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Human Resources withholds $1.5 MIL payment to NHHC

The Department of Human Resources is holding off on making the last payment of $1.5million to the Native Hawaiian Holding Company (NHHC) citing “questionable costs and failure to comply with condition of contract” for the $3.2million that was already paid out, according to a letter sent by Le’i Sonny Thompson, Director of DHR to the CEO of NHHC, Dennis Kanahele.


The NHHC was to provide training and employment in the contact center industry for 900 NEG participants and was also supposed to operate job placement and supportive services in a setting that would serve as part of the Workforce Investment Act (WIA) Workforce System.


This project was funded by the U.S. Department of Labor’s National Emergency Grant (NEG) and was administered by the local Department of Human Resources.


The One Stop Career and Training Center is located at the former American Samoa Veterans Association club house in Tafuna.


NHHC is partnered with Pacific Resources Inc. a local company owned by Michael McDonald and his wife Paula Stevenson-McDonald.


Samoa News reported earlier, that Procurement Office had approved the sole sourcing of the $4.7 million contract to NHHC and according to the governor’s office, the project is funded by the U.S. Department of Labor’s National Emergency Grant (NEG) and administered by the local Department of Human Resources.


In a letter sent last month to CEO of NHHC Dennis Kanahele, Le’i noted that NHHC failed to demonstrate justification for the finding which was requested last year under the review report in the American Samoa National Emergency Grant Program (ASNEG) sent last year. Samoa News has obtained a copy of the letter.


“After multiple reviews of programmatic and financial documents received by the ASNGE staff, there continues to be questionable costs with the use of $3.2million paid out to NHHC. “Additionally, there is great concern with lack of placement performance by the NHHC as required in the Scope of Work on the contract,” stated the letter.


Le’i informed NHHC to continue the submission of all programmatic and financial documentation to support the use of $3.2million to the NEG office no later than 4p.m. on March 8, 2013.


“Upon receipt of all NHHC program and financial documents, the NEG staff will review and issue an official determination of disallowable costs within 30 days, and additionally ASNEG will pursue debt collection action to recover all disallowable costs,” stated the letter.


Le’i informed Acting Governor Lemanu Peleti Mauga in a letter sent Monday, notifying the government officials that the government is withholding the remaining payment of $1.3million.


“I have reviewed and discussed in great length with our local NEG staff, who have been in contact with Mrs Janice Shordike, Federal Project Officer-Region 9, US Department of Labor, the NHHS’s current situation and their failure to comply with conditions set forth in their contract.


“You will find that NHHC had been given ample opportunities to comply and yet failed to do so,” says the letter.


The Human Resources Director also informed the government leaders that the government will not issue the last payment and also advised the NHHC to provide justification for the previous payments to the government by March 8, 2013.


Efforts to obtain comments from NHHC local project manager Michael McDonald were unsuccessful as of press time.