Tuesday, July 19, 2011 – 11:40 a.m.

The California Attorney General dropped two felony counts against San Bernardino County Supervisor Neil Derry Tuesday morning.

In exchange, Derry agreed to plead guilty to a single misdemeanor count of failing to report a campaign contribution.

The charges of perjury and filing a false document were dismissed.

He will also pay a fine to the court and state.

The agreement will not affect Derry’s capacity to serve in elected office or his ability to seek reelection in June 2012.

Sources say the case, brought forward to the Attorney General by San Bernardino County District Attorney Michael Ramos, was leveled in an effort to force Derry’s resignation from political office.

The case was also timed to aide Derry’s only announced opponent, James Ramos, Chairman of the San Manuel Band of Mission Indians.

Ramos announced his election bid simultaneously to the filing of charges against Derry.

If the District Attorney’s goal was to damage Derry’s reelection bid, he accomplished it.

Ramos, who is also a member of the San Bernardino Community College District board, is running against Derry with the personal endorsement of the District Attorney.

Today’s result, while placing a potential obstacle in Derry’s path to reelection, did little else.

Insiders in the District Attorney’s operation are reportedly upset at today’s events.

One reason? Derry will remain a seated county supervisor until December 2012, regardless of whether or not he’s seeks and wins reelection.

Derry’s recusal from voting on federally funded actions is also now ended.

One key aspect of the case involved developer Arnold Stubblefield.

Sources close to the situation say a conversation key to the felony case, that District Attorney investigators alleged to have occurred between Derry and Stubblefield, in-fact never actually happened.