TheBus funds
hijacked for hospital

$4 million federal grant diverted
to private parking garage

By Ian Lind
Star-Bulletin

Some $4 million from the federal government that was supposed to go for buses and bus facilities will end up paying for a private parking garage under construction at Kuakini Medical Center.

The grant from the Federal Transit Administration was pushed through Congress by Sen. Daniel K. Inouye and high-profile Washington lobbyist Henry Giugni, a former Inouye aide who also served as Senate sergeant at arms.

Inouye's Honolulu office manager is president of Kuakini's chief fund-raising subsidiary and a member of Kuakini's board of directors.

The transit grant was approved although the garage will be used exclusively by Kuakini employees, and bailed the medical center out of a financial bind. It illustrates the benefits, and problems, of congressional pork-barrel spending.

"These are the kind of projects that a senator will defend as completely necessary, but other legislators recognize for what it is, which is pork," said Jim Campi of the Washington, D.C.-based Citizens Against Government Waste.

"The funds are there for projects which, on their merits, deserve the money. Clearly, nobody thought Kuakini deserved the funding on its merits. This project doesn't pass the 'smell test' if they had to sneak it in as a bus project," Campi said.

During the same year that Kuakini received its grant, Hawaii was hit with transit funding cutbacks in all other areas, according to a summary by the transit agency.

Michele Konishi, Inouye spokeswoman, defended use of bus-related funds for the parking structure and described it as an "intermodal realignment project" aimed at alleviating traffic congestion around the medical center.

She said the decision to use bus funds was made by the Senate Appropriations Committee and not by Inouye. "We just put in the request, and they decide where it should come out of," Konishi said.

Inouye is a powerful senior member of the committee, and is well-known for using clout to have funds set aside for Hawaii projects.

Gary K. Kajiwara, Kuakini president and chief executive officer, said Kuakini will seek to have the money released soon. "We are being real practical about it," Kajiwara said. "When we see the money, we'll be happy. Prior to that, well, you can never read all the signs in the tea leaves."

The three-story concrete building, estimated to cost $4.9 million, is part of a $19 million expansion project that includes an 11-story medical office building, along with street improvements required by the city.

The new office tower could not qualify for federal funding because it is a leasehold condominium containing 72 office units, most of which will be sold to private physicians, Kajiwara said.

Kuakini has been told it could not occupy the building until sufficient parking is available, city records show. Kuakini, facing cost-cutting measures and eventual employee layoffs, asked Inouye for assistance and sought an endorsement from city transportation officials.

Jinny Okubo, office manager of Inouye's Honolulu office, became an officer and director of the Kuakini Foundation, the medical center's main fund-raising arm, in 1993, about the time of the original funding request.

She is now the foundation's president, according to state business registration records.

Okubo was also named to the board of directors of Kuakini Health System within months of the grant's approval in 1995.

Okubo told the Star-Bulletin that she had been a volunteer at Kuakini for more than 20 years before being appointed to the board of directors.

"When the issue came up about checking it out with the senator as to whether there was some potential for federal funding, I was not even in on the meeting," Okubo said.

Inouye initially attempted to include the Kuakini project in the 1995 fiscal year National Highway System budget on the premise that widening Kuakini Street by 3 feet in front of the medical center would provide needed traffic improvements, congressional records show.

The project was not funded that year, but the following year Inouye asked for $8 million for Kuakini, a request that was approved after being cut in half.

The city wrote a letter endorsing the initial request for federal highway funds, recalls former transportation chief Joe Magaldi.

But Magaldi said he was not aware that bus funds had eventually been tapped. "That wouldn't make any sense to me at all," he said.

Kajiwara defended the federal funding. "Not only was the economy fueled, but we will be able to utilize our reserves for the development of other health care delivery programs (instead of paying for the garage)," he said.

Kajiwara acknowledged that some people might question the appropriateness of using bus funds to pay for a garage for Kuakini employees, but he says Hawaii taxpayer dollars would have gone to other states if they hadn't gotten the grant.

Kuakini's application was originally submitted after the City Council killed a rail-transit proposal for Honolulu, and members of Hawaii's congressional delegation scrambled to shift some of the rail funding to other transportation projects in the state.

"Nobody else asked for any of the funds for projects in the state of Hawaii, not the city or the state," Kajiwara said.

Konishi said the parking was linked to traffic improvements. "A lot of cars park on the side of the road. In order to widen the street to alleviate traffic, you're going to take the cars off, so where are you going to put them? You need a parking structure."

City records show that only 22 of the 436 stalls in the new parking structure will be opened to the public to replace parking lost along Kuakini Street.

Public access to these stalls will only be available during limited evening hours, the records show.

Konishi also said federal transit funds in previous years went to Miami, Newark, and San Francisco to provide parking near medical facilities.