Gov. Josh Green blasted Hawai驶i State Auditor Les Kondo鈥檚 preliminary report on his signature tiny homes project, accusing the Legislature鈥檚 watchdog of being overly aggressive and expressing an unwillingness to help the administration with the endeavor.
The auditor, Green said, is engaged in a 鈥減ersonal vendetta.鈥�
鈥淚nstead of being constructive,鈥� Green said of the audit process, 鈥渋t became a very caustic, aggressive process.鈥�
鈥淚t was very much an interrogation,鈥� Green added.
Lawmakers in 2025 for the sprawling statewide kauhale initiative in 2026 and 2027, but also required Kondo to conduct an audit of the program. The request came after reporting by Civil Beat that found the state or other documents detailing the specific use of public money for some kauhale projects.
Lawmakers also moved to curb excessive operating costs of urban kauhale built without connections to public utility grids, which Civil Beat reporting also had , by for such off-grid tiny home villages.
Green鈥檚 administration has awarded the bulk of kauhale work to the nonprofit under a series of no-bid contracts, and the management of those contracts is at the center of Kondo鈥檚 memo. Kondo has not issued a final report, but last week wrote lawmakers to alert them that his office has found issues that 鈥渨arrant immediate attention.鈥�
鈥淲e are concerned that significant deficiencies in internal control in the State Office of Homelessness and Housing Solutions鈥� (SOHHS) implementation of the kauhale initiative create an ongoing and substantial risk of improper use of public funds,鈥� Kondo wrote in the memo to members of the Legislature and Ryan Yamane, director of the Hawai驶i Department of Human Services, which oversees the homelessness office.
A 鈥楧amning Letter鈥� To Lawmakers
In an interview with Civil Beat last week, Green sharply criticized Kondo鈥檚 work. Green accused Kondo of verbally attacking mid-level managers working on the initiative.
鈥淭hat is shocking, and that is exactly what he did,鈥� Green said. 鈥淪o this is an unconscionable approach he鈥檚 taken.鈥�
Green also took issue with the auditor鈥檚 overall posture, which the governor said failed to demonstrate a desire to help the executive branch.
鈥淲hen my people said, 鈥榃e would love your input so you can help us?鈥� he instead said, 鈥業鈥檓 not here to help you,鈥欌�� Green said of Kondo. 鈥淚 think the auditor is here to help any executive branch do better.鈥�
Finally, Green said Kondo鈥檚 memo failed to mention the program鈥檚 results and innovative concept. Green pointed out that the kauhale initiative differs from the approach of previous administrations, which generally helped homeless people through a patchwork of services including shelters, housing vouchers, social service checks and emergency room visits for medical care.
By contrast, Green鈥檚 kauhale initiative is designed to integrate deeply affordable tiny homes with onsite social and medical services 鈥� including, in some cases, onsite medical clinics. The program now provides 940 more beds for homeless people than existed before, Green said.
鈥淚n that context, it is an extraordinary success,鈥� Green said. 鈥淚t does things that we haven鈥檛 done before.鈥�
Green added that Kondo sent his memo to the Legislature in the waning days of the session, as lawmakers are making tough budget decisions.
鈥淚t is an abomination that, number one, he didn鈥檛 look at it more broadly like an intelligent individual should be able to do,鈥� Green said. 鈥淎nd, two, to send such a damning letter to the Legislature two weeks before they have to make determinations on funding without getting that fair input.鈥�
In a statement, Kondo defended his office鈥檚 approach of raising what the memo described as problems that warrant immediate attention.
鈥淚t is our responsibility to ask direct questions and examine issues of public concern,鈥� Kondo said. 鈥淪crutiny should not be misrepresented as aggression or disrespect. We stand by our approach and remain committed to honest, objective, and fact-based dialogue.鈥�
Kondo said he has always interacted with Green and agency staff 鈥渋n a professional and respectful manner.鈥�
鈥淢ischaracterizing good-faith oversight does not serve the public, or the principles of accountable government,鈥� Kondo said.
Audits Are Meant To Spot Flaws, Offer Recommendations
Analogous to the U.S. Congress鈥檚 General Accountability Office, state auditors are independent agencies that report to legislatures on the performance of the executive branch. In Hawai驶i, the state auditor is and reports on executive programs as directed by lawmakers.
According to the used in Hawai驶i, the purpose of performance audits such as the one Kondo is conducting isn鈥檛 simply to look at what programs are doing and whether they鈥檙e effective. The audits are also meant to show how the programs are being managed. If they find problems, auditors are expected to help by recommending ways to improve.
Kondo鈥檚 preliminary memo was not a final report. It didn鈥檛 discuss the kauhale initiative鈥檚 overall mission and effectiveness or offer final findings and recommendations. Instead, the memo sounded an alarm.
鈥淲e believe it necessary to issue this interim communication due to the immediate and continuing risk of waste and improper use of public funds,鈥� the memo said.
The auditor鈥檚 office looked at 10 contracts between the state and the nonprofit housing developer HomeAid Hawai驶i totaling $40 million to develop kauhale on undeveloped state land.
By reviewing invoices, receipts and other documents, the auditor鈥檚 office 鈥渋dentified almost $1.7 million that appears to be unsupported, unallowable, duplicative, or not clearly consistent with the contract terms or applicable State requirements,鈥� the preliminary report said.
In one instance, the auditor reported, the state homelessness office paid $770,000 to HomeAid, which HomeAid later paid back, indicating that the homelessness office approved HomeAid invoices that included unsupported costs.
The homelessness office paid HomeAid another $916,000 in costs the state shouldn鈥檛 have paid for various reasons, the memo said. In one instance, the state paid HomeAid twice for the same work.
鈥淭hese issues appear to be general and recurring rather than isolated,鈥� the memo said.
The memo also pointed to deficiencies in policies and procedures, known as 鈥� 鈥� in auditing parlance, related to contracting, contract administration and invoice review.
Deficiencies included a lack of processes to assess whether HomeAid鈥檚 contract amounts were reasonable and no evidence that Green administration officials had meaningfully reviewed HomeAid鈥檚 invoices before paying the contractor.
Green said his administration had gotten approval from Hawai驶i Attorney General Anne Lopez on 鈥渉ow to approach things under emergency rules.鈥�
Auditor鈥檚 Criticisms Are Not New
Kondo鈥檚 criticisms should come as no surprise to Green.
In February 2025, Green鈥檚 then-homelessness coordinator, John Mizuno, raised concerns about the high costs of building and operating a kauhale not hooked up to public utilities. Civil Beat reported at the time that to provide electricity to one kauhale consisting of 20 100-square-foot tiny homes with a common kitchen, bathrooms and other community buildings. Mizuno stepped down as homelessness coordinator later that month.
In another instance, on kauhale projects wrote Green expressing concerns about numerous issues related to the projects, including inadequate internal controls.
Civil Beat鈥檚 reporting also pointed out , which Kondo鈥檚 memo discusses.
In rebutting Kondo鈥檚 memo, the governor didn鈥檛 address the auditor鈥檚 preliminary findings regarding payments or management procedures. The governor acknowledged there鈥檚 room for improvement but said the program is an overall success.
鈥淚 totally acknowledge that we can make the program better each year,鈥� Green said. 鈥淏ut if you ask people out there, it鈥檚 extraordinary. It鈥檚 getting a lot of the toughest-to-help homeless individuals off the street.鈥�
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