Hi
I believe there is other federal funded housing on the island as well. Regarding why the one was built with federal funds and the other state, sorry, this I don't know the background on. We need someone else to chime in on that. That was before my time, I don't know.  

But regarding upkeep, 1 news item and 1 practiced theory.
1) News, Kukui Gardens was the recipient of some of the Obama funding for the Federal Stimulus Plan back in 2009 : 
http://the.honoluluadvertiser.com/article/2009/Feb/25/ln/hawaii902250409.html

2) Practiced theory.
If you put people in a dump, most will treat it like a dump and grow into that mindset as well. People become how you treat them and how they are perceived. If you treat people like animals, they will eventually act like it - because you caused it.