HOUSING AGENCY FORFEITS NEARLY $500,000 IN FUNDS

HONOLULU (AP) -- The state agency that oversees public housing was forced to
forfeit nearly $500,000 that could have been used to hire anti-drug
personnel because it did not spend the money in time, according to an agency
spokesman.

The Housing and Community Development Corp. of Hawaii failed to use the
funds over the past two years because the agency was in the midst of
''hiring restrictions,'' said Bob Hall, a spokesman for the agency's
executive director, Sharyn Miyashiro.

Because the agency didn't fill the jobs quickly enough, the money had to be
returned.

''I think overall we could have been a little more aggressive in filling the
positions,'' said Hall, Miyashiro's executive assistant.

The U.S. Department of Housing and Urban Development gave the state housing
agency $2.7 million in grants in the 1997 and 1998 fiscal years under the
Public Housing Drug Elimination Program.

The agency spent $2.24 million on programs meant to ''eliminate drug-related
crime and other criminal activities associated with drug-related problems''
through such organizations as the Honolulu Police Department, Honolulu
Community Action Program, Boys and Girls Clubs of Honolulu, the YMCA, Hawaii
Dance Alliance, Child and Family Services, Coalition for a Drug-Free Hawaii
and the Salvation Army, said Darrell Young, the agency's information
officer.

However, the agency failed to spend $231,000 over those two years, and the
federal government ''recaptured'' the unspent money, according to state and
federal records. Most of that money was earmarked for hiring staff to deal
with drug-related housing problems.

The Bush administration this year canceled the Drug Elimination grant
program, but the agency still has two years' worth of grant money that must
be spent by September of next year, Hall said.

The Housing and Community Development Corp. of Hawaii has been under fire
from federal officials for failing to spend millions of dollars in housing
grant money and for misspending millions more.

In a May letter to Miyashiro, HUD Assistant Secretary Michael Liu said the
state housing agency has chronically failed to spend housing grant money in
a timely manner, and ordered the agency to spend up to $2 million to hire a
consultant to straighten out serious management and organizational problems.

''HUD's California State Office reports that HCDCH has consistently required
extensions of deadlines going back to its 1995 grant,'' Liu wrote.

Gov. Ben Cayetano last week ordered the attorney general to investigate
problems at the agency, including why key documents are missing from public
files.