Conflicts and lax oversight shroud secretive Fisheries fund — Part 2
Honolulu, HAWAII — In part 1 of their investigation of the Western Pacific Regional Fishery Management Council, Civil Beat Hawaii looked at the history of the Western Pacific Sustainable Fisheries Fund and how the money spent is rarely discussed openly at full meetings of the 16-member council.
In Part 2, Civil Beat obtained documents under the Freedom of Information Act that show thousands of dollars have been awarded to members of the Western Pacific Regional Fishery Management Council. Civil Beat says projects paid for by the fund have directly benefited council members’ own business interests.
WESPAC DRIVES THE PROCESS
Tosatto and others interviewed by Civil Beat say that control of the fund and how the money is spent is squarely in the hands of Kitty Simonds.
In the years when money was coming from fines on illegal fishing, Simonds mostly picked the projects that got funded and the contractors. Now that the money is coming from quota agreements with the territories, she and her staff work with local officials on the selection of projects and contractors.
But at the May 1 hearing of the U.S. House Subcommittee on Water, Oceans and Wildlife, Simonds appeared to dismiss the notion that she and Wespac were issuing contracts and deciding how money from the fund is spent.
“I can tell you that I don’t, and the council doesn’t, fully get involved in (the Sustainable Fisheries Fund),” she said in answer to a question from Rep. Gregorio Sablan about contractors with possible conflicts of interest.
Simonds, who was clearly annoyed by the questions, said plans for the money are provided by the governors of the territories and that it is the Secretary of Commerce who signs off on them.
But Sablan wasn’t swayed.
“I’m concerned about the lack of transparency here,” he told Simonds.
Simonds insisted she was not familiar with all of the contracts and would have to get back to him.
In a brief interview with a Civil Beat reporter after the congressional hearing, Simonds continued to brush off concerns that are being raised over the fund.
“The quota money, that’s not even federal money,” she said. “That’s industry money that goes to them.”
“I think people are trying to look for things that they think that we’re doing illegally,” she added. “Come on. They don’t really care.”
One contract file released to Civil Beat under its FOIA request does contain a copy of a check for $250,000 made payable to Guam and signed by Simonds. But other contract files contain checks written to numerous vendors and it is much less clear whether that money was ever in the control of the local territory.
Simonds also pointed to annual audits that are done on Wespac and said the financial accounting of her operation has always shown she’s doing a good job.
But the last three audits, the only ones available on the federal website, don’t even mention the Sustainable Fisheries Fund by name. One notes its grant number, and provides a dollar amount, but nothing about how much was spent or where that money went.
Tosatto said the audit wouldn’t break out the Sustainable Fisheries Fund separately unless the auditors noticed a problem.
The audits look at Wespac’s overall operation and its broad financial practices, he said.
“They’ve been reasonably clean audits so far,” Tosatto said.
CONFLICTS OF INTEREST
John Gourley, who has represented the Northern Mariana Islands on the Western Pacific Regional Fishery Management Council since 2014, owns a company called Micronesian Environmental Services.
Records show his company has been paid more than $70,000 from the Sustainable Fisheries Fund as part of a study that collects fish off Saipan. That work was initially contracted before he joined the council but has continued since. He was recently awarded another $290,000 grant to expand that work, but that money comes directly from NOAA with no council involvement, Gourley and Tosatto said.
In 2013, he was paid $28,000 out of the fund for a Marianas Seafood Marketing Plan, records show.
Gourley was traveling on the mainland and said via email he could not do an interview with Civil Beat. He did note that NOAA allows Wespac members to apply for major grants such as the recent one he received.
He also wrote that the 2013 grant for the seafood marketing plan was awarded to his company after a competitive process conducted by the government of the Northern Marianas.
Gourley is one of five members of the executive and budget committee, which is made up of Wespac Chair Archie Soliai of American Samoa, Gourley of the Northern Marianas, Michael Duenas of Guam, Christinna Lutu-Sanchez of American Samoa and Dean Sensui of Hawaii.
Wespac members, including some on the executive committee, have benefited from the fund. Civil Beat also found that significant funding has been awarded to contractors who have personal or political relationships with Wespac and NOAA.
Potential conflicts of interest have drawn the attention of members of Congress. It’s one of the specific questions Ed Case and Sablan are seeking more information on from Simonds.
They asked specifically about Gourley’s Micronesian Environmental Services as well as a company called Mirae Info Design, a computing and statistical services firm, owned by a Honolulu computer scientist named Sunny Bak-Hospital. She’s married to Justin Hospital, a NMFS economist whose reports Wespac has used to oppose marine monuments.
Bak-Hospital is a former NOAA data management specialist and applications developer who holds a master’s degree in statistics. She worked for the federal agency from 2002 to 2009.
She’s also active in the Honolulu tech scene, including as one of the original organizers of Honolulu hacker space now known as HICapacity. She’s also been active with Code for Hawaii, a volunteer instructor for Girls who Code and has started teaching code to women in prison.
Bak-Hospital’s Mirae Info Design has received more than $95,000 in grants from the Sustainable Fisheries Fund. One contract for $22,000 is described as development of data tools for a government creel survey in the Northern Marianas.
She also received a $73,688 contract for alternative estimation methods for annual catch of federally managed species in the western Pacific. That contract ended in September.
Additionally, Bak-Hospital has been paid tens of thousands of dollars more for Wespac contracts that came from other Wespac funding — for studies on spearfishing and developing a database of data analytic tools for fishery data.
She is passionate about the notion that data must be collected, analyzed and used correctly, not to justify policy decisions.
Bak-Hospital said she understands congressional concerns over potential conflicts because of her husband’s position but said she keeps her work strictly separate from her husband, who she met at NOAA in 2006. They were married in 2012, she said.
“I honestly don’t see that there is any … conflict of interest,” she said.
Meanwhile her husband, Justin Hospital, the NOAA economist, conducted a study that found, in part, that expanding Papahanaumokuakea would cost the Hawaii longline industry upwards of $8 million a year due to lost fishing grounds.
Wespac built a campaign against the expansion that regularly cited that finding, despite the report’s other conclusion that the fleet would not necessarily lose that much because the longliners are free to make up the lost catch in other waters, as they have done.
Sensui has received tens of thousands of dollars through contracts from the Sustainable Fisheries Fund. A former news photographer, Sensui owns a media business called HI Production Associates.
Records show the fund has paid him $46,450 in two separate contracts to evaluate ko’a resources — essentially, a natural fish house — using structured video surveys. The contracts were awarded before he joined the council in 2016.
The underwater video he took was part of a project to compare changes in fish biomass and diversity of a known ko’a, or preferred shelter where fish aggregate, against traditional fishing knowledge.
Sensui said he did not have to bid for the job and wasn’t aware at the time that it came from the fund.
He said he got the job through his relationship with Makani Christensen, a boat operator who was familiar with the ko’a resources.
Christensen’s Keawe Consulting received $41,000 in contracts to charter a vessel in support of the ko’a resources project — in essence, supplying the boat that carried Sensui’s underwater cameras.
Christensen, a close political ally of Simonds, also ran as a 2016 Democratic primary challenger against Sen. Brian Schatz. Christensen has said his top priority if elected would be fighting the effort by Schatz and ocean conservation advocates to greatly expand Papahanaumokuakea in the Northwestern Hawaiian Islands.
Christensen did not respond to a request for comment for this story.
Blocking the expansion was a priority for Simonds. She helped organize public protests against the monument and lobbied Congress to stop then-President Barack Obama from expanding it.
Council members Christinna Lutu-Sanchez, who owns five U.S. longline boats based in American Samoa with her husband, and Archie Soliai, a StarKist executive whose office is in American Samoa, are also benefiting from decisions they’ve been involved in that have directed hundreds of thousands of dollars for the marina expansion project in Pago Pago.
As a longliner, Lutu-Sanchez will have a dedicated space to dock her boats, which provide the premium albacore tuna for the StarKist canneries there.
Lutu-Sanchez did not respond to efforts to interview her for this story, including during a recent reporting trip to American Samoa.
Soliai talked with Civil Beat in Pago Pago but said he had little idea how the funding process actually works despite his position on the executive committee and as the chair of Wespac. He indicated Kitty Simonds handles most of the details.
Soliai said the projects must meet the criteria set out in the approved marine conservation plan but beyond that he doesn’t know how projects are paid for out of the fund.
“I’m not sure what the approval process is,” he said.
The report will finish up in Part 3 where oversight of Westpac is characterized as “lax” and asks whether NOAA itself is doing an adequate job overseeing Wespac. Watch for it in an upcoming issue of Samoa News.