House Committee on Finance (FIN) - chair: Marcus R. Oshiro, vice chair: Marilyn B. Lee

Thursday, March 29, 2012, 5:30 PM in Conference Room 308

Testifier: JoAnn Maruoka, LWV of Hawaii, Legislative Committee

Click here to view SB2115, SD2

Chair Oshiro, Vice Chair Lee, and Committee Members: The League of Women Voters of Hawaii is very concerned about SB 2115, SD2, HD1, specifically §-25  Exemptions from state laws, subpart c) exempting Charter schools and their employees, the commission and its employees, and authorizers and their employees from the State Ethics Code, HRS chapter 84. Instead, the bill requires those entities to develop internal ethics policies and procedures. The State Ethics Code is intended to help preserve the public’s confidence in state government. Excluding public charter school and public charter school commission employees appears to be inconsistent with and contrary to that statutory purpose. The bill gives public charter school employees and public charter school commission employees all of the benefits of being state employees, without the corresponding accountability to the public as all other state employees have. They are entitled to participate in the state retirement program, to receive state benefits, and to be members of the HSTA and HGEA; their salaries are funded through the state general fund. Yet, they are not subject to the State Ethics Code. That means that public charter school and public charter school commission employees are not prohibited from accepting gifts, including lavish meals, extravagant trips and tickets to exclusive events, that are clearly intended to influence or reward their official action; they are not required to publicly report any gifts that they receive; they are not prohibited from using their position to give themselves or others unwarranted advantages; they are not prohibited from engaging in activities that may raise conflicts of interest issues --- all of which are addressed in the State Ethics Code. Although the bill requires public charter schools and the public charter school commission to implement their own ethics policies, what happens if there are no policies adopted by the school --- no ethics restrictions? While the bill encourages them to use the State Ethics Code as a guide in crafting their ethics policies, there is no requirement to do so; and their understanding and interpretation of various provisions in the State Ethics Code may be incorrect or incomplete which will result in their respective policies being incorrect or incomplete. The State Ethics Code was vetted by the legislature after numerous public hearings; in contrast, under the bill, policies can be implemented in a closed process, without public participation or scrutiny. It’s also likely that the ethics policy adopted by a public charter school or the public charter school commission will confer the investigative/decision making authority on the local school board and the commission, respectively. Given that ethics is generally based upon perception, the reasonable perception is likely that fox is guarding the hen house. We strongly urge you to delete the exemption and simply require compliance with the existing State Ethics Code. Thank you for the opportunity to submit testimony.