The Justice Department yesterday cleared Howard H. (Bo) Callaway, who was once President Ford's campaign manager, of conflict of interest charges, involving his effort while he was a government official to obtain favors for his Colorado ski resort.
In a letter to Callaway's attorney, Assistant Attorney General Richard L. Thornburgh said the "matter is no longer under active investigation and . . . no further action is contemplated at this time."
The charges, which led to Callaway's resignation last April as Ford's campaign manager, centered on reports that, while Secretary of the Army, Callaway had attempted to obtain U.S. Forest Service approval of a plan permitting expansion of his ski resort at Crested Butte, Colo.
The charges were first raised by Sen. Floyd K. Haskell (D-Colo.), whose Senate Interior subcommittee held stormy hearings last summer at which Callaway denied any conflict of interest.
One of Callaway's attorneys, Brian Gettings, said last night, "We are very pleased with the outcome. We knew it would end up this way from the beginning, but we are a little disappointed it took so long."
Gettings said that Haskell was "politically motivated" in raising the charges last spring. "The purpose was embarrasment of the President's campaign manager," he charged.
Callaway, who now lives in Atlanta and Colorado, could not be reached for comment.
The Senate subcommittee, voting on partisan lines, concluded that Callaway had used poor judgement in his dealings with the Forest Service, but reached no conlcusion on whether he had violated federal conflict of interests laws.
The Justice Department had the case under review for more than six months. Thornburgh also sent similar letters yesterday to two former Agriculture Department officials - J. Phil Campbell and Richard A. Ashworth - informing them that "no further action" was contemplated involving them.
The Callaway case revolved around the ski resort operated by the Crested Butte Development Corp., of which Callaway is a majority owner.The company had long sought a permit from the Forest Service which would have allowed the resort to expand onto federal property on a neighboring mountain.
Local Colorado officials of the Forest Service had written a report opposing the expansion. The charges against Callaway were that he had used his official position as Army chief to reverse that recommendation. Campbell and Ashworth were both longtime friends of Callaway and top officials of the Agriculture Department, of which the Forest Service is a part.
The key issue was a meeting in Callaway's Pentagon office on July 3, 1975, his last day as Secretary of the Army Ashworth and Campbell brought to that meeting Rexford Resler, associate chief of the Forest Service.
During the course of the discussions, Resler was asked to talk by telephone with Callaway's brother-in-law, Ralph O. Walton Jr., who was president of the resort corporation and who told Resler of the problems the resort would face unless permission to expand were granted.
After that meeting, Campbell wrote a memorandum asking the then Secretary of Agriculture Earl L. Butz to push for a recommendation favoring expansion to prevent the resort from going out of business.
Callaway denied charges of wrong-doing, but admitted that he may have been "naive" in holding the meeting with his friends and with Resler in his Pentagon office.
There were also reports, emanating from citizens in Crested Butte, that several Forest Service personnel had been transferred suddenly in order to eliminate opposition to the expansion of Callaway's resort. the Senate committee said it could find nothing to justify that charge.
Callaway was temporarily [WORD ILLEGIBLE] from the Ford campaign on March 13, when the charges were first first aired by NBC. He resigned the following month when it became clear that the investigations into his conduct would take many months and Ford's associates came to believe the charges would hurt the President's election chances.