Contra Costa Times (California)
California State Senator Don Perata is being accused of benefiting from an unethical fund-raising scheme that allegedly funneled corporate donations to support Democratic causes into the senator’s own pockets.
Perata, D-Oakland, the state Senate’s majority leader and one of the Bay Area’s most powerful politicians, denies the accusations. But as questions about his methods continued to fly on Thursday, Perata ended a business relationship with a Sacramento consultant and longtime friend at the center of the fund-raising storm.
Senate President Pro Tem John Burton this week asked the Senate Ethics Committee to review the charges, following revelations that Community Leaders for Neighborhood Preservation, a Democratic political action committee launched last year by a Perata ally, paid about half the money it raised to a consulting firm with long ties to Perata.
The consulting firm and another company owned by the same individual, Tim Staples, paid Perata “hundreds of thousands of dollars” as a consultant in recent years, according to the Foundation for Taxpayer and Consumer Rights, which asked for the ethics probe.
FTCR representatives said questions are raised due to the appearance of a “quid pro quo” in which corporations whose causes Perata has championed are donating money to the committee whose resources make their way back to Perata through Staples.
”The appearance of this scheme goes beyond an ethical violation and may be an illegal laundering mechanism that has been used to enrich an elected official,” wrote Douglas Heller, FTCR’s senior consumer advocate.
Perata, who wants to become Senate leader when Burton retires later this year, had little comment other than to say he is confident he acted “within the letter of the law and consistent with the high ethical standard public office demands.”
Perata acknowledged in a story published in a San Francisco newspaper this week that he is paid about $100,000 annually in consulting fees by Staples. He also said he solicited one corporate contribution for Community Leaders, the committee that employs Staples as its chief fund-raiser.
But Perata said he did not know of Staples’ relationship with Community Leaders because he works only with Staples’ business consulting firm, Staples Associates, not with his political consulting firm, Ascendant Solutions, which is the political committee’s manager and primary fund-raiser.
Sparks continued to fly Thursday, however, as Perata announced he was ending his professional ties with Staples.
“It is unfair for me to allow the good reputation of my lifelong friend to be subjected to harsh and often unjustified scrutiny simply because of my position as a public figure,” Perata said in a written statement.
Meanwhile, the founder of Community Leaders said Staples’ contract with the committee also was under review.
Phil Tagami, an Oakland developer who founded Community Leaders last May, said he does not believe problems existed, but suggested negative perceptions raised by the storm of bad publicity may force Community Leaders and Staples to sever ties.
Tagami, a longtime Perata ally, formed Community Leaders to support Democratic candidates and causes such as a search for better transportation, safer neighborhoods and environmental protection.
He said he did not know Perata was on Staples’ payroll, and that the senator had no role in the decision by Community Leaders to hire Staples. According to the FTCR, Community Leaders has paid or owes Ascendant Solutions $67,740, about half of the money the committee raised in its nine months of existence.
In addition, Heller said, all the money raised by the committee in that time came from four companies, all of which have contributed to Perata’s campaigns in the past.
They include Mercury Insurance, whose $75,000 in donations make it the committee’s largest benefactor.
Perata’s relationship with Mercury Insurance already has raised the hackles of consumer advocates such as the FTCR because Perata last year authored controversial auto insurance legislation pushed heavily by that company.
