Mission

It is our mission to serve the Council and citizens of Hawaiʻi County by promoting accountability, fiscal integrity, and openness in local government. Through performance and/or financial audits of County agencies and programs, the Office of the County Auditor examines the use of public funds, evaluates operations and activities, and provides findings and recommendations to elected officials and citizens in an objective manner. Our work is intended to assist County government in its management of public resources, delivery of public services, and stewardship of public trust.

Audit Authority

Hawaiʻi County Charter §3-18 establishes an independent audit function within the Legislative branch through the Office of the County Auditor.

Purpose

This engagement aimed to verify if the Department of Environmental Management's derelict and abandoned vehicle processes are effectively administered and complies with state and local regulations.

Performance Audit Definition

Performance audits provide objective analysis, findings, and conclusions to assist management and those charged with governance and oversight with, among other things, improving program performance and operations, reducing costs, facilitating decision-making by parties responsible for overseeing or initiating corrective action, and contributing to public accountability.

Our objective in performance auditing is to improve public services provided by the County government. We do this by recommending specific actions addressing the issues we raised and by providing valuable information to the public, the administration, program leadership, the county council, and the mayor.

Audit Objective

Does the Department of Environmental Management Solid Waste Division administer its Derelict/Abandoned Vehicle Program in accordance with Hawaiʻi Revised Statutes §290 and other relevant governance to identify, remove, and dispose of abandoned vehicles, thereby enhancing public safety, protecting the environment, and maintaining community aesthetics?

Scope

The audit was conducted from August 2023 to June 2024

• Reviewed inventory data from FY 2016-17 to FY 2022-23
• Reviewed financial data from FY 2016-17 to FY 2021-22
• Reviewed data from the Vehicle Disposal Assistance Program between FY 2018-19 to FY 2023-24

Areas not evaluated

• We did not evaluate cash handling processes conducted on impound lots
• We did not evaluate financial transactions conducted for abandoned vehicle auctions

Methodology

To accomplish our objective, we:

• Reviewed HRS § 290 and subsections relevant to the subject matter
• Reviewed the department's written rules, policies, and procedures
• Reviewed GAO Green Book, OSHA standards, and best practices
• Developed an understanding of the department's internal control system, processes, practices, and document flows
• Participated in two ride-alongs and site visits with DAV staff to observe various work processes
• Interviewed appropriate staff
• Gained an understanding of the Vehicle Disposal Fund program sustainability
• Assessed controls over the abandoned and derelict vehicle processes as follows:
  • Vehicles identified for extraction
  • Towing and removal
  • Determination of disposition versus destruction
  • Impound storage costs

• Monitored and tracked inventory
• Evaluated how collected fees are managed and tracked

• Noted any exceptions and identified opportunities/areas for improvements,
• Was mindful of potential fraud, waste, and abuse during the audit

We conducted this performance audit in accordance with generally accepted government auditing standards. Those standards require that we plan and perform the audit to obtain sufficient, appropriate evidence to provide a reasonable basis for our findings and conclusions based on our audit objectives. We believe the evidence obtained provides a reasonable basis for our findings and conclusions based on our audit objective.

What is an Abandoned Vehicle?

A vehicle that is unlawfully parked and left unattended for a continuous period of more than twenty-four hours on any public highway, public property, or private roads that are located within any ungated subdivision, where roads are open to and used by the public.

What is a Derelict Vehicle?

A vehicle that has been abandoned on property owned, managed or administered by the authority, if a part has been removed or material damage to the vehicle has rendered the vehicle inoperable and one of the following conditions exists:

What is the Derelict and Abandoned Vehicle Program (DAV)?

The Derelict and Abandoned Vehicle Program (Program) provides for the identification, removal, and temporary storage and processing of all paperwork related to derelict and abandoned vehicles, as well as processing, recycling, and auctioning of abandoned vehicles in accordance with program procedures.

What is DAV's Purpose?

A program which has operated since inception in 1979 and later incorporated  by the Department of Environmental Management for the purpose of disposing of abandoned or derelict vehicles and implementing a public outreach program to educate the public about the disposition of such vehicles.

What are the Program Objectives?

1. Coordinate the removal of vehicles from public and private roadways classified as derelict or abandoned.
2. Monitor the program and contracts to ensure that all derelict/abandoned vehicles are being processed and recycled in compliance with Hawaiʻi Revised Statutes, Hawaiʻi County Code, Department of Health Requirements, and Departmental Rules.
3. Continue the planning and design of the environmental cleanup for the Hilo Scrap Metal Facility.
4. Conduct at least one auction of eligible vehicles per year.
5. Provide Vehicle Disposal Assistance Programs for the public.

What is the Vehicle Disposal Assistance Program (VDAP)?

There is established a vehicle disposal assistance program to assist Hawai'i County residents with disposal of vehicles. Assistance shall be contingent on the availability of funds within the County's vehicle disposal fund and at the discretion of the director.

What is VDAP's Purpose?

The Vehicle Disposal Assistance Program (VDAP) assists residents of Hawaiʻi County with the towing and disposal fee of junk vehicles based on available funding.

Mission Statement

To protect public health, safety, and the environment by removing and recycling derelict/abandoned vehicles and properly disposing of waste generated from such vehicles.

Organization Structure

The program operates within the Department of Environmental Management's (DEM) Solid Waste Division.

Source: Courtesy Department of Environmental Management

FY 2024-25 Staffing

The program is made up of four positions, with an additional position currently requested:

Hilo Office

• Derelict and Abandoned Vehicle Specialist (Supervisor)
• Derelict/Abandoned Vehicle Coordinator (Inspector)
• Clerk III

Kona Office

• Coordinator/Vehicle Inspector (Vacant)
• Clerk III (Requested)

How is the Program Funded?

The program is funded through a Special Revenue Fund called the Vehicle Disposal Fund and is used to accumulate money for the towing, removal, disposal, and recycling of abandoned or discarded automobiles and automobile parts. Financing is provided through annual fees collected with motor vehicle registrations.

Revenue is comprised of five primary sources:

• Vehicle Disposal Fee
• $12.00 per registered vehicle per year
• Towing Fee
• Vehicles towed to County impound lots, amounts vary by conditions, location, and contractor
• Vehicle Storage Fee
• $10.00 per day charged at County impound lots
• Sale of Abandoned Vehicles
• Proceeds from vehicle auctions, amounts vary by bid
• Sundry and Miscellaneous

How is the Money Spent?

Expenditures are comprised of five primary sources:

• Vehicle Disposal
• Salaries and wages
• Vehicle and parts disposal (i.e., Operations: towing, disposal, security, phones, etc.)
• Vehicle and parts disposal equipment (i.e., Operational equipment: vehicles, computers, printers, office furniture, etc.)
• Inter-department
• Transfer to Capital Project Fund
• Pensions and Contributions
• Pension Accumulation

Where are Abandoned Vehicle Impound Lots Located?

There are three abandoned vehicle impound lots island-wide:

Hilo Abandoned Vehicle Facility

1651 Ho'olaulima Road

Hilo, HI 96720

• Zone 1
  • Kaʻū
  • Puna
  • North Hilo
  • South Hilo

     

    Kona Abandoned Vehicle Facility

    74-598 Hale Mākaʻi Place

    Kailua-Kona, HI 96740

• Zone 2
  • Kaʻū
  • North Kona
  • South Kona

     

    Pu'uanahulu Abandoned Vehicle Facility

    71-111 Queen Kaahumanu Highway

    Waikoloa, HI 96738

• Zone 3
  • Hamakua
  • North Kohala
  • South Kohala

DAV and VDAP Processes

The distinction between DAV and VDAP lies in the status of vehicle ownership. DAV refers to vehicles abandoned by individuals. VDAP involves vehicles whose owners still possess them but are actively working to properly dispose of their vehicle or private property owners looking to dispose of derelict vehicles left on their property.

 Reporting

1a. DAV vehicles are generally flagged in one of two ways. The public can call HPD to report vehicles they believe are derelict/abandoned, or HPD can initiate tagging while on patrol. Regardless of the method, the process begins with a notice on the vehicle when flagged. After a 24-hour waiting period, HPD checks if the vehicle was moved in accordance with HRS § 290-1, which states, "If a vehicle has been left unattended for a continuous 24-hour period, a notice is conspicuously posted on the vehicle."

1b. VDAP – Vehicle owners may surrender their vehicle or apply for derelict vehicles to be removed from their private property by filling out an application, which may be obtained from the Hawaiʻi County website at            https://www.dem.hawaiicounty.gov/services/derelict-and-abandoned-vehicles

The following tables highlight program progression.

Inspecting

2a. DAV-Per HRS § 290-12, The Hawaiʻi County Police Department (HPD) initiates a report. When completed, reports are approved and transmitted to DAV. The Clerk accesses reports daily, extracts specific data, and Coordinators perform vehicle inspections on the vehicles identified.

2b. VDAP-Coordinators schedule visits to residents requiring vehicle inspections, verify conditions and match application details.

Towing

After the inspection, a contracted towing company delivers vehicles to one of three impound lots or the scrap yard.

3a. DAV-The County frontloads towing charges; if the vehicle is returned to the owner, the owner is responsible for repayment.

3b. VDAP-Towing of up to two vehicles per year is free of charge to the public.

A written notice shall immediately be sent by registered or certified mail to the legal and registered owner of the vehicle per HRS § 290-2. A notice need not be sent to a legal or registered owner or anyone with an unrecorded interest in the vehicle whose name or address cannot be determined.

Inventory

4a. DAV – Impound lots are inventoried once per week, and vehicles are inspected and marked. All vehicles are validated using a division-maintained database.

4b. VDAP – Vehicles are immediately taken to be scrapped and are not entered into inventory.

Disposal

5a. DAV – Disposal happens in one of two ways. Either vehicles are scrapped or sold at auction per HRS § 290-3. Vehicles may be disposed of by public auction, oral tenders, or sealed bids after a public advertisement is made once in a newspaper of general circulation, provided that the public auction shall not be held less than five days after the publication has been made. Auctions are conducted in accordance with DEM Rule 2-9-4. A typical auction disposes of approximately 40 vehicles. Where no bid is received, the vehicle may be sold by negotiation, disposed of, sold as junk, or donated to any governmental agency.

5b. VDAP – Vehicles are immediately taken to be scrapped with disposal paid for by DAV.

We commend the Department of Environmental Management's Solid Waste Derelict and Abandoned Vehicle Program for its proactive efforts to reduce abandoned vehicles on public roads and beautify the environment.

Beautification Projects

• 70 vehicles removed from the Puna District between December 2022 and August 2023 through collaborative efforts with the Hawaiʻi County Police Department.
  • 58 vehicles removed from Hawaiian Oceanview Estates in July 2021

• 383 vehicles removed from Makuʻu Hawaiian Homes in September 2020

Employees survey the area for potential dangers before exiting their vehicles to mitigate risks. If surveying results in an actual or perceived danger, employees bypass the vehicle and return later. Depending on the issue, employees coordinate with HPD for an escort during their return inspection.

Policies and Procedures

DAV has no policies and procedures related to their safety and work processes.

We Found

• Program personnel lack uniforms and work in plain clothes instead.
• Policies and procedures do not address safety protocols, including personal protective equipment.
• Staff does not adapt equipment and resources to new working conditions or provide training.
• Personal protective gear like high-visibility vests and industrial boots are not required.
• Reliable communication and emergency support systems or protocols are not established in hazardous or remote areas.
• Measures like physical booths or online payments to minimize risks are not implemented.
• Safety devices such as lights and cameras are not installed at all impound lots.
• Comprehensive training in conflict resolution and equipment usage is lacking.
• Safety-related policies and procedures are not in place, exposing employees to potential hazards.

Conclusion

The review of personal protective measures for employees during field visits highlights gaps in safety protocols. Despite the County's obligation to minimize hazards to an acceptable level, environmental risks, remote locations, and some public interactions threaten employee safety. A lack of safety assessments and standards leaves coordinators vulnerable to potential hazards.

Finding 1: Limited Personal Protective Measures

Cause of the Condition

Safety concerns persist because DEM hasn't established a safety standard matching the risks employees face.

Effect of the Condition

The County leaves Coordinators vulnerable during hazardous vehicle-related activities.

Recommendation 1: Prioritize Personal Protective Measures 

We recommend that the Department of Environmental Management's Solid Waste Division prioritize personal protective measures.

In collaboration with the Safety Division, we recommend that the Department of Environmental Management pursue additional personal protection measures including but not limited to:

Environmental Factors

• Provide or require high-visibility vests, logo-embroidered uniforms, and appropriate personal protective gear (i.e., industrial boots, gloves, head, and eye protection)
• Consider appropriate personal protective devices after proper training has been administered.

   

  Location

• Implement two-way radios or equivalent communication devices and GPS for real-time communication.
• Employ noise-making devices such as whistles or air horns.
• Establish a buddy system in hazardous or remote areas.

   

  Public Interaction

• Install physical booths to separate employees from individuals at impound lots or collect payments via online applications or equivalent before vehicle release to minimize risks.
• Install perimeter safety devices at impound lots, such as lights and cameras at all impound lots.
• Require comprehensive training in conflict resolution, de-escalation techniques, and equipment usage. 

   

  Policies and Procedures

• Create policies and procedures related to safety-refer to Recommendation 3

Lack of Reporting Options for Abandoned Vehicles

Audit Activity

To determine if DAV educates the public on reporting derelict/abandoned vehicles, we conducted the following activities:

• Gained an understanding of applicable laws and governance:
  • Hawaiʻi Revised Statues § 290 Abandoned Vehicles
  • DEM Rules of Practice and Procedure 2-9-1(a)
• Reviewed DEM's Abandoned Vehicles website
  • Reviewed Derelict/Abandoned Vehicle Procedures
• Benchmarked other municipalities administering abandoned vehicle programs

Overview

The County removes and disposes of abandoned vehicles in accordance with HRS § 290-1(a). A vehicle is defined as abandoned when left unattended unlawfully for over 24 hours on public or certain private properties.

DEM Rule 2-9-1(a) states that “all derelict or abandoned vehicles located on public property or private roads may be reported to the County police dispatcher." Police identify vehicles in population centers and high-traffic areas. In remote locations, it becomes more important for the public to report vehicles that police might not otherwise tag actively. However, the public is limited to a single reporting methodology: calling in the vehicle. Public reporting can also be problematic. Errors and discrepancies include:

• Vehicles may be reported multiple times, whereas those in remote locations might not be reported at all

• Reports often contain inaccurate information
• Nuisance vehicles located on private property cannot be towed

The County's process of reporting an abandoned vehicle is currently by telephone:

Benchmarking

Comparing Hawaiʻi County's program with other municipalities, including Clark County, Nevada, Seattle, and San Jose, we found that timelines for identifying, removing, and handling dispositions are consistent with counterparts.

Cities and municipalities often use 311 services or apps for residents to access local government services. The difference between 311 and an app is the mode of access and interaction.

311 is an easy-to-access, non-emergency phone number that people can dial to connect with local government services and report non-urgent issues like abandoned vehicles, graffiti, illegal dumping, potholes, dead animals, noise complaints, and more. A 311 mobile application provides functionality similar to the 311-phone service but in a digital format. Users can use the app to report issues, access information, and communicate with local government services. The app often offers additional features such as GPS location tagging for issue reporting, photo uploads, and status tracking of submitted requests.

Using a 311 helpline or app streamlines communication with local government, simplifying the reporting process.

We found

Conclusion

The Department of Environmental Management established a program to dispose of abandoned vehicles and educates the public through its website. Relying solely on a website for public education can pose challenges because it may not reach all demographics or cater to varying learning preferences. Additionally, it might limit accessibility for those with limited internet access or technological literacy.

Community policing and patrols have effectively increased the number of vehicles identified and removed, especially in areas of high visibility. In remote areas, the program relies heavily on public participation. While information about the program is accessible to the public, simply making it available does not equate to actively engaging in a public outreach effort to educate them. Given that the public plays a crucial role in reporting, providing tools that facilitate education and reporting to enhance participation is essential.

Finding 2: Lack of Reporting Options for Abandoned Vehicles

Cause of the Condition

The program does not proactively educate the public on reporting abandoned vehicles.

Effect of the Condition

Vehicles remain in remote or undesirable areas for extended periods.

Recommendation 2: Increase Reporting Options

We recommend DEM implement a proactive campaign to educate residents on reporting abandoned vehicles, including but not limited to:

• Collaborating to facilitate easy reporting, increase community involvement, and expedite the identification and removal of abandoned vehicles from remote or undesirable areas:
  • Working with the Information Officer to increase public service announcements
  • Using social media
  • Using a 311 helpline, app, or similar services
  • Using online form

Conclusion

Identifying gaps in guidance helps management strengthen controls, add detailed instructions, and clarify procedures. Staff should be trained on established and approved procedures.

Standardizing work processes with clear policies enhances consistency, efficiency, and productivity, minimizes errors, promoting accountability and facilitates knowledge sharing, quality control, and organizational effectiveness.

Finding 3: Gaps in Policies and Procedures

Cause of the Condition

Program policies and procedures have not been updated to reflect operational practices.

Effect of the Condition

Not having formalized written policies and procedures causes confusion and inefficiency.

Recommendation 3: Enhance Written Policies and Procedures

We recommend DAV management continue to enhance policies to ensure consistent and safe administration of the program.

Inconsistent Vehicle Auction Processes

Audit Activity

To determine if vehicle auctions are regularly performed, we conducted the following activities:

• Reviewed Hawaiʻi Revised Statues
  • Section 290-2 Notice to Owner
  • Section 290-3 Public Auction
  • Section 290-5 Waiver of Public Auction Requirements
• Reviewed DEM Rules of Practice and Procedures
  • Rules 2-9-4 Auction of Abandoned Vehicles
• Reviewed Auction Data from FY 2016-17 to FY 2022-23

Overview

The Vehicle Disposal Fund's goal is to conduct auctions for the sale of abandoned vehicles that have met state-mandated holding and notification periods.

Required holding and notification period

HRS § 290-2 provides time frames for repossession and requires notifying vehicle owners of abandoned vehicles via registered or certified mail of the vehicle description, location, and intended disposition of the vehicle.

Some vehicles brought to the impound lots are set aside for auctioning, which may occur once or twice per fiscal year, or not at all, depending on resources. Staff stated that auctions are scheduled when 40 to 60 vehicles are available.

Vehicle auction data is recorded in the Police Report & Daily Logs report within the impound inventory and/or auction. These logs detail the impound date, vehicles selected for auction, and the impound lot location.

We Found

Our review of inventory logs revealed that some abandoned vehicles remained on impound lots for prolonged periods. Vehicles identified for auctions are set aside at impound lots until auctions are held. When auctions aren't held regularly, extended outdoor storage contributes to deterioration, negatively impacting the salvage value of vehicles.

Conclusion

In conclusion, DAV does not have an established auction schedule. No auctions were conducted during the global pandemic in 2019 or 2020, and since then, the department has held auctions in September 2021 and again in June 2022. No auctions have been held since.

Finding 4: Inconsistent Vehicle Auction Processes

Cause of the Condition

Scheduled auctions are not held regularly.

Effect of the Condition

Vehicles selected for auction lose value as they degrade over time, contributing to lost revenue.

Recommendation 4: Modernize Vehicle Auction Processes

We recommend that DAV increase the frequency of auctions for abandoned vehicles to reduce the time stored in impound lots. If possible, utilize online tools to establish a more user-friendly and consistent process for timely auctions of these vehicles.

Lack of Cross-Training for Program Continuity

Audit Activity

To determine if staff are cross trained to provide program continuity, we conducted the following activities:

Overview

DAV is made up of four positions, with an additional position currently requested:

Hilo Office

Kona Office

Section 4.05 of GAO's Greenbook describes management's obligations to recruit, train, mentor, and retain personnel to nurture professional competence. This Professional competence GAO Section 4.02 is achieved by obtaining relevant knowledge, skills, and abilities to carry out assigned responsibilities.

We found

The supervisor is a knowledgeable resource and guides staff; however, no staff is trained to manage the office temporarily during their absence. When DAV supervisors are absent, the Solid Waste Division Chief, with a full workload, serves a temporary support role while managing their regular essential duties and responsibilities. The limited availability inhibits the program's ability to respond to issues promptly, impacting timelines and decision-making.

Conclusion

For programs with small work groups, cross-training personnel is important for ensuring coverage and continuity because it increases staff knowledge and creates flexibility in operations. When trained in multiple roles, employees can cover for absent colleagues or handle increased workloads more effectively. This reduces the risk of disruptions to operations and ensures that critical tasks can still be performed even when key personnel are unavailable. Additionally, cross-training promotes a more knowledgeable and skilled workforce, enhancing the organization's resilience and adaptability to changing circumstances.

Finding 5: Lack of Cross-Training for Program Continuity

Cause of the Condition

Staff are not cross trained to assume the responsibilities of peers during absences.

Effect of the Condition

The lack of comprehensive cross-training of personnel:

• Impacts the overall decision-making process
• Reduces the effectiveness of meeting public needs
• Impacts monitoring of workflow and oversight

Recommendation 5: Provide Cross-Training for Program Continuity

We recommend DEM management cross-train staff for operational continuity during absences.

As a practice, we remain mindful and document instances of fraud, waste, and abuse within the scope of the audit objective and not specifically departmental or countywide.

We did not detect any instances of fraud, waste, or abuse throughout this audit.

During entrance, we inquired with the Department of Environmental Management about Fraud, Waste, and Abuse in their Division relevant to the objectives of the audit. DEM management reported no fraud, ongoing investigations, or pending litigation that would impact this audit.

During exit, we inquired with the Department of Environmental Management about Fraud, Waste, and Abuse in their Division relevant to the objectives of the audit. DEM management reported no fraud, ongoing investigations, or pending litigation that would impact this audit.

In closing, the improper use of government resources or positions are commonly uncovered by employees and the public. We strongly encourage reporting of any concerns through our fraud and whistleblower hotlines:

To access the complaints directory:

https://www.hawaiicounty.gov/our-county/legislative/office-of-the-county-auditor/inquiry-and-complaint

Submit a claim:

https://www.hawaiicounty.gov/our-county/legislative/office-of-the-county-auditor/inquiry-and-complaint/intake-form

Based on our evaluation, the Department of Environmental Management Solid Waste Division appears to administer its Derelict/Abandoned Vehicle Program in alignment with Hawaiʻi Revised Statutes §290 and relevant governance. Our assessment suggests that the program effectively identifies, removes, and disposes of abandoned vehicles, contributing to enhanced public safety, environmental protection, and community aesthetics.

We acknowledge that while our evaluation leans towards a favorable assessment, it's important to note that compliance may not be absolute in every instance due to variances in individual performance and judgment.

To improve government accountability and ensure audit recommendations are implemented or resolved, we will continuously monitor the status of pending recommendations using our remediation tracker. To view the status, visit us at: https://www.hawaiicounty.gov/our-county/legislative/office-of-the-county-auditor/remediation-tracker