Villaraigosa, other officials rely on ‘major loophole’ to raise funds, report says

Los Angeles Mayor Antonio Villaraigosa and other City Hall politicians have relied on a “major loophole” in the city’s campaign finance law to create committees that can raise donations much larger than they could accept for their own elections, according to a report obtained by The Times.

Many of the donations come from special interest groups seeking favorable government decisions.

In a 50-page study titled “Money and Power in the City of Angels,” the Los Angeles-based Center for Governmental Studies looked at Villaraigosa’s practice of raising contributions of $100,000 or more for campaign committees devoted to such single-issue topics as a telephone tax and improving public schools.

Under the city’s ethics law, the mayor and other candidates for citywide office cannot raise more than $1,000 per contributor for their own elections. The center said those same limits should apply to ballot measure committees that are controlled by an elected official.

Three Villaraigosa committees spent $11.4 million in the three-year period examined in the study. Among the six-figure donors mentioned in the report were the International Brotherhood of Electrical Workers, which represents employees at the Department of Water and Power, and Steve Bing, whose construction company specializes in environmentally friendly buildings.

“The public says that the mayor shouldn’t be receiving $1,000 contributions from a Steve Bing or labor or from the IBEW” for his own election campaign, said Robert Stern, the center’s president. “So why should his ballot measure committee be getting more than $1,000?”

Campaign finance lawyer Stephen J. Kaufman, who represents Villaraigosa and other city politicians, said the center’s recommendation would not withstand a legal challenge..

“The courts have said that you cannot limit expenditures for ballot measures,” said Kaufman, who said he was not speaking on behalf of the mayor or his other clients. Wednesday’s report offered a larger appraisal of the city’s election spending apparatus, looking at a series of campaign committees created between 2007 and 2009 that included city council races, ballot measures and spending by special interests. The biggest donations were from entities that gave to the mayor’s committees.

One of the largest came from Change to Win, a labor organization that provided $500,000 to Villaraigosa’s 2008 telephone tax measure, Proposition S. That group had separately pushed the mayor to bar truckers who operate independently from moving through the Port of Los Angeles, an initiative backed by the Teamsters Union that is now the subject of a lawsuit.

Stern’s group said it could not assess the impact of contributions on specific legislative decisions, since the City Council voted unanimously 99.993% of the time during a seven-month period examined in 2009. But it found that incumbents had a 19 to 1 spending advantage over their challengers in that year.

Those findings did not surprise Ron Kaye, interim executive director of Clean Sweep LA, a campaign committee that is recruiting candidates to run against council members next year.

Kaye said challengers typically face a steep uphill financial struggle. But he also argued that upsets do happen, as in the case of Measure B, a solar energy proposal that was defeated even though its backers raised nearly $1.7 million.

The report also examined “independent expenditure” contributions, which also have no limits but are distinct from ballot-measure groups because they cannot be controlled by a candidate.

The biggest beneficiary of such spending was then-city attorney candidate Carmen Trutanich, who saw the Police Protective League — the union that represents officers — spend $745,000 on his behalf. The powerful Los Angeles County Federation of Labor during the same period spent $351,000 on behalf of Trutanich’s opponent, former Councilman Jack Weiss. Trutanich won.

A third, huge player in 2009 was the DWP’s employee union, which spent $266,000 on behalf of Weiss and City Controller Wendy Greuel.

Those contributions sent a message to other politicians at City Hall, who threw their support behind a five-year package of raises for the utility’s workforce near the end of 2009, Stern said.

“I might call it a warning—’Don’t mess with us,’” he said.

david.zahniser@latimes.com