Ex-VECO executive testifies he bribed Kohring

Allen says he gave ex-lawmaker money at least five times

Posted: Sunday, October 28, 2007

ANCHORAGE - The former head of a major Alaska pipeline services company testified Friday that he handed state Rep. Vic Kohring $600 to $700 or more on at least five occasions.

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Bill Allen, former CEO of VECO Corp., also contradicted key parts of the defense case put forth by Kohring, who claims that money he received from the political power broker was a gift between men who bonded in part because of their relationships with women from Russia. Allen said he has never met Kohring's wife. He said a woman from Russia with whom he once had a relationship did not have a daughter, as Kohring's Russian-born wife does.

Kohring, elected seven times to the state House from Wasilla, is accused of demanding and accepting at least $2,600 from VECO officials in exchange for his support on legislation.

Prosecutors also contend Kohring solicited a job from VECO for his nephew and that Kohring sought $17,000 to pay off a credit card debt. Kohring is charged with four federal felony counts. Kohring resigned from the Alaska Legislature in July.

The federal government investigation of corruption in Alaska politics included wiretaps placed on the phones of Allen and VECO vice president Rick Smith in late 2005 and throughout the regular and special legislative sessions in 2006. The FBI also bugged a Juneau hotel suite used as a meeting room by VECO.

Allen and Smith have testified that they badly wanted the Alaska Legislature in 2006 to approve new oil tax legislation, known as the Petroleum Production Tax, or PPT. The measure, promoted as a way to provide a stable tax climate in Alaska, was sought by major petroleum producers before they would consider building a multibillion dollar natural gas pipeline tapping vast reserves on the state's North Slope. VECO would have been in line to bid on lucrative construction and maintenance contracts if that project had been built.

Allen testified Friday that he worried about how Kohring would voted on the PPT because he was famously against any increase in taxes. Kohring, the chairman of the House Special Committee on Oil and Gas, also was miffed because the bill was not referred to his committee.

Within a few days after the bill was introduced in February 2006, Allen, Smith and Kohring dined at the Island Pub on Douglas Island to talk about legislative business, Allen said. Smith made an excuse to leave the table, Allen said, and Allen gave Kohring $1,000.

"I wanted to make sure he was OK and kind of soften him up a little bit, where he wouldn't be so mad," Allen said.

In a meeting recorded by the secret FBI camera, Kohring on March 30, 2006 approached Allen and Smith for help in paying off a $17,000 credit card debt through a loan or a job. Near the end of the meeting, Kohring mentioned that he was about to fly to Oregon to see his wife and daughter. Allen said he gave Kohring a $100 bill that he could hide in a plastic Easter egg for the girl. When Kohring expressed gratitude for the gift and said he had just sent her money for a Girl Scout uniform, Allen handed him another wad of cash - $600 to $700 in 20-dollar bills.

"I figured I'd give him some more money," Allen said.

He rejected the idea of a $17,000 loan, he said, after talking to VECO's chief financial officer.

Allen said he had handed $600 to $700 to Kohring at least two times between 2002 and 2006. The first was soon after Kohring married and Allen learned Kohring could not afford housing in Juneau.

"He was sleeping in his office and I'd say, 'Vic, you're 6-8. How in the hell can you sleep on that couch?' He'd say, 'I do it."

Kohring also had trouble affording food, Allen said.

"Mostly it would be junk food. I felt sorry for him," Allen said.

He had another motive for payments to Kohring, Allen said - "to make sure he was loyal."

He made a similar cash payment to Kohring when the lawmaker was about to make a trip to Portland, Ore., and a third when Kohring told Allen he needed money for his daughter, Allen said.

In return, Allen said, Kohring said yes when Allen made requests. Kohring released a Senate bill from his committee affecting oil taxes for Cook Inlet producers, Allen said. Jim Clark, then-Gov. Frank Murkowski's chief of staff, had asked Allen to speak to Kohring, Allen said.



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