Smith: Kohring promised results for VECO

ANCHORAGE — Vic Kohring took the money.

That was the consensus Thursday during the fourth day of trial for the former state House representative charged with bribery, corruption and extortion.

Former VECO vice president Rick Smith spent the day on the witness stand testifying for the prosecution. No one, not even Kohring’s defense attorney, John Henry Browne, disputes former VECO CEO Bill Allen and Smith passed hundred dollar bills to the former District 14 legislator, who resigned in June.

The question is whether the money given to Kohring was bribes to buy the lawmaker’s influence or simply gifts between old friends. Browne attempted half the day Thursday to wring a satisfactory answer to that question out of Smith on cross examination.

Smith, 62, who sat on the witness stand with reading glasses perched on his nose, appeared put out by the testimony he had to give. Throughout the day, Smith’s eyes would dart to the federal prosecutors with whom he had cut a plea deal. Smith and Allen both agreed to testify against Kohring and other indicted state lawmakers.

Kohring’s corruption trial follows that of former state Reps. Pete Kott and Tom Anderson. Kott and Anderson were convicted. Anderson was sentenced to five years in prison. Kott is scheduled for sentencing Dec. 7.

Smith testified the money given to Kohring was payoff to keep Kohring in VECO’s favor. Browne has maintained Kohring never voted in favor of any bill at the bidding of VECO; however, Kohring is heard and seen on secret recordings saying he would attempt to lobby and influence his fellow legislators.

Smith said Kohring told him he would make appointments with members of the House Finance Committee to lobby for the Production Profits Tax VECO favored. The tax was arranged by former Gov. Frank Murkowski and officials from oil companies Exxon, British Petroleum and Conoco to give the industry a stable tax rate on oil and gas production in Alaska. Murkowski and the oil industry, of which VECO was a part, preferred a tax of 20 percent, lower than that 22.8 percent passed by the Legislature.

At one point in Thursday’s testimony Kohring made eye contact with Smith and the two held the gaze for a moment. Kohring smiled and Smith turned away.

When asked during a break by the Frontiersman reporter what it was like to sit across from Smith in the unfamiliar venue of a courtroom, Kohring said it was surreal.

“I’ve known him for 14 years,” he said. “We’ve had many dinners together. We were, at least I thought he was a friend, and to have him over there glaring at me, it was crazy.”

Browne tried to show that Smith had personal motives to point an accusing finger at Kohring.

Smith’s plea deal with the government allows his sentence to be substantially reduced from federal guidelines. The guidelines call for Smith to receive nine-to-11-year sentence.

“This is dealing with the rest of your life,” Browne said.

“I understand that I am up against a hard one,” Smith said. “I’m 62 years old.”

Also part of the plea, the government agreed not to charge VECO Corp. with a crime. This allowed Allen to sell the company to CH2M Hill. Smith benefited from this sale with a $200,000 to $300,000 severance package. Smith was also given $500,000 to hire two attorneys.

Video and audio recordings of Smith and Allen played for the jury were rife with profanity. From the witness stand Smith apologized for his foul language.

The Federal Bureau of Investigation first approached Smith on Aug. 31, 2006, he said. Allen invited Smith to a meeting at Allen’s house. When Smith arrived FBI agents were already there. Smith has pleaded guilty to bribery, extortion and conspiracy.

Most of the prosecution’s questions asked Smith to clarify or give his thoughts about the recordings presented the day before in court.

Smith understood Kohring's phone calls to be reassurance that Kohring was on board with VECO’s wishes. On one occasion Kohring called Smith to talk about House Bill 386, which called for tax breaks for exploration expenditures to oil companies.

Smith said Kohring went out of his way “to show me he's out there being proactive" to help get the best legislation for the oil industry.

Prosecuting attorney Edward Sullivan went so far as to try to get Smith to call Kohring a "loyal soldier,” but an objection by Browne to the attempt was sustained.

Throughout the day at various times jurors would pour each other glasses of water, take notes or yawn and stare. One juror spent 10 minutes with his head in his hand.

Smith also testified about $17,000 Kohring asked himself and Allen for to pay off his credit card debt.

“We both said we didn’t want to touch it at all,” Smith said; however, in a hidden video recorded at the time, Smith brings up the $17,000, saying that after the 2006 legislative session Allen and Smith would need to make a decision about his request for cash.

During cross examination Browne asked Smith about Allen’s secretly recorded statement where he said that for a $1,000 payment Allen gave to Kohring, Kohring “would kiss our ass.”

“But he didn’t kiss your ass, did he?” Browne said.

Former VECO CEO Allen is expected to testify when the trial resumes today.