Newport councilman being investigated by state political practices panel

The state Fair Political Practices Commission has opened an investigation about Newport Beach City Councilman Scott Peotter, the agency said Tuesday.

FPPC communications director Jay Wierenga wouldn’t say what the investigation is about, but it comes nearly a month after Balboa Island resident Jeff Herdman sent a letter to the commission alleging that a campaign contribution Peotter received last year violated Newport’s municipal code and the state Political Reform Act.

“We received a complaint in mid-April. It was taken under review,” Wierenga said. “Earlier this week the enforcement division opened an investigation.”

Peotter said Tuesday that the commission had not yet notified him about the investigation.

Generally when the FPPC receives a complaint, it reviews whether it has merit under the Political Reform Act, which the agency has jurisdiction to enforce. If it determines there may have been a violation, an investigation begins, Wierenga said.

He declined to comment further about Peotter’s case.

Herdman focused his complaint on contributions Peotter received during his council campaign from Woody’s Wharf, a Balboa Peninsula restaurant and bar that has been engaged in litigation with the city for years over the establishment’s desire for extended hours and dancing.

In his letter to the FPPC, Herdman called attention to “Peotter’s decisive role in the 4-3 City Council vote [in March] … that reversed a prior decision on appealing litigation between the city of Newport Beach and Woody’s, potentially generating hundreds of thousands of economic benefit to Woody’s going forward.”

During the months leading to the November council election, Woody’s Wharf owners Greg Pappas, Ralph Nudo, Christopher Pappas and Mark Serventi contributed $1,100 each — the maximum allowed by city code — to Peotter’s campaign, according to the councilman’s Form 460, which details campaign income and expenditures.

The filing also shows an $1,100 contribution from Woody’s Wharf as an entity, the legality of which was questioned by City Clerk Leilani Brown in an August letter to Peotter.

Brown advised Peotter that the donation from the restaurant violated the contribution limit because it was attributable to the owners.

Though Peotter said he did not agree with Brown’s interpretation, he announced in August that he was returning $1,100 to Woody’s.

However, none of Peotter’s campaign forms published on the city website in April showed he had returned the funds. In response to Herdman’s letter, Peotter sent the Daily Pilot a copy of the check.

Herdman argued that the Political Reform Act, which requires candidates to disclose donations and expenditures, was not followed because the return of the money was not detailed on the city website.

Herdman’s letter also took issue with a September fundraiser at Woody’s Wharf for Peotter’s campaign.

At the time Herdman crafted his letter in April, a $500 payment to the restaurant for food and drinks related to the fundraiser was not reported on Peotter’s campaign filing.

Peotter said that both the contribution refund and the $500 payment to Woody’s were accidentally left off his campaign forms.

“In the haste of trying to get them in on time, we missed it,” he said Tuesday.

Peotter has since filed a revised version of his Form 460 showing the refund and the payment.

“I made some mistakes in my reporting and I corrected them,” Peotter said. “My goal is to do everything according to the rules.”

The Fair Political Practices Commission does not have authority to remove an elected official from office, but it can levy fines up to $5,000 for violations of the Political Reform Act.

The commission votes on enforcement actions at monthly hearings. The majority of the agency’s investigations are concluded within a year, Wierenga said.