Lawmakers look to claw back felons’ pensions

Former Honolulu Police Chief Louis Kealoha is set to begin a seven-year prison sentence next month for felony convictions relating to his use of police officers to help frame his wife’s uncle. But that won’t stop his $9,700 monthly pension payments that come with having served 33 years on the police force.

The payments have fueled debate in recent years about Hawaii’s practice of continuing to pay out retirement benefits to public employees who commit serious crimes related to their jobs. Hawaii lawmakers are looking to curb the benefits this year through legislation that would allow a court to order half of an employee’s pension to be forfeited if they are convicted of a job-related felony.

Senate Bill 912 has sailed through the full Senate, and on Tuesday it passed the House Labor and Tourism Committee. The bill still faces additional hearings in the House of Representatives, but a similar measure introduced by House Speaker Scott Saiki passed the House in 2019, an indication that the proposed legislation, which has been introduced numerous times over the years, could succeed this year.

Sen. Bennette Misalucha said she introduced this year’s bill in response to waning public trust in government officials. “I think a bill like this will restore confidence in the state’s commitment to holding officials to high ethical standards,” she said.

Misalucha said the bill wasn’t just about the Kea­loha scandal, though noted it had “left a bad taste in people’s mouths.”

SB 912 has the support of the State Ethics Commission and Common Cause Hawaii, which advocates on behalf of open and accountable government.

“Public employees are also public servants. They cannot defraud the public and destroy our confidence in government and still reap the benefits of their criminal misconduct,” wrote Common Cause Hawaii Executive Director Sandy Ma in testimony on the measure.

Unions representing government workers have been notably silent on the bill. Officials with the United Public Workers of Hawaii, which represents more than 12,000 government workers throughout the state, including correctional workers and many blue-collar workers, didn’t respond to a request for comment. A spokeswoman for the Hawaii Government Employees Association, which represents about 40,000 largely white-collar state and county employees, also declined to comment, other than to acknowledge that the union had not submitted formal testimony on the bill.

Misalucha said she hadn’t gotten any pushback from the unions on the measure.

Hawaii is among 13 states that doesn’t allow pensions to be revoked when a public worker is convicted of a felony, according to research published last year by the National Association of State Retirement Administrators. California’s law, for example, allows retirement benefits to be rescinded for felonies involving crimes such as bribery, embezzlement or extortion relating to public funds.

Hawaii’s proposed legislation spells out similar crimes, though doesn’t set limits on the type of job-related felonies that could qualify. The bill leaves it up to the discretion of the courts to determine whether retirement benefits should be forfeited.

The legislation also stipulates that designated beneficiaries be allowed to receive benefits after the convicted government worker dies, limiting the effect the legislation would have on the families of government workers who have committed crimes.

If the bill passes, it’s not expected to retroactively affect Kealoha’s pension payments, which already have been partially diverted by the court. U.S. District Chief Judge J. Michael Seabright ordered that 75% of Kealoha’s pension payments go toward restitution of his victims, for which he owes $237,698. His estranged wife, Katherine Kealoha, who was sentenced to 13 years in prison for the crimes relating to her uncle, does not have a government pension, according to KHON. Her former attorney told the news station in 2019 that “she has no pension, no nothing, so she’s going to get out of prison with nothing but the clothes on her back.”