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GOP Lawmaker Accuses Oracle of Payoffs

A California GOP lawmaker is accusing Oracle Corporation of paying off politicians critical of its deal with the state to sell it $95 million in computer parts and software.

The deal, which a state audit said could cost taxpayers more than $40 million in unnecessary charges, has rocked the administration of Democratic Gov. Gray Davis and has led to 100 hours of testimony in the state legislature.

Those hearings are wrapping up now, but lawmakers are looking at e-mail evidence presented during the hearings that say an Oracle lobbyist encouraged the company to write checks out to politicians who had been critical of the deal.

Republican assemblyman Rod Pacheco, who sits on the panel investigating the scandal, said that looks like a payoff to him.

"They just recognized that the general pervasive influence in that environment is a pay-to-play atmosphere," Pacheco said.

Oracle said it made no payments and that they fired the lobbyist.

The $95-million, no-bid deal was supposed to save the state as much as $111 million, but last month the state auditor concluded the deal could end up costing the state up to $41 million more than if it had maintained its previous software supply arrangements. Oracle disputes that conclusion.

The software giant is already under attack for donating $25,000 to Gov. Gray Davis' re-election campaign.

Davis spokeswoman Hilary McLean said the governor knew nothing about the deal, fired the four top aides who ushered it through the legislature and is now in full damage-control mode.

"Gov. Davis wants to find out what's happened in this situation as much as anyone," McLean said. "The governor has said we're going to rescind the contract. We're working with Oracle to do that."

Pacheco said he doesn't believe it.

"I know they're telling the media they're trying to rescind it but, you know, the Davis administration is doing everything it can to keep this contract in place. They're having meetings about it, and they're figuring out to how to implement it," he said.

"While the future of the Oracle contract remains in doubt," Pacheco said, "the investigation will now be turned over to the state attorney general. Republicans have also asked for a federal probe as well."

Claudia Cowan currently serves as Fox News Channel's (FNC) San Francisco-based correspondent. She joined the network in April 2008.