Often it is scandal that spurs reform, and the Hawaii Legislature may now be facing one of those moments.

The Legislature has been jolted by the convictions of former Senate Democratic Majority Leader J. Kalani English and former House Finance Committee Vice Chairman Ty Cullen, who both pleaded guilty Tuesday to accepting bribes to benefit a wastewater company.

In addition to illicit cash that changed hands in a restaurant men’s room and was stuffed under the floor mat of a car, there were dozens of apparently lawful campaign contributions that businessman Milton Choy showered on English, Cullen and other political figures in Hawaii.

Those donations may be legal, but they suddenly appear so unsavory that lawmakers are eager to be rid of them. And the ugly political optics of all that suggest lawmakers may now be motivated to overhaul Hawaii’s system of campaign funding.

The larger issue being raised by the corruption scandal is the public’s mistrust of politicians and “a broader network that exists of influential people who are insiders in politics,” meaning people who have access to power, said Neal Milner, political science professor emeritus at the University of Hawaii Manoa.

The guilty pleas Tuesday by two former lawmakers and fallout from the corruption scandal may open a path for reforming Hawaii’s campaign spending system. Anthony Quintano/Civil Beat/2018

“Influence is about access, access is about power, and power is often about these kind of subtle things that you have at your disposal,” he said during a recent interview on the Honolulu Star-Advertiser’s “Spotlight Hawaii.”

“So when you see engineering firms and construction firms giving money to political campaigns — and that includes this guy with the cesspool company — most of the time the money is given in a general sense because it improves your reputation, it increases the likelihood that you’ll get some kind of access,” Milner said.

“The interesting thing about the cesspool guy is that a lot of his money went in that direction — you’re trying to become a player the way some of the big companies are players here,” he said.

Some see a more direct link between campaign donations and profitable government contracts. Sandy Ma, executive director of Common Cause Hawaii, said Choy’s contributions bought him access to insider knowledge about what projects state government would fund, and also helped get him access to agency heads who would oversee those contracts.

“It positioned him properly to meet the right people, shake the right hands, so that when a procurement contract is announced, his name is already percolating, his company is already percolating around in people’s minds,” she said.

That pattern is often described as “pay-to-play,” which Ma said has been banned in other jurisdictions including Connecticut, Illinois and Washington, D.C. by restricting or prohibiting contractors from making political donations. The Connecticut and Illinois laws were both triggered by scandals in those states.

Hawaii has a law to curb pay to play, but it has proved to be easy to circumvent. The law prohibits “any person” with a state or county contract from making donations during the life of that contract, but firms sidestep that restriction by having, for example, family members or company executives make personal donations.

Kristin Izumi-Nitao, executive director of the state Campaign Spending Commission, said the Hawaii ban on contractor donations has also proved to be difficult to enforce because there is no centralized database for all of the contracts and contractors who are hired by various state and county agencies.

Contractor Grace Pacific was fined $1,000 in 2019 under the Hawaii law for a donation to state Sen. Glenn Wakai, but few other cases resulted in fines under the existing law.

Sandy Ma of Common Cause Hawaii. 

Ma said Common Cause is going to look at tightening the weak existing law, and also wants lawmakers to consider whether subcontractors should also be banned from making political contributions. But that also presents enforcement challenges because there is no centralized list of state and county subcontractors.

The city of Honolulu and Maui County both contracted with Choy’s company, H2O Process Systems, to clean city and county buses, and the company web site says it also worked on a wastewater treatment plant on Maui, apparently as a subcontractor.

Choy, his family members and employees from his various companies have donated more than $356,000 to political campaigns since 2014, according to campaign finance data, including more than $160,000 donated by Choy himself.

When asked if state campaign spending officials are investigating any of those donations by Choy, his family or people affiliated with his companies, Izumi-Nitao said she cannot comment.

Another idea backed by Common Cause is a ban on campaign fundraising events for state lawmakers during the legislative session from January until early May. Critics have argued for years those spring fundraisers, which are routinely held, are unseemly at best.

Part of the problem is mid-session fundraisers can create scenarios where lawmakers hold official hearings on bills that are important to lobbyists or political activists in the daytime, and then host fundraisers that very evening to solicit campaign contributions from the same people.

Banning those mid-session fundraisers has been discussed for years, but the idea was never incorporated into state law.

“I think that’s a strategy if you’re concerned people are gaining undue influence or unfair advantage during session,” said Izumi-Nitao. “Of course, the situation is much more ripe for it now than if we discussed this in early January 2022” before Cullen and English were charged.

The idea “sounds like an area that could be impactful,” she said.

However, some neighbor island lawmakers have pointed out spring is when they are working in Honolulu for session, which from their perspective makes it a good time to hold a Honolulu fundraiser.

The Legislature has bills pending that would make it easier for the campaign spending commission to refer violations of campaign spending restrictions to county prosecutors or the state Attorney General, and would bar politicians from holding elective public office after a campaign-finance violation conviction for 10 years.

Banning mid-session fundraisers has been discussed for years, but the idea was never incorporated into state law.

Those include House Bill 2474, which was approved by the House Government Reform Committee last week, and Senate Bill 2345.

Ma is also interested in an array of other campaign and lobbying reforms, including expanding public funding of campaigns.

Other Common Cause ideas include prohibiting lobbyists from fundraising for candidates, and requiring that each elected official make an entry in a publicly available log each time they meet with a lobbyist.

House Speaker Scott Saiki has said the House will offer up reform proposals that could include changes in the campaign spending laws, but the details of those proposals are not yet publicly available.

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