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Ted S. Warren, Associated Press
Josh Powell, the husband of missing Utah woman Susan Powell, listens during a court hearing regarding the custody of his two sons, Wednesday, Sept. 28, 2011, in Tacoma, Wash. Powell's sons are currently with Susan's parents, but Josh Powell is asking for custody to be returned to him.

TACOMA, Wash. — Josh Powell said he would rather have his two young sons temporarily live in foster care than with the parents of his missing wife.

He even offered to "provide the cost of transportation" of taking his older son to school if the judge allowed him to remain in foster care.

But the judge disagreed with Powell, and on Wednesday granted temporary custody of his children, ages 4 and 6, to their grandparents, Chuck and Judy Cox.

Saying there was the "serious threat of substantial harm" if the children were allowed to return to the Powell home, Judge Kathryn Nelson ruled she "cannot return the children home at this time to the father" and agreed to allow the two boys to remain with their maternal grandparents at least for several weeks.

Another court hearing in the matter was scheduled for Nov. 15.

That decision came following a day long court hearing in the Pierce County Courthouse filled with renewed allegations against Josh Powell and the role he may have played in the disappearance of his wife, Susan Cox Powell. There were also new allegations that Washington officials say showed his home was not a safe environment for young children, and in fact put the boys in "imminent risk."

It was also a ruling that seemed to take Powell by surprise, as he said in court: "I was expecting to bring my sons home. I had no reason to believe they would not come back with me."

The decision to grant temporary custody of the children to the Cox family came with several conditions:

• Josh Powell will be allowed to have three hours of supervised visitation with the boys on Sundays while the Coxes are at church. He had requested unsupervised time with his children and asked that his sons not be allowed to attend LDS Church services.

• Josh will undergo a psychological evaluation including a "parental component."

• The boys will get immediate counseling

• Both parties will not speak poorly of the other in the presence of the children while also doing their best to protect them from their ongoing legal issues and the investigation into their mother's disappearance.

Wednesday's ruling is based on last week's decision by the Pierce County Sheriff's Office to pull the children out of the house and place them in protective custody as part of a "shelter care dependency case." A custody petition filed by Chuck and Judy Cox for their grandchildren will be placed on hold while this dependency case runs its course.

The Coxes fought for custody of their grandchildren, arguing that they believe their son-in-law is responsible for the disappearance of their daughter. Prosecutors also argued on Tuesday that Josh Powell is a subject in a voyeurism and pornography investigation.

Assistant Washington attorney general John Long, who is representing the Washington state Children's Administration, made additional arguments Wednesday about why the children should not be living in the home with Josh and his father, Steven Powell. He said Josh's mentally disabled brother has answered the door in the nude in the past and is often nude inside the home.

Long also told the judge that Josh Powell has admitted that he takes photos of people's legs in public without their knowledge. Long also talked about a poster of a woman found inside the house with a knife stuck through her.

But Josh Powell denied the allegations and had an answer for each accusation. He said the photos of legs were for marketing purposes but he wasn't allowed to show faces. He said the nudity was because when police showed up at the door with a search warrant, he didn't have time to get dressed. "My brother is a decent, modest person," he said.

Powell also argued there was no reason for anyone to believe his sons would be at risk in his home. "My sons are safe, they have everything they need. They have all of their needs met."

Powell again denied having anything to do with his wife's disappearance two years ago.

"I did not kill my wife. I love my wife. I know my wife loves my children. I want my wife back as much as anyone else could possibly want her back," he said, wearing his wedding band in court Wednesday. "I have not been charged, I have not been arrested with any crime. I do not believe there is any evidence to say that I was involved."

But prosecutors, Chuck Powell and Jennifer Graves, Powell's estranged sister who traveled with her husband from their home in Utah to attend the hearing, all said they believe Josh Powell had something to do with Susan's disappearance.

"In my heart, I'm quite convinced Josh is responsible for her disappearance," Graves said after Wednesday's hearing.

Susan's two sons were allowed to stay with the Coxes on Tuesday night on a temporary basis before Wednesday's ruling. Graves said it was nice to see her nephews again.

"It took them just five minutes to warm up to us," she said.

In court, Josh Powell, while arguing that his children shouldn't stay with Chuck and Judy Cox, said his sons had hardly spent any time with their grandparents during their short lives.

But Graves said that was "ridiculous" and that they all used to see each other often.

Graves, wearing purple — the color the Cox family has used to show support for their daughter since she went missing — said the children read stories Tuesday night and played games with everyone in the Cox home.

"I believe that the boys will be in a better place if they're not with Josh at this time," she said prior to the hearing.

Graves said the family does not talk about the situation with Steven Powell or the disappearance of their mother with the children. When asked whether the children mentioned their father, she said she thought they had "mentioned something once."

The boys had been living with Josh Powell and his father, Steven, in Puyallup, but the children were taken out of the home last week after Steven was arrested on charges of voyeurism and possessing child pornography. Long told the judge Tuesday that Josh Powell is also a subject in that investigation — prompting Josh to quickly deny any such activity.

"I have had nothing to do with any kind of illegal pornography," he said. "I have no concern about anything on my computers."

In fact, Josh Powell said he had no knowledge of his father's appetite for porn, otherwise he said he would have taken his children out of the home.

"I had no indication there was any problem. There was no visible sign there was any problem. There was no reason to believe there would be a problem," he said. "I have never gone digging through my father's personal belongings. I had no reason to believe there could have been a problem in that regard. I would have acted immediately."

But Graves said she was aware of her father's porn addiction, though she was "shocked" and "appalled" to learn how deep it was. Susan Powell had also told friends she moved to Utah to get away from her father-in-law.

Josh Powell told the judge he would not be bailing his father out of jail. And at different points during the hearing he indicated his brother would move out if it meant Josh's sons would be returned to him, and his father would move out should he be released.

"His property has been removed and put into a room and locked pending him moving out of the house," he said.

He also offered to move out and have his sister obtain temporary custody of his children. Mostly, Josh Powell said he was opposed to the idea of having custody given to his in-laws.

"I'm here for the best interest of my sons, and I believe ... they should come home with me," he told the court. "I have done everything to protect them from every threat."

But Long argued that in light of all the pending investigations into Steven and Josh Powell, "It's not proper for (the children) to live their with those investigations going. The state's position is this is not a safe place for two young boys."

Long said the state also believed that Josh Powell was responsible for his wife's disappearance.

"Taking a mother away from children and taking a mother away for as long as we've had here, almost two years now in December, it's probably the very worst type of abuse you can put on children," Long said, while adding that if Josh was responsible for Susan's disappearance, "those children have been through hell, frankly."

As the judge was considering issues related to Internet streaming and video cameras Wednesday morning, Josh Powell sat at a table up front Wednesday, staying mostly to himself. Powell, when he wasn't speaking, spent most of his time staring straight ahead, avoiding eye contact with anyone else in the courtroom and not talking to anyone.

Chuck Cox sat in the gallery next to Jennifer and Kirk Graves.

Media from both Utah and Washington filled the jury box and overflowed into the gallery area.

Steven Powell has pleaded not guilty to 14 charges of voyeurism and one of possession of child pornography. He remains jailed on $200,000 bail. Prosecutors said that for at least a decade, he had been secretly  filming women, including Susan Powell, and that he shot footage of two  young neighbor girls as they took baths and sat on the toilet.

Josh Powell has said he took his boys, then 2 and 4, on a late night camping trip in freezing temperatures the day his wife disappeared from their West Valley City home in December of 2009. West Valley police continue to call him a person of interest in the case because they say he has not been cooperative with them.