A municipal corruption scandal involving illegal scrap metal salvage and bribery is spreading across Northern California, from Sacramento to Sonoma and San Francisco.

At the center is Sheldon Morris, a Novato scrap metal dealer, who pleaded guilty Friday in federal court to bribing employees in three different municipalities – including Sacramento – who helped him buy and sell used water meters, scrap and materials.

Morris gave public workers cash and gifts valued at nearly $200,000, according to court records associated with his guilty plea. S. Robert Tice-Raskin, the assistant U.S. attorney who prosecuted Morris, said the investigation "is a significant political corruption matter."

"Sheldon Morris was not just greasing the palms of one city employee, but multiple employees in Northern California, in at least three municipalities," Tice-Raskin said.

Two former Sacramento utilities workers have been arrested or admitted guilt in the corruption probe. The FBI investigation continues; criminal cases against public officials from other municipalities could follow.

Officials with the city of Sonoma and the San Francisco Public Utilities Commission on Friday said they were surprised to learn their employees were implicated in Morris' plea deal.

"I was not aware that any of our employees were under investigation," said Ken Brown, mayor pro tem of the Sonoma City Council.

The 76-year-old Morris, who operated a salvage company called Underground Express, admitted in court to illegally acquiring used water meters owned by the cities of Sacramento and Sonoma. Morris recycled the scrap, took a cut of the proceeds for himself and set up slush funds, according to court documents.

Morris admitted he doled out payments from those accounts and bought gifts for employees and items for their agencies.

Morris acknowledged that he also gave Sonoma's water operations supervisor – called "Randall C." in the court documents – kickbacks for supplies Morris sold to the department.

In court Friday, Morris confessed that he paid 38 checks totaling nearly $150,000 and $1,500 in cash to Randall C. between 2002 and 2007.

Sonoma city documents identify its former water operations supervisor as Randall Cover. Records show Randall Cover is the subject of an active Sonoma police probe and FBI investigation, said Sonoma Sheriff's Lt. Sandy Geaslin. Cover could not be reached for comment.

While he was not charged with doing so, Morris also admitted giving checks and cash totaling $17,923.50 to two employees of the San Francisco Public Utilities Commission between 2002 and 2007. Those payments were to reward them "for purchasing and/or selling goods to Morris on behalf of the commission." The employees were identified only as "Gerald L." and "Alex D." in court documents.

Further questions were directed to the San Francisco city attorney, but officials there said they could not comment on the existence of the probe.

Morris is scheduled to be sentenced Oct. 24. With Tice-Raskin's concurrence, U.S. District Judge Garland E. Burrell Jr. allowed Morris to remain free without bail pending sentencing.

The admissions by Morris covered payoffs in checks and cash totaling $10,371.62 to Barry Holland, the now-retired superintendent of Sacramento's water distribution branch. Morris admitted that two air motors with a combined value of about $7,200, and a tapping machine worth about $8,500, also went to Holland for use by his branch.

Holland has pleaded guilty in federal court to taking bribes from Morris, and has been cooperating with the government. He has yet to be sentenced.

Morris confessed that he paid Mike Malone, who succeeded Holland as Sacramento's water superintendent, $2,300 in checks and $1,304 in cash for catering a department holiday party. Malone took the checks as part of a sting operation and wore a wire to tape conversations with Morris as part of the probe.

Money and gifts also went to Kenneth John Guerard, former storekeeper for Sacramento's water distribution branch, Morris admitted: $300 in checks and a storage container worth about $2,500.

In addition, Morris acknowledged that he gave Guerard a check for $752.57, "reportedly used to purchase a television for a giveaway at a branch social event"; a check for $1,600.09, "reportedly to purchase ladders for use by the branch"; a check for $1,656.12, "reportedly to purchase a lawn mower for use by the branch"; and two vending machines with a total value of $3,200.

The city fired Guerard in February. He was arraigned this week in Sacramento Superior Court, charged with taking bribes from Morris. Guerard's attorney has said he will be exonerated.

As the FBI investigated the salvage scam, the city of Sacramento launched its own audit of its Utilities Department. The auditor found contracting violations and such lax oversight that 4,500 new water meters, valued at $1.3 million, could not be accounted for.

The city has yet to determine whether any new water meters were recycled illegally.

Morris on Friday agreed to make restitution of $22,449.91 to Sacramento, $144,029.84 to Sonoma, and $19,762 to San Francisco. Under the terms of the plea bargain, the bribe recipients share the responsibility of restitution to each city.

Call The Bee's Terri Hardy, (916) 321-1073.