Honolulu Civil Beat needs your help to raise $100,000 in reader support by September 1. Every dollar raised strengthens our nonprofit newsroom!
Over the past two days we have raised $18,000 from 302 donors. Mahalo!
Chuck Totto can be a pest, especially to politicians. For 16 years, he has ferreted out corruption in city government as the executive director of the Honolulu Ethics Commission.
Totto has taken on some of the most influential players in Hawaii politics, including mayors, police chiefs and City Council members who together oversee the spending of billions of taxpayer dollars. His duty as chief legal counsel is to ensure that city officials are not abusing their power or otherwise taking advantage of their positions for personal gain.
On occasion, he’ll publicly admonish officials who break the rules or levy a hefty fine to send a message that ethical lapses won’t be tolerated.
That was the case in 2014 when he came to terms on a $50,000 settlement agreement with state Rep. Romy Cachola, who had been busted for accepting thousands of dollars in gifts while on the City Council from lobbyists who wanted to sway his votes on key issues, including Honolulu’s rail project.
But in all Totto’s years as an ethics enforcer, he rarely had to worry about job security. That was, until Honolulu Mayor Kirk Caldwell took office.
A Civil Beat review of Ethics Commission records, meeting minutes, emails, correspondence and interviews with those familiar with the commission’s work show that Totto has been under attack by Caldwell and those he’s appointed ever since the mayor took office in 2013.
It began with disagreements over the Ethics Commission budget and complaints that top administration officials were stonewalling investigations. Since then Totto has been subjected to a gag order, a 30-day suspension and a requirement to document his day in six-minute intervals.
Now the office is in shambles. The commission’s associate legal counsel and its sole investigator resigned recently, leaving Totto as the only person who can investigate ethics complaints. He’s considering filing a lawsuit against the very Ethics Commission he works for. He’s also cleared out his office of personal belongings, including family photos that once hung on the walls.
It seems as if he’s preparing for an exit — something that could occur as soon as Wednesday’s Ethics Commission meeting.
Caldwell regularly sidesteps questions about problems within the Ethics Commission, saying he’s played no part in the drama even though he appointed three of its seven members.
“I’ve stayed 100 percent away from this issue.” — Honolulu Mayor Kirk Caldwell
Caldwell has refused to speak to Civil Beat about the Ethics Commission, and most recently avoided questions on the topic after a June 3 press conference in his office by slipping through a back door.
Subsequent requests to interview the mayor were denied by his spokesmen, Jesse Broder Van Dyke and Andrew Pereira.
Caldwell was put on the spot during an April 11 press conference at the Frank F. Fasi Municipal Building when a television reporter asked him to comment on a recently released report that explained in part why Totto had been suspended. The mayor dodged then too, saying that questions should be directed to Ethics Commission Chairwoman Victoria Marks, who he appointed in November 2014.
“I’ve stayed 100 percent away from this issue,” Caldwell said. “I appointed three of a total of seven (commissioners). I’m not involved in this decision and I don’t want to respond because I’m not involved.”
Totto has hired former Honolulu Mayor Peter Carlisle as his personal attorney to help him navigate his feud with the Ethics Commission, which is made up of seven volunteer members, all of whom are mayoral appointees.
Caldwell appointed three of those members and a fourth, Peter Adler, is awaiting confirmation by the Honolulu City Council.
Carlisle is now running against Caldwell for mayor and the challenger has indicated that ethics will be a major campaign theme moving forward. Charles Djou, who also recently announced his candidacy for mayor, has also said he plans to address Caldwell’s relationship with the Ethics Commission during the campaign.
Caldwell won’t be able to keep the controversy at bay for much longer, Carlisle told Civil Beat.
“I think the issue is directly in his lap and he’s responsible for it,” Carlisle said. “How do I think he should take care of it? I think he should reverse all the actions that he’s done and make sure that we have a functional Ethics Commission. I think that’s critical for the function of the city and county of Honolulu.”
Carlisle said much of the tension between Caldwell and Totto can be traced to a single event — the mayor’s inaugural luau.
On Feb. 9, 2013, hundreds of Caldwell supporters gathered at Moanalua Gardens to celebrate his ascension to the mayor’s office. General admission tickets cost $25. But those seeking VIP treatment, which included better seats and booze service, paid $2,500 to $10,000 for a table.
Some of the most influential players in Hawaii business and politics took part, either by attending the event or paying for the festivities. Party-goers included former governors, corporate leaders, City Council members and musicians from some of Hawaii’s best known acts, including Kapena and the Royal Hawaiian Band, both of which performed that night.
But it was the donations and sponsorships that paid for the luau that drew the attention of the Honolulu Ethics Commission.
A nonprofit transition team formed to throw the party and help get Caldwell situated in office received more than 100 donations from businesses and individuals that totalled $381,000.
Many of those donations came from people and entities with direct business ties to the city, including cabinet members, lobbyists and other companies that had municipal contracts or were trying to influence city decisions, the Ethics Commission found.
The worry was that these donations were a way for these groups to curry favor with the new mayor.
On Oct. 19, 2013, the Ethics Commission released a 19-page opinion detailing its investigation into Caldwell’s inaugural luau. Although it absolved the mayor of any wrongdoing — he wasn’t the one actually soliciting donations — the commission found glaring loopholes in the city ethics code that needed to be addressed.
The opinion stated:
This case underscores the serious concerns about the integrity of city government when large donations are made for a mayor’s benefit from those who have much to gain or lose from their business relationships with the city administration. Government officials are restricted in receiving gifts because of the reasonable concern that gifts to an official may lead to the appearance or reality of preferential treatment by the official to the donor.
Caldwell did not take kindly to being investigated less than two months after taking his oath of office. The same day the Ethics Commission released its findings he issued a preemptive press release through Anthology Marketing Group trumpeting that he had been “cleared of any improprieties.”
“I am gratified that the Commission found that I did nothing wrong while transitioning into the office of the Mayor,” Caldwell said in his written statement. “Frankly, I was surprised that there was even an investigation to begin with, as the Mayoral Transition Committee followed the traditional practices used by our mayors and governors for as long as any of us can remember.”
Over the next several months, members of Caldwell’s newly appointed kitchen cabinet would make life difficult for Totto and his staff, so much so that he would publicly question whether the new administration was trying to manipulate his agency.
One of the first public spats came during an Ethics Commission meeting Nov. 4, 2013, just weeks after its luau ruling.
Caldwell’s top attorney, Donna Leong, who headed the Corporation Counsel Department, had gotten involved with the commission’s budget by making cuts and imposing a spending cap. This upset Totto and some of the commissioners, who viewed themselves as an independent agency that was supposed to be autonomous of the administration and other outside influence.
But the Ethics Commission was still administratively attached to Corporation Counsel for budgetary and bookkeeping purposes. That meant the administration could exert its influence where it counted most — the Ethics Commission pocketbook.
There wasn’t much cash to go around, either. The commission’s budget was roughly $360,000 at the time, a tiny fraction of the city’s $2 billion-plus operating budget. And the commission only had a handful of staffers — about five, including Totto and two legal clerks — to provide training and advice to more than 8,500 city employees and investigate 80 to 90 complaints a year.
At the time, Commissioner Michael Lilly, a former Hawaii attorney general, said there was no doubt that money equaled influence in such situations, and noted how important it was for the commission to retain control of its own budget moving forward.
“The power to control a budget is the power to control an entity,” he said.
But the commission had deeper concerns. Leong said city attorneys would be providing their own ethics advice to employees, which bothered Totto and others because it could result in conflicting opinions as well as a reluctance to report misbehavior.
In fact, some administration officials, including then-Managing Director Ember Shinn, worried that ethics complaints could result in costly grievances and litigation between the city and its employees. She said that “when you talk about dollars and cents there’s a balancing” that needs to occur.
There were also accusations that administration officials were actively interfering with Ethics Commission investigations, either by refusing to answer questions or completely ignoring staffers’ requests for information.
For example, the city would not share reports related to its high-profile investigation of a Central Oahu nonprofit that had received millions of dollars in federal funds from the U.S. Department of Housing and Urban Development. It was a convoluted case that involved allegations of kickbacks and political favors.
Totto’s investigation, which could have benefited from getting access to the city’s reports, eventually stalled out because of the lack of cooperation.
There were other cases. Totto sought access to a Honolulu Fire Department employee’s computer because he wanted to see if that individual was giving preferential treatment to a city vendor. Totto was also trying to get his hands on other employees’ emails to find out if they were participating in political activities while on the job. In both instances, he says he was denied access.
“The power to control a budget is the power to control an entity.” — Honolulu Ethics Commissioner Michael Lilly
Carolee Kubo, who heads the city’s Human Resources Division, said she didn’t want to provide the commission with any more information than was necessary because she didn’t want it “witch-hunting” city employees, who she said have a right to privacy.
The relationship became so strained that the commission even considered issuing subpoenas to force Caldwell’s cabinet members to comply with ethics investigations. Still, Caldwell said through a spokesman that it wasn’t his fight.
In the spring of 2014, city attorneys continually delayed Ethics Commission investigators’ requests to purchase a $600 GPS tracking device that they wanted to use for an overtime abuse investigation. Officials believed that nabbing the suspects could have saved about $250,000 annually.
Corporation Counsel delays compromised the investigation and the case fizzled. Ethics Commission members believed it was time for the mayor to step in.
On July 9, 2014, Ethics Commission Vice Chairwoman Katy Chen penned a letter to Caldwell outlining the many concerns she and her colleagues had about the administration’s handling of their agency ever since he took office.
She noted that many of the problems started in the fall of 2013 with Leong overstepping her bounds when it came to exerting line-item control over the Ethics Commission budget.
Chen summarized other issues that she said reflected “poor ethics policy from City leaders,” including the GPS case and concerns that Shinn was worried more with the cost of employee grievances than with ensuring the public maintained trust in city government.
Chen asked the mayor to help the commission “collegially” resolve the difficulties by clarifying the role the Corporation Counsel played in overseeing the Ethics Commission, and to ensure that it remained purely ministerial. Above all, Chen said, the mayor should support an independent Ethic Commission to demonstrate that his administration was committed to have a strong ethics program.
“It is vital that the Commission maintain its independence with the authority to conduct its investigations and other duties unimpeded by any agency of City government,” Chen wrote. “Because the Commission enforces the ethics laws on behalf of the public over all officers and employees, its independence must remain inviolate.”
The letter had the unanimous support of the commissioners at the time and they asked Caldwell to respond by July 14, 2014. On Aug. 18, they received their response. It was not what they expected.
Addressing his letter to Totto, Caldwell summarily defended his administration’s actions. He said the Ethics Commission, like all city agencies, should be required to justify its expenses, especially when cash is in short supply. The GPS monitor incident, Caldwell said, appeared to be a legal misunderstanding between the commission and the city’s attorneys over who needed to be notified to install the device on a municipal vehicle.
Caldwell said city employees should be able to seek ethics advice from Corporation Counsel attorneys rather than the commission so as to maintain the ability to have candid conversations about ethics compliance. If city employees, including cabinet members, could only seek ethics advice from the commission attorneys, he said, then how could the commission staff resolve the inherent conflict of being both a prosecutor and witness.
“I strongly support the decisional independence of the Ethics Commission in order to meet its mission and objectives,” Caldwell wrote. “Independence, however, does not mean unfettered authority to act without constraints within the administrative structure of City government.”
Totto’s relationship with the Ethics Commission took another turn in 2015 after Caldwell appointed three new members to the seven-member board.
Caldwell’s appointees, Riki May Amano, Victoria Marks and Allene Suemori, were all retired Hawaii state judges who had moved on to careers as mediators. Amano most recently has come under fire for potential conflicts while overseeing a case involving the $1.4 billion Thirty Meter Telescope on the Big Island, where she used to work as a judge.
The judges’ influence on the Ethics Commission would be felt almost immediately. They were particularly concerned with how Totto handled the Romy Cachola ethics case, and the subsequent fallout over similar allegations involving his former colleagues.
The Ethics Commission had slapped Cachola with a $50,000 fine on Sept. 27, 2014, after an investigation found that he had accepted lavish meals, free wine and rounds of golf from lobbyists in excess of what was allowed under city gift rules and was misusing his vehicle allowance.
The $50,000 settlement was the single largest penalty levied against a public official by the Ethics Commission. A press release accompanying the decision did not refrain from playing up the historical significance of the fine and the punishment meted out.
“Public corruption is the use of public office for private gain, and this case is a perfect storm of public corruption,” Totto said in the release about Cachola. “His recurring and self-enriching misconduct has eroded the public’s trust and confidence in City government.”
But the case became increasingly complex when Cachola accused other City Council members of being on the take.
According to Cachola, Ann Kobayashi and Ikaika Anderson — both of whom are current council members — had received illegal gifts from lobbyists while voting on key measures related to Honolulu’s rail project and other development issues, as did former council members Todd Apo, Nestor Garcia and Donovan Dela Cruz, who is now a state senator.
The Ethics Commission immediately launched an investigation. On May 27, 2015, Garcia paid an $8,100 fine for not disclosing his conflicts of interest for accepting the prohibited gifts from lobbyists and voting on legislation that would benefit the companies they worked for. The other cases remained open.
Totto had said for some time that council members’ votes could be nullified if it was determined that they did not disclose their conflicts. That assertion raised eyebrows, particularly among those with an interest in the rail. If key votes were thrown out it could place the largest public works project in Hawaii history in bureaucratic limbo.
Totto’s comments again put him at odds with the Caldwell administration, and particularly Corporation Counsel Donna Leong, who vociferously denied that any votes would need to be voided.
Amano took issue with how the Cachola matter played out in the press. During a Nov. 21, 2014, meeting, she complained that Totto sent out a press release without first notifying the commissioners. As a former judge, she said she would prefer that a decision stand on its own merits rather than be dissected by Totto in the media.
“That is not where we do our battles,” Amano said. “The documents and records speak for themselves.”
Amano, who had yet to be joined on the commission by Marks and Suemori, didn’t get much support from her fellow commissioners, some of whom felt it was important to work with the media to explain Ethics Commission actions and educate both citizens and city employees about important issues.
“If you can’t explain anything or comment in any way to media inquiries about an opinion then I think that diminishes our ability as a commission to educate the public on ethics.” — Katy Chen, former Honolulu Ethics Commission chairwoman
For the next several months, the issue was batted around the commission before finally coming to a head on May 13, 2015. Amano drafted a policy that went beyond issuing press releases, and instead took a hardline approach that effectively would have prevented Totto from speaking to the media at all.
Amano’s policy stated that “under no circumstances” should Totto or others in his office “engage in media activities to air concerns/grievances regarding the operations of the Ethics Commission, or interpret or comment on any decisions or advisory opinions.”
Totto would also not be allowed to talk to the press before first getting approval from Chairwoman Katy Chen or Vice Chairman Michael Lilly. But both Chen and Lilly, a former attorney general, questioned the wisdom of having such a broad policy. Above all, Chen believed it was cumbersome and impractical.
“If you can’t explain anything or comment in any way to media inquiries about an opinion then I think that diminishes our ability as a commission to educate the public on ethics,” Chen said during the May 13 meeting. “And I think that’s a disservice.”
Then-Hawaii News Now reporter Keoki Kerr was the only member of the media in the audience that day, and he did something journalists don’t normally do. He injected himself into the conversation he was there to cover.
Kerr was one of the most respected journalists in the state, and some commissioners wanted to know what he thought about Amano’s proposal. He told them that he worried they were going to make a decision that would directly affect how he and others journalists did their job by cutting them off from a key source of public information.
He added that enacting such a restrictive media policy would not only undermine Totto, but the entire commission. The commission already faced an uphill battle with respect to rooting out wrongdoing, he noted, because it was perennially short-staffed and had limited authority to mete out punishment.
Allowing Totto to use his bully pulpit, Kerr said, helps the commission amplify its message that corruption won’t be tolerated.
“It’s important that you generate discussion on these issues because I think from covering government for many years, people tend to look the other way,” Kerr said. “And the important thing is that we don’t look the other way when there’s a problem and we address it.”
It was a surreal moment for Kerr. In his 25 years as a journalist he had never stood before a government body to testify on an issue he was supposed to cover. He told Civil Beat in a recent interview that he normally believed it would be inappropriate for someone in his position to switch from observer to participant. But on this occasion he felt compelled to testify.
Kerr had noticed the many troubles Totto was facing with the Caldwell administration and the mayor’s appointees to the commission. Important ethics investigations were suffering as a result, he said.
For instance, Kerr broke the news in July 2015 that 17 ethics investigations had been halted because Caldwell’s Managing Director Roy Amemiya refused to renew an 89-day personal services contract for Letha DeCaires, a retired HPD officer who was the sole investigator in the office.
DeCaires would lose out on her retirement benefits if she worked 90 days, and instead had her contract renewed every 89.
The administration had told the Ethics Commission that it wanted to crack down the practice, and force the commission to hire a permanent investigator even though there were many other contract employees working under similar circumstances in other city agencies, including the prosecutor’s office and liquor commission.
DeCaires played an important role for the commission. She was handling some of the most complex and high-profile cases in the office, including the Cachola investigation that at the time involved several other council members.
“It just seemed that at every turn the city Ethics Commission was being undermined in the budget, the administration and through a draconian media policy that came out of nowhere.” — Keoki Kerr
DeCaires was also the lead investigator in a case involving the theft of Honolulu Police Chief Louis Kealoha’s personal mailbox. Kealoha and his wife, Katherine, a high-ranking city prosecutor, have been accused of framing her uncle for the crime and are now under a federal grand jury investigation.
Ethics Commission officials wanted to keep DeCaires for as long as possible, saying it would be difficult for a new investigator to get up to speed. They also said they had been told that the suspect in at least one ethics case was waiting for DeCaires’ contract to expire.
“It just seemed that at every turn the city Ethics Commission was being undermined in the budget, the administration and through a draconian media policy that came out of nowhere and was written by people who have no experience dealing with the media on a day-to-day basis,” Kerr told Civil Beat.
“That was troubling because there were so many important issues that the Ethics Commission was investigating so I felt like I had to speak up. I’ve been covering government and ethics and mismanagement at all levels of government for more than 25 years, and I’ve never seen this kind of a crackdown on a watchdog for actually doing its job.”
The commission didn’t make a decision at the May 13 meeting. But on June 24, 2015, while Lilly was absent, the cadre of judges made the push for Amano’s restrictive media policy. It passed 5-1, with Chen the only dissenting vote. Commissioners Stanford Yuen and Stephen Silva sided with Amano, Marks and Suemori. Leong had also submitted written testimony in support.
Backlash was swift, particularly from Hawaii’s media outlets. The Honolulu Star-Advertiser, Hawaii News Now and Civil Beat all issued stern rebukes in editorials, saying the policy overstepped the bounds of free speech and violated the public trust.
The Star-Advertiser called on Caldwell to take the lead in the matter. He didn’t.
On July 23, 2015, the commission voted 4-3 to rescind the policy. The only three people voting no were Amano, Marks and Suemori.
It was a clear indication Totto didn’t have the full backing of his commission anymore. That became more obvious last April, when the commission unanimously decided to suspend him for 30 days without pay.
The credibility of the Ethics Commission has faded. Last fall, it held a closed-door meeting in which it decided that it would dismiss its case against Kobayashi, Anderson and Dela Cruz, all of whom were represented by former Congresswoman Colleen Hanabusa, who had just been appointed by Caldwell to the board of the city agency overseeing the rail project.
While the commission’s sudden dismissals were surprising, another drama was playing out in the background that would ultimately shut down Totto and at least temporarily subvert the commission’s ability to investigate corruption in city government.
On Oct. 20, 2015, an Ethics Commission staffer filed a complaint with the commission about Totto creating a stressful workplace environment. Among other things, Totto had made his personal views known about various city officials and commissioners in a way that caused the worker to feel anxious.
“Totto had proven to be a capable leader for over 16 years. He survived several mayors and numerous Ethic Commissioners, with no problem. So why all of a sudden does he not know his job?” — Bill Shanafelt, former Ethics Commission investigator
The individual, whose name was redacted from all publicly released reports but appears to be former assistant legal counsel Laurie Wong-Nowinski, also felt that Totto had blindly pursued the case against Kobayashi, Anderson and Dela Cruz despite a lack of evidence and legal grounding.
Commissioners hired Honolulu attorney Anna Elento-Sneed on Dec. 8, 2015 to investigate the complaint. State records show Elento-Sneed, who specializes in labor law, had donated $500 to Caldwell’s 2012 mayoral campaign.
The investigation was completed Jan. 18, and resulted in the commission suspending Totto. He was also forced to take remedial steps to improve the efficiency of his office, such as develop flow charts and have his employees fill out time sheets that tracked what tasks they completed in six-minute intervals.
According to a Feb. 29 letter from Chairwoman Marks to Totto, the decision was unanimous.
“We trust that on a going forward basis, you and your team will establish, develop and maintain a workplace that is productive, proactive and positive,” Marks wrote. “The Commissioners will continue to look to you to set a sound, professional, and positive example for the Honolulu Ethics Commission.”
Totto’s office has been in disarray ever since his suspension. Wong Nowinski’s last day was in April, and the commission’s only investigator, Bill Shanafelt, has also resigned. That leaves Totto as the only staffer who can conduct investigations.
He has refused to talk about the current state of affairs at the commission. But on Friday, Shanafelt came to his defense in unexpected fashion.
At 12:37 a.m. Shanafelt, who has 35 years of law enforcement experience, sent a 1,000-word email to Civil Beat with the subject line “Ethics Commission Investigator Has Had Enough. I quit.”
Shanafelt praised Totto and his staff — including former investigator Letha DeCaires — criticized Elento-Sneed’s investigation as “incompetent” and railed against Marks and the other commissioners for trying to micromanage the office, a tactic he said was “purely punitive.”
He said that when he started he had heard rumors that Caldwell’s appointees were “out to get Totto” and that the executive director did not have the support of the city attorney’s office.
“How could that be?,” Shanafelt asked. “Totto had proven to be a capable leader for over 16 years. He survived several mayors and numerous Ethic Commissioners, with no problem. So why all of a sudden does he not know his job? … All of a sudden he needs to write a daily log? All of a sudden he is incompetent? All of a sudden, under the new leadership of Chair Vickie Marks, Totto becomes a problem? I must call Bull Doo Doo on this notion.”
Marks told Civil Beat in a recent interview that any claims that she or her colleagues are going after Totto on behalf of the mayor are laughable. In fact, she says she hasn’t had any contact with the mayor since she was unanimously confirmed to the Ethics Commission by the City Council in December 2014.
“I think much of the discussion, if you will, was manufactured,” Marks said. “I don’t think there’s any issue.”
The media policy came about, she said, because she and some of her colleagues — mainly the judges — had problems with how Totto was handling himself in the press. Marks refused to discuss the Ethics Commission’s internal investigation of Totto, but did say that the remedial actions that were called for by her and others, such as tracking staff time in six-minute intervals, was a necessary part of improving office functionality.
She added that she does not feel that the commission has been micromanaging Totto.
“Having an office that is efficient is important and knowing where cases are and how much time you’re spending on them is an important management tool,” Marks said. “What we don’t know is whether a request for advice takes five minutes to answer or five days of legal research to answer, and that’s what we’re trying to ferret out.”
She said the main purpose of the commission is to perform investigations, and readily admits that the office is short-staffed. But even though Totto is usually flanked by his attorney Carlisle during Ethics Commission meetings, Marks says that the commissioners’ relationship with their executive director is “congenial and positive.”
“I don’t have any friction. I don’t know if other people view things differently,” Marks said. “I think the commissioners are just trying to do the best they can do and do the right thing.”
The next Ethics Commission meeting is scheduled for Wednesday. On the agenda is an executive session item in which the commissioners will discuss a resolution to Totto’s possible legal claims against the agency.