Office of Hawaiian Affairs sues auditor over release of $3M

HONOLULU — The Office of Hawaiian Affairs sued the state auditor in an attempt to prompt the release of a $3 million general fund appropriation for the next fiscal year.

The agency filed the lawsuit Friday against state Auditor Les Kondo, The Honolulu Star-Advertiser reported.

Kondo suspended his office’s audit of the agency’s limited liability companies in December after its board of trustees refused to release unredacted minutes of its meetings.

The suspension put the office’s $3 million state allocation on hold because the state Legislature conditioned the funding on the audit’s completion.

The audit aimed to examine seven limited liability companies Hawaiian Affairs created from September 2007 to October 2015 to hold assets and pursue other outside business opportunities and higher-risk ventures.

The audit was meant to assess the use of the companies, including trustee oversight and whether grants and other funding were consistent with the agency’s spending policies and procedures, Kondo said.

Hawaiian Affairs officials hope a judge will view the redacted meeting minutes as protected, attorney-client privileged information and order the audit’s completion.

“OHA wants this audit finished so our beneficiaries can receive these critical resources. After weeks of discussions with the auditor, the trustees felt that asking the court to intervene was our only recourse,” Hawaiian Affairs Chairwoman Colette Macha­do said in a statement.

The complaint had not yet been served on his office, Kondo said Friday.

Kondo maintained that state law and a federal court opinion give his office the power to inspect all public records, including anything deemed falling under attorney-client privilege.

The information remains privileged and sealed even when given to his office, Kondo said.