DA’s office clears ex-Newport official in gift investigation

The Orange County district attorney’s office said this week that it had found no evidence of criminal wrongdoing by a former high-ranking Newport Beach city employee who was under investigation over worries that he may have failed to report gifts from city contractors.

In March, Newport Beach asked the district attorney’s office to look into 41 entries on the calendar of then-Assistant City Manager Steve Badum that may have indicated he was receiving free lunches, dinners, golf trips or tickets to sporting events from companies that won no-bid contracts with the city.

But in a letter to Newport’s city attorney on Tuesday, prosecutors said they closed the case after Badum provided financial records, “including bank statements, copies of checks and credit card statements that corresponded to the dates and times of the suspected gifts.”

“After reviewing the financial documents and other evidence provided by Mr. Badum, we have concluded that no further action should be taken,” the letter stated.

Public officials and employees must report gifts over $50 and are barred from receiving more than $460 in gifts from a single source, according to the state Fair Political Practices Commission. Records obtained by the Daily Pilot in April showed that Badum, who retired from the city in May, had never reported a single gift while working for Newport Beach.

Badum’s attorney, Jennifer Keller, said many of the items on Badum’s calendar that raised city officials’ concerns were personal outings such as seeing an Angels game with his wife.

Any time Badum met with anyone who had business with the city, he paid his own way, Keller said.

She called the investigation vicious and irresponsible and said she believes that Badum was a casualty of a political agenda.

“This was initiated by a disgruntled faction of the City Council that is unhappy with the new City Hall and decided to, I guess, take it out on the person who was the liaison with the contractor,” Keller said.

C.W. Driver, which managed the construction of Newport Beach’s controversial new Civic Center, was among the companies the city feared Badum may have taken gifts from.

Keller contended that Councilman Scott Peotter — and other council members who were elected with him in November on a slate called “Team Newport” — sacrificed Badum to further their push for an audit of the Civic Center’s $140 million price tag.

Councilman Kevin Muldoon, who ran on the Team Newport slate, denied any connection between Badam and the audit.

“I view them as two totally different things,” he said.

The City Council authorized the audit in June.

Peotter and fellow Team Newport member Diane Dixon did not respond to messages seeking comment Thursday.

Keller said no one at the city approached Badum about the concerns before sending his calendar to the district attorney’s office.

“The real problem here is that they never even asked him before forwarding it to the district attorney, which shows you it was a political action designed to create a story,” Keller said. “It was really dirty pool.”

In April, a story about the investigation appeared in the Orange County Register, citing a confidential memo written weeks earlier by City Atty. Aaron Harp.

It’s unclear how the Register obtained the memo. Councilman Keith Curry said he believes members of Team Newport leaked it.

“The only people that had access to the memo were the city manager, the city attorney and the City Council,” Curry said.

Muldoon said he doesn’t know who leaked the memo.

Harp did not respond to an email Thursday but previously said he did not know how the newspaper got the document.

Curry said it was appropriate to ask the district attorney’s office to investigate but added that he was happy Badum was cleared.

He was unhappy, however, that the probe spilled into the public prematurely.

“One thing the City Council needs to do is get to the bottom of who leaked this matter,” he said.