I tip my hat to the San Francisco Chronicle and staff writer Erin McCormich for exposing this “follow the money” story. Before voting for candidates or Ballot Measures please check to see who is providing the funds. What makes this difficult is that some campaigns the money may not be received until just after a filing date so the public cannot follow last minute contributions until after the election.i.e. Check out your local city council races where you might find some interesting special interest contributions in December.
For those preferring to read this Chronicle story later the link can be found at the bottom of the post. I did not wish to edit the text due to the fact that my areas of interest may differ from Juice readers.
“How special interests avoid spending limits”
Erin McCormick, Chronicle Staff Writer
Monday, February 11, 2008
More money is flowing into California’s legislative campaigns than ever, despite contribution limits that voters approved eight years ago in an attempt to quash the influence of well-heeled special interests in state elections, according to an analysis by The Chronicle.
Big-ticket donations have moved from candidate-run funds, where individual contributions are capped at $3,600 per election, into independent campaigns run by powerful groups to elect or defeat candidates.
Special interests also use loopholes to funnel money to legislators by donating to funds that fall outside the law’s limits, including legal defense funds, ballot measure committees or lawmakers’ favorite charities.
As a result, watchdog groups say, it has become nearly impossible for the public to follow the money.
Insurance and tobacco companies, unions, Indian tribes and other groups have used independent expenditure campaigns to pump millions of dollars into otherwise obscure state Assembly and Senate races, sometimes outspending the candidates themselves.
While such expenditures were allowed before voters restricted political giving by passing Proposition 34 in 2000, their use in legislative races has exploded by more than 2,500 percent since campaign contributions went into effect – growing from $1 million in 2000 to nearly $27 million in the 2006 election cycle.
For example, a special election in December to fill a vacant Los Angeles Assembly seat turned into a slugfest between labor unions and business groups – as a committee funded by state employees spent $251,000 running phone banks and organizing precinct walkers to support Democratic candidate Warren Furutani, who eventually won.
A corporate coalition funded by real estate developers, doctors and energy companies ran a $266,000 campaign for another Democrat in the race.
“The bottom line is the financing of political campaigns is a mess,” said Allan Hoffenblum, a Republican strategist, who follows state legislative campaigns as publisher of the California Target Book, a nonpartisan guide to state and federal election races. “The system favors the moneyed – and there’s been no sign of reform.”
On Thursday, the state Fair Political Practices Commission will hold hearings on the spike in independent campaign expenditures since Prop. 34 went into effect in 2001.
In the coming months, the agency’s chairman, Ross Johnson, a former legislator who was a co-author of the contribution-limits law, says he hopes to investigate the multitude of ways big contributors are getting around the reforms.
“The people of California have repeatedly voted to limit contributions to candidates – with the expectation that that would reduce special interests’ influence over legislation,” said Johnson. “But the will of the people has largely been thwarted.”
Special interests run massive campaigns against candidates they don’t like, paying to produce their own negative ads and mailers:
— When Ellen Corbett, then a San Leandro assemblywoman who supported consumer rights, ran for state Senate in the 2006 primary, she faced a mysterious opponent. Californians for Civil Justice Reform, funded by insurers, tobacco companies and other corporate interests opposed to consumer lawsuits, spent $577,000 for mailers opposing her and ads supporting her opponent, John Dutra.
Meanwhile, a consumer attorney group called California Alliance jumped in to support Corbett, funding a $385,000 campaign. By the time the primary was over, 14 different independent committees had weighed in, spending a total of $2.2 million to influence the election. Corbett survived that primary and went on to win the Senate seat.
— Former Democratic Assemblywomen Cindy Montanez of Los Angeles wasn’t so lucky. Montanez was author of a Car Buyers’ Bill of Rights in 2005. A year later, she was crushed in a Senate primary against Democrat Alex Padilla, thanks in part to a $123,000 opposition campaign by a committee known as Californians Allied for a Prosperous Economy – which was funded by car dealers.
The U.S. Supreme Court has ruled that the Constitution’s First Amendment guarantees individuals and groups the right to spend unlimited amounts of their own money to promote their political views. Under state law, candidates are not allowed to coordinate any of the activities of these independent spenders.
“Do we really believe legislators are less beholden to these outside groups because they’ve spent independently?” asked UC Berkeley political scientist Bruce Cain.
Even after the election is over, there are plenty of places special interests seeking to curry favor with lawmakers can put their money without having it subject to campaign limits. They can give unlimited amounts to a lawmaker’s favorite charity or to his legal defense fund or ballot measure committee.
Since contribution limits went into effect, The Chronicle found, special interests have nearly tripled the amount of money they give to charities at the behest of legislators – from $1 million in 2000 to $2.6 million in 2007. Some of these donations benefit bona fide charitable groups, while others seem to serve only the legislators’ personal interests:
— Last year, as a group of Indian tribes sought to win lucrative gambling compacts from state government, the Barona Band of Mission Indians allowed 16 of its favorite legislators to pick a school to receive a $5,000 donation – contributing a total of $80,000.
— State Senate President Pro Tem Don Perata, D-Oakland, solicited $850,000 in contributions to charities last year from donors, including Sierra Pacific logging company, E&J Gallo winery, Kaiser Permanente and the Irvine Co. development firm. Of that, $560,000 went to the Rebuilding California Foundation – an Oakland nonprofit formed in January of 2007 to monitor the spending of the state infrastructure bonds approved by voters in a campaign led by Perata.
— In 2006, Democratic Assemblyman Mervyn Dymally of Los Angeles directed $357,000 in contributions from a host of special interest groups to the California Black Legislative Caucus Foundation, a group that he chairs. The caucus has sponsored conferences and posh retreats for legislators.
In some cases, contributors pull out the stops and give money in as many different ways as they can think of.
In 2006, as AT&T Corp. sought legislation that would allow it to enter the cable television industry throughout the state, it gave direct campaign contributions to 76 of 80 assembly members and 36 of 40 senators.
But it didn’t stop there. AT&T gave $205,000 to the Democratic Party, $605,000 to the Republican Party and put $137,000 into various independent expenditure campaigns. And it made $99,000 in donations at the behest of nine legislators. In the year following the vote, it gave $50,000 to a ballot
measure committee controlled by Assembly Speaker Fabian Núñez, who sponsored the bill, and $25,000 to a ballot measure committee controlled by Senate leader Perata.
The bill, which took control of cable TV contracts away from localities and allowed statewide competition, passed overwhelmingly. Consumer groups said it was a giveaway that essentially deregulated the cable TV industry.
“I don’t think special interests are spending any less,” said Carmen Balber of the Foundation for Taxpayer and Consumer Rights, a Santa Monica consumer lobby that opposed the bill. “They are simply funneling the money through different avenues.”
Meanwhile, Prop. 34 hasn’t made much of a dent in the regular fundraising by lawmakers’ campaigns.
In the 2000 statewide election, before campaign contribution limits took effect, legislative candidates, competing in 100 races, raised a combined $109 million in their campaign funds.
In 2002, the year after Prop 34 took effect, total fundraising dropped to $72 million. But by the last legislative election in 2006, candidates for the 100 Assembly and Senate seats on the ballot raised enough money to surpass their 2000 record – collecting a combined total of $110 million.
Dave Gilliard, who has worked as a strategist in Republican Assembly races and independent expenditure campaigns, said the new ways money is being spent have made more work for campaign consultants like him but haven’t made things easier for the public.
“I think contribution limits have had the opposite affect that voters wanted,” he said. “It’s driven a lot of money underground and made it harder for people to figure out who’s behind a candidate. But it hasn’t lessened the amount of money going into politics.”
How to fix the system is a matter of debate. Republicans and many academics who follow campaign money argue that, because the nation’s highest court has ruled that independent expenditures can’t be banned, the best answer might be to get rid of campaign limits and improve disclosure to the public.
More liberal reform groups are calling for lower limits, elimination of loopholes and public funding of campaigns. But few people think the current system is working.
“It’s just a screwed deal,” said former state Sen. John Burton, co-author of the campaign contribution law. “There’s always a way to get around limits.”
Big spenders
The biggest independent expenditure committees and what they spent in the California legislative elections during 2006 and 2007.
California Alliance for Progress and Education $3,621,409
This committee, which bills itself as “an alliance of professionals, employees and small business,” ran campaigns in seven legislative primaries and four general election races in 2006, including opposing Democratic San Leandro state Sen. Ellen Corbett in her primary run for her Senate seat.
Major funders
California Dental Association Independent Expenditure PAC$1 million
California Real Estate Independent Expenditure Committee$760,000
California Real Estate Political Action Committee$450,000
Farmers Employees & Agents Political Action Committee$344,500
California Building Industry Association PAC$200,000
California Hospital Association PAC$120,000
Team 2006, sponsored by California sovereign Indian nations $1,992,392
This group of tribes with casinos ran independent expenditure campaigns in eight 2006 Assembly and Senate races, including helping Republican incumbent Sheila Horton fight off Democrats’ attempts to capture her San Diego Assembly seat.
Major funders
Agua Caliente band of Cahuilla Indians $2.8 million
Sycuan band of the Kumeyaay Nation $2.8 million
Pechanga band of Luiseno Indians $2.8 million
California Correctional Peace Officers Association Independent Expenditure Committee $1,653,226
This group representing California prison guards, one of the state’s biggest contributing groups, made independent expenditure contributions in 17 legislative races in 2006.
Major funders
California Correctional Peace Officers Association$2.8 million
Californians for Civil Justice Reform $1,666,883
This group of corporations and industry groups that support legal tort reform funded independent expenditure campaigns in three Senate primaries in 2006, including spending more than $500,000 to oppose Ellen Corbett.
Major funders
California Building Industry Association$100,000
21st Century Insurance$100,000
ACC Capital Holdings Corp.$100,000
California Real Estate Political Action Committee$100,000
Bank of America California Political Action Committee$100,000
Pfizer Inc.$100,000
Pacific Gas & Electric Corp.$75,000
American Insurance Association$75,000
Amgen Inc.$60,000
Countrywide Home Loans Inc.$50,000
Farmers Insurance Group$50,000
Chevrontexaco Corp.$50,000
The Irvine Co.$50,000
Philip Morris USA Inc.$40,000
Source: Chronicle analysis of campaign finance filings
Follow the money
Loopholes in California’s campaign contribution limits make special-interest spending hard to follow:
Before Proposition 34 took effect in 2001
— Unlimited: Special interests could give unlimited amounts to candidates’ campaign funds.
After Prop. 34 took effect
— Limited: Special interests are limited to $3,600 per election to state Assembly and Senate candidates.
— Unlimited: Special interests can spend unlimited amounts on their own campaigns to support or oppose candidates.
— Unlimited: Special interests can give unlimited amounts to legal defense funds or ballot measure committees or make big donations to a charity at a legislator’s behest.
To view campaign contributions and expenses, go to the California secretary of state’s Web site: cal-access.ss.ca.gov/Campaign/
Get involved
The state’s Fair Political Practices Commission meets Thursday at 10 a.m. at 428 J St., Suite 800 in Sacramento to discuss skyrocketing independent campaign expenditures and new rules for legislators’ out-of-state travel expenses.
To read the agenda, go to: links.sfgate.com/ZCJS.
E-mail Erin McCormick at emccormick@sfchronicle.com.
http://links.sfgate.com/cgi-bin/article.cgi?file=/c/a/2008/02/11/MNK8UTCAQ.DTL&type=printable
Great report, investigation and information partner! Amazingly, your eye of eagle reporting seems to be getting better and better!
Campaign Finance Reform is a joke.
Even Al Capone knew that…..when
he invented the “brown paper bag
delivery service”.
These new organizations popping
up are simply following on the
heels of a “Hedge Fund Mentality”.
For instance: Set up a committee:
“Bob & Diane’s Square Dancers for
Universal Health Care!” The average Joe will never know that
they are collecting unlimited funds
from their rich friends and business associates and dispensing
them to targeted races that will
either lend or borrow that money
into the Hillary Campaign coffers.
To be very fair – the Republicans
do exactly the same thing.
Case in point: Emily’s List…just
for starters! They have the best
Enron Accountants available!
Sorry, but forgot to mention that
it usually takes two years to
follow up on Campaign misdeeds..
http://www.fppc.ca.gov/
The Fair Poltiical Practices Commission…needs a strong enforcement arm…which includes
the ability to prosecute RICO
Statutes! This could wind up
being a bigger bureaucracy than
the BATF…..and needed just as
much or more! McCain-Feingold
is the biggest joke next to the
Keating Five…being left off
the hook on the S & L Crisis!
Whoa – you are right !!
sniff, sniff, ….. yes – I can smell the stink of the Yes on Measure D campaign.
You can smell it coming from Ware Disposal in Logan Barrio.
Larry:
The only problem is that you missed the major article as written by Tom Chorneau of the SF Chron Sacramento Bureau here in Sacramento. Erin, while her report is beneficial, is the second on this piece that Tom has been working on for months. BTW, Don Perata sponsored a gun buyback program this weekend in Oakland. They projected 300 guns to be turned in at 250 each-all paid for by personally by Perata. Actual turn in was 1000 handguns turned in no questions asked and off the streets of Oakland. The Oakland PD issued warrants for the remaining 700 at the same price. Violence does have a buy back. I dont see any of the members of the Santa Ana City Council proposing, promoting, or funding such a program. Maybe Clownia “I am not a Pro” Alvarez can use her developer contributions to fund such a program.
How interesting that AT&T and other telecoms are also seeking immunity, as we speak, from having illegally spied on Americans at the Administration’s behest…and they’re getting plenty of help from our spineless Congress.
Yeah, campaign finance reform IS a joke…because there are still too many loopholes that benefit the powerful and connected….the very entities mentioned in your post.
Schwarzenegger centrist Republican
Thank you for the heads up. Sorry that I may have missed the report which you cite. You have no idea of the number of newspapers that I read researching data for this blog posts and our Cutting Edge program.
After the Columbine H.S. shootings President Clinton initiated a gun buy back program resulting in thousands of guns being taken off the streets in cities around the country.
This past July Mayor Richard Daley of Chicago initiated another program where $100 gift cards were given in exchange for handguns and shotguns that were turned in with no questions asked.
I have seen a report stating that this program has resulted in collecting over 4,000 guns every year. The same report stated that “guns are involved in 80 percent of the city’s murders.”
I seem to recall writing a Juice post from the Orlando area last year when they mentioned a similar buy back program in the Orlando Sentinel.
As to Santa Ana initiating a similar program let me suggest that someone contact Chief Paul Walters to see if he in fact has a similar program in place. If not encurage him to do so.
As a supporter of the Second Amendment I will stand alongside all of the responsible gun owners of America who do not break the law and are not involved in the crimes for which guns are used.
anon 2:17 p.m.
When I walked the halls of our Capitol some years back promoting redevelopment law reform one elected official told me it was refreshing to see someone from the district rather than a parade of “special interest” paid lobbyists knocking on his door asking for special consideration on behalf of X or Y. Although it’s a 400 plus mile drive up the 5 freeway to Sacramento let me urge readers to periodically try to schedule a visit to see your representatives in their offices or while they are in Session. How will they know that we support or oppose their actions if they don’t hear or see us?
PS: Email is not the answer. They are flooded and simply do not have time to read and respond to the majority of same.
They surely have these “special interest” types visiting their offices, taking them out to dinner and off to the golf course.
When you consider that their families are down here in OC and that they only return on weekends, they are vulnerable to the messages from these highly compensated lobbyists.