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The Honolulu Advertiser
Posted on: Thursday, September 27, 2001

Judge rules out 'Ewa Villages repayment

By David Waite
Advertiser Staff Writer

Former housing official Michael Kahapea has no income now that he has been sentenced to 50 years in prison for bilking the city out of $5.8 million that was to be used for the the 'Ewa Villages revitalization project and, therefore, needn't repay $1.7 million, Circuit Judge Reynaldo Graulty ruled yesterday.

Honolulu Deputy Prosecutor Randal Lee, who presided over a months-long trial of Kahapea last fall on multiple theft charges, had argued during a series of restitution hearings over the past several months that of the millions Kahapea was convicted of stealing from the housing project, at least $1.7 million benefited him directly.

According to testimony at his trial, Kahapea awarded contracts to friends and relatives to move businesses away from the former 'Ewa sugar mill to make way for the city's 'Ewa Villages project.

But investigators learned that contracts were given to businesses existing only on paper and that relocation costs were hugely inflated. Companies that were paid large amounts for work never done kicked back large sums to Kahapea, according to trial testimony.

Investigators believe that Kahapea squandered much of the money betting in Las Vegas.

Kahapea's lawyer, Donald Wilkerson, described the ruling yesterday as a moral victory for Kahapea, who was sentenced by Graulty in the 'Ewa Villages case last year.

And while Kahapea pleaded no contest last month to stealing about $1.54 million from three other city projects and was ordered by Circuit Judge Karl Sakamoto to repay about $866,000, that restitution order was later set aside by Sakamoto, pending a new hearing on the matter, Wilkerson said.

He said Kahapea has always disputed the amounts he is accused of stealing, in the 'Ewa Villages case and the other cases.