Anchorage Daily News

WASHINGTON -- After spending nearly $200,000 of his company's money improving the Girdwood home of Sen. Ted Stevens, Veco chief executive Bill Allen received a note from the senator asking for a bill.

"I asked Bob P to talk to you about this so don't get P.O.'d at him -- it just has to be done right," said the Oct. 6, 2002, handwritten note, entered as a prosecution exhibit Wednesday in Stevens' felony disclosure trial.

Sure enough, said Allen, on the witness stand for the second day, Bob Persons did talk to him. But Persons, a good friend of both men and the owner of the Double Musky restaurant in Girdwood, explained that the note wasn't to be taken seriously -- it's a wink and a nod, not a demand to do the right thing.

"Don't worry about getting a bill -- Ted's just covering his ass," Allen quoted Persons as saying. Then, briefly injecting a moment of levity into an otherwise tense morning, Allen turned to the jury and said, "Maybe I shouldn't have said 'ass.' " The jurors cracked up laughing.

Stevens' supposed request for a bill came on a day of damning testimony by Allen. But the session was cut short at the lunch break by an unexplained issue involving a juror. U.S. District Court Judge Emmet Sullivan called a closed-door meeting with attorneys for both sides before recessing for the day. Whether that session was about the juror or other matters couldn't be learned.

But Sullivan said the trial would resume this morning with Allen back on the stand. The government is expected to play three recorded conversations between Allen and Stevens that were made in 2006 after Allen agreed to cooperate in the FBI's sweeping public corruption investigation in Alaska.

Stevens is charged with seven felony counts of failing to report more than $250,000 in gifts, mainly from Allen and Veco, between 1999 and 2006. Allen, the government's star witness, has pleaded guilty to bribing Alaska legislators and is awaiting sentencing.

On Wednesday, Allen's second day of testimony, he recited a litany of work he did for Stevens on the house without ever getting paid.

Allen was asked time and time again by assistant U.S. Attorney Joe Bottini: Did Stevens pay for any of the work done by Veco? Did Stevens pay for the electrical work, the plumbing? Did he pay to move the generator? Did he pay for the lower level deck? How about the electrical tape system that melted ice off the roof?

"Who did that work?" Bottini asked.

"Veco electricians," Allen said.

"Who paid for the materials?" Bottini asked.

"Veco," Allen said.

What about the steel deck and stairs at the back of the house? Veco.

What about the steel log holder.

"I think I had it fabricated at the shop," Allen said.

What about the new steel deck on the third story loft?

"That platform was fabricated at the Veco shop," Allen said.

Who paid for the folding metal escape ladder that went from the loft to the ground?

"Veco did."

Through Allen's testimony and notes and e-mails from Stevens, it became clear that Stevens knew what he was getting -- and appreciated it.

"Many thanks for all you've done to make our living easier and our home more enjoyable," Stevens wrote in a note to Allen dated Nov. 8, 2002.

"When I think of the many ways in which you make my life easier and more enjoyable, I lose count!" he said in the Oct. 2, 2002, note. "Thanks for all the work on the chalet."

"Bill: Bob (Persons) has been filling us in on all the help you've given him on our (remodeling) project," Stevens said in an e-mail on Sept. 24, 2000. "You and Bob have been the spark plugs and we are really pleased with all you have done."

Stevens singled out Rocky Williams, the Veco foreman who oversaw the biggest part of the project in 2000 and 2001 -- jacking up the house and adding a new first floor, a second-story kitchen and a garage.

"And we've never worked with a man so easy to get along with as Rocky," Stevens wrote. "Plus, everyone who's seen the place wants to know who has done the things he's done."

In the November 2002 note, Stevens repeated his request for a bill.

"Don't forget we need a bill for what's been done out at the chalet," Stevens wrote.

Allen said he ignored him again. "I don't know why," he said.

Did you want to send Sen. Stevens a bill? asked Bottini.

"I really didn't want to," Allen said.

"Why not?" asked Bottini.

"Because I wanted to help Ted," he said.

"Why?" Bottini asked.

" 'Cause I like him," Allen said.

Allen began his day of testimony recounting how he first heard that Stevens was dissatisfied with his Girdwood home.

"I think we were on the plane and he said he needed more room," Allen said. Stevens talked about jacking up the cabin and adding a large single room beneath it -- a place for bunk beds primarily for his grandchildren when they came to go skiing at nearby Alyeska Resort.

"I told him we had some jacks," Allen said.

Stevens eventually hired a house mover, not Veco, to lift the house. But as Stevens' wife, Catherine, warmed to the idea of the addition after initially wanting to sell the place, it became clear the project needed an architect, Allen said.

"He told me that Catherine, that she wanted to be in the middle of it," Allen said. "Now she wants to have a house. Before, she never did. (Now) she wants to put her fingerprints on it. He thought that was good. She wanted to have a bigger house."

Allen assigned an engineer with architectural experience to the project, he said.

Catherine Stevens rejected some ideas born from the oil fields where Veco normally worked. Allen thought a grated steel deck on the second story was a great idea because snow would fall through instead of having to be shoveled. She thought it would make the home look like an oil platform, Allen said. So Allen assigned workers to build a wood deck on the second floor, and later another deck on the new first floor to make the house look balanced.

And he fixed problems. With the project completed, he and Stevens would hang out on the ground-floor deck and smoke cigars, he said. When it rained, "the water would be coming down your neck" through the upper deck. The solution? Veco workers put a roof of plastic sheeting between the two decks.

Meanwhile, Veco was getting favors from Stevens, Allen said.

Stevens intervened to get the World Bank to pressure the Pakistani government to pay Veco its share of profits it claimed it was owed on a pipeline there. Stevens intervened with the State Department to pay for training Russians in building oil production modules, a project approved but never put place, Allen said. And Stevens acted on behalf of the company for an Arctic logistics contract with the National Science Foundation, though Allen said he thought he would have been successful without Stevens' help.

Stevens' defense has said that he was doing nothing more than helping constituents -- a normal activity for senators.

Unrelated to Stevens, Allen testified about a previously undisclosed state legislator whom he had bribed, though he didn't provide the lawmaker's name. He also explained for the first time what his son, Mark Allen, might have done to put in him legal jeopardy had Allen not gotten him immunity.

The matter came up as Bottini asked Allen about his deal with the government. Aside from a possible reduction in his 9-to-11 year sentence if he cooperated -- Allen said he didn't trust the government to deliver -- he said his deal bought immunity for Mark and the rest of his family.

When Allen was being debriefed by the government, he said, he didn't mention a suspicion he had about his son: that Mark "got money to this legislator." After that debriefing session, Allen said, he called his son to confirm it.

"Yes, Dad, I did," Allen quoted his son as saying.

"The next thing in the morning, I got ahold of that agent and said I had, and that Mark had."

Allen was directed by the judge not to name any legislator he admitted bribing, in part because one of them was former Senate President Ben Stevens, Ted Stevens' son. The judge ruled such an assertion would be prejudicial to Ted Stevens. However, Allen described the legislator whom he and Mark had paid as "her."

So far, no current or former female legislators have been publicly identified as targets of the FBI's investigation.

Contact the reporters: rmauer@adn.com and ebolstad@adn.com.

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