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FBI agent seen examining liquor control documents

Spokesman for the bureau would not confirm or deny any federal investigation

WAILUKU — As an FBI agent examined documents in the Wailuku offices of the county liquor department Monday, a County Council committee recommended an audit of the department following public criticism stemming from the department’s handling of nonprofit groups’ events and advancing unpopular rule and policy changes, such as doing away with the blackout period for retail alcohol sales.

It was not clear what the FBI investigation entailed, but the agent was observed Monday morning reviewing for several hours numerous documents laid out on a table in the office of former Deputy Director Mark Honda, according to a source with direct knowledge of the visit who wished to remain anonymous.

FBI spokesman Arnold Laanui said Monday that the bureau does not confirm or deny the existence of any investigation.

Phone calls to liquor department Director Glenn Mukai were not returned Monday.

The FBI’s visit to the offices of the Department of Liquor Control in the Trask Building follows a violence in the workplace complaint filed against Mukai, which was heard by the Liquor Control Commission on Jan. 19. The complaint was filed by Bill Pacheco, head of the enforcement division. He has said that several grievances also have been filed by the Hawaii Government Employees Association against the liquor director’s office since Mukai took over in June 2016.

Pacheco’s complaint appears to be scheduled for the liquor commission’s next meeting Feb. 14, according to he commission’s website.

Across the street in the county building, the council’s Policy, Economic Development and Agriculture Committee on Monday voted 6-0 in favor of recommending that the full council approve a resolution to conduct an audit of the liquor department. The committee hopes the audit will be completed by June 30 or earlier.

The resolution is slated to be heard at the Feb. 16 council meeting.

Committee Chairwoman Yuki Lei Sugimura, who has been critical of the department, said in a memo that the audit will focus on the effectiveness and efficiency of the department’s current operations and “assist with making long-term, decision-making solutions to improve overall operations and public trust.”

The liquor department and its leadership under Mukai have come under fire in the past year over major rule changes that included allowing 24-hour retail sales of alcohol and imposing stringent requirements on nonprofit groups seeking single-event licenses. Most of the rule changes have been reversed under public pressure.

Despite the public uproar, the liquor commission said Mukai has been leading the department in a “satisfactory manner” in his evaluation released earlier this month to the council and Mayor Alan Arakawa. Mukai received “above average” marks in all categories, including leadership in the department’s relationships, community relations, standards of professionalism and management of the department’s administrative and budgetary responsibilities.

Council Member Riki Hokama is “very supportive” of the audit, saying that a lot of people are talking about the situation with the liquor department. “Even on Lanai there is dissatisfaction,” said Hokama, who holds the Lanai residency seat. 

Council Member Alika Atay concurred with Hokama, adding that some in the community are suggesting a charter amendment to place control of the liquor department under the mayor rather than the liquor commission.

The volunteer commission, made up of members nominated by the mayor and approved by the council, has oversight of the liquor department and the power to hire and fire its director.

Sugimura, who introduced the resolution, stepped into the debate over new more stringent rules imposed last year by the department on nonprofit groups seeking single-event liquor licenses for fundraisers. Some nonprofits had to cancel events because they could not satisfy some requirements, including board members being fingerprinted, submitting to criminal background checks and providing Social Security numbers.

She testified before the commission and introduced changes to streamline the licensing process for nonprofit groups.

In a memo to the committee, Sugimura offered some specific areas she would like the audit to focus on:

• Obtaining feedback, some confidentially, on the liquor department’s operations from department employees; other county departments, such as police, the county prosecutor and the county corporation counsel; other counties; liquor licensees, including nonprofits that conduct special-event fundraising; and business advisory groups.

• Interpretations of state law and implementation by the department for the past five years.

• Determining whether the liquor license application process can be streamlined.

• Reviewing the internal structure and responsibilities of the licensing and enforcement sections. 

• Analyzing the relationship between the liquor commission and the department. 

The audit would be a third-party performance audit, funded through the Council Services Program Budget for audits, according to the resolution.

In other matters related to the liquor department, new commissioners have been nominated by the mayor’s office to replace Vice Chairman Darren Lopez of Lanai and Makawao commissioner Dana Souza, said Mike Molina, an executive assistant to the mayor, on Monday.

Both commissioners’ terms are set to end March 31, but Souza resigned Jan. 19 after missing six consecutive meetings. In his resignation letter to the mayor, he said he could not complete his term “due to other commitments and responsibilities.”

Lanai Today newspaper Publisher and Editor Alberta de Jetley and Paia businessman Jonathan Todd have been nominated to replace Lopez and Souza, respectively, Molina said. He added that Todd could be eligible to fill Souza’s seat as early as March.

The council must confirm the nominees.

Newly approved commissioner Leslie-Ann Yokouchi of Kula is expected to appear at the commission’s Feb. 14 meeting. She replaced former commissioner Brenda Lee after Lee abruptly resigned in November, citing “personal and health issues” as well as “travel commitments.”

Molina said he has seen a “noticeable increase” in liquor commission applicants over the past year and a half. The period coincides with Mukai’s tenure as director, which has seen several key workers depart, including deputy director Honda three days before Christmas.

“We’ve had more than the usual applicants for the liquor commission,” Molina said. “They were very difficult choices. There were a lot of good people who could serve on this commission, but the mayor is very pleased with the two nominees.”

* Melissa Tanji can be reached at mtanji@mauinews.com. Chris Sugidono can be reached at csugidono@mauinews.com.