Oracle Affair Gets Even More Messy

Gov. Gray Davis’ chief of information technology charged Thursday that an administration rival boasted about his sway with Davis, and once made a threatening call to a high-tech executive who made a campaign donation to a Republican gubernatorial candidate.

Elias Cortez, director of the Department of Information Technology, became so emotional in his testimony before the Joint Legislative Audit Committee that at one point Thursday the proceedings were stopped so he could compose himself.

Cortez said he was cut out of the final decision on the $95-million Oracle software-licensing contract, which was awarded one year ago without competitive bids and has been the focus of intense scrutiny and criticism this spring.

The contract was touted as a way for the state to save more than $100 million on its software purchases, but an audit in April concluded it would cost the state $41 million instead, even with the “savings.”

Cortez also said he has been “abandoned” by the administration since Davis suspended him--with pay, at his annual salary of $120,000--on May 2.

But his most dramatic remarks concerned the role of Arun Baheti, Davis’ former director of e-government.

Baheti resigned this month after acknowledging that shortly after the Oracle contract was signed last May 31 he met a lobbyist for the software maker at a Sacramento restaurant and bar and accepted a $25,000 campaign donation on Davis’ behalf.

Although taking the money was not illegal, it violated the Democratic governor’s policy prohibiting government aides from engaging in campaign work.

Since then--including during testimony before the legislative committee--Baheti and administration officials have portrayed the exchange with the lobbyist as an isolated mistake and have said the lucrative Oracle contract was not related to the campaign contribution.

Cortez painted a different picture. He said an associate in the high-tech industry told him that Baheti had telephoned the associate to complain after the man’s company contributed money to a Republican candidate for governor.

Assemblyman Dean Florez (D-Shafter), chairman of the Joint Legislative Audit Committee, asked: “Is it true that Mr. Baheti questioned a software vendor about contributions that vendor made to the Richard Riordan campaign? Are you aware of that?”

“Yes, sir,” Cortez replied.

Cortez noted that he had worked for five weeks at Oracle earlier in his career, and that one of his former supervisors at Oracle was working for a firm in San Jose when Baheti called.

“This is such a small world, the technology world,” Cortez said. “That same boss happened to be a marketing director for a corporation here in San Jose. He told me in confidence that he got a strange call from Arun, about, ‘Who’s side are you on?’ I was shocked. He asked me, ‘Don’t take it anywhere. Just, you need to know that.’ This was the kind of mode of operation this person [Baheti] has.”

In later testimony, Cortez said he wasn’t sure whether the former supervisor had referred to a donation to former Los Angeles Mayor Riordan, a failed GOP candidate for governor this year, or to some other Republican running for governor. Cortez did not reveal his former boss’ name or identify the company where he worked.

Baheti said in a phone interview that he was “blown away” by Cortez’s statement.

“I’m trying to imagine myself making such a call,” Baheti said. “Let’s put it this way, based upon the clear inconsistencies each time Cortez testifies, it’s clear that Cortez’s veracity is in doubt. Before this is over, I’ll be responsible for Jimmy Hoffa’s disappearance.”

When Florez asked Cortez whether he felt he was being used as a scapegoat by the administration, Cortez became too emotional to testify, and took a lengthy break.

Upon his return, he gave a rambling answer, prompting Assemblywoman Rebecca Cohn (D-Saratoga) to complain, “Seems like the witness has strayed from the question.”

“My reputation in the industry has been speared,” Cortez said. “I am being held accountable for other people’s mistakes.”

Some committee members were skeptical of Cortez’s testimony. “He’s pointing fingers in everybody’s direction but his own,” said Sen. Bill Morrow (R-Oceanside).