Donors from firm
fed Harris $319,000R.M. Towill Corp. also got
$30 million in nonbid city
contracts since the mid-1990s
Employees and subcontractors for a local engineering firm at the center of a criminal investigation into Mayor Jeremy Harris' campaign gave nearly $400,000 in political donations and other gifts to Harris and his pet initiatives.
CORRECTION
Wednesday, Oct. 15, 2003>> A graphic entitled "R.M. Towill and subcontractors' city work" on Page A6 Sunday listed Hawaii Design Group Inc. as a subcontractor that received city contracts. Hawaii Design has received contracts from the city, but not as a subcontractor for Towill, and it has been a subcontractor for Towill, but not on city jobs. Also, Hawaii Design was listed among subcontractors of Towill that contributed to the Harris campaign; it did donate, but the graphic may have wrongly implied that it did so as a subcontractor to Towill on city jobs. Finally, the company's name is Hawaii Design Associates Inc. -- it appeared on one list as Hawaii Design Group Inc.
The Honolulu Star-Bulletin strives to make its news report fair and accurate. If you have a question or comment about news coverage, call Editor Frank Bridgewater at 529-4791 or email him at fbridgewater@starbulletin.com.
A Star-Bulletin study of Harris' campaign records found that R.M. Towill Corp.'s staffers and their network of friends, relatives and subcontractors made more than 280 political contributions totaling $319,000 to Harris' political campaign since 1996.
Towill and subcontractor Mitsunaga & Associates Inc. gave an additional $65,000 to the nonprofit Environmental Foundation in 1998 and 1999 to help pay for the mayor's Asia-Pacific Environmental Summits.
The contributions -- made during a period in which the Towill firm received more than $30 million in nonbid city contracts -- represents more than 6 percent of the money raised by Harris since 1996 and dwarfs the $212,000 in illegal campaign contributions raised on behalf of Harris by rival engineering firm SSFM International Inc., whose top executives earlier this year pleaded no contest to criminal violations of the state campaign spending law.
Towill's largess explains the city Prosecutor's Office's recent focus on the firm's employees and subcontractors.
Ten donors connected to Towill -- including Vice President Roy Tsutsui and former state housing official Wesley Segawa -- were arrested in July by Honolulu police on suspicion of making political donations under false names.
Five subcontractors agreed to pay the state Campaign Spending Commission more than $200,000 in fines to settle allegations that they made illegal political donations to Harris, former Gov. Ben Cayetano and other prominent local Democrats.
"For one entity to be associated with more than a quarter of a million dollars to an officeholder ... is a tremendous corrupting influence," said Craig Holman, a campaign finance expert at Public Citizen, a Washington, D.C.-based consumer advocacy group.
"That's a lot of money to raise for any officeholder in any state in the country, let alone for a local election."
Bill McCorriston, an attorney for Harris, denied any relationship between political donations and the awarding of city contracts. McCorriston said Harris was the first mayor to implement a rigorous contracting process that took the decision-making out of the hands of political fund-raisers and placed it on the desk of civil servants.
A lawyer for Towill declined comment, and company officials could not be reached. But in court filings, the engineering firm has challenged subpoenas issued by the Prosecutor's Office in its criminal investigation into the Harris campaign on the grounds that they were overly broad.
Towill employees Tsutsui, Nancy Matsuno and Kenneth Sakai also sued the Honolulu Police Department's lead investigator, Maj. Dan Hanagami, alleging that he harassed them and violated their rights by arresting them after they invoked their constitutional right against self-incrimination.
The Prosecutor's Office declined comment.
"They're part of a Hawaii culture that dates back 30 or 40 years, where to get involved in contracting you contribute politically, but that doesn't mean that there is a quid pro quo," said McCorriston, who described the prosecutor's investigation as "heavy-handed."
"This system wasn't invented by Jeremy," McCorriston added. "It wasn't encouraged by Jeremy. In fact, Jeremy was one of the first to make sure that the political fund-raisers in the administration were not the ones awarding contracts."
The $319,000 raised by Towill's network is probably the largest amount amassed by a single group on behalf of a single political candidate in Hawaii, according to Bob Watada, executive director of the Campaign Spending Commission.
Watada, whose office has opened a civil investigation into contributions by Towill's employees, said the figure probably understates the actual amount given by the engineering firm's employees and subcontractors.
Watada declined to discuss specifics of his investigation, but people familiar with the probe said that at least one subcontractor has told commission investigators that a Towill employee solicited donations from them.
Harris' filings with the commission list no corporate contributions from Towill.
Many of the subcontractors and employees have already figured in the two-year investigation of the Harris campaign by the Prosecutor's Office and the commission. Here's a snapshot of some of the biggest contributors and the amounts they gave:
>> R.M. Towill employees and their spouses made 87 political donations totaling $80,150 to the Harris campaign between 1996 and 2001. The donors included company executives Tsutsui and Sakai, who were arrested in July on suspicion of making illegal campaign contributions.
>> Geolabs, which conducted the site work for Towill on the city's Ewa Villages revitalization project, gave more than $55,000 to the Harris campaign through a maze of employees, friends and relatives that included a then-teenage student, an auditor for the HPD's white-collar division and a former University of Hawaii student class president. Geolabs agreed to a $64,000 fine from the commission in January 2002.
Some donors, including the teenager, weren't aware that they gave money to the Harris campaign until their names appeared in a June 2001 Star-Bulletin article.
>> Structural engineering firm Wesley Segawa & Associates Inc. was fined $53,000 by the commission in July for allegedly laundering $26,000 to the Harris campaign and $21,000 to Cayetano's campaign.
The company's namesake, Wesley Segawa, a former chairman of the state Housing and Community Development Corp. of Hawaii, was arrested in July by Honolulu police on suspicion of money laundering and making false-name campaign contributions. Segawa's attorney, Darwin Ching, declined comment, citing the pending criminal case.
>> Engineering firm NTW Associates Inc. agreed to pay the commission a $19,000 fine to settle charges that it made $29,350 in false-name contributions to the Harris campaign. Five donors associated with the firm were arrested by Honolulu police in July on suspicion of making false-name contributions.
>> Maple Gardens Inc., whose officers at one time included Towill's former chairman Donald Kim. The Star-Bulletin reported in June 2001 that several waitresses and other employees at the Moiliili Chinese restaurant gave $3,000 checks to the Harris campaign.
Restaurant owner Robert Hsu -- a former Towill employee -- said then that the contributions were paid for by his employees and not the Towill firm. But investigators with the commission found one check indicating that the donation was made on behalf of the Towill firm.
Under state law, businesses and individuals are barred from giving political donations under false names. Donors also are limited to giving $4,000 to a mayoral candidate and $6,000 to a gubernatorial candidate in a four-year election period.
"R.M. Towill has a stable of loyal people that are required to make campaign contributions whenever tickets are passed out to them," Watada said.
Founded in 1930, Towill is one of the state's largest engineering firms. Since 1996, the company has received more than 30 nonbid city contracts totaling $30.7 million, including the $3.9 million construction management contract for the $300 million Sand Island Wastewater Treatment Plant and a $1 million Ewa Villages revitalization project.
More than a dozen of those contracts were either awarded or amended during the last week of December, implying that the contracts were signed or changed at the last minute so that money appropriated for the project by the City Council would not lapse, said Lowell Kalapa, executive director the nonprofit Tax Foundation of Hawaii.
Kalapa said the practice implies that the projects either have a low priority or aren't valid to begin with. Such contracts can end up costing a state or city government more money in change orders and amendments than the contract itself due to mistakes and oversights made during rushes, he said.
"This raises a question of waste," Kalapa said. "Where do all of these contractors get the money from which they can make these contributions? It's gotta come from their work, and that's got to come from the taxpayers."
McCorriston, however, defended Towill's work, saying the firm has a long track record as a primary contractor not only for the city, but also for the state and federal governments.
