Ex-Davis aide didn’t expect Oracle donation

By Steve Lawrence, The Associated Press
Friday May 24, 2002

SACRAMENTO – A former aide to Gov. Gray Davis says he was surprised when a computer company lobbyist gave him a $25,000 campaign contribution for the governor at a Sacramento bar. 

Arun Baheti told a legislative committee Wednesday he had no idea that lobbyist Ravi Mehta planned to give him the check when they met for drinks last year, although Mehta commented before their meeting about needing to get a check for an earlier fund-raising event to Davis’ campaign committee. 

“I was surprised that he handed it to me,” Baheti said. 

Mehta, whose clients include Oracle Corp., delivered the check from Oracle a few days after the Redwood Shores company signed a $95 million, no-bid contract with the state. Baheti said he forwarded the check to Davis’s campaign committee by Federal Express. 

The contract was initially billed as a way the state would save at least $16 million — and possibly as much as $111 million — through volume purchases and maintenance of database software. 

But the state auditor said last month that the deal would cost California up to $41 million more than if the state had kept its previous software supply arrangements, a conclusion Oracle disputes. 

Davis and Oracle have denied there was any link between the contribution and the contract, but the governor has returned the money and state and Oracle representatives are discussing how to rescind the deal. 

Baheti told the Joint Legislative Audit Committee that his meeting with Mehta was “just a general conversation over drinks. ... He was interested in some of the items in the (state) budget.” 

The committee is holding a series of hearings on the contract. 

Asked if he and Mehta talked about the contract, Baheti said, “I’m certain it had to come up.” 

Baheti said sometime after he sent the check to Davis’ campaign office, a campaign official — he couldn’t remember her full name — called and “expressed her displeasure in the fact that I had received and Fed Exed the check and strongly requested that I never do that again.” 

“She felt it was an error in judgment,” he said. “After listening to her side of the conversation, I agreed.” 

In response to repeated questions, Baheti said he couldn’t recall details of the meeting with Mehta, including the date, the restaurant or the dinner conversation. 

Sen. Steve Peace, D-San Diego, called Baheti’s inability to recall details of the meeting “beyond straining credulity.” 

Baheti was a Davis adviser on technology issues who resigned May 2 because of his role in the contract controversy. Davis aides said he was asked to resign because he violated a rule that bars administration officials from accepting campaign donations. 

“It was clear to me it was going to become an issue and a distraction to the administration,” Baheti said. “I felt the best thing I could do for everyone concerned was to resign.” 

Several committee members asked Baheti why it took so long for the governor’s chief of staff, Lynn Schenk, to ask him to resign. He said he didn’t know. 

As Davis’ director of e-government, Baheti said he had an open door policy and met often with representatives of high-tech firms interested in signing contracts with the state. 

He said he had a meeting with representatives of Oracle or Logicon Inc., an Oracle vendor, last May 23, shortly before the contract was signed. 

Baheti said he remembered having concerns or questions about the proposed contract and at a meeting with other state officials on May 24 expressed reservations about signing a no-bid software agreement with Logicon. 

“I didn’t understand how the state could enter into a sole-source agreement with a reseller of software, particularly given there were other resellers that earned their living selling Oracle products. 

“Any time there is a middleman involved it’s going to cost more money,” Baheti added. 

Officials at the meeting then decided to seek a contract directly with Oracle, he said.