Perata won’t face probe by Senate;

Published on


San Jose Mercury News (California)

SACRAMENTO — A key Senate committee rejected a consumer group’s call to investigate state Sen. Don Perata and said the East Bay politician’s financial dealings are ”no cause for discipline.”

The bipartisan decision, sent in a letter dated Thursday to the group, gave Perata, D-Oakland, the vindication he sought after a newspaper reported he received about $100,000 in consulting fees that raised conflict-of-interest questions.

The Senate Rules Committee concluded the matter did not merit a full inquiry. ”A mere allegation that conduct ‘looks bad’ is not sufficient to trigger an ethics investigation,” the committee’s letter said.

The letter was signed by Senate President Pro Tem John Burton, D-San Francisco, and Sen. Ross Johnson, R-Irvine.

Perata followed the law in disclosing the financial arrangements, and it is up to voters ”to determine whether or not their representatives adhere to a standard of behavior consistent with their values,” the letter said.

In a written statement, Perata said the ruling confirmed ”that my business relationships were properly disclosed and fully compliant with both the law and Standards of Conduct” in the Senate.

But Doug Heller, who filed the complaint, said he was disappointed with the Senate Rules Committee’s decision. Heller works for the Santa Monica-based Foundation for Taxpayer and Consumer Rights.

”The only way to restore public trust when you have either corruption or even the perception of corruption is through a full public hearing under oath,” Heller said. ”The fact that the Senate majority leader is the one to be investigated is no excuse to keep it behind closed doors.”

Last month, a Bay Area newspaper reported on a series of transactions that prompted questions about whether a major donor with a clear legislative agenda was funneling money into Perata’s pocket.

According to the article, Mercury General donated $75,000 to a political action committee named Community Leaders for Neighborhood Preservation. The group raised money for Democrats across the state.

The committee, in turn, paid Staples Associates, a Sacramento firm run by Tim Staples, a longtime friend of Perata, for services. And Staples hired Perata as a consultant, paying him about $100,000 in fees.

Last year, Mercury, a Los Angeles insurer, persuaded Perata to carry legislation on its behalf that would have allowed the company to offer discounts to people who have maintained their auto insurance over a certain period of years. The measure was signed by Gov. Gray Davis but struck down in court earlier this year.

Heller and his group fought the Mercury-backed legislation. Heller said he believed that the measure would have ultimately hit new and poor drivers with higher insurance rates. To Heller, the sequence of money exchanges looked like a laundering scheme.

Two days after the first article appeared about the questionable dealings, Perata announced he had severed his business relationship with Staples. Perata said his consulting for Staples had been only for Bay Area business deals.

The Foundation for Taxpayer and Consumer Rights will explore whether to pursue other action, such as filing a complaint with the Fair Political Practices Commission, Heller said.

The release of the letter late on a Friday appeared designed to limit news coverage, Heller said. ”There’s no surprise this comes on a Friday night. And there’s no surprise that behind closed doors the Senate has decided not to go after one of its own.”
Contact Andrew LaMar at [email protected]

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