by Andrew Walden
Would you loan a drunk Keith Kaneshiro crony $50M? How about giving him a blank check—co-signed by the State Treasury?
SB2331 and HB1835 allegedly “authorize the issuance of special purpose revenue bonds to assist Keahole FBO I LLC with planning, designing, constructing, equipping, and operating facilities for aviation services and aviation-related services at Ellison Onizuka Kona International Airport at Keahole.” If Keahole FBO I LLC goes bankrupt, taxpayers would be responsible for paying its debts. It is already “not in good standing” according to DCCA BREG.
SB2331 has a double referral to the Senate Transportation (TRS) and Ways and Means (WAM) Committees. TRS has set a public hearing for SB2331 on January 29, 2020, at 1:00PM in conference room 225. (UPDATE: TRS approved SB2331 'with amendments' 4-0 with one absent.)
The bills are modelled on 2019 SB652 –- a $50M special purpose revenue bond for Keahole FBO I LLC-- which made it all the way to Conference Committee before dying. SB2331 and HB1835 both leave the dollar amount of the special purpose revenue bonds blank—to be filled in later.
According to State DCCA BREG, “Keahole FBO I LLC” is managed by Calvin Say’s former House Vice-Speaker Jon Riki Karamatsu and headquartered at Karamatsu’s Waipahu condo. After a failed run for the Democratic nomination for Lieutenant Governor, Karamatsu was hired to work in the Honolulu Prosecutor’s office by Keith Kaneshiro.
A February 17, 2019 West Hawaii Today article says the $50M Special Purpose Revenue Bond is really for “AV8 partners…a holding company of Keahole FBO I LLC, the company identified in the bill currently making its way through the state Legislature. … The Kona Jet Center, being developed by AV8 Partners, will include a 36,000-square-foot hangar able to hold the largest private aircraft in the world, in addition to a 7,000-square-foot fixed-base operation, 50,000-gallon above-ground fuel facility and as much as 6 acres of new private ramp for its clients.”
According to BREG, AV8 Partners’ status is “no standing-entity converted”. Organized December 20, 2017, it was a partnership between Karamatsu’s JRK Enterprises, LLC, and somebody named David Johnston. The new 'converted' entity, AV8Partners, LP, was organized May 25, 2018 and is already “not in good standing” per BREG. Its sole listed partner is “AV8 GP LLC” which was organized one day earlier as a partnership between JRK Enterprises and Johnston and is also “not in good standing.” All of these corporations are headquartered at Karamatsu’s Waipahu condo. JRK Enterprises, LLC was “not in good standing” when we checked in January, 2019 -- but has since sobered up.
Jon Riki Karamatsu campaigning for Honolulu prosecutor Keith Kaneshiro, 2012. The Courts are considering a petition for Kaneshiro’s removal.
This is Karamatsu’s third try for Keahole money.
In 2016, legislators foolishly considered loaning $10M to a very similar Jon Riki Karamatsu project, Keahole Management Group LLC, for “…planning, designing, constructing, and equipping facilities for the manufacturing and processing of products.”
Karamatsu’s Keahole FBO I LLC scheme, was organized in August, 2016, just four months after first scheme died in conference committee. Karamatsu then organized “Keahole FBO LP,” with Keahole FBO I LLC as the only listed partner, on May 31, 2018. Like his ‘AV8’ corporations, all of these ‘Keahole’ corporations are headquartered at Karamatsu’s Waipahu condo. Meanwhile, his 2016 vehicle, Keahole Management Group, LLC, and Keahole FBO LP are both no longer in good standing, per BREG.
Akamai readers will remember that Karamatsu, drunk at twice the legal limit, crashed into a pillar on the Moanalua Freeway at 1:15 AM on the morning of Tuesday October 16, 2007. This led to his demotion to House Judiciary Chair.
After coming in 6th in the 2010 Democratic Primary for Lt Governor, Karamatsu went to work as a Honolulu Deputy Prosecutor under Keith Kaneshiro. But on April 7, 2015, after a second DUI arrest, Karamatsu resigned.
In his resignation letter, Karamatsu intoned: “With the intense media coverage on my pending OVUII case, I do not want to be a distraction to the work of the department.” Apparently his hope is that there will be no media coverage of his latest attempt at a sweetheart deal with his former colleagues.
Deputy Prosecutor Karamatsu moonlighting as Rave Producer.
As a prosecutor, Karamatsu in 2014 faced criticism for moonlighting as the security chief for a drug-induced rave party at Kakaako Makai Park.
…one of the key producers was Deputy Prosecutor Jon Riki Karamatsu. His boss, Honolulu Prosecutor Keith Kaneshiro did not know that Karamatsu was involved until weeks after the event. And sources say, Kaneshiro was not happy.
"I'm not somebody who's a big proponent of rave parties in general," says former Honolulu City Prosecutor Peter Carlisle, "They tend to have problems with alcohol and drugs and I can't imagine somebody who is a professional in the prosecutor's office endorsing that kind of behavior."
Karamatsu is proud of his involvement. His blog provides a running tally of all his convictions and has pictures of him on stage during the Love Festival.
In a January 18, 2019 blog post, Karamatsu writes about promoting—what else?--a Honolulu tavern--alongside his airport project on Opening Day:
My business partners and I are working to build facilities, infrastructure, and services for private jets at Ellison Onizuka Kona International Airport (“KOA”), which will create jobs and revenue for Hawaii island and the State of Hawaii. Further, our entities are helping the State on improvements they want in their KOA master plan.
Further, my other business partner and I passed out coupon fliers for our client Minori Craft Japanese Tavern @minorihawaii , a Japanese restaurant located near the Hawaii Convention Center at 1731 Kalakaua Avenue, Honolulu, Hawaii.
Jon Riki Karamatsu mugshot from 1st DUI arrest.
Jon Riki Karamatsu mugshot from 2nd DUI arrest.
An April 16, 2016 post on Karamatsu’s blog, written during his first run for money, describes working on “a development project in Kona, Hawaii and an EB-5 Regional Center based in Hawaii.” The EB-5 Green Card program is characterized by Forbes as fraud-riddled and by Daily Caller as corrupt.
In an April 3, 2016 blog post, Karamatsu writes about: “…the companies that I’m a partner of, a number of which are being built from scratch in the areas of development, construction, aviation, hotel, manufacturing, EB-5 foreign investment, and events management. In the spirit of the music events business that I’m involved with….”
Channeling his narcissism, Karamatsu titles the post: “…If they judge you by extraordinary standards, then live super extraordinary lives….”
If he is so extraordinary, why does he need all of us average taxpayers to co-sign his loans?
2020: SB2331 Text, Status
2020: HB1835 Text, Status
2019: SB652: Will Legislators Give Drunk Rave Promoter $50M?
2019 -- SB652: Keahole FBO I LLC
2019 – HB203: Keahole FBO I LLC
2016 -- SB2301: Keahole Management Group, LLC
2016 -- HB2063: Keahole Management Group
WHT: Special purpose revenue bonds eyed for Kona Jet Center
2016: SB2301: Legislators Vote $10M for Drunk Driver to Promote Rave Parties