Hawaii Gov. Josh Green said state Auditor Les Kondo’s preliminary report on the governor’s homelessness “kauhale” tiny homes initiative reads like a personal attack on the administration rather than oversight meant to improve the program. In remarks made as lawmakers prepare budget decisions, Green accused the audit process of turning “very” aggressive and “caustic” and of framing questions in a way that, in his view, was not designed to help the executive branch.
Green said the Legislature in 2025 approved a total of $88.2 million for the statewide kauhale initiative in 2026 and 2027, while also requiring Kondo to conduct an audit. He pointed to earlier reporting by Civil Beat that, he said, found Hawaiʻi did not have receipts or other documentation detailing how public money was used for some kauhale projects. Lawmakers also moved to restrict funding for off-grid tiny home villages that are not connected to public utility grids, a change that Civil Beat reporting had helped prompt.
Green said his administration has awarded much of the kauhale work to HomeAid Hawaiʻi through a series of no-bid contracts, and that the management of those contracts is at the core of Kondo’s memo. Kondo has not issued a final report, but Green’s comments followed Kondo’s letter to lawmakers, in which Kondo warned that his office found issues that “warrant immediate attention.”
Green accused Kondo of what he called an adversarial posture. “Instead of being constructive,” Green said of the audit process, “it became a very caustic, aggressive process.” Green added that “It was very much an interrogation.” He also took issue with the auditor’s approach toward the administration, saying Kondo failed to demonstrate a willingness to help. “When my people said, ‘We would love your input so you can help us?’ he instead said, ‘I’m not here to help you,’” Green said, adding that he believes “the auditor is here to help any executive branch do better.”
Green also criticized Kondo for sending the memo to lawmakers late in the legislative session. Green said it was an “abomination” that Kondo did not address the program more broadly and that Kondo sent “such a damning letter” two weeks before lawmakers must decide on funding without what Green described as fair input. Green said Kondo’s memo did not emphasize the program’s results or its “innovative concept,” contrasting the kauhale initiative with previous administrations’ reliance on a patchwork of services such as shelters, housing vouchers, social service checks, and emergency room medical care.
In Green’s description, the initiative integrates deeply affordable tiny homes with onsite social and medical services, including onsite medical clinics in some cases. Green said the program now provides 940 more beds for homeless people than existed before and called it, “In that context, … an extraordinary success,” adding that it “does things that we haven’t done before.” Green said he received approval from Hawaiʻi Attorney General Anne Lopez on “how to approach things under emergency rules.”
Kondo, in turn, defended his office’s approach in a statement. “It is our responsibility to ask direct questions and examine issues of public concern,” Kondo said. “Scrutiny should not be misrepresented as aggression or disrespect. We stand by our approach and remain committed to honest, objective, and fact-based dialogue.” Kondo said he has interacted with Green and agency staff “in a professional and respectful manner,” and he said, “Mischaracterizing good-faith oversight does not serve the public, or the principles of accountable government.”
Kondo’s memo to lawmakers raised concerns about the State Office of Homelessness and Housing Solutions’ management of the initiative. Kondo wrote that his office was “concerned that significant deficiencies in internal control” in SOHHS’s implementation “create an ongoing and substantial risk of improper use of public funds.” He also said the memo was an interim communication because of what his office described as an immediate and continuing risk of waste and improper use of public funds.
According to Kondo’s preliminary memo, auditors reviewed 10 contracts between the state and HomeAid Hawaiʻi totaling $40 million to develop kauhale on undeveloped state land. Kondo’s memo said the auditors, after reviewing invoices, receipts and other documents, identified “almost $1.7 million that appears to be unsupported, unallowable, duplicative, or not clearly consistent with the contract terms or applicable State requirements.” The memo described an example in which the homelessness office paid $770,000 to HomeAid and HomeAid later repaid the money, which Kondo said suggested the homelessness office approved invoices that included unsupported costs. The memo also said the homelessness office paid HomeAid another $916,000 in costs the state should not have paid and said one instance involved the state paying twice for the same work.
Kondo’s memo also pointed to weaknesses in internal controls and procedures for contracting and invoice review. It said there was a lack of processes to assess whether HomeAid’s contract amounts were reasonable and said there was no evidence that Green administration officials had meaningfully reviewed HomeAid’s invoices before paying the contractor. In the audit framing, those issues appeared “general and recurring rather than isolated,” and the memo described deficiencies in policies and procedures related to contracting, contract administration and invoice review.
Green and others connected the fight over the audit to concerns raised earlier about costs and oversight of kauhale projects that are not hooked up to public utilities. The AP story described prior reporting by Civil Beat that, in February 2025, followed concerns that taxpayers had paid $21,000 per month to provide electricity to a kauhale consisting of 20 tiny homes sharing a kitchen, bathrooms and community buildings. It also described concerns voiced by a former construction manager and said those concerns included inadequate internal controls, which Kondo’s memo addressed. In response to the memo, Green acknowledged the administration could make improvements but said lawmakers and the public should view the initiative as an overall success, arguing it has helped move homeless people off the street while integrating housing with services.