Lawmakers in Hawai’i are currently deliberating the future of the Kauhale program, looking into both its funding and necessary oversight controls.
The state agency responsible for Hawai’i’s homeless villages, the Department of Human Services (DHS), has faced scrutiny after a detailed review by Civil Beat revealed that it lacks the necessary records to account for millions of dollars paid to a nonprofit for the construction of hundreds of housing units.
Since late 2023, the state has issued over $37.1 million in no-bid contracts to HomeAid Hawai’i, aimed at building small dwellings as part of Governor Josh Green’s Kauhale Initiative.
While HomeAid has furnished DHS with balance sheets and supporting documents that illustrate how state funds were used for some of its projects, the agency has been unable to provide receipts or further documentation to clarify how public funds were allocated for other projects.
DHS stated that some projects are incomplete and will be subjected to audits once they reach completion.
In the meantime, Governor Green is pursuing an additional $50 million from the Legislature to expand his homelessness initiative.
Lawmakers are still in the process of deciding whether to approve this funding and what stipulations should accompany it for building new kauhale villages statewide.
A significant point of contention has arisen in the House and Senate regarding the necessity of requiring at least two bids for construction, with the differences set to be addressed in a conference committee that has yet to be arranged.
The Kauhale Initiative was launched in response to the state’s critical homelessness crisis.
In early 2023, following a campaign focused on addressing Hawai’i’s housing issues, Green declared a state emergency regarding homelessness.
At the time, Oʻahu’s annual Point-In-Time count identified more than 6,223 homeless individuals, with over half residing outdoors.
In rapid succession, Green’s administration established 12 kauhale statewide.
The state’s suspension of the procurement code, enacted under the state of emergency, allowed for the avoidance of competitive bidding, resulting in the selection of HomeAid Hawai’i as the development contractor for the program.
The Kauhale Initiative’s goal is to create “affordable spaces for housing and healing our people, through intentional ‘kauhale’ design and operation.”
However, criticisms have emerged, including from Green’s former homelessness coordinator, John Mizuno, who has challenged the operating costs of some kauhale initiatives.
Civil Beat’s examination of construction expenses highlights possible oversights in DHS’ management of these projects.
The department struggled to provide documents outlining expenditures by HomeAid on two of the most expensive kauhale projects to date — Phase 2 of Middle Street and another initiative in Kahului, Maui — which total over $14 million.
Officials noted that work on these projects has recently commenced, and HomeAid has received approximately $2 million as an upfront payment.
Additionally, there was insufficient information provided on two other contracts.
One of the contracts, which aimed to deliver 273 homes statewide, saw HomeAid CEO Kimo Carvalho billing the state for nearly the entire contract cost all at once, accompanied by minimal detail regarding spending.
For another contract regarding the Alana Ola Pono kauhale in Iwilei, the state disbursed $2.5 million upfront — half the contract value — based on a brief overview of the work that would be performed.
Upon request for records from Civil Beat, no additional details were provided regarding the allocation of the remaining funds.
While this project was opened in December, Carvalho indicated it was about two weeks away from completion.
Most of the invoice review for these projects was conducted by Jun Yang, at the time an employee of the Department of Transportation, who was also part of a kauhale team created to assist Mizuno.
Yang’s involvement was significant; at one point, during a delay in payments from DHS to HomeAid, he informed Carvalho that if HomeAid sent payment request forms, “we will get them taken care of.”
Yang, who transitioned into the role of head coordinator after Mizuno’s resignation in February, is now at the forefront of these discussions.
DHS Deputy Director Joseph Campos acknowledged the department’s duties to both the public and the Legislature.
He noted that while they are leveraging the authority granted under the emergency order to bypass the formal bidding process, they are nonetheless exercising diligence in selecting contracts.
“Although we utilize the authority of the emergency order not to do a formal bid process, that does not mean we go willy nilly in choosing whatever we want,” Campos stated.
A bill aimed at mandating competitive bidding is presently under debate.
The House has advocated for accountability measures, including a requirement for at least two bids from construction firms, but the Senate opted to eliminate this stipulation after Yang conveyed concerns that it could complicate and delay project development if only a single bid were received.
House Housing Committee Chairman Luke Evslin, who modified the kauhale bill to encompass the two-bid requirement, expressed uncertainty regarding the position House conferees will adopt in the upcoming negotiations.
Evslin acknowledged that while no-bid contracts are permitted under Green’s emergency declaration, enforcing a two-bid requirement aligns with ensuring accountability as the Kauhale Initiative evolves beyond emergency response.
He remarked, “Our hope is to transition the Kauhale Initiative into something that is sustainable.”
Green declined an interview request to address the kauhale bill, with his spokesperson Makana McClellan indicating that the administration prefers to defer discussions about active bills until after the session concludes.
Mizuno also opted not to comment on the ongoing situation.
McClellan noted that HomeAid’s kauhale projects are regularly assessed for compliance by the state Attorney General’s Office.
The divergence over the two-bid stipulation reflects contrasting viewpoints between the former and current coordinators overseeing Green’s Statewide Office on Homelessness and Housing Solutions.
Both parties agree on the overarching goal that establishing tiny home villages with much-needed support services is preferable and more cost-effective than offering services to individuals living on the streets.
However, the way to achieve that goal remains a point of contention.
Mizuno, an experienced former lawmaker, who was appointed in December 2023, spoke in favor of requiring two bids during testimonies in February.
Evslin’s housing committee subsequently modified the bill to comply with this recommendation.
In the same month, Mizuno raised concerns about the operating costs related to certain kauhale developments, particularly emphasizing villages constructed without connections to existing water and electricity utilities.
An independent study initiated by the Statewide Office on Homelessness and Housing Solutions in January 2025 revealed that the operational cost for an off-grid community of 20 tiny homes amounted to $8,600 for each bed.
Costs related to diesel fuel and equipment needed for electricity for that area reached $21,032 just in April, leading to an expense of more than $1,000 per month for each tiny home.
In stark contrast, the average monthly bill for standard-sized residential properties on Oahu is merely $202, according to Hawaiian Electric.
During a tour of several projects, Mizuno highlighted that the monthly operating cost for another kauhale situated inside a converted residential home was slightly over $1,300 per bed.
Although typically an ardent supporter of Green’s initiative, Mizuno expressed significant concerns regarding the off-grid kauhale approach.
In a public statement, Green contended that these off-grid solutions serve merely as temporary housing to transition individuals off the streets and into more permanent homes.
By the end of March, Mizuno departed from his post to become Green’s special advisor on homelessness, with Yang succeeding him.
In less than a month thereafter, on March 12, Yang urged lawmakers to eliminate the two-bid requirement during a joint hearing of Senate committees on Health and Human Services and Housing.
Echoing DHS’s earlier testimony, Yang expressed apprehension that enforcing a two-bid minimum might hinder timely project advancement, especially if only one bid was submitted.
Documents requested by Civil Beat have shown discrepancies concerning spending.
Initially, Civil Beat sought documents illustrating HomeAid’s kauhale contracts’ expenses in late February, following previously reported high operating costs related to some off-grid projects.
The request focused on obtaining invoices and associated papers customary for substantial construction endeavors, along with final reports mandated by the contracts.
The department’s initial response, received two weeks later, did not include these detailed expenditure documents, supplying only contract copies in their place.
On April 11, the agency eventually scanned and supplied invoices and supporting documents for the majority of the kauhale projects.
They provided an extensive overview for the first phase of the Middle Street project but noted significant irregularities regarding other contracts.
For instance, HomeAid received a June contract valued at $5.8 million to provide 273 tiny home units.
While payments were meant to be split into four installments between June and September, with corresponding invoices and related documents for each phase, HomeAid instead submitted two invoices—one for $174,000 in August and another for $5.6 million in October.
Most of these funds were categorized under
image source from：https://www.civilbeat.org/2025/04/the-state-spent-millions-on-housing-for-the-homeless-show-us-the-receipts/
