All county purchasing cards are supposed to have codes preventing the user from buying alcohol, Hawaii County Finance Director Deanna Sako said Wednesday during Mayor Billy Kenoi’s theft trial.
But apparently, only Kenoi could override that restriction.
“With authorization by the Mayor’s Office, alcohol is allowed,” said Sako while on the witness stand.
Kenoi’s purchases of alcohol, which prosecutors have described as “exorbitant,” with the county credit card have taken center stage in his trial this week.
Defense attorney Todd Eddins said Kenoi purchased alcohol as a way to build relationships and that it served a county purpose. He said that’s the mayor’s style.
Prosecutors have argued that Kenoi wasn’t honest about the purposes for all the purchases, which reached as high as $600, and that he didn’t provide receipts for several transactions as required by county policy.
The county’s pCard policy restricts the purchase of alcohol. But, as other county officials have testified, Sako said Kenoi had authority to approve such purchases, or at least that was the practice. Sako, who also acts as the county’s pCard administrator, became finance director in late 2014.
Kenoi is charged with two counts of second-degree theft, two counts of third-degree theft, three counts of tampering with a government record and making a false statement under oath.
Those charges are based on 15 pCard transactions totaling $4,129.31 from 2011-14. Prosecutors say Kenoi took between four and 26 months to reimburse the county for 14 of the charges, which in addition to alcohol, included the purchase of a bag at Target and a two-night stay at Hapuna Beach Prince Hotel for a nephew as a wedding present.
A $200 bill at Volcano House restaurant wasn’t reimbursed.
Eddins said Kenoi did not intend to permanently deprive the county of money.
Prosecutors said many of the reimbursements occurred a few days after media requests were made for Kenoi’s pCard records.
Kenoi used a line of credit from First Hawaiian Bank to make at least one of the reimbursements, according to prosecutors.
That was confirmed by Charles Erskine, bank vice president and area manager, during testimony.
Kenoi told reporters last year that he doesn’t have a personal credit card.
Kenoi’s secretary, Paulette Wilson, who also took the stand Wednesday, said one of Kenoi’s aides at the time, Kevin Dayton, would help the mayor review his pCard purchases when records requests were made.
Dayton, who is now the capitol bureau chief for the Honolulu Star-Advertiser, was a close adviser to Kenoi and acted as his media liaison.
Wilson said her tasks included compiling Kenoi’s pCard statements and sending them to the Finance Department for payment each month.
State Deputy Prosecuting Attorney General Michelle Puu presented several receipts from the 15 transactions. Wilson said she had not seen them, though Kenoi is required to provide them.
Sako said receipts are required to help ensure the pCard charge is a legitimate county expense. If an expense involved a meal, for example, the names of people present would be written on the receipt, she said.
If no receipt is available, a signed affidavit is required. Wilson said an affidavit was provided for the Volcano House charge.
That charge was listed on Kenoi’s pCard records as a “luncheon for U.S. Conference of Mayors visitors.”
Deputy Attorney General Kevin Takata said in a court filing that Kenoi hosted Alexander Cochran, who does not work with the mayors organization, and his wife and children. The group lists Tom Cochran as its CEO and executive director on its website.
Eddins said the visitors are relatives of the CEO and that Kenoi, who sits on the organization’s advisory board, hosted them to build a closer working relationship.
Wilson said she relied on Kenoi to clarify any of his pCard charges.
When she asked about purchases at Longs Drugs, which turned out to be for liquor, Kenoi told her they were for “Sam Choy’s Poke Contest Volunteer Appreciation Event,” as listed on pCard records, and a Tahiti Fete event. The latter charge was for $201.68 and included Jack Daniels and Crown Royal.
Prosecutors argue the timing of the purchases don’t line up with the events.
Eddins said Kenoi returned to the events after they ended to provide the liquor to volunteers and visitors.
Wilson also was asked to identify signatures on the receipts recovered during the state’s investigation. She said all appeared to be Kenoi’s handwriting, though a signature on a receipt that showed a large amount of alcohol was consumed was hard to decipher.
Dayton, who took the witness stand Tuesday, continued his testimony Wednesday morning and spoke positively about his time working for Kenoi, whom he referred to as a good friend.
He worked as one of Kenoi’s executive assistants from 2008-11 and an executive director from 2012-15.
A farewell party for Dayton in 2011, listed on pCard records as a “strategic planning luncheon,” is among the 15 transactions prosecutors allege violated the law.
Takata said earlier that alcohol was listed on the receipt. Dayton and Wilson, who also was present, said they don’t recall seeing alcohol consumed at the lunchtime gathering.
Wilson, who also was questioned about the $320 charge, said it was a farewell event that became a “planning luncheon.”
In response to questions from Eddins, Dayton said it was important for Kenoi to develop relationships with others, including congressional staff that he referred to as “gatekeepers.” He suggested that approach was responsible for the county getting much-needed assistance following the Great Recession.
“That makes all the difference between success or failure,” Dayton said.
Prosecutors say Kenoi used the pCard to purchase $600 worth of alcohol at Clyde’s Gallery in Washington, D.C., in 2011.
Eddins argued the large tab was work-related since he said Kenoi was hosting congressional staff members at the restaurant. He said it’s another example of the mayor’s relationship-building efforts.
Dayton, in response to a question from Eddins, also criticized local media coverage of Kenoi, which he characterized as “extremely aggressive” and “very harsh.”
An article published in West Hawaii Today in March 2015 revealed that Kenoi had spent nearly $900 on his county credit card at a Honolulu hostess bar, spurring a state investigation and numerous stories from other print, television and digital media outlets on the subject.
But Dayton, who once worked at the Hawaii Tribune-Herald, suggested local reporters had been unfair in covering the administration.
“I got the impression that the staff or higher editors disliked the mayor,” he said, without elaborating.
Witness testimony will continue Monday in Hilo Circuit Court.
Takata said the prosecution expects to rest on that day.
Email Tom Callis at tcallis@hawaiitribune-herald.com.
