2006-01-AU Audit of the County of Hawai‘i's Recycling and Diversion Grants Program

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Legislative Auditor County of Hawaii OVERVIEW Limited Scope Audit of the Department of Environmental Management's Recycling and Diversion Grants Program, Fiscal Years 2004 and 2005 Report No. 01 -06, June 2006 This limited scope performance audit of the Department of Environmental Management, Solid Waste Division, Recycling and Diversion Grant Programs for fiscal years 2004 and 2005, was initiated at the request of the Hawaii County Council in Resolution No. 168 -05. This audit is intended to provide an objective assessment of the Department of Environmental Management's compliance with applicable governmental regulations related to its recycling and diversion programs; an objective assessment of its compliance with applicable policies and statutory requirements in its procurement and contracting of program services; an objective assessment of its implementation of and adherence to standardized policies and procedures for managing and monitoring said programs; and constructive recommendations for improvement of the Department's internal controls to assist in more effective and efficient operation of the County's Recycling and Diversion Programs. Background The Department of Environmental Management (DEM) was created by Charter amendment in December 2000, and tasked with the enormous responsibility of management, oversight, and operation of all solid waste and wastewater functions for Hawaii County which were formerly under the purview of the Department of Public Works. The auditors would like to acknowledge that while audit findings indicate material weaknesses in DEM's internal controls, the recycling and diversion programs represent only one facet of the Department's responsibilities and accomplishments. When the Department director was hired in 2002, she assumed responsibility for a department that lacked several key management personnel, was facing a crisis forced by the imminent closure of the East Hawaii Landfill, had no written recycling and diversion program policies and procedures, and was statutorily mandated to meet certain recycling and diversion goals with inadequate and degraded infrastructure.