East Hawaii News

Hilo Airport Field Office Included in Audit’s Criticism

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Hilo International Airport did not escape the attention of state auditors critical of the management of the state Department of Transportation.

The report by acting State Auditor Jan Yamane found fault with the DOT’s handling of construction projects, saying it allowed a contractor to make key decisions in the 12-year, $1.7 billion modernization of Honolulu International Airport.

While the size of the project mandated the hiring of a third-party manager, the DOT’s removing of itself from some of the decision-making resulted in “questionable allowances.”

The result was that the manager hired, Parsons Transportation Group, improperly received rent-free offices and reimbursement of $570,000 in office renovation expenses as well as $21,000 for “team-building” training.

The over-reliance on contractors also resulted in time and cost over-runs, the audit said.

That included the DOT’s failure to procure a new contract for airport security which the audit said resulted in the old contract being extended three times at a total cost of $37.7 million.

Yamane was also critical of the department’s failure to perform proper analyses for the construction of modular field offices on the neighbor islands.

The audit said the DOT’s bundling of the office construction with larger projects likely resulted in higher costs.

Those projects at the Hilo, Lihue and Kahului airports cost a combined $1.3 million.

In the case of Hilo’s airport, the nearly $183,000 spent on a 1,056-square-foot field office was included in a $10.9 million contract awarded to Isemoto Contracting Co. for replacement of the terminal’s roof.

“Separate procurement of the field offices would have encouraged competition and likely resulted in lower bids by other vendors,” the audit said.

“Further, Airports [Division] could not provide us with any cost analyses for constructing pre-engineered structures versus buying or renting trailers, thus raising additional questions as to the economic benefit of constructing new field offices,” it said.

In Lihue, the $125,000 field office was part of a $7.8 million heliport improvement project.

In both Hilo and Lihue, the specifications for the field offices called for a single-story building measuring 44 feet by 24 feet, and said that the “Huaka Gable” home package from HPM Building Supply was acceptable without further approval.

The audit said that while DOT officials had found that $180,000 was the average price to construct a 1,400-square-foot home, based on a 2002 price list, they had incorrect information regarding the purchase of a similar-sized trailer that could be used as an alternative structure.

The DOT said purchase of a similar-sized trailer would cost $178,000, but auditors estimated that a trailer half the size of the home package would cost about $39,000.

Nearly $974,000 was earmarked for a field office out of a $24.7 million contract for improvements at the Kahalui airport.

That was nearly 30 times what the auditors estimated it should have cost.

The auditors said that based on a site visit to the 1,764-square-foot Kahului facility, and on an interview with a construction manager there, it appeared that one 48-foot by 12-foot trailer would be sufficient for the “intermittent use by a few individuals.”

The audit said the DOT did not disagree with or dispute its findings.


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