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Mayor Peter Carlisle has delivered the bluntest assessment yet of a nonprofit under scrutiny for possible misuse of federal funds.

The people in charge of ORI Anuenue Hale “weren’t following the rules” and it’s been difficult to convince them otherwise, he told Civil Beat in an interview last week.

The city still awaits word from the U.S. Department of Housing and Urban Development about its plans to bring the troubled local nonprofit into compliance and avoid the loss of $7.9 million in federal funding.

“This was a very difficult, emotionally-charged situation with the person who had come under the microscope,” Carlisle said in an editorial board interview at Civil Beat headquarters last week. “It’s not like they weren’t doing good things for people, but they weren’t following the rules, and it was very, very difficult to get them to the point where they realized. Their attorney knew it, but it was so hard to get this person there.”

Carlisle didn’t identify “this person” by name, but it’s likely he was referring to Susanna Cheung, the founder of ORI Anuenue Hale, the Central Oahu nonprofit that serves the elderly and disabled citizens.

Carlisle also didn’t specify when ORI finally became convinced of its mistakes.

But as recently as a month ago, Cheung told Civil Beat that ORI was unfairly targeted by HUD. After the Honolulu City Council met on Aug. 3 without asking tough questions of ORI, Cheung said that local HUD official Mark Chandler has discriminated against her company because she’s Chinese, wasn’t born in Hawaii and is female.

“Why are we not being treated equal? I’ve worked very hard. I earned my degree. Except I speak with an accent. My accent is a funny accent to him,” Cheung told Civil Beat. “It’s a personal vendetta. … I think it’s America, we have equal rights. But no, you are not allowed to speak out. You are not allowed to talk back.”

Messages left for Chandler Tuesday afternoon were not immediately returned.

Carlisle was reluctant to assign blame to the administration of former Mayor Mufi Hannemann for a lack of oversight, citing potential litigation. But he did say new Community Services Director Sam Moku and Budget and Fiscal Services Director Mike Hansen have worked closely with ORI to help the nonprofit understand what went wrong and what steps come next.

ORI spokeswoman and program director Yvonne de Luna said the company is eagerly awaiting feedback from the city and from HUD. She said ORI has complied with every demand since the compliance issues were first raised in a HUD report earlier this year.

“It seems to me after the three months, we should be at the point of moving forward. I don’t think it’s productive for anybody to keep rehashing over the past,” de Luna said. “I think it has shown our good-faith efforts to respond to HUD’s concerns and to the city’s concerns. Yes, we have our own perspective of the matter. … We kind of want to go past blaming and who does what.”

Meanwhile, Carlisle has worked with HUD to make clear the city is moving in the right direction.

“They don’t think that we’re going to get to the point where we’re going to owe money. They’re going to do everything that they can to tell us what we need to do so that that doesn’t happen,” Carlisle said, reprising the theme from an earlier interview with Civil Beat. “I promised them if it includes me standing on my head at the bandstand at Iolani Palace blowing bubbles out of my nose, if he tells me that will save the $7 million, I’ll do it.”