then became
24 the program manager for youth services, which was a continuum
25 of services, including outpatient, in-home/in-school
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1 services, day treatment, partial hospitalization, acute
2 services, and we had some group homes as well.
3 Q. Where was that, ma'am?
4 A. That was at the Medical University of South
5 Carolina.
6 Q. And that was from 1993 to 1996?
7 A. That was -- I was in the utilization management
8 from '93 to '94, so '94 to '96, and during that time I also
9 maintained a private practice in community sector --
10 Community Mental Health Center in South Carolina as well.
11 Q. I see. What type of private practice did you have
12 there?
13 A. This was working the community mental health
14 system, again, doing individual, family, and group work with
15 families of children with severe emotional disturbance.
16 Q. When you started with the Department of Health,
17 then, in 1996, September, what were you hired -- what
18 position were you hired?
19 A. I came in as the performance manager, performance
20 management specialist I believe it was called at that point
21 in time.
22 Q. Am I to understand, then, you were recruited
23 from -- by someone here in Hawaii to come to Hawaii to work
24 for the Department of Health? Is that how it worked?
25 A. I was interviewed on the phone and had several
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1 different conversations with folks before coming, yes.
2 Q. And was it you seeking to come here to work or how
3 did it happen that you came to Hawaii?
4 A. It certainly was my choice to come. I came
5 willingly. If your question is that -- yes, my husband was
6 being recruited at the same time, but I certainly believe
7 that I was coming because there were professional
8 opportunities for me as well.
9 Q. No, I'm not suggesting you came for any other
10 reason, ma'am. I wasn't aware that your husband was being
11 recruited at the same time. Both of you were being recruited
12 at the same time?
13 A. I believe that the intent, the desire at that point
14 in time was they were looking for a clinical director, and so
15 John was being recruited more than I, but given my background
16 all being in child and adolescent mental health, I then began
17 looking at what opportunities might exist for me, and so some
18 various interviews were set up for me. We began talking with
19 folks, and we thought that that would be a good fit for me.
20 Q. So you were a performance management specialist in
21 what branch or division?
22 A. It was for the Child and Adolescent Mental Health
23 Division as a whole, so at that point in time it was over the
24 family guidance centers. And in 1996 -- the major move
25 towards privately contracting with agencies didn't happen
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1 until July of '97, so there was -- it was a very different
2 system at that point in time, so it was to help the family
3 guidance centers, which were providing some direct services
4 and some contracting, at that time develop their quality
5 management, quality assurance system. Things were still in
6 very beginning stages of forming a system at that point in
7 time.
8 Q. Now, these family guidance centers, they function
9 for more than providing services to Felix children, were they
10 not?
11 A. At that point in time?
12 Q. Yes.
13 A. I don't believe so, but again, I didn't come into a
14 leadership position. I was still learning about the division
15 at that point in time. I believe that once the consent
16 decree was settled, they focused in on serving only Felix
17 kids, but again, between '94 and '96 I'm not exactly sure.
18 Q. When you started, then, with the department --
19 A. I believe it was all Felix kids.
20 Q. Will you do me a favor and wait until I finish
21 before you answer, because sometimes your answer might be
22 different, and what's happening now is you and I are talking
23 over each other and it's hard for the reporter to take that.
24 Just wait until I'm done with the question.
25 A. Yes, sir.
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1 Q. And you and I, especially you, talk fast so that
2 she has a difficult time. Nothing wrong with that, but she
3 has a difficult time taking it. So we need to slow down just
4 a little bit, if you don't mind.
5 A. Yes, sir.
6 Q. So what was the progression, then, from a
7 performance management specialist to the chief of CAMHD?
8 A. In July of '97 I became the clinical director of
9 the Child and Adolescent Mental Health Division, and then
10 that fall the chief left. Rich Munger was the chief at that
11 time. I believe he left in August.
12 Q. John?
13 A. No. Rich Munger. He left and then in December the
14 assistant chief at that point in time also left, so in
15 December of --
16 Q. '97?
17 A. -- '97, and actually I think it's '98, so I'm
18 losing a year here, '98, the assistant chief and chief had
19 left so I became both the acting chief while I was still the
20 clinical director.
21 Q. I see. So when you came here --
22 A. That's correct.
23 Q. -- as the performance management specialist, your
24 husband, John Donkervoet, was also hired for a position here?
25 A. Yes.
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1 Q. What position was that?
2 A. He was hired into the clinical director position.
3 Q. I see. And for how long did he occupy that
4 position after coming here?
5 A. I believe he was in that position for one year.
6 Q. And then where did he go from there?
7 A. I believe he went directly to the training
8 institute, Felix Staff Services.
9 Q. Felix?
10 A. Yes.
11 Q. After which he became -- after which he became
12 director of the MST continuum research project or not?
13 A. I don't believe so. I'm trying -- I have a hard
14 enough time tracking my professional background. I think he
15 actually left the training institute and worked at Hawaii
16 State Hospital for a period of time.
17 Q. I recall his testimony. I think you're right. And
18 then he became the head of the institute -- I'm sorry, the
19 continuum project?
20 A. I believe that that's accurate.
21 Q. Did you appoint him to become the head of that
22 project?
23 A. No, I did not.
24 Q. Who did?
25 A. There was an interview process including Carol
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1 Matsuoka, who was the administrator of MST, and some other
2 members of children's division participated in that panel.
3 Q. You were the head of that division, though, were
4 you not?
5 A. Yes, sir.
6 Q. Did you take yourself out of the process?
7 A. Yes, sir, I did.
8 Q. So you had no part to play in John being selected
9 as the director of the continuum project?
10 A. No, sir, I did not.
11 Q. By the way, you have been present here for most of
12 the proceedings, I noticed, especially when it involved
13 Department of Health's employees. You have no quarrels with
14 what the committee is doing here, do you?
15 A. No, sir, I don't.
16 Q. And you -- as far as your understanding of what is
17 happening, one of the areas that the committee is
18 investigating is accountability. You have no problem with
19 accountability, do you, that concept I'm talking about?
20 A. No, sir. What I'd like to say, though, is that my
21 intention to be here is that I think this is -- it can be
22 quite a stressful thing to be on this side of the table, and
23 I think that people have been working very hard and there's
24 lots to be proud of and I'm here as support to other members
25 of division. That's my only interest in being here.
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1 Q. I understand why you're here, and that's
2 commendable. You understand the committee's charge, though,
3 is more than just that. One of the things they are looking
4 at is to be sure that children and students who are entitled
5 to it get -- Felix type students get that type of services
6 provided to them, you understand that?
7 A. Yes, sir. I just hope that the committee is able
8 to maintain a degree of balance in looking at things.
9 Q. Well, I'm sure there will be balance, ma'am. But
10 part of what the investigative committee is doing is to make
11 sure that these expenditures I'm referring to are proper
12 expenditures and that the money is properly spent, as is
13 their charge as elected representatives of the state of
14 Hawaii. You understand that, do you not?
15 A. Yes, sir.
16 Q. So that you agree that any public employee should
17 be accountable to someone as a general concept?
18 A. Yes, sir.
19 Q. Now, as to -- I understand that there's been a lot
20 of testimony from a number of witnesses while you have sat
21 through these proceedings. As you sit here today, to the
22 best of your recollection, is there anything that anyone has
23 testified to with which you have disagreement?
24 A. Yes, sir.
25 Q. Is there a lot or a little?
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1 A. There's a fair amount.
2 Q. Fair amount.
3 A. And I would like to say, though, I don't think
4 that -- I would like to think that people did not sit at this
5 table and purposefully under oath distort or not tell the
6 truth. That's not how I choose to look at people, but I
7 think that my perception of things -- they have their bit of
8 knowledge, and so they are sharing their bit of knowledge
9 without putting it in context of the entire picture.
10 Q. And of course it might be their view of things as
11 they perceive it, right?
12 A. I hope the committee understands that, yes.
13 Q. And of course you have your own view of things as
14 you perceive them, right?
15 A. Yes, sir.
16 Q. And no one necessarily is saying one side is right
17 or wrong. You have your own views and you validly and
18 honestly believe in them, right?
19 A. Yes, sir.
20 Q. And that's what these people were doing when they
21 came forward to testify to give information to the committee.
22 You don't feel that any one of them did it in a mean-spirited
23 way, do you?
24 A. I can't answer for them, sir.
25 Q. As you watched them testify, as you know them, if
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1 you do, nothing you saw suggested that they were doing it in
2 an ill-mannered or mean-spirited way?
3 A. That's not true, sir.
4 Q. That is true?
5 A. That is not true.
6 Q. There are some who were mean-spirited?
7 A. In my view, in my opinion, yes.
8 Q. Which ones were they? I'm not going to push you,
9 if you're going to tell me you don't want to tell me.
10 A. I'd prefer not to.
11 Q. All right. However, based on what you've heard as
12 an observer to these hearings, based on the testimony that
13 has been given, have you incorporated any changes in the way
14 your division, your branch, CAMHD, operates?
15 A. Because of this committee?
16 Q. Not the committee necessarily, but the testimony
17 that's come out, have you incorporated any changes or are you
18 planning to incorporate any changes in the future based on
19 what you've heard?
20 A. If the question is based upon the testimony that
21 they gave, am I looking at --
22 Q. You agree that the testimony of some of these
23 witnesses casts or raises questions about the manner in which
24 your division is being operated? I'm not saying you agree
25 with them. I'm not suggesting they are even true, but would
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1 you agree that some of the testimony that's been given here
2 would raise questions about the manner in which your division
3 is being operated?
4 A. I would not say that.
5 Q. You don't say that there are any questions about
6 how the operation -- how your division is being operated?
7 A. I think that there may have been some questions
8 raised about some specific situations or some specific
9 circumstances. I did not hear anyone raise any issue as to
10 the way division as a whole is being managed.
11 Q. Well, division as a whole, but there are aspects
12 of -- parts of the division and the way it is being managed
13 that raises questions?
14 A. I heard some individuals who gave testimony talk
15 about some discrete parts of division and raised some
16 concerns, yes.
17 Q. Are you suggesting that everything you heard as
18 you've sat here through these proceedings, when you were
19 here -- let me ask this. If you were not here, did you
20 attempt to listen or watch the proceedings elsewhere?
21 A. I made some attempt. I did not catch all of them,
22 no.
23 Q. You made an attempt to, though, if you were not
24 here?
25 A. I did. I think there was one early on.
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1 Q. Well, what I'm asking you is you've heard personnel
2 from the Department of Health raise complaints about the
3 manner in which certain parts of your division was being
4 operated? No?
5 A. I truly -- I'm not sure that I remember or recall
6 what it is you're referencing.
7 Q. Do you recall the testimony from the people at the
8 Diamond Head Family Guidance Center?
9 A. Yes.
10 Q. They raised issues, and the head of that division
11 is David Drews?
12 A. Yes.
13 Q. And did you hear David Drews testify that he
14 himself listened to what people from his department testified
15 to -- division testified to, such as Dr. Gardiner, for
16 example, and you heard him testify -- David Drews testify
17 that he was not disputing anything that Mr. -- Dr. Gardiner
18 said? Do you remember that?
19 A. I believe I recall David making a comment like
20 that, yes.
21 Q. So that if that is the case, then, Dr. Gardiner did
22 raise some valid concerns, did he not, as to how the -- how
23 the division was being operated?
24 A. I think one of the things that Dr. Gardiner said is
25 at the time of his testimony he had been here for two weeks.
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1 Q. I understand.
2 A. And so he was concerned about a particular -- is my
3 recollection of the majority of his testimony, was about a
4 particular agency that he had some issues with.
5 Q. Loveland?
6 A. Yes, sir.
7 Q. Well, did he not also testify about not only
8 Loveland but about general procedures at the guidance center?
9 A. That I don't recall.
10 Q. You don't recall?
11 A. No.
12 Q. But nonetheless, even though he was here for only
13 two months, David Drews didn't seem to have any problems
14 with -- in terms of disagreeing with what he testified to?
15 A. Okay.
16 Q. So that you have no problem with what he testified
17 to either, from what you heard?
18 A. No, you asked me whether or not David did. I
19 can't -- if you're asking me something about Mr. Gardiner's
20 testimony, and I don't recall, so I can't tell you whether or
21 not I disagree with it or not.
22 Q. I understand you don't recall, but you do recall
23 David Drews testifying that he had no quarrels with what
24 Dr. Gardiner said?
25 A. I remember that statement, yes.
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1 Q. So however -- whatever it may be that Dr. Gardiner
2 testified to and you listened to it, there's nothing that he
3 said that was of concern to you such that you would recall?
4 A. No, sir, I'm not willing to make that statement. I
5 don't mean to be difficult with you, but you're asking me to
6 give a statement about something that I'm telling you I don't
7 remember.
8 Q. For example, have you instituted any changes in the
9 manner in which Loveland Academy is monitored?
10 A. No, sir.
11 Q. You feel that nothing more needs to be done with
12 regard to Loveland and your overview of it?
13 A. All of our agencies are monitored on a varying
14 schedule. They are looked at for their claims review
15 process, which is the accounting, the going out and looking
16 at the claims that exist and what we've been billed for to do
17 a claims review, and it's a fiscal monitoring process. That
18 happened in the spring, and we did ask for some money back
19 based on lack of documentation. We do a comprehensive
20 monitoring process, which I believe Ms. Brogan gave you some
21 overview of what is included in our comprehensive monitoring
22 of all provider agencies, and at any point in time when we
23 get complaints in about a given agency, we then would go out
24 and do a targeted review, particularly if it's around safety
25 and issues of that involving a child.
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1 Q. Have you done a targeted review of Loveland?
2 A. We have.
3 Q. When was that done?
4 A. Well, we've done them in the past.
5 Q. When?
6 A. I can't give you the specific dates.
7 Q. More than one occasion, though?
8 A. Yes, sir.
9 Q. And did they pass your review satisfactorily?
10 A. What happens typically in our reviews when we go
11 out is that there are particular findings, so we issue a
12 findings report and we require corrective action to be done,
13 and so they have to submit what their corrective action plan
14 is, and then we monitor them on a particular corrective
15 action, and we are currently in the process of that with
16 Loveland, completely unrelated to what was brought up here to
17 this committee.
18 Q. So when was the last time, then, Loveland was, for
19 lack of a better term, audited?
20 A. I'm sorry, if you're using the word audit, do you
21 mean fiscal? Usually --
22 Q. We could make it performance, we could make it
23 fiscal. Let's talk about fiscal first.
24 A. Fiscal, it was either March or May. It may have
25 been May.
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1 Q. This year?
2 A. Yes. They are done -- all of our providers are
3 looked at annually, and so that was fiscal year '01's claims
4 review audit.
5 Q. Okay. So that in those audits, then, one of the
6 things you look at for sure is whether or not if there has
7 been an expenditure, whether it was for the service that it
8 was meant to be for and whether the service was provided, of
9 course, among other things?
10 A. I'm sorry, could you say that again?
11 Q. Yeah. When you look at these fiscal items, when
12 you monitor them, part of the process includes looking at an
13 expenditure and determining, first of all, whether it was
14 spent in the way that it was designed to be spent and,
15 second, that the actual service took place?
16 A. It's actually a documentation audit. So if in fact
17 they invoiced us for individual therapy, we have particular
18 standards around what has to be in the documentation to
19 submit a claim for individual therapy. So they actually look
20 at the documentation in the records to substantiate the claim
21 that was submitted to us.
22 Q. See, that's what I was asking about. So you do
23 have a process where you do what you just described, right?
24 A. Yes.
25 Q. As part of your regular overview of providers such
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1 as Loveland?
2 A. Yes, sir. I need to put in context a developing
3 system of care, because it is very important and I don't
4 think that it's been adequately described here in this
5 committee process. When you're talking about a state that
6 was sued and entered into a consent decree to develop a
7 system of care, you're talking about moving a system over a
8 period of seven years from completely inadequate to now what
9 I believe is a very adequate system. And so what we found in
10 1995 would be very different than what you'd find in the
11 records today.
12 Providers are getting better at their
13 documentation. They are getting better at the quality of
14 their services. And we could not in 1997, because we would
15 find inadequate documentation, close all of the agencies.
16 One of the challenges is building capacity and doing
17 corrective action plans so you help people succeed rather
18 than just killing off all of the private agencies, which you
19 could have done, and then you don't have a system of care and
20 you haven't met the requirements of the consent decree.
21 So there is a balancing act. So some of what we
22 had to do was you may find a particular provider agency that
23 has billed for day treatment service, and in our
24 documentation we require specific elements to be in that note
25 in order to bill us, and the quality of that note would not
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1 be what we would want. Rather than make them pay all the
2 money back, which for many of these small companies -- we
3 contract with a lot of agencies -- would be insufficient,
4 then what we would do is develop a corrective action plan
5 with them and give them a period of time to improve their
6 documentation. As we get now tighter -- as they get more
7 experienced, we get tighter, the requirements are tighter.
8 Q. Well, so that by now -- at least let's use last
9 year, year 2000 and 2001, these providers are much better at
10 these fiscal matters than they were in the past?
11 A. They are much better.
12 Q. And you require -- your department requires --
13 would require much more of them than you might have in '95 or
14 '97?
15 A. That's correct.
16 Q. So that you would expect all of their documents
17 would be in order now as compared to back then?
18 A. I need to be clear. We don't audit every single
19 documentation.
20 Q. I understand.
21 A. We do a sample.
22 Q. That's not possible, right?
23 A. Correct.
24 Q. But you do your best to audit so that you satisfy
25 yourselves that what the provider is doing is what they say
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1 they are doing and they're providing fair and reasonable
2 services at fair and reasonable rates?
3 A. And I want to --
4 Q. Is that right or wrong?
5 A. I believe that that's correct.
6 Q. Okay.
7 A. What we do as a division, because of resource
8 issues, is this claims review process is actually contracted
9 out to a company who does the review for us, and then --
10 Q. Who is that? What company is that?
11 A. It's Jerry Leong, Incorporated, I think is the name
12 of the company, and she -- her group goes in and does the
13 review using our standards, using which records we ask that
14 they look at, and that sort of thing.
15 Q. I didn't realize that. I thought it was done in
16 house.
17 A. We actually -- well, early on when we were doing
18 some reviews and I think -- again, I really didn't come until
19 '96, so I believe that '97 and '98 people tried to do it in
20 house and what we found is it wasn't random enough, we didn't
21 have the quality, and the standards were not the same. When
22 you ask somebody to go in and audit a fiscal record for
23 fiscal purposes, they look at it very differently than a
24 clinical person, and we actually had clinical people looking
25 at records for fiscal purposes and we had a tough time
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1 managing performance.
2 Q. But the person who only has a fiscal background may
3 not necessarily see in those same records what a person with
4 a clinical background would have?
5 A. Actually, my understanding is that the folks that
6 are hired and used by Jerry Leong all have kind of a quality
7 assurance clinical background. They are clinical folks, but
8 they understand that their job is to look at fiscal billing
9 issues.
10 Q. Was Mr. Leong's company -- it's the company that
11 provides this service, is it not?
12 A. Yes.
13 Q. Was it in existence before you contracted with them
14 to do the service that they are performing for the
15 department, do you know?
16 A. I don't know.
17 Q. In other words, was his company -- was it started
18 to do what they are doing now for you?
19 A. I don't know. First all, it's a she.
20 Q. She, I'm sorry.
21 A. That's okay. I genuinely don't know. It was --
22 the desire to do this contract was a recommendation out of
23 our administrative services side, and they knew -- and they
24 suggested, and I don't know -- I've never met her, actually.
25 Q. But you, of course, because of your position as
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1 chief, you are aware of the manner in which they conduct
2 their reviews and audits, are you not?
3 A. I am.
4 Q. In fact, they do it in accordance with your
5 procedures as you have instructed them to follow, your
6 meaning the --
7 A. The division.
8 Q. -- the division's procedures, right?
9 A. That is correct. I do not directly give the
10 instructions, and so what I'm giving you testimony here about
11 today is my understanding of the truth.
12 Q. All right. I understand that. I won't hold that
13 against you, but to the extent that you know, I appreciate
14 your telling us. Now, for example, do you remember when the
15 last fiscal audit was done on Loveland? And I'm sorry to
16 focus only on one organization, but we have a limited amount
17 of time to do this, so I can't necessarily talk about them
18 all, so do you remember when the last time was that you
19 reviewed -- or Ms. Leong's company did a fiscal review or
20 audit of Loveland?
21 A. It was in the spring of fiscal year '01 and I
22 actually believe that it was March or May.
23 Q. Of this year, then?
24 A. Yes, sir.
25 Q. Okay. And did they come through okay? Is that the
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1 one you said they had to pay back a small amount?
2 A. Yes, sir.
3 Q. What was that amount? I think I've heard it
4 before. Do you remember what it was, about? If you don't,
5 that's fine.
6 A. I'd be guessing, and I don't want to do that.
7 Q. But otherwise, they passed that audit
8 satisfactorily?
9 A. I think that if you were them -- this was just the
10 fiscal side, not the performance side.
11 Q. Yes.
12 A. They had to give back some money, and none of our
13 provider agencies like to do that, so I'm not sure they would
14 define it as a success. They were not particularly pleased
15 with having to give us money back.
16 Q. Do you know the manner in which Ms. Leong's company
17 did this audit? In other words, did they just go in and
18 randomly select some children's files or did they ask that
19 Loveland pick some files? Do you know how they --
20 mechanically how they did it?
21 A. They are directed by our fiscal section of
22 children's division, and we may have -- it's sometimes done
23 randomly and sometimes there are particular records that for
24 a reason that our fiscal section may be concerned, if they
25 know a particular record or a particular provider that works
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1 for that agency they may have some concerns about, so they in
2 fact may ask for that particular record to be looked at, so
3 it is not completely random. We would prefer that we move to
4 really random, but fiscal advises me that there are some
5 records that truly need to be looked at and so they have
6 Ms. Leong's group look at those records in particular.
7 Q. So what happens is the names of the files -- names
8 on the files are given to Loveland and Loveland, then, within
9 some reasonable amount of time produces the files for review,
10 is that how it's done, where some file is red flagged to be
11 looked at, for example?
12 A. I'm sorry?
13 Q. I thought you explained a process where someone
14 suggested that this file ought to be looked at and so you
15 would tell Loveland, let me see that file, and they would let
16 you see that file, for example. Is that how it's done? Did
17 I misunderstand you?
18 A. No. I'm just trying to make sure -- I don't know
19 when you're done, so I don't know when to talk. This was the
20 fiscal year 2001 closing, so in 2000 we actually did give
21 them some notice of what it was we were going to look at.
22 That's part of walking them along, that process that I was
23 talking about, developing a system of care. I don't believe
24 in 2001 we are giving them notice. So we go in --
25 Q. So you haven't done it yet?
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1 A. No, sir, 2001 is closed. We go in to do our audit.
2 We don't tell them ahead of time which records we want them
3 to pull. We go in on that day and ask for those particular
4 records. In previous years we had given them a certain
5 period of time. Like if they just said, well, we have that
6 progress note but it's not in the record, we would give them
7 the time in 2000 and '99 to actually produce that. In 2001,
8 part of developing them as agencies, we did not give them
9 that time.
10 Q. Why would that note not be in the record?
11 A. They would say that their therapist who had done it
12 had done the note, they could say it, but they weren't there
13 in the office that day and so they would then submit it.
14 Q. But they did perform the service?
15 A. Correct.
16 Q. And did the note?
17 A. Correct.
18 Q. It just wasn't in the file?
19 A. Correct. So they would say it was a poor record
20 keeping situation, that the service was provided. And so as
21 part of developing them as agencies, we would do corrective
22 action plans around that and we allowed that I think in '99
23 and 2000. In 2001, we did not.
24 Q. Was there any reason why you allowed it in '99 and
25 2000 and you're not going to allow it this year?
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1 A. Yes, sir, that's part of -- as I was telling you,
2 most of these agencies -- or many of these agencies were
3 brand new in fiscal year '98.
4 Q. Loveland started in '99, I believe.
5 A. Okay. So these agencies, brand new in '97, fiscal
6 year '98, were learning how to run businesses, and part of
7 our job was to develop the capacity, to develop the system of
8 care. We did not have providers to serve children's mental
9 health needs in the state, and so we had to work with the
10 provider agencies and help guide them along how to manage
11 their business, how to manage the quality of their clinical
12 practice as well as how to manage themselves as small
13 business agencies, and so we -- again, there's a balancing
14 act involved when you're managing a system of care.
15 Q. Sure.
16 A. And so we were trying to build capacity, help them
17 develop, monitor quality, monitor accountability, and still
18 hold them accountable, but we gave them the opportunity to do
19 corrective action plans.
20 Q. Ms. Donkervoet, though, one of the most critical
21 things in a situation like with a provider such as Loveland
22 is that progress note, very important part of the whole
23 process, are they not, progress notes?
24 A. Yes, sir.
25 Q. And that's the only way you can determine whether
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1 or not the proper treatment is being given, whether these
2 students are progressing or not, things of that nature, is
3 through those progress notes, right?
4 A. I would not say that's the only way, no.
5 Q. That's one of the more important ways, though?
6 A. That's one of the more customary ways.
7 Q. Look at the file and see what was being done, what
8 progress had been had, things of that nature, the progress
9 notes in a certain student's file would be critical, would it
10 not?
11 A. It's one of the more customary ways, and we do
12 believe that it is critical and we do monitor for that and we
13 hold them accountable.
14 Q. But you would agree that doing it in a random
15 fashion would be a much better way than what you did in '99
16 and 2000? I understand your reasons for doing it, but doing
17 it randomly would be much better than doing it in the way
18 that you have, by giving them the names of the students so
19 that then they could do whatever they wanted, but then they
20 could give you the file?
21 A. Again, we are not using that practice. That was a
22 developmental stage, and I believe that it was warranted in
23 '99 and 2000, and I believe that our agencies are now at a
24 different level of performance and so it is no longer
25 warranted and we changed our practice.
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1 Q. You are aware that doing it the way you did it
2 could result in abuse? I'm not saying it did. Could result
3 in abuse, right?
4 A. Could. Again, I'm not going to agree that it did,
5 but could.
6 Q. Let me give you an example. I'm going to have
7 marked as Exhibit 1 for identification a memo. I'd like you
8 to look at that memo together with us and we can talk about
9 it.
10 (Exhibit No. 1 marked.)
11 Q. If you might look at the memo, it's under Loveland
12 Academy's letterhead.
13 A. Yes, sir.
14 Q. Have you seen this before, by the way?
15 A. No, sir.
16 Q. Have you read it?
17 A. I have read it.
18 Q. Anything about this strike you as being unusual?
19 A. Yes, sir.
20 Q. And we're talking about a memo that's stamped
21 confidential under Loveland Academy's letterhead, and
22 probably the most prominent words are urgent memo, very bold
23 face, with two exclamation marks, and dated October 3rd, '01,
24 this month -- last month. It's to all staff from a Julie
25 LaMadrid, copied to Patty Dukes. You know those
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1 individuals, don't you?
2 A. I do not know Julie LaMadrid.
3 Q. I think she works in the business office or
4 something like that. It's re: Progress Notes. Do you see
5 that?
6 A. Yes, sir.
7 Q. It says, "We have just been subpoenaed by the state
8 auditor's office and they will be auditing all of our client
9 records on October 5th through October 12th." And now this
10 memo is dated October 3rd, so they just learned about it.
11 "Attached is a list of progress notes that are missing from
12 the client records. Please complete all notes and turn them
13 in immediately. If you were absent from Loveland Academy
14 that day, then you," underlined, bold face you, "then you
15 must find a way to complete the note. Paychecks will be held
16 until all notes are in the client's file. There is no
17 exception... all notes must be done. Should you have any
18 questions, please see Julie or Aaron." I believe Aaron is
19 referring to Aaron Wilton. Do you know Aaron Wilton?
20 A. No.
21 Q. "Mahalo." Now, does that suggest that there are
22 these client records without progress notes?
23 A. That certainly sounds as how I would understand it.
24 Q. And that these progress notes -- well, these staff
25 members are being instructed and threatened with their
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1 paychecks being withheld if they don't go in and fill in the
2 progress notes when they might have been absent that day.
3 How would they fill in the progress note if that staff person
4 was absent that day?
5 A. Sir, I've never seen this memo. I can't explain
6 why Loveland would do such a thing, and this is the first
7 time it's being brought to my attention.
8 Q. Would it be fair to say that you will look into
9 this?
10 A. Yes, sir.
11 Q. And it does suggest some impropriety, suggests?
12 A. It's concerning, sir.
13 Q. On its face.
14 A. It's concerning.
15 Q. All right. Now, in fact, Loveland has not been
16 accredited yet, has it, from the Department of Health?
17 A. Department of Health -- when you use the term
18 accredited, you mean CARF or COA accredited? I don't which
19 term you --
20 Q. No. I understand the Department of Health has an
21 accreditation process for providers such as Loveland, and in
22 their case when they started two years ago, two and a half
23 years ago, for some period their accreditation was waived.
24 Do you know of that?
25 A. Again, I'm just trying to understand your question.
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1 We don't separately accredit. We require when we release an
2 RFP that the agencies that we contract with must be CARF or
3 COA or JCHO accredited. Those are nationally accrediting
4 bodies. If it's a new agency, we allow a period of time.
5 However, they must be showing us their plans to become
6 accredited.
7 Q. What period of time?
8 A. I don't know off the top of my head.
9 Q. Do you know if Loveland is in that category of
10 being given that waiver?
11 A. In order to be given a contract with us, they were
12 a new agency, they would have to be given that waiver.
13 Q. Sure, but now this is two years later, though,
14 right?
15 A. I believe that they came in in '99 you're telling
16 me.
17 Q. Yes. My understanding was July of '99 they opened
18 their doors.
19 A. Then that's two years into it.
20 Q. Will you look into that for us, please?
21 A. Yes, sir.
22 Q. Now, if this involves a personal matter, then I
23 would ask that you not answer it, because I'm not trying to
24 get into personal matters, but have you looked further into
25 or intend to look further into the relationship between
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1 Loveland and David Drews?
2 A. Not at this time, sir. We've done an
3 investigation. I'm comfortable with that investigation. The
4 action that's been taken, I understand from Dr. Drews after
5 his testimony, it was quite an unpleasant experience for him,
6 that he has severed any relationship with Loveland and that
7 the sign is down. That was at his action, not at any
8 requirement on my part.
9 Q. He severed any relationship with Loveland?
10 A. Yes, sir.
11 Q. So I haven't looked, the sign is down?
12 A. Yes, sir.
13 Q. The banner is down?
14 A. Actually, I haven't driven by either, but that's my
15 understanding.
16 Q. And he's not using the rooms there?
17 A. That's my understanding.
18 Q. And I assume he's taken that off his Website?
19 A. That's my understanding. That was his action, not
20 required by --
21 Q. Not something your division initiated?
22 A. No, sir.
23 Q. You were here when Ms. Ako testified that Lenore
24 Behar was contracted directly by the Department of Health,
25 and I think she suggested you might have knowledge about
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1 that. Do you?
2 A. Yes, sir.
3 Q. Can you tell us what that knowledge is, ma'am?
4 A. You actually said the technical assistance panel
5 disbanded the end of 2000 --
6 Q. I could be wrong.
7 A. I believe it was actually earlier, either the
8 summer or the fall of 2000, around some court hearing, that
9 the technical assistance panel was disbanded.
10 Q. I see.
11 A. We have no contracts with Dr. Groves, Dr. Foster,
12 Judy Schrag -- who's the other one -- Lenore. Was there a
13 fifth one? I can't recall, but those -- my understanding and
14 what division has abided by is that we are required by court
15 order to pay the Felix monitoring project. Our part is
16 $600,000. Last year by court ordered their budget was
17 increased. Our part was 150,000. That was requested to the
18 legislature last year.
19 Q. I understand that.
20 A. At the end of the technical assistance panel, one
21 of the key initiatives that has been discussed with the
22 legislature at length has been the dissemination and support
23 of evidence-based practices as well as the evaluation of our
24 system, and part of what we did in January of 2001 was that
25 we hosted with more than 500 people from our state a
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1 conference on evidence-based treatments, and we brought in
2 from the Surgeon General's office the Surgeon General's
3 report and IMH folks and some of the best leading researches
4 in children's mental health to lead that conference.
5 Q. Is that the conference she participated in?
6 A. She participated and she assisted us in preparing
7 for it and talking with the Surgeon General's office and IMH
8 and how to strategically get some folks here to help us with
9 that conference. That's the only contract that we've had
10 with Dr. Behar separate from her role in the technical
11 assistance panel.
12 Q. And for how much was that contract?
13 A. I can't -- actually, I have, but I don't off the
14 top of my head, the actual dollar amount. We executed an MOA
15 with a not to exceed 25 K. It did not exceed 25 K, but I
16 can't give you the exact dollar amount. I can get it to you.
17 I just don't know today.
18 Q. Please do. And this was -- this was what you
19 believe appears to be the documentation we may have seen that
20 suggested that Lenore Behar was contracted with by the
21 Department of Health directly?
22 A. I believe that if you're referencing documents that
23 we've provided to the auditor's office that then was provided
24 to you, we have a list of everybody that we've contracted
25 with over years. She shows up on that list once, and it is
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1 for that conference participation and leadership.
2 Q. So correct me, then, when did the technical
3 assistance panel -- when was that discontinued?
4 A. I actually think that came out of the -- remember
5 August 2nd, 2000 was the big -- a court date or a court
6 document came out around that date, and I think that the
7 disbanding of the technical assistance panel was around that
8 same time.
9 Q. Wasn't that the one that established or conferred
10 on the heads of the departments these what we call super
11 powers?
12 A. I heard the committee call them super powers. I've
13 actually heard DOE call them super powers. I have not heard
14 Department of Health use that term. We actually -- the
15 director has waiver authority, and that is when the director
16 got his waiver authority for procurement and personnel in
17 order to comply.
18 Q. Well, is that what Ms. Ako was referring to when
19 she referred to HRS 103 D and F?
20 A. Right. I believe how the court order reads --
21 something that the director of health may waive procurement
22 103 D, 103 F, and personnel as needed to comply with matters
23 of the consent decree, something of that nature.
24 Q. You have disagreement with the term super powers?
25 A. It's not a term that I would use.
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1 Q. Well, all right. But they are powers that
2 supersede any Hawaii state statute, right?
3 A. They allow the director to waive the --
4 Q. In other words, not -- the director is allowed to
5 do things that otherwise would be in violation of the state
6 statutes, right?
7 A. As needed in order to comply with the requirements
8 of the consent decree.
9 Q. I understand that. Now, do you recall the process
10 that was initiated and instituted that resulted in the MST
11 being brought here to Hawaii and utilized with our children?
12 A. Can you tell me the beginning of that statement,
13 the process?
14 Q. Yes. How did it happen? You were involved with
15 that process, were you not?
16 A. Yes, sir, I was.
17 Q. In fact, because of your position, at least as to
18 any services that are provided to your division, CAMHD, as to
19 what programs ought to be funded, what programs ought to be
20 discontinued, you have a -- you play an integral part of that
21 process, do you not, as chief?
22 A. Yes, sir, I do.
23 Q. And hiring and firing within your division, same
24 thing, you have the -- you play an integral part in those
25 processes?
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1 A. Not in -- not necessarily in hiring and firing
2 because I have individuals that report to me and then there,
3 again, are kind of an organizational structure, and so I
4 defer -- I rarely participate in interview panels or make
5 decisions about who's selected for positions, unless they are
6 the three positions that report directly to me. Other than
7 that, it's part of the other managers and supervisors to
8 manage that process.
9 Q. Now, how about MST, getting back to that, if I
10 might, you were part of the process that resulted in MST
11 being utilized here in Hawaii?
12 A. Yes, sir.
13 Q. And tell me what was that process? How did it
14 occur?
15 A. Okay. It was in the fall of 2000, and actually
16 much of the action came out of the experiences that I had
17 during the legislative session of '99. That was a session
18 year that we had very high numbers of kids on the mainland
19 and we had more and more judges court ordering kids to send
20 them to the mainland and we had Kahi and Queen's both
21 completely full and saying they can't take any more, and the
22 legislature was also very concerned that we were spending
23 more and more money. That was a big year for emergency
24 appropriation as well. Actually, Ms. Ako misspoke. When --
25 that appropriation emergency request that year was higher
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1 than last year's. It was a tough session year, and obviously
2 the legislature was very concerned about the rising costs and
3 yet we were sending more and more -- at that point in time we
4 peaked at 89 kids on the mainland. The majority of those
5 kids were conduct, behaviorally disruptive kids being ordered
6 by judges, and so part of --
7 Q. Excuse me. Actual federal court judges or are
8 these administrative --
9 A. No, these are family court judges. Family court
10 judges order kids to the mainland because they -- their
11 perception was we didn't have adequate facilities or programs
12 or treatment programs here.
13 Q. Did we have adequate facilities in your mind here?
14 A. No, sir.
15 Q. So these judges were correct in their rulings, to
16 your understanding?
17 A. We -- I would not agree to all 89, but there
18 certainly were some kids that we were not able to serve, and
19 so --
20 Q. Do you feel your position -- the state's position
21 on that in those matters or those cases where you feel maybe
22 the court was wrong, do you feel that the state's position
23 was adequately espoused in court?
24 A. There's a process that we go through when we go
25 into family court, and that's that the attorney general
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1 represents all three divisions together, or child serving
2 agencies, so the AG represents Department of Education,
3 Department of Human Services, and Department of Health, and
4 there's one position, obviously, that's represented as the
5 state's opinion. I understand and accept that at times it's
6 the decision of the state to make decisions that may not
7 always be Department of Health's position, but we have to go
8 in with one position and so --
9 Q. By which -- by what provision or requirement do you
10 have to go in with one -- how was that --
11 A. I can't give you the statute.
12 Q. How was that policy reached, statute?
13 A. I'm not sure if it's statute. I'm not sure if it's
14 policy. It is the organization of the AG's office and how we
15 interface.
16 Q. That might be difficult, would it not, with three
17 departments being represented by the same counsel where they
18 might have differing opinions?
19 A. You're now asking me a legal opinion, and I'm not
20 sure how you would go in with so many different opinions, so
21 I don't have a better suggestion. It's not always --
22 Q. Okay.
23 A. So then the fall coming off of a session where we
24 had rising number of kids going to the mainland, we were
25 concerned that that was not -- it was so far away for some of
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1 our Hawaii kids and they were going to, you know, Nebraska
2 and Kansas where we really were concerned about Nebraska and
3 Kansas folks understanding our kids and being able to provide
4 services for our kids, and then not only that, but when they
5 were coming back we hadn't changed the family, we hadn't
6 changed the school, and we hadn't changed the community, and
7 so we spent that money and spent that time and hadn't gotten
8 anywhere.
9 At that same point in time, that summer, the
10 Surgeon General put out the first ever report on children's
11 mental health services and about what are the evidence-based
12 treatments, and NIMH began also really looking to support
13 what are the evidence-based treatments, what do we know, and
14 out of -- in October of 2000 -- no, in October of '99 I
15 established what's called the Evidence-Based Services Task
16 Force. This is a task force that is multi-disciplinary in
17 nature, consists of primarily University of Hawaii folks,
18 some of -- now that we have some psychiatrists, our
19 psychiatrists, and they actually are reviewing the literature
20 comprehensively about what's known about what works.
21 And again, when we started looking at the kids
22 we're sending to the mainland, the kids that we were not
23 doing well I think in anyone's eyes, it became the misconduct
24 kids, the willful misconduct, behaviorally disruptive, the
25 kids that were not being managed well in their home and in
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1 their communities.
2 Q. And were these necessarily juvenile delinquents?
3 A. That's how folks outside of children's mental
4 health may refer to them.
5 Q. Were they in that category?
6 A. Yes, sir.
7 Q. Behavioral conduct?
8 A. Behavioral conduct issues.
9 Q. I'm sorry.
10 A. And so then in October of 2000 I -- based upon
11 touching base with as many people and expertise that I could
12 find, we decided to release an RFP for five home-based MST
13 teams, and that was a public RFP released. Panels were
14 established to review those RFPs, as we do with all of our
15 RFPs. I don't sit in on any of the decisions. There are
16 panels that are determined, and they use criteria upon which
17 to make the decision about who's awarded the contracts, and
18 we then started with the five home-based MST teams in January
19 of 2000. Is that right? January of 2 --
20 Q. Could be.
21 A. I think that's right.
22 Q. The program was discontinued this August, this
23 summer?
24 A. No, sir. That is the continuum.
25 Q. No, I understand. I'm sorry. The continuum was.
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1 You're right.
2 A. So that's why I want to separate five home-based
3 teams came up in January, and then actually what happens in
4 our system as it's developing, then those communities that
5 don't have MST begin to have some concerns about why does
6 this community have MST and we don't have MST, and we began
7 to see that those communities that had MST were in fact able
8 to bring their kids back from the mainland, prevent kids from
9 going to the mainland, and so we added in July of 2000 five
10 more to the communities that didn't yet have MST. So -- and
11 that was done through the same public RFP process. Same
12 panels. I didn't sit in on anything, and it was sheerly done
13 based upon it's the best treatment that we know of as far as
14 effectiveness with this population.
15 Concurrently, as things happened, as we're
16 developing systems, in March or so of 2000 we continued to
17 look at many of the kids -- other kids that were on the
18 mainland and in Kahi and Queen's were, in fact, not the
19 willful misconduct but the severely emotionally disturbed,
20 kids with anxiety, severe anxiety, severe depression, maybe
21 emerging schizophrenia or bipolar disorder, kids that have
22 more of a mental health background. And so I went through
23 the same process. We went back to the Surgeon General's
24 report, we went to NIMH, we went to the Evidence-Based Task
25 Force, and we said what works to get these kids out of
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1 residential? Because what everybody nationally is saying is
2 residential doesn't work. Get your kids out of residential.
3 You're spending state money and it's not going to give you
4 the results you're looking for.
5 So based upon feedback from NIMH, based upon
6 national experts -- best researchers that I can find in
7 children's mental health, your best possibility is to try
8 MST. That's the only children's mental health service that
9 is as heavily evaluated as they have committed to evaluating
10 their treatment, and so we began to have discussions with
11 them in March about whether or not in fact this would make
12 sense.
13 Q. Discussions with whom?
14 A. Folks from the Family Services Research Center,
15 which is Scott Henggeler and researchers.
16 Q. This was Scott Henggeler that I believe your
17 husband testified about with whom he interned at the Medical
18 University of South Carolina, that person?
19 A. I don't know if John did his internship under
20 Scott, but that is --
21 Q. He did an MST internship?
22 A. That is my understanding.
23 Q. At the Medical University of South Carolina?
24 A. That is my understanding.
25 Q. So when, then, was this decision made to employ MST
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1 as opposed to some other evidence-based program?
2 A. We went through the IRB process in June for a start
3 date of July, and so I believe in March, April, May we
4 actually were evaluating it, looking at other possibilities,
5 trying to see if there was some other option, but no one else
6 was interested in developing a research proposal, getting it
7 through the IRB process. We had people that were interested
8 in maybe offering their services, but not in doing
9 evidence-based research, which we wanted to make sure we were
10 evaluating whether or not we were getting the results we
11 wanted.
12 Q. Now -- it's convenient now.
13 A. I'm sorry?
14 Q. They're asking me when to take a break to relieve
15 the court reporter for a few minutes.
16 CO-CHAIR REPRESENTATIVE SAIKI: Take a
17 five-minute recess.
18 (Recess taken.)
19 CO-CHAIR REPRESENTATIVE SAIKI: Members, we'll
20 reconvene our hearing, and we'll continue with questioning by
21 Special Counsel.
22 SPECIAL COUNSEL KAWASHIMA: Thank you, Chair
23 Saiki.
24 Q. If I might just for few minutes, ma'am, go back to
25 the questions I was asking you just for a few more on
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1 Loveland. Is David Drews still in a position to oversee and
2 approve authorizations for payment for Loveland Academy?
3 A. That was one aspect of his testimony, and actually
4 I think it was Mike Stuart's or Ken Gardiner's testimony that
5 was confusing to me, because contracts -- the selection of
6 the choice to contract with Loveland was not Dr. Drews.
7 That's done by the panel, the RFP panel.
8 Q. No, it wasn't that. I think --
9 A. The authorization of the specific services are
10 decided upon by IEP teams, and then the care coordinator
11 fills out a form, which is called a service authorization or
12 service procurement form, based upon the decision of the IEP
13 team and then it's inputted, so I'm not quite sure what the
14 testimony -- I'm confused about any kind of testimony of what
15 Dr. Drews does or doesn't do to -- for services around that.
16 Q. Let me ask you if we go through the IEP process,
17 past that point to where the IEP somehow comes out with a
18 recommendation, Loveland endeavors to provide the treatment
19 and then submits a statement for services rendered, okay, at
20 that point. Now, at that point there still could be disputes
21 as to how much should be paid, if at all, right?
22 A. When services are authorized by the care
23 coordinator, we have a comprehensive data management system,
24 and the number of units, which, depending upon the level of
25 care, a unit may be five minutes or a unit may be a day, it
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1 depends upon the level of care we're talking about, but the
2 units are actually inputted into the computer system based
3 upon the authorization given by the care coordinator. The
4 claim when it comes in cannot exceed the number of units that
5 that care coordinator authorized, so there's actually a
6 matching electronically between what was authorized and
7 what's being billed for.
8 Q. So that in no situation where a payment for -- a
9 request for payment is made beyond the number of units that
10 is authorized, in no case has the Department of Health ever
11 made payment in more than the amount that was authorized and
12 is -- as is contained in the computer or not? Do you
13 understand what I'm saying?
14 A. Try one more time.
15 Q. You're suggesting that because it's in the computer
16 for a certain amount of service and the service is rendered
17 and maybe an excessive amount -- maybe more than one unit --
18 one unit is authorized, more than one unit is rendered,
19 and they -- two units are rendered, and the statement for
20 services rendered is for two units. Now, in that situation
21 are you saying there's absolutely no way the department can
22 honor that payment for the second unit?
23 A. No. What happens is that gets kicked back to the
24 provider agency that billed, and they are notified that
25 that's in excess of what was authorized, and then they have
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1 to follow up with their care coordinator to say whatever the
2 miscommunication was or whatever the problem was, and so the
3 care coordinator would then have to do what's called a retro
4 authorization to increase that. The data system will not
5 allow for a claim to be paid without the care coordinator
6 inputting those --
7 Q. Are there situations where a person in David Drews'
8 position can override any or all of that and authorize
9 payment to a provider? Are there such situations?
10 A. Where they can override what?
11 Q. Where David Drews can override what you're talking
12 about, can override that and authorize payment such that
13 payment is made to a provider?
14 A. Not to my knowledge. That would not be policy,
15 that would not be practice. If you're aware of a specific
16 situation, I am not.
17 Q. Well, you -- obviously you listened to all of David
18 Drews' testimony, did you not?
19 A. No, actually, I did not. It was on a Saturday. I
20 think I came in in the middle. I arrived in the middle of
21 Dr. Drews' testimony.
22 Q. And you did not in any other way review his earlier
23 testimony?
24 A. No, I did not.
25 Q. Did you -- I think what I asked him was during the
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1 second half of his testimony. Do you recall him testifying
2 that yes, there were situations, albeit his recollection was
3 much less than other witnesses had testified to, but he did
4 admit that there were situations where questions about
5 billings from Loveland Academy were brought to him?
6 A. Correct.
7 Q. And he authorized payment. Do you recall testimony
8 in -- to that effect?
9 A. No, sir, I don't.
10 Q. So that if he did in fact authorize payment where
11 there was a dispute between the person under him who's
12 working on it and Loveland, that he should not have approved
13 that payment to Loveland, any case like that, is that what
14 you're saying?
15 A. I think we have to be careful to -- again, because
16 we're a developing system and we do have some performance
17 issues, not only on the provider side but on family guidance
18 center's side, and we are working on their supervision issue.
19 So if in fact it is authorized in an IEP and if in fact the
20 service was provided but then a care coordinator comes and
21 says I don't want to do this, then in that situation the
22 direct supervisor would have to comply with the IEP and work
23 with explaining to the care coordinator why in fact that had
24 to be complied with.
25 Q. Are there such situations as I am referring to
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1 where there would be a dispute between the provider, such as
2 Loveland, and the department where David Drews would have the
3 authority to override whatever else --
4 A. Not to my knowledge.
5 Q. So that if he did that, then he did something
6 improper? If he did in fact override whatever requirements
7 were there and authorized payment to a provider such as
8 Loveland, then he would have done something improper, right?
9 A. I admit that I'm a little bit concerned that I'm
10 not sure I understand what it is you're referencing, but if
11 I'm understanding you, that it would not be practice or
12 policy or protocol in our division.
13 Q. In other words, something he should -- it would
14 have been something he should not have done?
15 A. To override --
16 Q. For him to authorize payment where one of his
17 people had questions about whether or not it ought to be paid
18 and the provider, such as Loveland, would call him directly,
19 for example, him meaning David Drews, and seek payment of
20 that invoice and he authorizes payment, that situation?
21 A. Again, the reason I'm confused is because he can't
22 authorize it. It would have to go back into a data system,
23 right. I mean, we are in an electronic billing module. We
24 don't do paper invoices.
25 Q. A situation --
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1 A. So there's something that I feel like I'm not
2 understanding, so it's a little bit risky for me to give you
3 an answer.
4 Q. Well, the situation as I have described it,
5 assuming I've described it generally correctly, should not
6 occur; is that what you're saying?
7 A. Generally, yes, I would agree with.
8 Q. Well, generally? What other situation might there
9 be other than generally?
10 A. I'm putting some qualifying remarks around it
11 because, again, I'm concerned that you're talking about a
12 specific situation that I am not understanding correctly.
13 Q. Maybe you might ask him about it.
14 A. Okay.
15 Q. You know, there was -- and, again, perhaps it's a
16 numerical thing, but there were figures to suggest that the
17 state was paying Patricia Dukes and her organization as much
18 as $53,000 a year for one student. Does that sound right to
19 you?
20 A. For a child with severe autism --
21 Q. At Loveland?
22 A. For a child with severe autism, that sounds about
23 right.
24 Q. Well, I'm not so sure if it even was -- a child
25 with severe autism necessarily. Is it your testimony that a
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1 child with severe autism, that amount is not -- doesn't
2 surprise you? It does not seem unreasonable, let me say?
3 Does not seem unreasonable?
4 A. I think that the unreasonableness -- you're getting
5 to what services exist and the structure of them. It would
6 not be unusual for severe -- a child with severe
7 disabilities, whether actually for severe child with SED
8 that's placed out of the home, that's $625 a day, so children
9 with severe autism are frequently in a day program and then
10 have wrap services around the clock with intensive services,
11 so it would not surprise me. I don't think we have a lot of
12 them our state, but it would not surprise me to hear about a
13 handful of children like that.
14 Q. The enrollment at Loveland isn't all -- or the
15 great majority of them are not severe autism students, are
16 they?
17 A. Again, I don't review the specific children that
18 are in that program. It is program designed, to my
19 understanding, for children with autism. And again, as our
20 treatment services are decided upon through the IEP process,
21 the only kids who would be placed there are children that the
22 public school system doesn't feel like they have enough
23 supports to appropriately provide treatment or educational
24 services and supports. And so that being the case, if the
25 school system feels that they cannot manage that given child,
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1 it indicates to me that that is pretty severe autism.
2 Q. Were you involved with the actual awarding of
3 contracts to Loveland when they started in '99?
4 A. I do not sit often the RFP panels. Decisions are
5 made based upon independent panels. I do review the RFP
6 before it goes out. Loveland was one agency that came in
7 with a proposal in response to the RFP. We currently have
8 approximately 60 plus contracts. They are one -- and each
9 one of those proposals had a separate panel that evaluated, a
10 panel of five people.
11 Q. Who sits on that panel?
12 A. Five people. We try for Department of Education,
13 Department of Health, two, and a family member, and we
14 received exemption from the state procurement office to
15 actually have family members sit on our review panels as an
16 effort to involve families in our system of care.
17 Q. Who sat on behalf of the Department of Health, if
18 you know, in Loveland's?
19 A. I can get that information. I don't know off the
20 top of my head.
21 Q. Are there usually more than a few who actually
22 perform that function for the department? In other words,
23 when you select people from the Department of Health, are
24 they usually among a group of six or ten or 20?
25 A. Yes. There's a large number, because to review
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1 these, given the rest of your job, is --
2 Q. I see.
3 A. It takes time.
4 Q. For example, would a person such as David Drews
5 serve on this type of panel from time to time or not?
6 A. He may have been asked. I'm not sure that he
7 accepted. A lot of times branch chiefs feel like they have
8 too much other stuff going on, so they may not have sat on
9 it, so --
10 Q. He probably did not sit on the panel for Loveland,
11 did he?
12 A. I would not know.
13 Q. He probably shouldn't have if he had that
14 relationship with Central Pacific and Loveland, right, if
15 they had that --
16 A. They may not have had that relationship if they
17 didn't exist at that point in time, correct, so I would have
18 to get that panel listing for you, and I can do that.
19 Q. Are you aware of the application initially made by
20 Loveland for -- to provide services to the department for
21 autism students which was rejected or denied because there
22 was not the requisite person with the requisite experience
23 and credentials to provide that service, something like that
24 occurring, does that sound familiar to you?
25 A. No. I'm to again decide if you're done or not
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1 before I jump in.
2 Q. Sorry.
3 A. Discussions, again, before July of '99, we had no
4 day program, educational program, or otherwise for children
5 with autism. And so what was happening in '97 and '98 was
6 children with autism -- we were getting a fair number of
7 complaints from families. The court was very concerned. We
8 actually had to provide a report about what it is we're going
9 to do to address our services for kids with autism, and so
10 there probably were negotiations with whoever we could find
11 about who's got some expertise in serving kids with autism.
12 At that point in time I believe that Maggie Koven
13 and Patty Dukes were working with Hoahana, and so I know that
14 many of the referrals for kids with autism were actually
15 going to them. And so I know that they existed as providers
16 in the community. We didn't have a lot of providers who were
17 coming forward and saying we have an expertise, this is a
18 population that we know how to treat. So I understand from
19 Dr. Dukes' testimony that someone from children's division
20 approached her talking about whether or not they could put
21 together a program. That would not surprise me that
22 discussions like that were occurring, and I can tell you back
23 then there were some concerns about Dr. Dukes' not having the
24 appropriate credentials.
25 I although think that it needs to be understood
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1 that's coming from a children's mental health division where
2 we look for mental health credentials, and when you're
3 treating a child and providing supportive -- educational
4 support services for a child with autism, it's not always a
5 mental health issue. It's a social and a communication
6 educational support kind of services, and so I'm not sure
7 that we were correct in requiring her to have mental health
8 if her population that she wants to treat are children with
9 autism.
10 Q. Whether or not you're correct, though, your
11 department's regulations and requirements required that that
12 person have mental health experience or credentials?
13 A. That's correct.
14 Q. So that there was that situation, then, where she
15 went back and a week or two later came back with a master's
16 degree in the appropriate area to provide services?
17 A. I have no idea that that was a week or two.
18 Q. How long was it?
19 A. I have -- I have no idea.
20 Q. Did you just waive the requirement, do you recall?
21 A. In '98 --
22 Q. It was '99.
23 A. No, '99 they were awarded the contract.
24 Q. I understand that, but I understand also before
25 they got the contract they could not have gotten it -- or at
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1 least a part of that contract they could not have gotten
2 because she did not -- or no one there had the appropriate
3 degree to provide autism services?
4 A. I don't believe that to be true because in their
5 proposal Dr. Dukes, if she's coming in as the administrator
6 or the director, as long as she has a clinical director,
7 which she has had with Dr. Koven, the administrator and the
8 program director does not have to have all of the
9 credentials. There are different credentials for the
10 different positions.
11 Q. You don't recall anything that autism required that
12 Dr. Koven did not have --
13 A. Not --
14 Q. -- that had to be satisfied by Ms. Dukes getting
15 this master's from Central Pacific University?
16 A. No. My understanding is that Loveland's
17 credentials will be covered by Dr. Koven, and I think that
18 the issue around credentials came up when Patty Dukes wanted
19 to bill for, say, individual therapy, when she says she's
20 doing speech therapy and we're saying if you're billing us
21 for individual therapy, it has to be mental health treatment,
22 and what she -- and that was the situation. I believe that
23 was '98.
24 Q. And then for mental health treatment to be provided
25 she had to have an advanced degree?
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1 A. If she's providing mental health treatment.
2 Q. Right. An advanced degree in what?
3 A. We have what's called a qualified mental health
4 professional, which means it's a master's degree in
5 psychology, social work.
6 Q. That's what she got, a master's in psychology?
7 A. That's what I heard from her testimony. I
8 certainly have not double checked her credentials.
9 Q. All right. That's fine. Now, just going back,
10 then, for a few minutes on MST. You mentioned the various
11 studies that have been performed regarding evidence-based
12 services.
13 A. Yes, sir.
14 Q. Studies and articles, I assume, that were looked
15 at?
16 A. Yes, sir.
17 Q. Who wrote those articles?
18 A. I believe all of the MST research on that
19 particular treatment -- are you asking specifically about MST
20 or all of the articles we've reviewed?
21 Q. All of them such that you -- that the reason that
22 you ultimately having read all of them chose MST as a
23 therapy?
24 A. Well, the Evidence-Based Services Task Force --
25 Q. Were you part of that task force?
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1 A. I am not. I appointed it. Periodically I'll sit
2 in to just listen to what they're talking about, but I
3 appointed -- asked that task force to convene and they at
4 this point have reviewed more than 500 articles about
5 children's mental health treatment approaches.
6 Q. When did you -- you testified you put that task
7 force together in 1999?
8 A. Yes, sir.
9 Q. Who was on that task force?
10 A. Dr. Bruce Tropeda from the University of Hawaii
11 School of -- Department, I guess, of Psychology chairs that.
12 There's representatives for -- other representatives from
13 psychology, UH psychiatry, several representatives
14 participate, UH social work participates, UH School of
15 Nursing -- College of Nursing participates, again, some of
16 our family guidance center psychologists that are in the
17 public sector but choose to participate in something like
18 that are given time to participate and --
19 Q. This is the original one now. I'm not talking
20 about how it exists now.
21 A. That's how it was originally set up. There isn't a
22 change in how it was designed.
23 Q. Well, is there anyone else that you've not
24 mentioned that was on that original task force that may or
25 may not be on it now?
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1 A. I did not -- I did not appoint individual people
2 and say you are a member. I just asked Dr. Tropeda to
3 convene a task force, and what has happened is people have
4 convened and I don't always know who's in which meeting and
5 who is not in the meeting.
6 Q. Was your husband on that task force?
7 A. I don't believe so.
8 Q. I'm not saying he was. I'm asking you. Do you
9 know?
10 A. No, I do not believe so.
11 Q. He shouldn't have been on it is what you're saying?
12 A. No, that's not what I'm saying.
13 Q. Who would have appointed him from the Department of
14 Health, though?
15 A. I would assume that would be something he would
16 talk with Carol Matsuoka about.
17 Q. You would not have been that person?
18 A. No.
19 Q. You appointed no one to the task force?
20 A. Other than ask Dr. Tropeda to convene the group.
21 Q. You yourself --
22 A. Again, I want to be clear that I'm not sure -- I
23 genuinely don't know if he was there, and I don't know that
24 there would be a problem if he was there. I don't perceive
25 that to be a problem, but I don't know if he was or not.
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1 Q. You don't perceive that to be a problem when he in
2 fact did an internship under Scott Henggeler at the Medical
3 University of South Carolina and then they end up using MST
4 and he ends up being head of the continuum ultimately? You
5 don't see a problem with it, at least an appearance problem?
6 A. You may see an appearance problem. I think if you
7 look into it, I'm not sure I believe there's a substance
8 problem.
9 Q. I'm not suggesting necessarily bottom line there
10 was one. I'm just asking you does that not suggest to you an
11 appearance problem?
12 A. To me it does not. I can understand from you that
13 to this committee it may, and I think if you look into at a
14 substance level I don't think there's any grounds for it,
15 but --
16 Q. You know, did you hear your husband testify?
17 A. I did not.
18 Q. One of the things he testified as to why he
19 resigned from being the director of the continuum, one of the
20 things, was the perception that he believed people had that
21 he had influence because of your position?
22 A. I understand that.
23 Q. Words to that effect. Now, he at least had that --
24 or at least knew that some people had that impression.
25 A. I think that both of us are aware some people may
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1 choose to stand outside and be critical, may make some
2 comments and some statements, but again, I say that if
3 somebody comes in and takes a look at it, I don't think
4 there's grounds for it. And I think that it was a stressful
5 thing for him to think that he's bringing potential criticism
6 to me in the job that I'm trying to do, and, you know, I
7 think as a family member people make different decisions and
8 he chose to step out because of his concern that it was
9 influencing the appearance for me.
10 SPECIAL COUNSEL KAWASHIMA: Thank you very
11 much. I shouldn't take more time. That's all I have.
12 CO-CHAIR SENATOR HANABUSA: Thank you.
13 Members, we'll institute our usual rule. Let's begin with
14 Vice-Chair Oshiro, followed by Vice-Chair Kokubun.
15 VICE-CHAIR REPRESENTATIVE OSHIRO: Thank you,
16 Co-Chair Hanabusa.
17 EXAMINATION
18 BY VICE-CHAIR REPRESENTATIVE OSHIRO:
19 Q. I just wanted to get some clarification, I think,
20 on one area, and it had to do with when Mr. Kawashima was
21 asking about whether you heard anything that has in any way
22 made you think that there may be modifications that are
23 necessary in terms of how CAMHD is operating. Do you recall
24 that?
25 A. Yes, sir.
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1 Q. My question has to do with I think you said that
2 everything is based on an electronic billing system?
3 A. Our contracted services, that is true. We have an
4 extensive electronic data system. Flex and respite are the
5 two exemptions from that.
6 Q. But I also was asking a question of Ms. Ako when
7 she was here earlier, and I was asking particularly about the
8 instance where there are codes for providers and then there's
9 actually a code for each service.
10 A. Yes, sir.
11 Q. And my question comes about because when we were
12 looking through all of the documents, there are a lot of
13 instances -- what we encountered was someone like Dr. Dukes
14 billing 52 hours in a single day or we have someone like --
15 what's another example. We have a Dr. LeGoff billing 52
16 hours a day, and when we questioned Dr. Dukes about it what
17 she said was that she was told by the division that they
18 couldn't get another code so everybody providing that service
19 had to come under her name, under her code, and I just
20 want -- I mean, I'm seeing that as a big problem because, if
21 you just let me explain, the problem I see is that when we
22 looked at things, we looked at the documents, and things like
23 that immediately caused a red flag for us, if you understand?
24 A. I do.
25 Q. A person cannot bill 52 hours a day, and then the
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1 secondary problem underlies is that how are we going to get
2 proper oversight over the services that are actually provided
3 because, for one, if we have to go back and look at each
4 progress note and make sure that it's verified and
5 documented, that's one issue, because that's a lot of
6 additional work. On the second level it's also because if
7 there are instances where people are feigning documentation
8 and just generating progress notes just to have supporting
9 documentation, then that also questions services that are
10 being provided.
11 So can you explain to us why is it that you only
12 have this single numerical system for a single service to
13 that provider and is there any way we can rectify it so we
14 won't encounter this program again? Because I think it's
15 been a significant problem in term of our review of the
16 number of providers and the number of hours that are
17 accounted for each of these individuals.
18 A. I am aware of that -- the issue and the -- somebody
19 has to bill. It is an issue for the day treatment programs
20 and an issue for the biopsychosocial rehab programs. When
21 you're talking about outpatient treatment services, they are
22 all billed under the direct provider. Now, group therapy
23 confuses people because you can get more units than looks
24 like is possible in a given hour, but I've heard some other
25 folks testify as to why that is.
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1 So in day treatment and in biopsychosocial rehab
2 it's not as though there is a discrete mental health
3 treatment service. There may be some group that's part of
4 day treatment, there may be some individual, there's some
5 educational component, there's some social opportunity times,
6 and so you may have during a given day treatment or a given
7 biopsychosocial after school program -- it's much more of a
8 milieu-based treatment, if that makes any sense to you. It's
9 a staff. So you'll have the clinician that will provide the
10 therapy, but you also have them just organizing a kid's day.
11 It's like a school classroom, and so in a school classroom
12 there will be the teacher, and what we're saying is that you
13 bill under that individual, and yes, there are other aides
14 working in there, and yes, there are other people doing
15 things, but we need to know who's responsible for overseeing
16 that program, that day treatment, or that biopsychosocial on
17 that given day.
18 Q. I understand all of that, but at the same time
19 isn't it just as easy to insert another subcode into that, I
20 mean, further divide up that code? Because, I mean, I think
21 really our problem is that we're looking at this from a very
22 different perspective in terms of we're looking at it from a
23 fiscal oversight problem, and things like this just
24 immediately cause problems for us and cause concern for us,
25 and if we don't have the proper justification, then we're
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1 forced to do things like this, and sometimes there are
2 instances where maybe there are good explanations, but other
3 times we have things like this memo coming from Loveland
4 which makes us more so scrutinize them, and we just need to
5 ask is there any way where we can rectify this, you being the
6 division head, so that maybe we can solve this in the future.
7 A. I know that we have a new RFP, and I don't think
8 it's been released yet, but I think it's due to be released
9 for next July, and we looked at -- we're not doing day
10 treatments anymore, so that takes care of the day treatment
11 program. We will still run into it with biopsychosocial and
12 an after school intensive outpatient program, and what I can
13 tell you is that I can look into it and see what we can do to
14 come up with some other means of tracking the time so that --
15 I agree, it brings up a red flag and it's not always
16 warranted. If it is, then we should attend to those, but
17 sometimes it makes people concerned and there's a valid
18 explanation. So I'll see if I can address that somehow.
19 Q. Thank you very much.
20 CO-CHAIR SENATOR HANABUSA: Vice-Chair
21 Kokubun, followed by Representative Kawakami.
22 VICE-CHAIR SENATOR KOKUBUN: Thank you,
23 Co-Chair Hanabusa.
24 EXAMINATION
25 BY VICE-CHAIR SENATOR KOKUBUN:
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1 Q. Tina, I wanted to ask you about the change in
2 school-based services and how that specifically would affect
3 Child and Adolescent Mental Health Division, and I'm talking
4 about the impact from the perspective of staffing and the
5 budget.
6 A. As you heard some from Val, I think we initially
7 transferred last session $21 million to the DOE. You may
8 recall that the previous year we actually had already
9 transferred over the service authorization responsibility to
10 the Department of Education, so they already in fact were
11 managing that population, and the care coordinators that we
12 have are providing intensive case management to the kids who
13 have more intensive or out-of-home treatment.
14 That's what the -- we did not do a good enough job
15 in explaining to the legislature. They perceived that
16 there's going to be some reduction for the care coordinators.
17 That transaction occurred in the fall of '99, and so there
18 wasn't -- there is not a significant impact on what
19 children's mental health division was doing in May or June or
20 July. We're still doing the same thing that we have been
21 doing.
22 Q. For the so-called high end?
23 A. For the intensive -- kids with intensive services,
24 which are home and community based and kids placed out of
25 home, we provide intensive case management services. The
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1 care coordinators' case loads are now between 15 and 20.
2 They are required to do school visits, intensive in-home
3 visits. They have to link up with all of the providers. We
4 are requiring a lot more visits at the treatment programs, if
5 they are out of home placed so we can get them back into
6 their home community. So it's where in the past when their
7 case loads -- you may have heard something about their case
8 loads being like a hundred or thereabouts. They were much
9 more paper pushers working with a data system. They are
10 really now out in the schools and in the communities and the
11 people's homes. We now track how many family visits, home
12 visits, community visits they are doing. It's truly
13 intensive case management the way it was designed. We did
14 not explain that well to the legislature, so they perceived
15 that there was going to be some reduction.
16 I need to clarify that we still have the children
17 with autism for this year. We are planning for July -- I'm
18 sorry, I have a hard time with years, July of '02 that autism
19 services as a whole will go to the Department of Education,
20 which then, again, we are looking at -- since we can track
21 our money per kid, we're looking at transferring the money
22 that is associated with that given child to the Department of
23 Education so they can then just take over the management. In
24 that situation, we would also transfer or look at
25 reallocation. I don't want to use the wrong term. We would
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1 need less care coordinators and they would need more to take
2 on the management of that population. It is a challenging
3 population that has intensive needs. Without a doubt,
4 Department of Education will require more staff and we will
5 require less. We are already having those discussions with
6 the Department of Education in trying to plan for how to
7 transfer those positions or what that looks like when you
8 move from one department to another.
9 Q. But other than the autistic clientele, the changes
10 that were made in '99, you think really adjusted your
11 division in terms of the transfer?
12 A. Adjusted as far as the case loads. That's when the
13 numbers really went down. When they were able to go down
14 from the hundred down to 15 to 20 to 25 was actually in '99
15 when the Department of Education began doing service
16 procurement through our data on the low end, if you will,
17 kids. They're now called school-based kids. Department of
18 Education took them over in '99. What they've done now is
19 that they are either doing the contracts or they're providing
20 the services, but as far as managing the population, they
21 took that in the fall of '99.
22 There are some other exceptions that I just want to
23 make sure that I'm clear on. Juvenile sex offenders, we
24 continue to maintain that population, even if they are only
25 getting intensive outpatient services. We think that that's
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1 probably too intense for a school-based behavioral health
2 program to manage. Some kids with some severe eating
3 disorders that the schools have tried their school-based
4 program and these kids really need focused intensive
5 outpatient. So there are some exceptions of some outpatient
6 kids that we may keep, not the majority of them and they are
7 kind of isolated by district of how many kids those are.
8 Q. Give my a rough idea in terms of numbers and in
9 terms of the students that you were providing service to,
10 what has been the change?
11 A. Of the kids that we manage?
12 Q. Yeah.
13 A. The school-based behavioral health are managing
14 kids that have kind of minor behavioral issues in a school or
15 they may be kids that have some anxiety and some depression
16 but it's able to be managed on an outpatient basis. The kids
17 we have have severe behavioral disruption. A lot of times
18 the family issues are much more complex.
19 Q. I don't mean to interrupt, but I've been given my
20 warning. I just wanted to know what the differences in the
21 numbers are. How many were you serving prior to '99, how
22 many are you serving now?
23 A. Okay. July, May -- actually, I can give you
24 current numbers. July -- May to June the numbers, including
25 DOE -- I mean Zero-to-Three, looks like there was about
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1 13,500, about 2,000 of those, 2,500, belong to early
2 intervention. So there are about 12,000, a little bit less
3 than that, kids that we were serving, but on any given month
4 the number of kids accessing services was more like 8,000, so
5 8,000 kids and we're down to we now have 3,000 kids that we
6 manage in the intensive mental health system. So we've lost
7 5,000 kids.
8 Q. Thank you.
9 CO-CHAIR SENATOR HANABUSA: Representative
10 Kawakami, followed by Senator Slom.
11 REPRESENTATIVE KAWAKAMI: Thank you, Chair
12 Hanabusa.
13 EXAMINATION
14 BY REPRESENTATIVE KAWAKAMI:
15 Q. Tina, I wanted to ask, on the high end youngsters
16 from the numbers we were first sending out of state till
17 today, what is that number here and there, the total?
18 A. We peaked and we spent most of -- we peaked at 89
19 and we spent most 1999 in the 80s. We had a really tough
20 time getting out of the 80s. Today we have 17 youth on the
21 mainland.
22 Q. And the total when we were sending out of state was
23 how many?
24 A. 89 was as high as we went.
25 Q. 89 was the total?
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1 A. Yes.
2 Q. And 17 today?
3 A. And the vast majority, almost three-quarters, are
4 court ordered kids that we continue to work with the courts
5 on how to bring them home.
6 Q. Follow-up question, and I had tried to get
7 something going, was to build a cadre in the state to be able
8 to bring these home -- these children home earlier, et cetera
9 and nothing was done. I remember when Dr. LeMahieu came on
10 board I mentioned it to him also and he said he thinks that's
11 a good idea, to be working with UH and so forth and getting a
12 cadre up to speed, but nothing was ever done. Do you know
13 why?
14 A. Can you describe what you mean by cadre?
15 Q. Teachers in the system were willing to go back to
16 school or to get some kind of training so that they could be
17 doing some of this in our community. I guess we're looking
18 long range, but perhaps -- and I just wanted to know, did
19 they feel that we could not do it?
20 A. I think that when you're talking about these kind
21 of kids that require mainland placement, yes, I think that,
22 again, a school is developing and they are getting better and
23 stronger and stronger, but I think that when you talk about
24 these 17 kids, the schools are very antsy and concerned about
25 working with these kids. And I hope that we can build their
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1 confidence, and we actually on our side have developed kind
2 of a cadre around helping transition these kids back and
3 helping teams understand that they can build supports, and I
4 think that by making more therapeutic foster homes, by
5 strengthening our case manager skills in home and community
6 and school supports, and we have now a transition specialist
7 that is really working around each and every one of these 17
8 to help teams figure out what it is, what their supports at
9 the school and home and community are going to need to be in
10 place to bring the kids home. All of them now have
11 transition plans, all of them have discharge dates, and it's
12 a matter of developing the school and community to be able to
13 be prepared to accept these children back home.
14 Q. So you see that happening within a span of how many
15 years?
16 A. Oh, I think that --
17 Q. Soon?
18 A. The majority of them will be able to get back. We
19 have kind of special situations where we now have kids that
20 have been up there for years and their families actually have
21 moved. Those kids it doesn't make sense to bring back to
22 Hawaii, and we have kids now who have become adults. They
23 are 20 years old and we need to transition them back into the
24 state where they now are. Unfortunately, we've lost some of
25 Hawaii's children, and so some of those kids are going to
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1 transition into their state where they are and the rest we're
2 going to be able to bring back home, and I certainly hope
3 it's within the next year we'll have all of Hawaii's children
4 home.
5 Q. When you say bring them back home, will we be
6 paying for this? Will the state pay for bringing them home?
7 A. It's a requirement. We are paying for where they
8 are now and we pay for their --
9 Q. Continue until they return?
10 A. Yes.
11 Q. And provide the services?
12 A. Yes.
13 Q. Now, I wanted to know when you mentioned
14 Dr. Tropedo and the research that was done by that group, you
15 had quite a few people. What were the recommendations of the
16 task force that looked at the literature --
17 A. Oh, that's wonderful.
18 Q. -- and the comprehensiveness of it?
19 A. There's an entire report that I'd love to provide
20 to the committee. After analyzing this, they have developed
21 a comprehensive report about the different diagnoses of kids
22 and what the evidence-based treatments show, and now they've
23 actually developed for us practice guidelines which are being
24 disseminated to every school for school-based behavioral
25 health, every family guide center to actually guide the
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1 practice around all of these evidence-based treatments.
2 Q. So those haven't come out in the field yet?
3 A. They have.
4 Q. They have?
5 A. Yes.
6 Q. So we could get that?
7 A. Absolutely.
8 Q. And the last question, Tina, has to do with, you
9 know, the categories of mental health now. We've moved from
10 the beginning, now you said we're up to, what, 13,500 total?
11 A. Total Felix kids, I believe that's true.
12 Q. Out of that, the categories of kids, the ones with
13 the largest chunk is autism now?
14 A. No. Actually, out of that we have approximately
15 600, I think -- between DOE and us we agree that there's
16 about 660 children with pervasive developmental disorders, of
17 which autism is one of them.
18 Q. Okay, and then the next category?
19 A. They are our conduct and behaviorally disruptive
20 kids, and to a minor degree, then, you get into the ADHD
21 kids, and then the next group are the anxiety PTSD and
22 depressed kids.
23 Q. So the lowest kids would be that last group?
24 A. The smallest group is the true emerging
25 schizophrenia kind of population. Those are the emerging SMI
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1 kind of kids, and you don't a lot of times see that first
2 break until they are 17 or 18 years old, so that's our lowest
3 population.
4 Q. And the last -- very last question. The courts
5 do -- they keep recommending, am I correct --
6 A. Yes.
7 Q. -- kids into the system? They never -- we never
8 get money from the courts, okay, so when you make your
9 recommendations for funding, are they included?
10 A. Are you talking about our recommendation to the
11 legislature?
12 Q. Yeah.
13 A. Are they -- the court kids included or the courts
14 themselves?
15 Q. No, the youngsters that have to be given services
16 through the schools.
17 A. Yes, ma'am, they are in there.
18 Q. Because that chunk comes on afterwards.
19 A. That's correct, and they are in there. Any
20 court-ordered costs for serving the Felix class kids that we
21 have are in our budget requests.
22 Q. So you usually put up to the time that you get the
23 requests?
24 A. That's right, and at times it's tough to project
25 because we don't know what the court is going to order.
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1 Q. Off the top, how many court-ordered cases now?
2 A. You mean court involved?
3 Q. Involved and ordered that services be provided.
4 A. Our data is not as good on that as I would like. I
5 believe it's about 3 percent of our 3,000 kids, which --
6 somebody help me -- is that 900? I think that's 900. I have
7 to look at the accountant.
8 Q. Thank you very much.
9 REPRESENTATIVE KAWAKAMI: Thank you, Chair.
10 CO-CHAIR SENATOR HANABUSA: Thank you.
11 Senator Slom, followed by Representative Leong.
12 SENATOR SLOM: Thank you, Chair Hanabusa.
13 EXAMINATION
14 BY SENATOR SLOM:
15 Q. Mrs. Donkervoet, you have knowledge of the
16 legislative process. Am I correct in suggesting that you
17 have been involved in terms of lobbying or testifying at the
18 legislature for budget matters?
19 A. Yes, sir, I have.
20 Q. And what's been your experience in terms of the
21 funding that you have sought for these programs?
22 A. I think that when we have done an adequate job of
23 explaining ourselves to the legislature, the legislature has,
24 perhaps reluctantly, but supported us. I think that it's
25 always a stressful time. It's not an easy time, nor should
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1 it be. We've come in every year since I've been involved
2 with an emergency appropriation request. I think there's
3 lots of requests for data and trying to understand, and I can
4 understand why it's challenging. If Felix is not all that
5 you do, it's a little bit difficult to understand, and I
6 believe that I've done the best that I can to explain it, and
7 sometimes I've done a better job than others.
8 Q. When you say reluctance by the legislature, are you
9 talking about reluctance to fund the programs or reluctance
10 because of possibly information that was asked for and not
11 communicated clearly?
12 A. Yeah, I think that their reluctance has been what
13 they perceived has been not timely kind of responses from us
14 or inadequate responses from us.
15 Q. When you first began your testimony you said one of
16 the reasons you're here is to be supportive, and so forth, of
17 the efforts, and you raised an issue of balance. First of
18 all, very briefly, very briefly, could you just summarize
19 what you consider to be the accomplishments in your area?
20 A. Oh. I think that we now have identified the
21 children with severe emotional disturbances in our state.
22 We've developed a system of care as it's required. We're
23 providing timely and appropriate services to the vast
24 majority of the kids in this system, and I think we're
25 committed to evidence-based treatments and to evaluating our
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1 system and to being accountable both fiscally and clinically.
2 I think you could not have said that three years ago about
3 this system.
4 Q. When you raised the issue of balance, what issue or
5 issues do you feel that either the committee or people that
6 have come before the committee have not been fairly
7 represented?
8 A. I think that there's been a focus on sort of what
9 was done wrong two years ago or mistakes that may have been
10 made, and I think that one -- you have to understand the
11 different kind of demands and pressures and the time that the
12 court expects certain things to be implemented and the speed
13 with which certain things have to change, and I think that
14 people have responded in the best way possible at that given
15 point in time when you're trying to develop a system.
16 This is not a clear process and a clear path. You
17 may implement one part to a system and then because you get
18 changes coming at you from five different sides, you then
19 have to change directions again, and then you again evaluate
20 and you have to change directions. So there's not a direct
21 path, and I think sometimes folks that aren't involved look
22 for the direct path from here to here, and that's not how you
23 implement systems. That's not how you manage systems. It's
24 constantly evaluating and incorporating and making changes,
25 and I think that this committee has looked a lot about what
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1 has been done wrong in '97, '98, '99 and has missed a lot of
2 the accomplishments that are taking place right now, which I
3 think the monitor and the court even recognize how -- the
4 accomplishments are right now. And that's something that the
5 state -- entire state should be very proud of.
6 Q. Technically, are you a regular civil service
7 government employee with the state of Hawaii?
8 A. Am I regular --
9 Q. Or are you a contract employee?
10 A. No, I'm not a contract employee.
11 Q. So you are a full-time employee of the state
12 covered by civil service?
13 A. I'm not -- I'm an exempt, but I think I still have
14 civil service and union rights. I forget what I have as far
15 as an exempt employee. I'm a full-time exempt employee. I
16 don't know if I have civil service rights or not.
17 Q. Your husband had indicated one of the reasons he
18 was leaving was because of family, spending more time with
19 family and so forth, are you planning on staying in your
20 position?
21 A. I think that I am committed to taking the system
22 where I think it can go, and I'm honored to be part of the
23 process of managing this system. I would like very much to
24 continue to be part of it. I guess this committee may have
25 some input into whether or not I continue.
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1 Q. And one final question. You mentioned also at the
2 outset about tension that was created and the unnerving part
3 about testifying and so forth, and obviously you've watched a
4 lot of the testimony. Did anything that happened here in the
5 last couple of months cause you to miss any work for health
6 or other reasons?
7 A. Related to this committee?
8 Q. Yes.
9 A. No, sir.
10 Q. Thank you.
11 SENATOR SLOM: Thank you, Co-Chair.
12 CO-CHAIR SENATOR HANABUSA: Thank you.
13 Representative Leong, followed by Senator Sakamoto.
14 REPRESENTATIVE LEONG: Thank you, Chair
15 Hanabusa.
16 EXAMINATION
17 BY REPRESENTATIVE LEONG:
18 Q. Good day. I just had a couple of questions. I was
19 interested in your contract for review, and I thought that
20 was interesting because it seems to be such a concern with
21 many agencies, you know, how they are doing their review and
22 if they really are and if they are uniform and whether they
23 are appearing or not for payment. I know what the lady's
24 name is, but I was wondering how long has this been going on?
25 I think you indicated it was just in March. How long has
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1 this been going on, your review contract?
2 A. We've been doing it at least since fiscal year '99.
3 I'd have to look at my documents to see -- it may have been
4 in place in '98.
5 Q. So the Loveland Academy would not have been part of
6 this?
7 A. The Loveland Academy is part of the review.
8 Q. It is part of the review?
9 A. Yes.
10 Q. And secondly, I was wondering, who assumes the
11 cost? Is it your department or is it the state or Felix?
12 Who covers the cost for this review?
13 A. Well, I think we're all the same, so it is -- it's
14 a cost that is absorbed by children's division, which is
15 absorbed by Felix, which is absorbed by the legislature
16 funds. I mean, it's all the same money.
17 Q. So is it a very expensive situation or is it
18 something -- see, I was thinking it's nice because hopefully
19 it will be more uniform, but I'm not sure it's going to be
20 more uniform.
21 A. At this time one of the things -- what we've
22 represented and what we've been sure is that the money that
23 is recouped offsets the cost of the contract. We're actually
24 recouping more than we're paying for the contract. Hopefully
25 as their practice gets better and they get stronger, we'll
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1 actually recoup less so then you have a cost, but at this
2 point it's a wash.
3 Q. So is there some discernment about this information
4 from the Loveland Academy, you know, having to get their
5 records in order?
6 A. I saw that memo today and I've already actually
7 spoken with we need to have some immediate follow up to that.
8 Q. And my last question has to do with your claims
9 review. How many agencies actually go in -- and I know this
10 is doing it kind of anonymously or not at a set time, how
11 many agencies do they cover?
12 A. We contract with at least 60 agencies through our
13 RFP process. We then also have other contracts, MOAs that we
14 have to enter to serve the rural areas if someone didn't
15 respond if we didn't get enough people, and all of the
16 contracts that we have are looked at annually.
17 Q. So did you answer my question, what does this cost?
18 What is the cost?
19 A. The specific cost of the contract I'm not sure that
20 I have with me. What I said to you is that whatever it is we
21 recoup, is greater than the cost of the contract. We do have
22 that. I just don't know it off the top of my head, how much
23 that specific contract is for.
24 Q. And --
25 A. I'd be happy to provide that, though.
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1 Q. And this woman is the one that heads all of the
2 review?
3 A. It actually is very tightly managed by our fiscal
4 office. The Jerry Leong folks come in and we specifically
5 tell them exactly which records we want them to look at, what
6 the random selection is. They go out -- they are kind of the
7 leg work stuff. They go out and actually do the checks, and
8 actually what they turn back in to us is kind of a matrix of
9 whether or not what we asked them to look for was it present,
10 was it absent, was it there but it was inadequate. They
11 complete it, and then our fiscal takes back and does the
12 analysis about how much money that means. So actually all
13 they are doing is actually going out and looking at the
14 records for us.
15 Q. I see. Thank you very much.
16 REPRESENTATIVE LEONG: Thank you, Chair.
17 CO-CHAIR SENATOR HANABUSA: Thank you,
18 Representative Leong.
19 Senator Sakamoto, followed by Co-Chair Saiki.
20 EXAMINATION
21 BY SENATOR SAKAMOTO:
22 Q. Hi, Mrs. Donkervoet. I'm glad to hear your comment
23 about now you can track the money per child, which in the
24 speed of things before that was very difficult. In light of
25 that capability, would we be seeing less emergency
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1 appropriations in that now you can have a better handle on
2 the cost of the service you're providing?
3 A. Let me first say nothing would make me happier than
4 to not have to sit at those tables and ask for an emergency
5 appropriation. I believe that this year, as we've looked at
6 the numbers, you can expect an emergency request this year,
7 and I believe we're putting every mechanism in place so this
8 will be the last year, but I can't make you any promises
9 because I continue to think we're getting stronger, we're
10 getting better, and we're putting the mechanisms in place.
11 We're putting in the proper budgeting. I think we're looking
12 at numbers with a much better handle. We're not seeing
13 growth. We're not at this point adding tremendous more
14 services. So it is reasonable that this is the end of the
15 emergency request time.
16 Q. Or at least there will be a spreadsheet to show we
17 estimated 600 and now we have 700, therefore --
18 A. I think we can exactly tell you where the cost
19 overruns are.
20 Q. That's good. I'm glad you're doing evidence-based,
21 and I'm happy to hear a report is out. Is that a continuing
22 process or this is it and good-bye?
23 A. No, it actually is an ongoing -- the first report
24 actually came out I think in October of 2000, and the next
25 report is getting ready to come out, because obviously they
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1 continue to look at new data. They meet monthly and they
2 look at all the new research that's coming out. So I believe
3 within the next month the second report is coming out and
4 they are committed -- what's great about this is that the
5 interest is growing. We have more people from education now
6 participating and folks really want to be part of this
7 process.
8 Q. In the past, one of the criticisms was the
9 Department of Health CAMHD side was clinical approach as
10 opposed to whatever else. Is the evidence-based more
11 clinical or is it more global than clinical as well as other
12 methods of what works?
13 A. At this point in time the initial parts, since it
14 came -- its evolution development started from mental health,
15 it looked at clinical evidence-based treatments. Now, with
16 the inclusion from the Department of Education, we're
17 actually looking at much more of the school-based
18 evidence-based approaches, which are much more behavioral and
19 they're measured differently, so it's a different way of
20 evaluating it, but much of the focus at this point in time is
21 on much more of the school-based and kind of less directly
22 clinical interventions.
23 Q. Dean Kadman at the medical school has touted the
24 ability to get National Institute of Health grants, other
25 projects. At least it's my understanding thus far we've not
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1 been able to -- at least in children's mental health been
2 able to acquire large amounts of money to actually help pay
3 for some of the costs as we're proceeding with some of the
4 various applications. Is that something that we could
5 advance the ball in?
6 A. Let me first start by -- remember CMHS, the Hawaii
7 Ohana Project was a federal grant, and so that continues to
8 get a fair amount of national recognition of what we did with
9 the Hawaii Ohana Project and the successes that we have seen
10 from that. There are other possibilities to apply for the
11 next CMHS grant, and NIMH, which is National Institute of
12 Mental Health, a section of NIMH -- during our best practices
13 conference a few weeks ago I actually met with the head of
14 the children's clinical section. Her name is Kimberly
15 Hogue-Woods, and I talked with her about what possibilities
16 might exist to support us in what we're doing about
17 disseminating evidence-based practices. She was very
18 supportive. She talked with me about -- that there's this
19 new way of getting a fast track. First of all, NIMH grants
20 run about -- you can start now and you might get it two years
21 from now. I was trying to explain that I needed it now.
22 There is a fast track approach which she's given me the
23 details to. She's supportive of it completely, informed
24 about what we're doing here, and excited about it. So I hope
25 that the combination of Dr. Tropeda and myself will be
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1 looking to apply for something like that in coming months.
2 Q. Is that something in order of tens of thousands or
3 hundreds of thousands?
4 A. NIMH grants are fairly small. I'm not sure. You
5 get awarded I guess based upon what it is you submit, but --
6 Q. The Ohana was what, sort of -- you already have
7 received --
8 A. That actually I think was -- closing year 1.9
9 million.
10 Q. Last question. So now that the task force has come
11 out with work product, is that something that a typical third
12 grade teacher could say I have this document, I'll turn to
13 the chapter on ADHD, and I see several strategies that a
14 committee has come up with and maybe I'll try strategy one
15 because it seems to be 80 percent of the children respond to
16 strategy one? Is it --
17 A. And certainly -- as we look at dissemination,
18 we're certainly studying how you properly disseminate and how
19 do you truly change teacher's practice, school-based
20 personnel practice, and clinician practice, and basically
21 what we've done in the past hasn't really changed practice.
22 So we are looking at how to really do that and evaluate if
23 it's working. We have developed a matrix table just like
24 that. We are disseminating that, as well as the practice
25 guidelines, which give them a little bit more information.
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1 We don't want people to get so boxy that they forget to
2 individualize for a given kid. So it's a matter of giving
3 them competency but also helping them remember to use common
4 sense and use their team model, and so we are looking at
5 evaluating all of those issues when we think about
6 dissemination.
7 Q. Richard Hess and Bob Campbell are --
8 A. Richard Hess and Bob are very tight with this.
9 Exactly who we're working with around all of this. We've
10 gone out and done joint trainings about some of this and are
11 committed to remaining doing our joint efforts.
12 Q. Second last question. Sorry. I guess
13 evidence-based studies, that's fine, theoretical, that's
14 fine. When do we get to the point where we can see dollar
15 amount based on certain strategies, which vendor, which
16 provider in deed is giving our system the best outcomes at a
17 cost that's reasonable as opposed to any provider to provide
18 any treatment because the goal is providing service?
19 A. I don't think we're actually that far off. We
20 actually have lots of data that we can begin to tie our
21 outcomes to our dollars and begin to evaluate providers based
22 upon that. One of the vacant positions that we have right
23 now and has been vacant as long as we've created it is called
24 a data evaluator, and it's truly finding somebody whose job
25 it is to look at our data system -- we have lots and lots of
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1 data available -- and to help guide us around what
2 interpretation should be made, but we're looking for somebody
3 who understands systems, data evaluation, and has a clinical
4 background, and so it's been challenging to find that person.
5 Q. $1.1 million grant, they'll do it if you have the
6 data.
7 A. Well, we have the data.
8 Q. Thank you.
9 CO-CHAIR SENATOR HANABUSA: Co-Chair Saiki.
10 CO-CHAIR REPRESENTATIVE SAIKI: Thank you.
11 EXAMINATION
12 BY CO-CHAIR REPRESENTATIVE SAIKI:
13 Q. First category is on Na Laukoa. Are you familiar
14 with Na Laukoa?
15 A. Yes, sir, I am.
16 Q. Your division has a contract with Na Laukoa?
17 A. Yes, sir, and I just need to clarify that I don't
18 remember off of the top of my head if it's with Kaniu 1, LLC
19 doing business as Na Laukoa or what that legal terminology
20 is, but I know them as Na Laukoa.
21 Q. But it was one of the Kaniu LLCs, right?
22 A. Yes.
23 Q. Basically what were the years in which Na Laukoa
24 was contracted by your division?
25 A. I believe that they came in in October of '98 as
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1 part of the closing of the Kapiolani Health Hawaii, and then
2 in July of '99 they bidded to -- with the RFP process like
3 everyone else did, but I think we did bring them in in '98
4 because of downsizing and getting rid of KKH, the
5 demonstration project.
6 Q. Are they still under contract through your
7 division?
8 A. Yes, they are.
9 Q. Do you -- generally what kind of services are they
10 providing, generally?
11 A. Intensive in-home, therapeutic aide, I believe that
12 those are the -- they may have had outpatient services, but
13 since we transferred all of that to DOE, they may have lost
14 that.
15 Q. Is your division satisfied with the services being
16 provided under that contract?
17 A. I think that that agency exists like many of our
18 agencies, particularly the smaller agencies that exist in
19 some of the communities that we have where parts of their
20 program -- they tend to do very well with the community.
21 Culturally they are very strong and tend to understand the
22 kids in their community very, very well. I believe that
23 originally -- and I haven't seen the most recent report on
24 them, we had some concerns about their administrative
25 oversight, and we worked with them around a corrective action
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1 plan on that, but again, I think we see that in many, many of
2 our smaller agencies that we do business with. They were
3 developing, they were fairly new, and they did some things
4 very well. Some people were very pleased with what they were
5 doing, and they needed guidance and some oversight in
6 managing their agency.
7 Q. Has your division received complaints about Na
8 Laukoa?
9 A. In which fiscal year? And actually, I'm not going
10 to be able to answer you anyway.
11 Q. At any time.
12 A. We have complaints data. I don't recall any
13 specific one that I can identify sitting at the table, but I
14 can provide to you our complaints data.
15 Q. Okay. Could you provide that to us, please. Do
16 you compile that data for all providers or just for certain
17 providers?
18 A. Our data evaluation is done by how many complaints
19 we have by family guidance center, how many are about our
20 fiscal operations, which many of the providers complain about
21 our billing process being too cumbersome, and how many are
22 about provider agencies. So I'm actually interested in all
23 of them, so our complaints section provides me reports about
24 all of the different providers. So they tell me which levels
25 of care, to see if we have patterns there, to see which
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1 agency, to see if we have patterns there. It's cut many
2 different ways.
3 Q. Did you -- were you involved in or did you have
4 knowledge of the Na Laukoa contract being awarded through
5 PREL before it actually -- before the contract was executed?
6 A. I'm hesitating because --
7 Q. Let me ask it this way. Had you ever voiced your
8 concerns about Na Laukoa prior to the PREL contract?
9 A. I believe that I did, and it was not around --
10 again, we were not required to be a tremendous part of this
11 technical assistance collaborative. We had to address the
12 performance in many different areas, and what we've done is
13 every family guidance has a mentor and has a QA specialist.
14 So we were addressing it this way, and then the Department of
15 Education was doing this targeted technical assistance thing,
16 and my concern was that Na Laukoa had done a nice job in
17 Hilo, and again, with that Hilo community and Big Island
18 community -- they go beyond Hilo, I don't want to -- but this
19 was going to be a state-wide kind of systems level contract,
20 and so it was not strongly saying don't give them a contract,
21 it was do you think that Na Laukoa is an agency that is ready
22 to take that on and do they have an understanding about how
23 to do systems level implementation evaluation kind of stuff.
24 Q. Well, was your recommendation generally that Na
25 Laukoa not receive the contract or that it receive the
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1 contract, referring to the PREL contract?
2 A. I didn't voice an opinion that strongly. I asked
3 that that be considered, has anybody talked to them about
4 whether or not and are we -- has that been adequately
5 answered, do we think they are ready to take something like
6 this on. And again, because it was being executed by DOE,
7 that was not my decision, but I gave that input.
8 Q. Thank you.
9 EXAMINATION
10 BY CO-CHAIR SENATOR HANABUSA:
11 Q. Tina, let me ask you some questions about the
12 technical assistance panel. Did they ever provide you
13 personally as the head of CAMHD any type of assistance? This
14 is the technical assistance panel created in the decree.
15 A. Absolutely.
16 Q. And what kind of assistance did they provide you?
17 A. When I began in the acting position in whenever --
18 that December, one of the issues for me was that I think that
19 I have some strengths in some areas, but this is for me too,
20 I had some concerns about legislative stuff, state policy
21 level that I had not done and heavily unionized kind of a
22 system. I wanted some guidance around implementing the
23 system of care in so many different communities and how to
24 support communities while still also attending to the policy
25 level stuff.
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1 So it was much more in there would be frequent
2 meetings with Lenore and Ivor, very -- I need to say that not
3 in his role as monitor, but he does consultations with the
4 TAC -- the Felix monitoring project, it's the same funding
5 stream, but he acts as technical assistance, and in talking
6 things through, that this is the way that I'm strategically
7 thinking I need to go, what do you think? And, again,
8 managing a system of care, how do you develop capacity, how
9 do you build people up, how do you develop a system while
10 you're still doing the accountability top down.
11 Q. Okay. So you knew Lenore and Ivor Groves. They
12 met with you in the initial years --
13 A. Yes.
14 Q. -- when you started?
15 A. Yes.
16 Q. Did you know Lenore Behar before you came to
17 Hawaii?
18 A. No, I did not.
19 Q. How about Ivor Groves?
20 A. No, I did not.
21 Q. How about Judy Schrag?
22 A. No, I did not.
23 Q. Did Judy Schrag give you similar kind of assistance
24 that you've attributed to Lenore Behar and Ivor Groves?
25 A. I certainly have met with Judy and she did
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1 specifically around interfacing mental health in with schools
2 and better understanding schools and IEPs linking with CSPs,
3 but it certainly was not the same frequency that I met with
4 Lenore and Ivor.
5 Q. I know you said after this about the early part of
6 2000 you gave -- well, the Department of Health entered into
7 some kind of memorandum of agreement with Lenore Behar not to
8 exceed $25,000. That's correct, right?
9 A. Yes, that's my understanding.
10 Q. And that was before Lenore Behar got into trouble
11 in North Carolina?
12 A. Yes, it is.
13 Q. Did she reveal --
14 A. That's my understanding. I don't know actually
15 when her trouble in North Carolina came.
16 Q. The news reports I've read is about early February.
17 Did she reveal to you that she was having some problems in
18 North Carolina?
19 A. My -- it's a very vague recollection that she
20 was -- again, she's in -- was in the position that I'm in in
21 North Carolina. We're in the same position, and so she would
22 talk to me about -- that things were a little bit stressful
23 and things were crazy there and things were stressful during
24 legislative session for me here, and so it was that kind of
25 communication about things were rough and rocky in North
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1 Carolina. I do not remember her ever revealing the content
2 of it or talking with me in detail about -- and I still don't
3 know what the specifics are of that.
4 Q. How about your relationship with Ivor Groves, you
5 said that he's assisted you in technical assistance. Have
6 you used his services in any other way?
7 A. Other than technical assistance?
8 Q. Right.
9 A. No. I don't -- I view all of his kind of support
10 as technical assistance, so no.
11 Q. Outside of his role as the technical assistance
12 panel or as the monitor, have you contracted with him or --
13 A. No.
14 Q. -- any his company separately?
15 A. No.
16 Q. And have you -- what was interesting to me is that
17 he -- well, part of the benchmark became the MST program.
18 Did you have any conversations with Ivor Groves specifically
19 about MST and how you believed in that program?
20 A. He actually, I believe, has sat in on one or two of
21 the Evidence-Based Task Force when he's in town to observe
22 that process, and I think that it's -- I certainly before we
23 went with the five teams, those first five home-based teams,
24 talked with him about whether or not that made sense to him
25 because I was doing it as sort of a diversion or bringing
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1 capacity to bring kids back from the mainland.
2 Q. Let me understand something first. When the
3 Department of Health as an entity is communicating policy
4 decisions or proposals to Ivor Groves as a monitor, is that
5 done through you or is that done through Ms. Swanson or is
6 that done through Bruce Anderson or is it a collective of all
7 three of you meeting with him?
8 A. I think it's probably a combination of all and
9 sometimes it's through the AG's office. When we're truly
10 talking to him as monitor, most commonly it comes from the
11 AG's office.
12 Q. But when he sits in on your -- this group that you
13 talked about, this task force, is he sitting in as monitor or
14 is he sitting in as someone just interested in the process?
15 A. I don't think that those of us that are working in
16 this field kind of separate him into two separate beings or
17 bodies. I think that much of his monitoring style has been
18 technical assistance and consultation out to communities, and
19 so you can -- his posture changes, his participation changes
20 when he's being monitor. Most of the time I would say he's
21 in his technical assistance consultation and just enjoys
22 being part of kind of the academic discussions that are going
23 on.
24 Q. Let me shift gears now. You know the state
25 procurement office gives a publication out that -- and this
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1 one is a list of registered private providers, that is a list
2 of qualified health and human services providers. Are you
3 familiar with this document?
4 A. No, I'm not.
5 Q. Well, let me ask you something else, then. We have
6 taken the production that was made by Department of Health in
7 August -- in our August hearing and we've gone through the
8 contracts from CAMHD, and I'm just looking at the large ones.
9 I know you said there's about 60. There's about 27 that are
10 over $700,000 or over a million in this particular situation.
11 Like, for example, Kahi Mohala, which is called Sutter Health
12 Pacific, is 10,927,000 and so on. Does that sound right to
13 you? This is for -- I guess it's last fiscal year. Are you
14 familiar with that?
15 A. Kahi was a big -- they are the $625 a day. One of
16 our biggest -- largest contracts, but it's significantly gone
17 down, and I don't remember what's -- what this point in time
18 is, but Kahi was one of the largest we have, if not the
19 largest.
20 Q. For example, Loveland Academy is at 1.7 million,
21 which seems to be in line with what Dr. Dukes testified to,
22 and Kaniu 1 is 1.2, 1.3 million, does that sound in the
23 neighborhood?
24 A. Yes.
25 Q. What's interesting to me, when you look at the
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1 state procurement office, it tells you what date -- in this
2 publication of theirs, it tells you what date the respective
3 entities made the list, so to speak, and most of these
4 entities made the list in October of 1998, and some of them
5 as late as 1999 sometime. Is this in line with what you were
6 discussing earlier, how you had to basically find providers
7 and nurture them and get them to the point where they are
8 bidding and providing these services?
9 A. I don't understand the question.
10 Q. You said earlier to Mr. Kawashima that we have to
11 understand that you didn't have these types of providers
12 available in the community, so there was a lot of
13 hand-holding, a lot of helping them, whether it's in the
14 technical area, whatever, to come together and to provide
15 these services. Now, some of the smaller ones, that's what I
16 assume it is, but even the larger ones make the list in
17 October 1998 and some as late as 1999. So for the smaller
18 entities, is that what you were talking about, going out into
19 the community, like Loveland, for example, finding a group
20 that could provide the services that you need and then having
21 them bid and then they make the list?
22 A. I'm not sure you're connecting our RFP process to
23 the POS state procurement list, and I don't believe that
24 everybody that's -- we contract with is on the POS list. I'm
25 not sure how those decisions are made. By being on that POS
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1 list means you can get other services without going under
2 contract. If you're on the POS list, you can actually
3 contract or receive services up to a certain dollar amount
4 without having to be contracted by a state agency. So it may
5 have been in their interest to get themselves on the POS
6 list, but our agencies, when we go through the RFP process,
7 we did not, I don't believe, maybe under a general condition
8 that I'm not remembering, but I don't believe they are
9 required to be on the POS list. So I would say that provider
10 agencies are probably doing that because then they can get
11 other services without -- I think you can go up to like 100 K
12 if you're on that list without having a contract from other
13 entities. So it may be strengthening them as a business but
14 it wasn't a requirement of ours.
15 Q. I see. So these entities are just going from
16 your -- probably being able to provide services to you and
17 then getting on the state list as well?
18 A. That's my understanding.
19 Q. Because what it does say is that if you are in this
20 category of not in good standing, no one can contract with
21 you, and some of your entities are in this not on good
22 standing, so I was wondering if in fact they were able to
23 still get contracts because of the, quote/unquote, super
24 powers that Dr. Anderson has?
25 A. We would certainly have concerns if somebody is not
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1 in good standing on the POS list, but it's not my
2 understanding that that means that we can't contract with
3 them.
4 Q. They can still contract with you?
5 A. We would have to be aware of what the issues are
6 involving not in good standing and if they were able to
7 address that through some corrective action or some other
8 means. We may still choose to contract with them. If
9 there's only one agency serving Lanai and they're not in good
10 standing, chances are we're going to work with that agency
11 and figure out how we can build them up.
12 Q. Let me now -- my time is up too, so let me see if
13 there's any follow-up questions?
14 SPECIAL COUNSEL KAWASHIMA: I have none.
15 CO-CHAIR SENATOR HANABUSA: Any follow-up
16 questions? Senator Sakamoto, followed by Representative
17 Oshiro.
18 EXAMINATION
19 BY SENATOR SAKAMOTO:
20 Q. The MST, that's a particular type of treatment as
21 opposed to day treatment, as opposed to therapeutic care?
22 A. Those are levels of care, levels of service
23 definitions. MST is a treatment model, a particular way that
24 has a scientific and research basis on how to deliver it. If
25 you wanted to classify it like a day treatment or therapeutic
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1 foster home, it's an intensive home-based service is what it
2 is.
3 Q. So intensive home-based service would be the
4 generic term?
5 A. Correct.
6 Q. MST would the Ford four-door vehicle?
7 A. That's correct. Right now, for example, we
8 purchase intensive home-based service other than MST and we
9 don't really know what that means they are doing. They are
10 doing intensive in-home, what they are doing in the home is
11 not under any treatment model. It's --
12 Q. In the benchmarks I seem to remember in the
13 discussion it called for MST in specific or did it call for
14 intensive home-based?
15 A. I know that you want a short answer. If I can give
16 you one explanation because I've heard conversations about
17 the benchmarks and I think there's some confusion. What
18 happens with benchmarks is as you're preparing to go to
19 court -- and those particular benchmarks were as we were
20 facing a potential contempt court hearing. Under the
21 direction of the AG, both departments are required to come up
22 with your plan of what you're going to do to address the
23 areas that you know there are deficiencies, and the monitor
24 will identify the different areas that there are
25 deficiencies.
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1 Our particular areas are not having adequate
2 capacity, too many kids on the mainland, not enough autism
3 services, not enough evaluations, stuff like that, and we
4 come up with a plan. Our plan was -- as submitted to the
5 monitor was -- it had -- it's called a service capacity plan.
6 You've heard DOE talk about a FRP. We have a service
7 capacity development plan that identified different areas,
8 how many foster homes we were going to open up. One of the
9 areas we addressed was that we were going to do MST. All --
10 and so we are required to set up objectives for ourselves,
11 both DOE and us. We have to set target dates, we have to set
12 our objectives. Once we submit that into court, we are held
13 to all of that plan. The monitor just picks particular
14 benchmarks out of what we have submitted of what he's going
15 to look at, but once we submit it in, we're held to the whole
16 plan, not just the benchmark. Does that make sense? There
17 are other objectives, there are other target goals other than
18 the benchmarks that we also have to comply with.
19 Q. I guess I'm wondering why in the court document it
20 didn't state intensive in-home as opposed to -- I mean, it's
21 like buy a four-door vehicle as opposed to saying buy this
22 particular vehicle?
23 A. And what I can say is because that's not how we
24 turned in our plan. He took that specifically from our plan,
25 and our plan, as we talked, was not to add more intensive
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1 in-home. We actually have lots of intensive in-home in this
2 state. We're not getting accountability out of it. We're
3 not getting outcomes out of it. We're actually somewhat
4 concerned about our intensive in-home and the costs
5 associated not given the results we're getting. So we
6 specifically said we are going to do MST. All he did is take
7 that specific objective and make it a benchmark.
8 Q. Thank you.
9 SENATOR SAKAMOTO: Thank you, Chair.
10 CO-CHAIR SENATOR HANABUSA: Vice-Chair Oshiro.
11 EXAMINATION
12 BY VICE-CHAIR REPRESENTATIVE OSHIRO:
13 Q. Just briefly. I think when Chair Saiki was asking
14 about the complaints you said that you have a data -- or a
15 database for the complaints, in particular I think it was for
16 Na Laukoa, and you said you were going to provide that; is
17 that correct?
18 A. I'll provide the complaints data.
19 Q. Is that an easily accessible database?
20 A. Yeah, pretty easy. It's not on our MIS system, but
21 it works.
22 Q. Would we be able to get it for the majority of the
23 providers?
24 A. You can get it sorted by provider. I assume that's
25 what you mean. We have a database and all you want is it
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1 sorted by provider?
2 Q. Yeah.
3 A. Yeah, we can do that.
4 Q. Thank you.
5 CO-CHAIR SENATOR HANABUSA: Anyone else with
6 follow-ups? I have one.
7 EXAMINATION
8 BY CO-CHAIR SENATOR HANABUSA:
9 Q. Tina, there was a Bob Rees article, and this is in
10 line with what Mr. Kawashima was talking to you about the
11 appearance of conflict, and I read that article to say that
12 you checked I think it was three times with ethics about
13 contract -- about your husband and the role with MST. Is
14 that an incorrect statement?
15 A. I believe that's a correct statement.
16 Q. So I guess you said that you didn't believe that
17 there was an appearance, people may think so, but there
18 wasn't, but you must have been concerned enough to check with
19 ethics yourself?
20 A. This -- right, this was before we even moved
21 forward at all, and I certainly did. I don't want to do
22 anything that would bring embarrassment to the division or to
23 the department and wanted to make sure that I conducted
24 myself appropriately.
25 Q. Why the number three? They said -- I think the
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1 article said three times. You can correct me if I'm wrong.
2 It said on three separate occasions you checked. So why --
3 A. I think it was more a representation of my anxiety,
4 so I would think of a different area so I would call back and
5 then say, but do you think this, does that cause any
6 problems? And they would say as long as there's a panel
7 that's appointing him, that he's qualified for the position,
8 he's not reporting to you, there's a reason -- and they
9 walked me all the way through the process. They assured me
10 that there was no problem.
11 Q. Your husband testified that it was -- he believes
12 it was you who ultimately made the decision to stop the
13 continuum project. Is that correct?
14 A. That decision rests with me.
15 Q. So it was you who decided to stop the continuum
16 project?
17 A. Based upon the information that was presented to me
18 as the division chief, I hold that responsibility.
19 Q. And what was it about the project itself that
20 caused you to say this is it, you're going to end it?
21 A. Again, you've heard some of -- the change in the
22 system. As we were going along when we were first talking
23 about this we didn't have -- we hadn't transitioned to school
24 based when we were planning, so the case loads were still
25 high. We didn't have the foster homes. We didn't have the
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1 mentors and the QA specialists out there changing practice.
2 We weren't mentoring folks at the line level. We added
3 psychiatrists which were reviewing things. So while we were
4 implementing the continuum, again, systems change. You don't
5 do one thing at a time. We were hitting this from as many
6 different sides as possible, and what happened was we started
7 to see really positive results in our usual group, in our
8 real system, and we had this continuum project happening and
9 they were doing okay. There wasn't any problem with it, but
10 it has a benchmark that made me nervous because we didn't
11 meet our benchmark, and that was one thing that I started
12 taking a look at, and the other part was my discomfort that
13 if our system was okay, why in fact was this necessary and
14 what were we going to do and I didn't want to feel obligated
15 to get up to 200 if, in fact, our true system was operating
16 and getting results.
17 Q. In other words, your control group was doing fine,
18 was doing as well?
19 A. I can't say that about those specific 29 kids. I
20 can say that about the 3,000 kids. Those 29 kids I don't
21 know, and we'll get that evaluation in --
22 Q. A question that I asked him, and he didn't have the
23 answer to it, was, you know, it is a benchmark in the decree,
24 and usually you just don't simply say it's not going to be
25 done, because it's a benchmark. So did you check with Ivor
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1 Groves before you decided to end the continuum program?
2 A. Yes.
3 Q. And let me ask you something else. You mentioned a
4 little bit about Lenore Behar. Would you consider that over
5 this period of time you developed like a friendship with
6 Lenore Behar, personal relationship?
7 A. I would not describe her as -- as a friendship,
8 given the stuff that I don't know the details of, I do
9 respect her. She was very helpful to me. She truly gave me
10 advice that was helpful, I think, in helping me manage the
11 system, and I appreciate what she shared with me.
12 Q. But she's not considered a friend?
13 A. No, I don't see any ongoing relationship with her.
14 I mean, if I see her at a conference, I would certainly be
15 friendly with her, but I have no personal friendship with
16 her.
17 Q. How about Dr. Groves, do you feel that he's
18 developed into a friend over these, what, '96, about five
19 years that you've dealt with him over the whole Felix issue?
20 A. I would see it actually fairly similarly. I think
21 that he's been also very helpful. I appreciate his support
22 and his guidance during the past several years. I've
23 actually heard some conversations that he may be looking at
24 not being with us much longer and where he's -- I don't see
25 any ongoing kind of friendship or relationship, but I truly
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1 appreciate what he has shared with me, how he's helped me in
2 the system, but I don't --
3 Q. You can't make a statement like that and expect me
4 not to ask. What do you mean he's not going to be with -- is
5 he going to resign as monitor? I mean, what basis do you
6 have to say that?
7 A. I think that we're getting to a point -- my
8 understanding, we're getting to a point where he's actually
9 very satisfied with what he's seeing and with the results
10 that we are getting and there's not as much need for him to
11 be here, but he's certainly -- all that goes through the
12 court, and so that would be a discussion, but he's actually
13 just very complimentary of how we're doing and that there's
14 not as much need for him to be around.
15 Q. Is this like a private conversation or is this
16 something that's commonly known among those of you who appear
17 at the federal court and speak to him or is this something
18 that you just know?
19 A. I think -- no, no, he's talked with many other
20 folks about this kind of stuff.
21 Q. But this is a conversation he's had with you?
22 A. He has had it with me and I know he's had it with
23 other folks as well. I need to also say that at other points
24 in time, though, he's told us that before. So actually,
25 we're all saying, well, we'll see if he really goes away.
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1 We'll see.
2 Q. How recent is the last time he said it to you that
3 he'll go away?
4 A. Well, he's actually --
5 Q. Was it fairly recently?
6 A. A week, ten days ago.
7 Q. A week or ten days?
8 A. Based upon the results he's seeing in service
9 testing as he travels around. He's very complimentary and
10 saying that there's actually very little that we,
11 particularly children's mental health, need to be attending
12 to and that he's very happy with how we're doing.
13 Q. We congratulate you. I believe the whole committee
14 will congratulate you on that. And he hasn't been here, so
15 it must be over the phone?
16 A. He was here.
17 Q. Oh, he was here? And Judy Schrag, same question,
18 same answer?
19 A. I have not had any recent conversations with Judy
20 Schrag.
21 Q. But my question was whether you developed a
22 personal relationship. Is that the same kind of response you
23 gave as to Lenore Behar and Ivor Groves?
24 A. I would say Judy, again, because I met with her
25 less often, that there's less of a relationship, but I
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1 appreciate her help. She really was helpful to us.
2 CO-CHAIR SENATOR HANABUSA: Thank you. Let me
3 ask if there's -- I knew nobody could let that go. Yes,
4 Co-Chair Saiki.
5 EXAMINATION
6 BY CO-CHAIR REPRESENTATIVE SAIKI:
7 Q. I didn't use all my original five minutes. On the
8 technical assistance panel, it was disbanded -- in our
9 understanding, it was disbanded in late 2000?
10 A. Okay, and I --
11 Q. Was it disbanded because of the investigation into
12 Lenore Behar?
13 A. I don't believe so.
14 Q. Why was it disbanded?
15 A. Again, because there wasn't seen to be -- I guess
16 in the earlier days of the consent decree it was thought
17 that -- again, Lenore's expertise is in systems of care and
18 in children's mental health systems, and Judy's expertise
19 being in education, of course, it was that departments needed
20 specific targeted consultation, and I guess the stage that we
21 are presently is that any need that we might have for
22 consultation or technical assistance is much more specific,
23 and rather than having two individuals identified, that the
24 monitor would identify targeted people that would be used to
25 help us. We weren't in a phase anymore where we needed such
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1 intensive -- two individuals to be identified.
2 Q. As far as the assistance that Dr. Behar provided,
3 did it include strategies on how to maximize federal funds
4 and how to spend federal funds or the mechanism to use
5 federal funds, just generally?
6 A. We had some conversations around that, but I don't
7 recall that being a major part of the work that she did with
8 us. We have other agencies that we actually have contracted
9 with for consultation around maximizing federal dollars and
10 she was not one of them.
11 Q. Last question is on the court monitor and his
12 indication that he may be looking at leaving this position.
13 Did his sentiment start to accelerate when this committee was
14 formed?
15 A. No. As I said, in the past he has said this at
16 different points in time over the year, and then he has just
17 said it recently, but I don't -- I don't see it tied to this
18 committee. I see it more tied to we've done service testing
19 this fall and it was really accelerated, so as he went to
20 more and more complexes and saw more and more results, I
21 think he's generally saying out there at the line it is very
22 different than what it used to look like and he's very
23 pleased with what he's seeing.
24 Q. Thank you.
25 A. I need to be very clear. He's not saying that --
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1 and he didn't make any representation that he's leaving on a
2 particular date. He's just saying you guys are doing a great
3 job, you don't need me anymore, I'm going to be out of here
4 soon, that sort of a conversation.
5 Q. Thank you.
6 CO-CHAIR SENATOR HANABUSA: Any other
7 follow-up questions?
8 If not, thank you. Thank you, Tina.
9 Members, I believe our next scheduled hearing is
10 Wednesday at 9:00 o'clock, so we will be reconvening at that
11 time. This meeting is adjourned.
12 (Hearing adjourned at 4:52 p.m.)
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1 STATE OF HAWAII )
2 ) ss:
3 CITY & COUNTY OF HONOLULU )
4
5 I, JESSICA R. PERRY, do hereby certify:
6 That on November 3, 2001, at 9:04 a.m. the
7 foregoing proceedings were taken down by me in machine
8 shorthand and was thereafter reduced to typewritten form by
9 computer-aided transcription; that the foregoing represents,
10 to the best of my ability, a full, true and correct
11 transcript of the proceedings had in the foregoing matter.
12 I further certify that I am not attorney for
13 any of the parties hereto, nor in any way concerned with the
14 cause.
15
16 DATED this 16th day of November 2001, in
17 Honolulu, Hawaii.
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19
20
21
22
23 Jessica R. Perry, CSR 404
Notary Public, State of Hawaii
24 My commission expires: 5/11/03
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