Investigators probe remodeling at home of Sen. Ted Stevens

Federal agents ask contractors to turn over building records

Posted: Wednesday, May 30, 2007

ANCHORAGE - Federal investigators have interviewed contractors who worked on an extensive remodeling of the Girdwood home of U.S. Sen. Ted Stevens seven years ago.

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Three contractors who worked on the project told the Anchorage Daily News that the FBI asked them to turn over records from the job. One said he was called to testify about the project before a federal grand jury in Anchorage in December.

The remodeling work in summer and fall 2000 more than doubled the size of the house, a four-bedroom structure about two blocks from the day lodge parking lot at the Alyeska ski resort. The home is Stevens' official residence in Alaska.

Bob Persons, the longtime owner of the Double Musky restaurant in Girdwood and an old friend of Stevens, monitored the remodeling for Stevens and his wife while they were in Washington, D.C. He also has been questioned by the FBI.

"I will be testifying. That's all I can tell you," he said last week. "It is an ongoing investigation that I'm not supposed to talk to or see anybody about it."

Ted Stevens and his wife, Catherine, declined to answer questions about the Girdwood house. Stevens' office issued a prepared statement.

"While I understand the public's interest in the ongoing federal investigation, it has been my long-standing policy to not comment on such matters," he said. "Therefore, I will withhold comment at this time to avoid even the appearance that I might influence this investigation."

The FBI and the U.S. Justice Department's Public Integrity Section are investigating corruption in Alaska but would not comment.

"This is a pending investigation and we're just not going to confirm or deny any aspect, any rumors, any allegations out there," FBI spokesman Eric Gonzalez said.

Stevens is the most senior Republican in the U.S. Senate. He has not been directly connected with the corruption investigation.

Federal agents in August raided offices of six state legislators, including those of one of Ted Stevens' sons, Ben Stevens, who held the position of state Senate president. The FBI said then that it also had executed a search warrant in Girdwood. The location of that search has not been officially disclosed.

VECO, an oil-field service company with a long history of lobbying and donating to political campaigns, was a target of investigators, according to search warrants that became public. On May 7, the company's longtime chief executive, Bill Allen, and a vice president, Rick Smith, pleaded guilty to federal conspiracy, bribery and tax charges. They are now cooperating with authorities.

Four current or former Alaska state lawmakers have been indicted on federal corruption charges.

Stevens, Persons and Allen also have a business relationship. Persons is the managing partner of Alaska's Great Eagle LLC, a racehorse-owning partnership that includes Stevens, Allen and his son, Mark, along with several other Alaska businessmen.

Augie Paone, owner of Christensen Builders Inc. of Anchorage, said in a recent interview that Bill Allen hired him to complete the framing and most of the interior carpentry at Stevens' home. He was directed to send bills to VECO, where someone would examine them for accuracy, before sending them to Stevens, he said.

Paone said that as far as he knew, Stevens and his wife, Catherine, paid his bills. He sent at least $100,000 in invoices to the Stevenses in Washington, D.C., he said.

According to Paone and other contractors, the renovation involved jacking up a single-story house, building another floor on the original foundation or pilings, and lowering the original structure onto the new one.

Catherine and Ted Stevens purchased the home in August 1983.

City property records show the 10-room home contains 2,471 square feet of living space. With its quarter-acre lot, its assessed value for 2007 is $440,900.

The FBI last year took his paperwork on the project, Paone said. Agents seemed particularly interested in VECO and its officials, he said, and the government already had copies of most of his invoices from VECO files.

Paone testified before a federal grand jury in December, he said.

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