The future of a program employing hundreds of people thrown out of work by the Maui fires is in limbo after the nonprofit that runs it, dogged by budgeting and bookkeeping missteps, shut it down early.

The CEO of Maui Economic Opportunity acknowledged the nonprofit had trouble getting its arms around the federal program, created in the months following the August 2023 fires. She enrolled too many people too rapidly, she said, fell behind in billing the government and failed to make a key budget adjustment.

“I think we didn’t really understand because (the grant) was stood up so  quickly,” said CEO Debbie Cabebe. “We’ve never administered a grant like this ever; we’ve done employment and training grants but not a disaster recovery workforce grant which involves so many people. But you don’t know what you don’t know.”

Cabebe said she learned Sept. 5 in an email from the state Department of Labor and Industrial Relations that funding was to be “revised” downward by 22%, from $12.7 million to $9.8 million. But she didn’t reduce her spending; she said she was waiting for a new budget document from the state.

In an emailed statement, a state official said the revision was part of an ongoing process of reassessing the grant after 70% of it was spent.

“These adjustments do not signify a reduction in funding but rather an appropriate reflection of the evolving circumstances,” wrote Maricar Pilotin-Freitas, administrator of the state labor department’s workforce development division, which manages the U.S. Department of Labor grant.

Maui Economic Opportunity also fell behind on its billing. When it tried to catch up with a November invoice to the state labor department of more than double the usual amount — $1.3 million instead of $577,000 — that set off alarm bells.

“That’s a humongous increase,” Pilotin-Freitas told Civil Beat. “We called the Department of Labor right away.” 

Pilotin-Freitas, however, expressed continued confidence in Cabebe and Maui Economic Opportunity, saying the billing spike was due to “being optimistic and enrolling more people.”

Under terms of the National Dislocated Worker Grant, the program had been set to run from October 2023 to Sept. 30, 2025.  

Eighteen days after the $1.3 million invoice was filed, the 58 nonprofits that employed hundreds of workers through the program – in jobs ranging from feeding fire victims to providing post-fire mental health services that use Indigenous approaches – learned it would end eight months early, on Jan. 11.

“It feels like the chair was pulled out from under us,” said Autumn Ness, executive director of Lahaina Community Land Trust and president of Maui Hub, which has three workers in the program and feeds about 70 families impacted by the fires. “It’s just one system fail after another system fail.”

The program received a short reprieve after Maui County earlier this month stepped forward with $1.9 million from its Office of Economic Development, which will extend it to March. Maui officials did not respond to a request for comment about the funding and whether it comes with any conditions.

According to U.S. Department of Labor spokesperson Monica Vereen, the state was “conditionally approved” in 2023 for a $21 million grant to fund the program and has so far received $10.5 million of that award — $6.8 million of which had been paid out to Cabebe’s nonprofit through October. 

Rep. Jill Tokuda, D-Hawaiʻi, said Monday the federal funds are still available for the program, but the state and Maui Economic Opportunity need to push forward to request the remainder of the grant.

“We do not get involved in (Maui Economic Opportunity) doing its job, holding them accountable. We got the pot of money,” said Tokuda. “ It’s contingent on the agencies to pull this program together and get this disbursement out to the people who need it.”

Problems Blamed On Process, Personnel Issues

The Department of Labor’s National Dislocated Worker Grants have for decades funded post-disaster temporary job programs nationwide. Hawaiʻi previously received  $1.1 million in 2018 after the Kīlauea volcano erupted, and $500,000 the same year in the wake of severe storms that struck Oʻahu and Kauaʻi.

The latest grant worked like this: The state Department of Labor and Industrial Relations hired Maui Economic Opportunity to administer the program. It is one of Maui’s largest nonprofits, with $22 million in 2023 revenues, and operates dozens of programs on the island. 

Maui Economic Opportunity in turn recruited and screened candidates, then referred them to an employment agency that placed them at other local nonprofits in fire recovery jobs that paid between $20.50 and $27 an hour. 

Etina “Edna” Hingano is one of those workers. She said her job has been critical to her recovery from the trauma of losing her Lahaina home and nearly dying in the fire, during which she sheltered for nine hours in the Pacific Ocean.

Maui Economic Opportunity steered Hingano, 55, to a $23-an-hour job at Lahaina Resource and Recovery Center, where she prepares supplies such as food and furnishings to distribute to fire survivors setting up new homes.

“It’s a good space to recuperate and to forget myself and what I went through, and to think of other people and what they went through,” she said.

Program participants like Hingano submit time cards to supervisors, who approve and forward them to the employment agency that placed them at the host site. Then, the agency — Employer Options — pays the employee and bills Maui Economic Opportunity, which submits a monthly request to the state for reimbursement.

Cabebe blamed the complex payroll and reimbursement process, as well as health issues and turnover among personnel at her organization, for the billing problem that snowballed.

“Due to the multiple channels that it goes through to get to us, combined with staffing challenges, the processing for reimbursements was delayed,” she said.

Maui Economic Opportunity announced Friday its chief fiscal officer, Monica Takamura, has stepped down for health reasons, but remains as accounting manager. She is being replaced by Julie Strong, most recently finance manager at a logistics company in Pennsylvania.

“One of the strengths through MEO’s six decades has been its Fiscal Department and financial management,” Cabebe said in a press release, saying Strong would continue that tradition.

Leaders of the nonprofits involved say they dread the prospect of laying off fire victims who have found some financial stability and emotional relief in jobs that contribute to the larger community’s recovery. 

“How are we as the host organization able to look at our staff in the eyes and tell them we’re not able to hold you because we don’t have the funding because it’s such a short notice,” said Nettie Aquino, executive director of Na Kia’i O Maui, which operates Lahaina Resource and Recovery Center.

Bad News, Then An Emotional Meeting

Maui Economic Opportunity staff delivered the bad news via calls to host site leaders, and Cabebe followed up with an email that cited “changes in funding levels and the number of participants enrolled.”

In an emotional Dec. 8 Zoom follow up meeting, she offered few additional details, based on Civil Beat’s review of a recording of the meeting. She said the program was meant to be temporary and its status was always subject to change.

“Whenever you get a grant from the government, it usually is always based on or subject to funding availability,” she said at the meeting, where she was barraged with frustration and sometimes angry questions. “So you can get a grant and a lot of times they’re revised, sometimes they’re less, sometimes they’re more.” 

That didn’t satisfy the nonprofit leaders. 

“Please recognize the impact and the harm this is creating and amplifying across disaster recovery on Maui,” Nicole Huguenin, director and founder of Maui Rapid Response – which employs 12 program participants – told  Cabebe at the meeting.

“Please own it,” Huguenin added. “That’s the responsibility you take when you take on big grants like that.”

Cabebe responded: “I do acknowledge that it is an extreme hardship on everybody and that was never an intention. And I can only apologize for that and try to figure out how to make this a better situation, and quite frankly, I don’t have a definite answer.”

Lack Of Funding Clarity

Shifting explanations about how much funding is available have confused the nonprofits that employ workers through the program. 

Maui Economic Opportunity announced in December 2023 it had received $12.7 million for a two-year program and its agreements with participating nonprofits also say the program is “100% federally funded by a Maui Disaster Recovery National Dislocated Worker Grant … of $12,741,350.”

The October 2023 contract between the state and the nonprofit also reflected that, saying Maui Economic Opportunity would be paid $12.7 million for a program that would run until September 2025.

Cabebe herself said she did not know that only $10.5 million had been earmarked for the state until after the crisis developed. She said she also learned only recently from the state that the grant funding was to be reassessed after 70% of it had been spent. 

That’s a typical practice, according to Vereen, with the federal labor department, though — like Cabebe — the leaders of the Maui nonprofits where program participants work said they had not been told that previously.

“The lack of clarity on the numbers for many of us, if not all of us, was confusing because at least in all of our collective experience in working with grants, we generally know exactly what we’re dealing with,” said Keolamau Tengan, executive director of Ka’ehu. Among other activities, Ka’ehu grows and provides native plant species to support post-fire replanting. The organization employs one program worker but was approved for five more.

“To have things change, which is I guess what we were hearing in terms of the amount of funds being released, did not make sense to us,” said Tengan. “We’re taking everything as it comes, but my hope is being able to have that clarity so we can better move forward for our community.”

The state can request the remainder of the original $21 million grant and has indicated it will, Vereen said.

“Bottom line is this money hasn’t disappeared,” Tokuda said. “The federal money is absolutely there. …But the state needs to act.”

Enrollment Stretched Finances

Exactly how many people have benefited from the program also remains murky.

Maui Economic Opportunity’s December 2023 announcement about the program said it would provide up to 300 jobs. Cabebe last week told Civil Beat the program had placed “nearly 200 participants.” The next day, she emailed to say 399 had been enrolled, more than the “goal of 323.” In a separate interview, Pilotin-Freitas said 419 people had been enrolled.

Regardless of the precise numbers, Cabebe said, her organization enrolled more participants than originally planned for, speeding the draw down of money. 

“Because we weren’t sure if we were going to get additional funding or not, we kept enrolling and in hindsight maybe we should have stopped enrolling a while ago,” Cabebe said at the Dec. 8 meeting. “But because it was federal funds and there were so many unknowns, we kept enrolling. So, you know, I apologize for that.” 

Whatever the final number, the economic impacts of the closure would be severe, said Chana Makale’a Dudoit Ane, founder with her late husband, Hoapili Ane, of Living Pono, which employs 12 workers from the program to acquire food from local farmers for fire survivors. 

“It would be devastating if all those workers’ families lose their income within the next month or three months,” Ane said. “And they’ve already been traumatized by this horrific experience — and then having to relive the insecurity of not having a job and the not knowing.”

A Struggle To Fill The Gap

Cabebe has cautioned the host site leaders that beyond the March extension, nothing is guaranteed, urging them to prepare to let their dislocated workers go by then.

Pilotin-Freitas, however, said she is assessing the program’s needs and is hopeful her department will be able to secure federal funding to extend it to its original September conclusion. She said she has received promising feedback from the U.S. labor department.

“They’re optimistic that our request will be approved,” she said. “We can’t guarantee it.”

Asked whether Maui Economic Opportunity should continue running the program and whether there would be any safeguards in place if they did, Pilotin-Freitas did not answer directly. Instead, she said that the communication between her office and the nonprofit “has been constructive and conducted in good faith” and that it is “committed to working with MEO to ensure that services continue to be delivered to those impacted by the Maui wildfires.”

Some host sites feel they can’t wait. They are currently scrambling to make up the gap as insurance in case the government doesn’t come through.

Aquino of Na Kia’i O Maui said she and colleagues intend to lobby foundations and businesses for more funding as well as state, county and federal officials. 

“We need to put a platform together, put a presentation together,” she said, “so we see how big of an impact (the program) is and how it’s needed. And we can advocate that way.”

Civil Beat’s coverage of Maui County is supported in part by a grant from the Nuestro Futuro Foundation.