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Council to discuss ending group’s parking concession

A Maui County Council committee is calling for ending a parking lot concession on county property in Lahaina by the Friends of Moku’ula, questioning the group’s financial management and its responsiveness to community and council inquiries.

A resolution to end the group’s parking concession is on the council’s agenda today, and there’s a bill recommended for first-reading passage to establish a fund — the Hawaiian Cultural Restoration Fund — to deposit public parking proceeds from county property in Lahaina.

The meeting begins at 9 a.m. in the Council Chambers on the eighth floor of the Kalana O Maui building in Wailuku.

A council Economic Development, Energy, Agriculture and Recreation Committee report details how the Department of Parks and Recreation initially submitted a resolution to continue operation of concession parking in December 2011.

But, as council committees reviewed the matter, problems surfaced from the organization’s continued operation of a paid parking concession.

Sometime after 2003, the friends group began outsourcing the parking concession to Diamond Parking Services, according to the committee’s report. The outsourcing incurred the expense of hiring a contractor and reduced the net proceeds for the organization.

Section 10 of both the organization’s lease and license agreements provides for periodic council review and approval of the parking lot concession.

Although the Friends of Moku’ula was obliged to submit annual reports, the council committee reviewing them “had difficulty obtaining timely reports.”

“Moreover, the reports provided failed to include detailed information concerning operation of the parking lot concession,” according to the economic development committee report.

It also noted that the council’s review of the matter was stymied for several years by numerous problems, “including the organization’s apparent financial mismanagement, lack of community engagement, poor communication with the administration and the deaths of Friends of Moku’ula’s original executive director, Anthony “Akoni” Akana, in 2001, and his successor, Shirley Ann Kaha’i, in 2013.”

In 2015 and this year, the council committee met six times, hearing public testimony that “the Friends of Moku’ula had not made significant progress to fulfill its restoration mission, and the organization was unresponsive to inquiries from county officials and community stakeholders,” the report says.

The Maui News attempted to contact the friends group for comment by leaving a voicemail message and sending an email inquiry. There was no response.

Beginning in September 2015, the committee chairman, Council Member Don Guzman, asked the friends group to provide documents showing the organization’s gross and net revenue, agreements with its for-profit arm (Ka Lua O Kiha Inc.), agreements with its parking lot concession contractor, articles of incorporation and tax returns.

“Timely and complete responses were not forthcoming,” the committee report says.

The committee sought a copy of the friends’ current contract with Diamond Parking, but the group failed to produce a fully executed contract for any period after 2009.

The committee’s analysis of cumulative documents provided by the friends indicate Diamond Parking collected approximately $30,000 per month in gross parking lot concession proceeds and kept a third of that.

Documents provided to the committee suggest that the Friends of Moku’ula directed parking proceeds to its for-profit Ka Lua O Kiha and that the two entities shared employees, operating costs and board members, according to the committee report.

The report notes that parking concession proceeds were supposed to be used only for “restoration and preservation purposes.”

The organization’s executive director, Blossom Feiteira, agreed to provide a comprehensive financial audit, but a year later the organization has not provided it, the report says.

According to a letter submitted to the committee Nov. 22 by Friends of Moku’ula attorney Stanford Manuia, the friends group and its nonprofit arm recently changed accounting firms and hired Kawahara+Hu, certified public accountants, to continue work on the group’s comprehensive financial management audit. That work had been assigned to Levin & Hu, CPAs.

The committee report says that the friends group’s executive director reported Nov. 29 that the organization has had trouble documenting the use of concession funds since 2003.

Feiteira told the committee that an internal audit showed that the group used parking lot concession money for administration and operations.

“She acknowledged the organization ‘did not adequately spend the money the way they were supposed to for the first 10 years,’ ” the report says.

The Friends of Moku’ula was established as a nonprofit in 1995 to restore Moku’ula at the corner of Front and Shaw streets in Lahaina. The 4.7-acre site was the home of chiefs of Pi’ilani in the 1500s.

The site had freshwater, spring-fed ponds that surrounded a 1-acre sandbar called Moku’ula. It was the residence of the Kamehameha line of ali’i in the 1800s and a political center when Lahaina was the capital of the Hawaiian kingdom from 1837 to 1845, according to the committee report.

In the early 1900s, the properties were abandoned, and the ponds were filled in with coral rubble.

In early 2002, the county entered into two agreements with the Friends of Moku’ula. One was a lease for 35 years for a 2-acre parcel for rent for $1 per year. The other was a license for 20 years for a 2.7-acre parcel for rent for $1 per year.

Both agreements require the friends group to use the property “solely to restore and preserve Moku’ula and the ponds of Mokuhinia.”

* Brian Perry can be reached at bperry@mauinews.com.