Before five employees in the Honolulu Department of Planning and Permitting were indicted by the feds two weeks ago, accused of  accepting bribes, one of their colleagues admitted to cashing a check from a property owner whose plans she was reviewing.

But she didn’t face any discipline or get charged with a crime. At least not yet. 

Instead, she got two years of paid time off. 

The case, discovered by Civil Beat through public records requests, shows that DPP and the Honolulu Police Department were aware that a DPP employee had taken the money, which she said she later returned. And yet the person faced no discipline. The city said she resigned before it completed its investigation.

The situation also exposes a costly consequence of how the City and County of Honolulu handles reports of employee wrongdoing. Investigations can drag on for so long that they have the effect of granting an extended paid vacation to someone accused of misconduct. 

The inspector’s name was redacted from the records provided to Civil Beat. However, metadata in the digital files show that the person was Candace Izumi. She was a supervising building inspector making between about $56,500 and $87,000 per year, according to the Department of Human Resources. Civil Beat was unable to reach Izumi for comment. 

Sandy Ma, executive director of the government accountability organization Common Cause Hawaii, said the city’s response appears to encourage bad behavior.

“They need to put the public first. It’s like, come on, people,” she said. “Two years. Holy cow. And they didn’t even root out the problem.”

The recent indictments were brought by federal prosecutors. Former building plans examiner Kanani Padeken has pleaded guilty to honest services wire fraud and admitted to accepting over $28,000 in bribes to expedite projects for William Wong, an architect and CEO of Asia Pacific Architectural Consultants. The company has advertised itself as a permit expeditor.

Wong pleaded guilty to the same charge as Padeken. Both face up to 20 years in prison and a fine of up to $250,000, according to the plea agreements.

Three other current and former DPP employees have pleaded not guilty. A current building inspector is scheduled to be arraigned Tuesday morning.

Izumi only returned to work after the situation attracted some public attention. 

Civil Beat mentioned her case in a story about paid administrative leave last year, although her name wasn’t yet publicly known. Within days, she was “brought back to work,” according to the city human resources department.

However, she immediately requested vacation for the rest of the week. By that Friday, she had resigned. 

The same pattern played out with another DPP employee accused of threatening someone. He was put on paid leave in May 2018 and collected a paycheck for two years. 

After Civil Beat’s 2020 story, that person was called back to work in “another section, pending completion of the investigation,” according to the human resources department. However, he too immediately requested vacation and then resigned. 

“Based on the resignations of both DPP employees, the investigations were closed,” human resources said in an emailed statement. 

No discipline was ever issued, the department said.

Collective bargaining agreements allow up to 30 days of leave without pay pending investigations, according to human resources.

“Thereafter, the city is required to place the employee on paid leave status or return the employee to work, possibly in a different capacity, until the investigation is complete,” the department said. 

Civil Beat asked the city for an interview with an official who could explain what happened in Izumi’s case and why the city pays employees to stay home for prolonged periods after they’ve been accused of misconduct. 

Neither Mayor Rick Blangiardi’s office nor DPP agreed to be interviewed. In a statement, Blangiardi spokesperson Tim Sakahara noted that the former DPP inspector resigned before the mayor took office.

“The current administration will act swiftly and forcefully in response to any knowledge of wrongdoing,” he said.

So-called “stay away pay” is an issue that has frustrated taxpayers across the country for years.

Government employees have benefits that private sector workers do not, including a right to due process and protection from arbitrary dismissals, according to Governing, an online publication.

Even when problematic behavior is well documented, Governing reported that employees can still drag municipal and state governments through long and costly court proceedings. That’s something agencies may seek to avoid.

A Honolulu spokesman told Civil Beat last year that the city has no limit on the length of time an employee can be on paid administrative leave and that personnel actions are considered on a case-by-case basis.

Employee Received A Check From A Property Owner

Izumi’s case is described in a city memo.

She confessed to cashing a property owner’s check during an April 2018 interview with Wallace Carvalho, who heads DPP’s customer service division, although she claimed she later sent the money back. 

The inspector said that in the summer of 2017, she got together with a close friend who is a contractor. They met at a residential property where the friend had been hired to do renovation work. 

The permit for that renovation had not yet been granted, Izumi said. 

At the meeting, the friend introduced Izumi to the homeowner, who was an architect, according to her account. 

Civil Beat could not identify the contractor or property owner because the city redacted their names.

A week or two after the meeting, Izumi got a letter at the Kapolei Hale Permit Issuance Branch containing a check from the homeowner for $400 or $500, she said. 

“She claimed she deposited the check into her account without thinking,” the memo states.  

But within a week or two, she withdrew the money from her bank account and “mailed the cash back to the property owner,” she told her superior. The memo does not explain why. 

Izumi said she never again had contact with the homeowner but did review and approve the plans for the project, according to the memo. 

Carvalho questioned whether any building or zoning code standards were compromised, given that the contractor was a “personal and close friend.” 

“She answered ‘No,’” the memo states. 

Carvalho noted in the memo that he had not received other ethics complaints about Izumi.

He recommended that she be suspended without pay for five to 10 days “with the understanding that if other similar violations are investigated and confirmed to be true, termination from the City and County would be an option.” 

A few weeks later, then-acting DPP director Kathy Sokugawa sent a letter to the inspector advising her that she was being placed on leave with pay. 

“This is to advise you that we have received evidence of serious misconduct, including, but not limited to, failing to follow departmental policies and procedures, and potential ethics violations while carrying out your duties and responsibilities … in the issuance of certain building permits,” Sokugawa wrote in the May 2018 letter. 

Izumi was banned from Kapolei Hale and the Frank Fasi Municipal Building on King Street. 

Sokugawa wrote that the department hoped to conclude its investigation by June 29, 2018. But apparently, that didn’t happen. 

After two years of receiving paychecks for no work, Izumi wrote in a letter of resignation that she wished to pursue “other business opportunities.” 

In the letter, she requested that the ongoing investigation be closed and that all materials be removed from her file.

She noted that DPP was willing to do that previously when she was “considering my options for a position elsewhere in the City.”

DPP said it gave the case file to HPD Deputy Chief John McCarthy on Jan. 16, 2020, but no charges were ever filed. McCarthy said on Friday that the matter is “still pending investigation.” 

Civil Beat asked HPD’s spokesperson for an interview to discuss any efforts to investigate bribery in the department in general. HPD did not respond. 

Carvalho, Sokugawa and Administrative Service Officer Wayne Miyashiro, who was also mentioned in the memo, did not respond to requests for comment.

In an interview with Civil Beat, former mayor Kirk Caldwell said he wasn’t aware of a DPP employee on paid leave for two years.

“It’s the first I’ve heard about it, and I don’t want to speculate,” he said. 

Caldwell said efforts to investigate bribery allegations at DPP during his tenure went nowhere. 

“We would have an internal auditor investigate it. We asked the police department to investigate,” he said. “I have to say I don’t know if some of those things did end up with the FBI investigating. That I don’t know. But, when we asked to investigate, there was no report back to me that they could actually prove something.” 

He added, “It was taken seriously and we tried to investigate as much as we can.”