Wednesday, January 27, 2010


House travesty in the making—contractor payola bill railroaded to House floor

by Larry Geller

The House has greased the skids under a bill designed to feed corruption in state government. Although the 2010 session has barely begun, a bill to legalize pay-to-play in state procurement is suddenly headed to the House floor for a vote.

Many people complain that the legislative process is slow and unwieldy. Bills crawl from committee to committee, and often falter along the way if supporters can’t get to each hearing to submit testimony. When a bill clears one house, it then “crosses over” to the other and must run the gauntlet all over again.

Not this bill. Judiciary Chair Jon Riki Karamatsu, caught on video last session (see: Hawaii legislators lusting for corporate lucre) in an embarrassing bid  Laughing stock of the nationto boost campaign contributions ostensibly so he could donate some to favorite charities, has been allowed by House Speaker Calvin Say to pull a fast move in the opening moments of the 2010 legislative session.

Yesterday House leadership (and this could not have been done without the conniving of Speaker Say) fast-tracked a bill to the floor that will lift restrictions on campaign contributions by contractors holding competitive contracts. The bill (HB 2249) will not be heard by any other House committee.

The bill was introduced by only one House member: John Riki Karamatsu himself, and was exempted by the Speaker from the usual committee-by-committee review that other legislation typically endures. It was passed by the Judiciary committee by recommendation of one House chair: John Riki Karamatsu himself.

This bill opens the floodgates for what we used to call in New York “the ol’ payola ” because it permits and encourages bribes contributions intended to influence the procurement process. Why import New York-style corruption to Hawaii?

The way this works is that a contractor pays now and gets the contract (sole-source or competitive, doesn’t matter) later.

The competitive bidding process depends on contractors fulfilling criteria that are built into each RFP (Request for Proposal). In Hawaii law, the criteria, which you will find in an RFP expressed as a point system, must be strictly evaluated to determine the winning bid. Disputes over this lead to challenges and lawsuits such as the ones that the Hawaii Office of Elections is facing.

The process is commonly manipulated to favor particular bidders. In other words, it’s quite legal for the procuring authority to set the specs and point criteria to favor the goods or services provided by a single, favored contractor or supplier.

Both state and municipal contracts can fall victim to this kind of favoritism and corruption. It’s how cronies are rewarded for being cronies.

If Say and Karamatsu think they can slip this by unnoticed, they’ve failed already. Common Cause Hawaii has raised objections. Barbara Wong, state Campaign Spending Commission executive director, has spoken out against it.

The question now is whether other House members will join to block this maneuver. Last year they did.


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