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Tuesday, March 30, 2010
Fireworks, dirt, and stolen trucks: Colleen Hanabusa and the Honolulu Raceway Deal
By Andrew Walden @ 1:34 AM :: 52376 Views :: DHHL, Ethics, Development, Politicians

by Andrew Walden

Did Colleen Hanabusa pick up where Jerry Chang left off?

As the 2006 legislative session came to a close, a three-way land swap was being negotiated to build a new racetrack on Oahu after the closure of Honolulu Raceway park at Barbers Point. The Legislative deal exploded in the faces of its sponsors when it was revealed that Rep. Jerry Chang (D-Hilo) and the father-in-law of Sen. Suzanne Chun-Oakland (D-Kalihi) had a personal stake in the parcels being traded.

Even before their self-dealing became known, Oakland and Chang's proposal had met with opposition from dirt track racers--and the dirt racers' chief ally, Senate President Colleen Hanabusa (D-Koolina). The same Colleen Hanabusa who had a couple of years earlier moved heaven and earth to get a $75M tax credit for Ko Olina--in spite of her deep personal involvement with that project--came out against spending $1M of State money to buy the new raceway site, allegedly because the site plan did not include a dirt track.

Commentators and legislators patted themselves on the back and tut-tutted about Chang and Oakland's ethical lapse. The episode was proclaimed a victory over corruption. It seemed like the end of the story--but it wasn't.

Hanabusa's opposition to the Chang-Oakland land swap helped launch the quest for a new Honolulu raceway down a twisted path littered with stolen trucks, incinerated porta-potties, bunkers loaded with fireworks, and of course, huge mounds of illegal dirt.

When the Advertiser in 2004 had exposed business dealings between then-State Sheriff John Sousa and two convicted felons, Souza said he was considering resigning and acknowledged "The appearance is bad." Souza had extended $25,000 credit to organized crime figure Jonnaven Monalim as part of a deal to sell seven Makaha acres of former Hanabusa family property. Another convicted felon was managing Souza's Pueo Trucking company while Souza was Sheriff.

But just two years later, Hanabusa's husband Souza would form a close working relationship with one George Grace III. Their plan: To build a new Honolulu raceway, just yards from the old one, on Hawaiian Homelands "Parcel 24" at Barber's Point / Kalaeloa. After working closely with Grace, Souza would extend him financing to facilitate Grace's May, 2009 purchase of Pueo Trucking, LLC.

Pueo Trucking shows up on Hanabusa's financial disclosure reports for both 2008 and 2009. In the 2008 disclosure, Hanabusa reports personally representing Pueo Trucking before the State Public Utilities Commission.

Unlike Monalim, a search of the Hawaii criminal database indicates that George Grace III has never been convicted of a crime. But the controversial owner of porta-potty rental firm Paradise Lua has had a court-documented interest in stolen trucks going back to the 1990s.

Grace came out on the losing end of a civil case before the Hawaii Supreme Court, April 30, 2003. Grace and his in-laws, Bernard and Hester Lum, had each sued the Honolulu PD for return of trucks seized by police in December 1998 and January, 1999. Deeming them to be stolen because the VINs were altered, police took two trucks from Paradise Lua's fleet and one from the Lum's home.

The court decision recounts the history of the VIN displayed on the Ford F-150 truck seized from Grace's In-laws:

"the VIN found on the truck taken from the Lums rightfully belonged to a Ford 350 regular cab truck once owned by an outfit called Commercial Lift. This latter truck got into an accident, was declared a total loss, and was purchased by a party named Grace...."

The court ended by upholding all three HPD seizures, explaining:

"(There is)... substantial evidence before the court that the truck HPD seized from the Lums was a stolen truck with VINs altered to conceal its status...."

"As the court has made the factual determination that [Grace] knowingly possessed vehicles with altered VIN numbers, both (trucks with license plate numbers) LUA02 and 224TPC are deemed to be contraband."

Grace and three other defendants had been indicted on seven counts of first degree theft by a State Grand Jury on October 29, 1997. (Case # 1PC97-0-002655) Grace's co-defendants all made plea deals: Stephen Higa pled no contest on November 12, 1998; Donald P Dias pled guilty on January 8, 1999; William "Bulla" Nelson pled no contest on May 11, 1999. In spite of this, attorneys managed to win dismissal of the charges against Grace "for prosecutorial misconduct" on February 10, 1999.

After the State's failure, a federal grand jury in 2001 indicted Grace and four other defendants. The Star-Bulletin July 26, 2001 explained:

A federal grand jury has indicted five men for conspiring to set fire to commercial trucks owned by truck rental companies on Oahu between 1996 and 1999.

Three of the defendants also are alleged to have torched about 56 portable toilets in February 1999 that belonged to a competitor of one of the men indicted, George Grace III, who owns Paradise Lua....

The porta potties went up in flames at Aloha Stadium in the early morning hours of February 24, 1999--about the time no contest and guilty pleas were being presented by the State defendants and just 14 days after Grace won dismissal of the State charges against him.

The Star-Bulletin continues:

The indictment was filed yesterday in U.S. District Court against Grace, Paradise Lua employee Keoki Medeiros, Joseph Mangca, William "Bulla" Nelson and Scott Silva.

The indictment charges the defendants and unindicted co-conspirators with the theft and destruction of trucks ranging from $45,000 GMC vans to a $130,000 Kenworth truck....

The Kenworth truck was brought to Grace's Waianae property on Iliili Road on Aug. 1, 1996, where it was dismantled by Grace and two other conspirators, according to the indictment....

On Aug. 6, 1996, Grace, Mangca and two co-conspirators loaded the stolen Kenworth parts onto the stolen GMC truck, and the truck was driven to a cane field in Kunia. Gasoline was poured over the Kenworth parts and the stolen GMC and both set afire, the indictment said....

Grace, Mangca and Nelson are charged with conspiring to destroy portable toilets owned by a competitor "for the purpose of giving defendant Grace a commercial advantage in the toilet rental business," the indictment alleges.

Facing these charges, Nelson pled guilty August 19, 2002.  Charges were dismissed against Grace and the three others.  Less than four years later, Grace would be at the center of the raceway disputes.

As they were challenging the Chang-Oakland raceway land swap, Hanabusa's dirt-racer allies March 24, 2006 registered with DCCA a non-profit corporation named S.O.R.T. -- an acronym standing for "Save Oahu's Race Tracks". Chaired by racing community leader Evelyn Souza, the officers included her husband Franklin Souza, George Grace III, and his wife Jeanette Grace, daughter of Bernard and Hester Lum. Evelyn and Franklin Souza are not related to John Souza.

The non-profit S.O.R.T. negotiated a month-to-month DHHL "revocable permit", beginning August 23, 2007. Between August, 2007 and April, 2008 cancelled checks show $19,675 in rents and deposits paid to by S.O.R.T. to DHHL.

But there was a double cross. Hawaiian Homes Commission minutes February 24, 2009 state:

“At a meeting that took place in February, 2008, (then-DHHL Chair Micah Kane) claimed it was determined that George Grace be the ‘point of contact.’"

DCCA records show that George Grace III registered a separate, for-profit corporation named Save Oahu's Race Tracks, LLC on March 21, 2008—apparently after receiving the lease from DHHL. Grace's new corporation was given DHHL RP #411 covering Parcel 24.

Why would DHHL do this? One racing community leader explains:

"There were millions of dollars of (DHHL) appropriations on the line. We were told that is was necessary for the Department to keep Colleen happy. And if John Souza was happy, Colleen was happy."

At the time, on-line debate raged between Grace and supporters of the ousted non-profit S.O.R.T. Grace's postings were always signed, "Posted by JS3, forums poster for Humble George."

A S.O.R.T. supporter asked:

"Why is John Souza III going with you to the DHHL meetings if he's not making any money on the deal?"

The answer, signed "JS3, forums poster for Humble George" was,

"...I openly admitted that I couldn't read, but I can comprehend very well. I taunted you about comprehension many posts ago. And I meant it as a joke. but, I seriously think that you have a problem, either with comprehension or a mental block. Because you keep babbling about the same crap. Or as lawyers would say asked and answered, which means that you asked that before and I had answered you many times. And I told you, morons and I said morons with an "s" that js3 stands for "just sitting in third round"....

"As far as John Souza, he is one of the biggest supporters of our efforts from the very beginning. And I say 'our' as in everyone that supports 'Save Oahu's Race Tracks'. The Souzas (Evelyn and Franklin Souza) know that. And yes, he is the man my trucking company came from. And yes, he sat in many meetings with the Souza's and I and DHHL."

In a March 27, 2008 posting "JS3, forums poster for Humble George" explained, "Please be patient. As you know, my postings take two people."

Then the evictions began.

The New York headquarters of Grucci Fireworks, a subtenant which had been leasing an old munitions bunker on the property from the non-profit S.O.R.T., allegedly received a disturbing April 10, 2008 telephone call which Grucci's Controller Jack Grennan described in an email sent the next day to S.O.R.T., DHHL, and Grucci's local representatives:

"About 3:00EST I received a phone call from Hawaii supposedly from a girl named Jennifer. As soon as I got on the phone this man with an Hawaiian accent jumps on yelling, making irrational threats, using the f BOMB several times and making incoherent threats including a reference to a gun. I tried to calm him down and told him if he had any questions he could contact our local representative ... to deal with the situation His behavior grew louder and more threatening. He then stated he was going to lock the gates and throw our property out the bunkers if we didn't pay up. He then said if we tried to cut the locks and gain entry to our bunkers he was going to f##### blow us off the property. He then slammed the phone and hung up. This is my recollection of the phone call. This guy George was totally out of control, unprofessional, and very threatening."

After being contacted by Grucci's local representative, a DHHL property manager emailed back:

"I contacted Mr Grace to inform him of the allegations made in your letter regarding his statements made to Grucci personnel in New York. Mr Grace denied making them."

On April 9, 2008, Grace wrote to Evelyn and Franklin Souza:

"I am hearby giving notice that effective immediately, I am humbly asking both you Franklin and Evelyn Souza to stay off of any of my properties, with greater respect to Parcel 24....If you refuse to honor my request, I will have to contact the local authorities and proceed with trespass violations."

Massive amounts of dirt from nearby property developments were being dumped on the property, ostensibly for the construction of a dirt track--but also saving tipping fees which could otherwise be charged to load haulers. According to a March 30, 2008 web posting by "Humble George" who identified himself as George Grace III:

"(T)he dump takes the dirt for free, cause it has no rubbish. If you have rubbish mixed, it's $35 per ton. One dump truck averages 20 tons x 2000 loads. You do the math."

If the loads were not accepted as being free of rubbish by the dump, the savings would be substantial. Twenty tons times 2,000 loads times $35 per ton would equal $1.4M. As "JS3, forums poster for Humble George" explained:

"The truckers are kicking in $25 from their proceeds to the project. When we get paid from the contractor 'Royal', the proceeds or donations from all the truckers will go into an account which will be used to purchase other necessitated for the project. After I take my donation from my proceeds from the 3 trucks I own, the balance will go to labor, fuel, wear & tear, misc expenses such as insurance, and taxes. After that, whatever is left over, will probably go to help pay the note on other equipment that I've purchased to help with the project."

Answering a question about complaints from the City, another posting signed "JS3, forums poster for Humble George" explains:

"FYI, there are huge supporters from both city and state, with high ranking positions. Who will see to it that I be given a chance, real soon, to address the HCDA board."

But Grace's "high ranking" supporters apparently did not impress the Honolulu Community Development Administration. On May 14, 2008 the City issued Notice of violation No. 2008/NOV-04-223 to Save Oahu's Race Tracks LLC, threatening Grace's company with $1000/day fines for stockpiling 34,878 cubic yards of dirt without a permit.

Paperwork was shuffled back and forth for months, but eventually the threat of fines forced removal of the dirt. Today Oahu racers are no closer to opening a new track than they were in 2006.


RELATED?: Will Hanabusa allow DHHL to revert back to the bad old days?

LINKS: Hawaii Supreme Court decision April 30, 2003

ADV: Raceway debate picking up speed

Hanabusa, Souza tied to Pali Golf course shooters’ mob

Cayetano: Hanabusa's Broken Trust connections lead to Ko Olina


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