State panel won’t investigate Perata;

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Money paid by college friend questioned

The San Francisco Chronicle

SACRAMENTO — A state Senate ethics lawyer has declined to conduct a full investigation into the private business dealings of Sen. Don Perata, finding that his receipt of personal income from a friend he paid campaign money “would be no cause for discipline by the Senate.”

In a letter released late Friday, Sens. John Burton, D-San Francisco, and Ross Johnson, R-Irvine, the chairman and co-chairman of the Senate Rules Committee, said the chief counsel of the legislative ethics committee concluded that the allegations involving Perata, D-Oakland, “do not rise to the threshold triggering the initiation of full investigative proceedings.”

The preliminary ethics inquiry began after reports in The Chronicle detailed the business relationship between Perata and a college friend, Timothy G. Staples. The reports showed that Perata paid Staples more than $300,000 from his campaign funds for political work over the course of four years, while Staples paid the senator $100,000 per year in personal income during the same period.

The two men asserted that Staples’ payments to Perata were for business development consulting advice unrelated to the senator’s campaign funds or government work. Still, Perata has declined repeated requests through a spokesman to identify specific projects he consulted on.

The inquiry was started after a consumer group filed a complaint about the relationship between Perata and Staples.

In a statement issued Friday night, Perata said: “The senate rules committee has confirmed what every lawyer and outside expert has already told me: That my business relationships were properly disclosed, and fully compliant with both the law and standards of conduct.”

The consumer group that filed the complaint, the Foundation for Taxpayer and Consumer Rights, was disappointed by the decision.

“It’s not surprising that behind closed doors, politicians decided not to fully investigate one of their own,” said Doug Heller, an advocate with the group. “But the facts are the facts, and closing down this investigation before there is a hearing will not satisfy the public’s need to know what Perata has been doing with all this money.”

Some legal experts said the arrangement through which Perata paid Staples campaign money and Staples paid Perata for consulting services did not appear to be illegal. But in one instance that some experts said raised more serious questions, Perata received payments from Staples while carrying legislation for a company that had retained Staples as a paid consultant.

Perata, a candidate to succeed Burton as Senate leader later this year, recently amended financial disclosure statements to say that he made more than $100,000 per year in 2002 and 2003 from Staples, though he was not required to specify how much more.

The letter from the Senate rules leaders said the facts laid out in the newspaper reports would not be cause for discipline by the Senate. The letter concluded that Perata’s business dealings were properly disclosed and that the public scrutiny was sufficient enforcement.

“Such review is, in fact, the primary ‘regulator’ of the behavior of public officials, in that it permits voters to determine whether or not their representatives adhere to a standard of behavior consistent with their values,” the letter stated. “In that regard, the system of public disclosure worked here exactly as planned.”

The letter noted that Burton and Johnson discussed the matter with Perata, and that Perata ended his financial relationship with Staples after questions were raised about it. Perata’s spokesman, Jason Kinney, said that Perata made the decision to sever the relationship on his own and that the move was not recommended by the two senators.
E-mail Christian Berthelsen at [email protected]

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