i L i n d

Ian Lind • Online daily from Kaaawa, Hawaii

i L i n d header image 2



Millions in explosives-clearing contracts go to politically connected firm

September 28th, 2011 · 7 Comments

Back to that work clearing unexploded weapons from sites on the Big Island. According to news accounts, the work is being done by a local company, Environet Inc.

It seems that one person’s dangerous unexploded bullets and bombs are another person’s gold mine.

According to the federal government site, www.usaspending.gov, Environet and its joint ventures have been awarded over $59 million in defense contracts since 2000, including $9.9 in FY 2011, $23.7 million in FY 2010 and $14 million in FY 2009, most for ordnance removal activities in Hawaii.

The company is a partner in ALE Environet JV LLC, a joint venture with Alu Like Enterprises, and Dawson Environet JV, a joint venture with Dawson Technical LLC.

According to state business registration records, Dawson Technical is managed by Hawaiian Native Corporation, controlled by the family of Beatrice “Beadie” Dawson.

The companies have benefited from so-called “set-asides” to benefit Native Hawaiian and women-owned companies, and as a result have landed many of the federal contracts that formerly went to mainland corporations.

Environet is owned by Joe Pickard, a familiar name around these parts. Here’s some of this background.

There was a mention here in November 2004 regarding Mufi Hannemann’s transition team.

Transition team member Joe Pickard gave $4,000 to the Hawaii Republican Party, according to a search of FEC records, and $2,000 to the Bush-Cheney campaign (with another $2,000 to Bush-Cheney from his wife). Again, on the other hand, Pickard contributed $500 to Democrat Ed Case, while both Pickard and his wife appear to have given the maximum allowed to Abercrombie this year ($2,000 each for both the primary and general). A $2,300 contribution to Lingle’s 2002 campaign was also recorded from Pickard’s wife.

Here’s something I posted in September 2005:

Thanks to Star-Bulletin reporter Crystal Kua for her story today on the quiet switch that resulted in Community Planning & Engineering being included as a subcontractor under the city contract for a key mass transit study. Kua reports public relations pro Kitty Lagareta, a key ally of Gov. Linda Lingle, is questioning the company’s last minute inclusion in the deal. And well she should.

Kua’s story fails to present enough background or perspective to appreciate why this is an issue. She describes Joe Pickard, president of Community Planning, as “Hannemann’s friend and political supporter.” True enough, but there’s more to the picture.

Pickard first entered the public spotlight a decade ago when he rode a wave of developer support in an unsuccessful attempt to unseat then-City Councilman Steve Holmes, a strong environmentalist who had earned the ire of developers and other corporate interests.

Pickard was mentioned here last year after being picked as a member of Mayor Hannemann’s transition team, reflecting his active campaign support, including contributions to two “independent” political action committees that also backed Hannemann’s candidacy.

Two companies controlled by Pickard, Community Planning and Environet, have also been major contributors to Gov. Linda Lingle with donations of $18,700 since 1998, state campaign records show.

Contributions to Linda Lingle by Pickard companies
1998-2005

Community Planning
5/5/98 $500

6/29/98 $3,000

6/11/02 $3,000

10/3/02 $3,000

6/23/03 $200

Environet Inc
9/5/02 $1,000

9/26/02 $2,000

5/2/03 $6,000

Community Planning was awarded six nonbid contracts worth more than $6.7 million by the Department of Hawaiian Home Lands during 2004. Environnet landed two nonbid contracts from the city this year valued at $800,000.

Then from January 2008:

You may recall Pickard’s record of contributions to Lingle’s campaigns, mentioned here back on 9/17/2005. I recently ran across his $10,000 contribution last year to the Hawaii Republican Party, which I mentioned in a Honolulu Weekly column.

His firm, Community Planning and Engineering, was the subject of a Jim Dooley investigative piece last year because of its many contracts awarded by the Department of Hawaiian Home Lands under the administration of Micah Kane, who previously served as Republic Party chair. Dooley says Pickard’s family has given $70,000 to the GOP, Lingle, and Lt. Gov. Aiona since 1998. He

Pickard grew up in Kahuku, where his family has played a pretty prominent role. He’s been politically active, was a developer-backed candidate for City Council a decade ago against environmentalist Steve Holmes, has also been a campaign contributor to Congressman Abercrombie, and was a member of Mufi Hannemann’s transition team. He was one of the founders of an effort to turn out Hawaiian voters in 2006.

Then another brief mention at the beginning of the 2010 campaign year.

Over on the Abercrombie side of the ledger, I was surprised to see Joe Pickard, president of Environet Inc and a former Hannemann backer, along with other members of Pickard’s family, give a total of $24,000. There must be an interesting political story there!

Influence Explorer, a data project of the Sunlight Foundation, quickly produced this a profile of Environet, which shows the company contributed more to then-Congressman Neil Abercrombie than to any other candidate. See if this link will work.

During much of the period, Neil was chairman of the Subcommittee on Air & Land Forces, House Committee on Armed Services, a position that could have given Neil some clout.

So can political connections help land federal contracts?

I’m guessing most of these contracts were awarded via the 8(a) program promoting minority-owned businesses.

Here’s a description from the Native Hawaiian Organizations Association.

The opportunity for full participation in our free enterprise system by socially and economically disadvantaged persons is essential if we are to obtain social and economic justice for such persons and improve the functioning of our national economy.

This philosophy expresses the foundation for federal programs encouraging minority business enterprise started in 1969. At that time, federal legislation granted preferential status in federal contracting under section 8(a) of the U.S. Small Business Act to qualified for-profit businesses owned by members of minorities. These so-called “8(a) firms” were allowed to receive federal contracts on a “sole source, non-bid” basis so long as the contracts did not exceed certain “thresholds”. This program still exists. The contract size thresholds today are $5.5 million, in the case of contracts involving manufacturing, or $3.5 million for all other contracts.

In 1990, qualified 8(a) firms in which a controlling interest is owned by a recognized Indian tribal organization or an Alaska Native Corporation (“ANC”) were given a special status. These firms are not restricted by the thresholds but can receive sole source, non-bid contracts of any size. These firms are dubbed “Super 8(a) firms”.

Later, Sen. Daniel K. Inouye (D -Hawai’i) introduced legislation that added firms in which a controlling interest was owned by a Native Hawaiian Organization (“NHO”) to the program. An NHO must be a non-profit organization incorporated in the State of Hawai’i by Native Hawaiians (of no specific blood quantum). The NHO in each case operates as an “umbrella” organization for its for-profit subsidiaries and, as long as it owns a controlling (51%) interest in each of those subsidiaries (i.e., corporations or limited liability companies), the latter can qualify as an 8(a) contractor, receive contract awards on federal jobs, and so forth.

I haven’t yet had a chance to unpack all of this information.

On the one hand, I should be happy that federal contracts are going to Hawaiian businesses supporting programs of social advancement in the Hawaiian community. That’s certainly better than profits leaving the state with mainland contractors.

But something about the campaign contributions, political influence, and public money leaves me with a queasy feeling in my gut. Perhaps it’s just a red flag waving a warning, a situation to watch out for, rather than an immediate issue. Frankly, I’m not sure.

Tags: Business · environment · Politics

7 responses so far ↓

  • 1 Andrew Cooper // Sep 28, 2011 at 9:44 am

    Thanks for a little background on Environet. As a Waikoloa resident I have watched their trucks and crews running around for a few years now.

  • 2 cwd // Sep 28, 2011 at 10:36 am

    Mahalo for your posts – this is a subject – along with the humans involved – that I’ve been following for many years now.

    I first got to know Joe when he ran agains Steve Holmes and found his positions on environmental issues to be more than somewhat inconsistent.

    An interesting factoid – last week, I got stuck in traffic while an accident was being investigated. In the next lane was an Environet truck. That, in turn, reminded me that the name was a major factor in the creation of two other business names – Environauts, Inc. and Environuts, LLC which I reluctantly never wound up registering with DCCA because I couldn’t get board approval.

    Back to now – I look forward to seeing what you come up with.

  • 3 Wailau // Sep 28, 2011 at 12:53 pm

    These kinds of history-connecting posts are an important reason why this blog is so valuable. And yet there are only two comments whereas an evanescent story about Lee Cataluna chiding the governor over his vacation choices sparks a deluge. Crony capitalism, whether or not cloaked in the guise of localism, is a serious problem in Hawaii and the source of much political gamesmanship and corruption.

  • 4 Ulu // Sep 28, 2011 at 2:18 pm

    When it comes to UXO, the last thing you want to worry about is that a company may have gotten the job even in part because of political connections.

  • 5 Richard Gozinya // Sep 28, 2011 at 5:59 pm

    “So can political connections help land federal contracts?”

    Hehe. That’s a joke, right?

  • 6 hugh clark // Sep 28, 2011 at 6:47 pm

    As always, just follow the money.

  • 7 Taxpayers // Sep 29, 2011 at 9:49 am

    I would like to know if Alu Like promoted and shared this kind of opportunities with the Hawaiians at large or was this an in-house information.

    It looks like the connected rich get richer and the poor are keep in the dark.

Leave a Comment

*