Letter to the Editor: Newport City Council Campaign Finances Need Auditing

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Recently the Daily Pilot reported that the California Fair Political Practices Commission (“FPPC”) had opened an investigation into the failure of Residents for Reform to file the required disclosures of campaign expenditures and contributions related to the 2014 city council election. There are now five violations of law, including two charges of accepting excess contributions and two charges of failing to report expenditures by Councilmember Scott Peotter under investigation by the FPPC or the District Attorney.

For the past several months, I have been looking into how the 2014 election was financed. Despite a $1,100 contribution limitation in the municipal code, the campaigns of Team Newport (Scott Peotter, Marshall Duffield, Kevin Muldoon) were financed by a few powerful interests giving tens of thousands.

Howard Ahmanson, Jr. gave over $60,000, mostly through ‘independent expenditure” groups with names such as California Conservative PAC and California Taxpayer Protection Committee.

Tom Larkin gave nearly $50,000 to the Residents for Reform committee. People affiliated with Lido Plaza owner Fritz Duda gave over $22,000, much of it after the election was over. Local developer John Saunders gave $10,000. The owners of Woody’s Wharf gave more than $8,000. These contributions were structured to circumvent the $1,100 limit in city law.

Residents for Reform, under the leadership of Dave Ellis, spent $25,000 in mail and thousands more in consultant costs, polling and PR.

These big contributors were not disinterested parties. Ahmanson, Duda and Woody’s were involved directly or through their affiliates in major litigation with the city. Saunders had major development projects pending in the airport area. Some were major dock owners.

Councilman Poetter’s recent use of the city seal in his attack on the Supreme Court decision on gay marriage takes on added significance when it is understood that Howard Ahmanson, Jr., his primary donor, is the leading opponent of gay rights efforts in California.

Following all the money spent in the city council race has been made nearly impossible because funds were funneled through state committees, political parties, independent expenditures and some costs, such as polling and consultants which were not reported at all. I believe the residents of Newport Beach are due an accounting of all of the money spent to take over the city council by Team Newport and these special interest individuals and groups. All of us need to know who had investments in the outcome of the election, and how those contributions may influence council decision making.

I believe the city should request that the FPPC conduct a full audit of all of the candidates (winners and losers), independent expenditures, slate mail committees and other expenditures spent to influence the election. This is not a witch hunt, or a whitewash, but a commitment to full transparency so that all of us will be able to know exactly who our elected officials are beholden to.

Jeff Herdman

Newport Beach

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  1. Mr. Peotter has been am embarrassment to this city since the moment he sat down in that council chair…too bad he hid his real agenda from the public, but I guess that’s why Dave Ellis kept his candidates out of any meaningful debates…had we been able to question “Team Newport” Peotter’s arrogance and ignorance would have shown through.