HAR §16-27-16. Memorandum of understanding

(a) Informal action by means of a memorandum of understanding shall be considered for institutions which have been assigned a UFIRS or NRS composite "3" rating. The memorandum of understanding is a means of seeking informal corrective administrative action from institutions considered to be of supervisory concern, but which have not deteriorated to the point where they warrant formal administrative action. The purpose of the memorandum is to correct an institution's weaknesses by focusing on the institution's problem areas and defining responsibility for ensuring that deficiencies are addressed within designated time periods. (b) The memorandum of understanding shall be signed by the commissioner and the institution's board of directors. In all instances, the respective federal authority shall be invited to join in this action. (c) The memorandum of understanding shall address the specific problems of an individual institution. Use of the memorandum, as opposed to formal supervisory and enforcement action, is appropriate where the problems discussed with management and the board of directors of the institution have been adequately detailed and the institution, in good faith, will work to eliminate the problems. An institution's failure to comply with the provisions of the memorandum, or continued deterioration in the areas addressed in the memorandum, may facilitate implementation of formal administrative action. (d) Monitoring of an outstanding memorandum of understanding may be conducted by the division through progress reports, visitations, or examinations. (e) Termination of a memorandum of understanding shall be considered when the institution's overall condition has improved significantly and the institution has substantially complied with the terms of the memorandum. The division shall coordinate any termination with the federal authority, if the latter is a party to the action. (f) General use of a memorandum of understanding for a UFIRS or NRS composite "3" rated institution does not preclude recourse to formal supervisory and enforcement action when it is believed that management is unwilling to take necessary corrective action. (g) The memorandum of understanding may be used in a situation where other than a UFIRS or NRS composite "3" rating is assigned, depending on the circumstances. [Eff 8/13/87; am and comp 1/27/01] (Auth: 27-6 §16-27-23 HRS §§412:2-100, 412:2-107, 412:2-300, 412:2-301, 412:12-109, 412:13-224) (Imp: HRS §§412:2-100, 412:2-300, 412:2-301, 412:12-109, 412:13-224) SUBCHAPTER 4 FORMAL SUPERVISORY AND ENFORCEMENT ACTION