Gov.’s Top Aides’ Pay Bolstered by Donors

Gov. Arnold Schwarzenegger has supplemented the salaries of at least four of his top government aides with private campaign money, a practice that means a piece of their overall pay has come from donations by corporations and others that do business in the Capitol.

Schwarzenegger set up a standing agreement in which three present and former aides received a monthly $5,000 check from his political accounts to moonlight as campaign aides, on top of what they earned in salary as government employees, the governor’s office said.

The combination boosted their overall annual compensation rates from the $120,000-to-$130,000 range to $180,000 to $190,000. That’s more than the governor’s job pays, although Schwarzenegger waives his $175,000 state salary.

The payments went to three of Schwarzenegger’s most influential advisors: Patricia Clarey, who left her job as chief of staff in December; Rob Stutzman, who stepped down as communications director Friday; and Richard Costigan, who continues to serve as the governor’s chief liaison to the Legislature.

Last week, Schwarzenegger’s office confirmed that his new chief of staff, Susan P. Kennedy, would double as a campaign aide and be paid campaign funds in addition to her $131,000 government salary.

The governor’s office declined to comment Friday on what she is getting from campaign accounts, although that amount eventually must be made public in state campaign finance reports filed periodically.

Part of Kennedy’s role will be to brief campaign donors about the governor’s policy agenda in a series of luncheons and conference calls over the next month, according to Schwarzenegger campaign memos obtained by The Times.

Bob White, chief of staff to former Gov. Pete Wilson, acknowledged through a spokesman that he received a campaign salary in addition to his state pay during Wilson’s 1994 reelection campaign. The spokesman declined to say more.

But Gray Davis, whom Schwarzenegger ousted in the 2003 recall campaign, barred the mixing of campaign and state pay. So did former Gov. George Deukmejian, according to one of his senior advisors. And former Gov. Jerry Brown said through a spokesman that no one on his government payroll earned such a dual income.

State law prohibits government aides from engaging in political work on state time, although they are permitted to “exercise their 1st Amendment rights and participate in politics on their own time,” said Nathan Barankin, a spokesman for state Atty. Gen. Bill Lockyer.

Watchdog groups warn that Schwarzenegger is creating a potential conflict of interest if his aides appear financially beholden to campaign donors whose interests depend on state actions.

“If you’re a policy advisor to the governor, the policy should be based on the interests of California and actual policy merit,” said Theis Finlev, policy advocate for California Common Cause. “How do we know they’re not suggesting policies beneficial to prospective donors and not necessarily in the interests of the state?”

Schwarzenegger’s donors include state contractors, companies lobbying for passage of certain legislation, utilities regulated by the state, and other business interests eager to sway the administration’s decisions.

The memos describing Kennedy’s role in the upcoming political luncheons offer a window into the types of interests that are supplementing staff salaries.

Those who sent out the letter inviting supporters to meet Kennedy and other campaign officials have given the governor’s campaigns a combined $8.8 million over the last four years. Some of that money went to Schwarzenegger’s campaign for state-funded after-school programs in 2002, before he became governor.

For example, A.G. Spanos, a Stockton developer who owns the San Diego Chargers along with family members and employees, has given the governor’s campaigns $2.7 million. Paul Folino of the Orange County high-tech firm Emulex Corp. and his family and employees have given $1.46 million.

Others include Los Angeles-area developer Rick Caruso, who along with affiliates has donated $387,000 to the governor’s campaign coffers; and Silicon Valley entrepreneur Timothy Draper, who has given $282,400.

A spokesman for Schwarzenegger said the governor’s aim is twofold: He wants his policy staff to know what his campaign is doing, and he wants his campaign team to get strategic insights from his policy staff.

Stutzman said that the governor’s staff is motivated by nothing beyond serving a public agenda and that the interests of donors do not influence decisions.

“If you’re inside the government, you’re fully obsessed with governing and driving decisions based on what the governor wants to do in government,” he said.

Costigan, the legislative secretary, collected nearly $46,000 in income and expenses from the governor’s campaign committees in 2004-05, campaign finance reports show. That was on top of his annual $123,230 state salary. His job is to help shepherd the governor’s agenda through the Legislature and consult with him on which bills to sign or veto.

Since Schwarzenegger’s election two years ago, Costigan has also been seen at some of the governor’s fundraising events.

Clarey, who served as the governor’s chief of staff at $131,412 annually until Kennedy replaced her last month, took in about $30,000 in salary and expenses from campaign accounts over the last two years, records show. A total of $4,114 of that reflected travel expenses incurred when she left the government payroll for two months last year to run the governor’s special election campaign. Clarey’s duties included setting up the campaign organization and providing direction.

Stutzman earned about $56,000 in salary and expenses from the governor’s campaign funds in 2004-05, records show. His state salary was $123,230 a year. He temporarily left the government payroll for about three months during that period to engage solely in campaign work.

Information about the three aides’ outside pay was published in August in the San Jose Mercury News and its sister paper the Contra Costa Times.

Among other state administrations, payment practices differ. Nevada Gov. Kenny C. Guinn, a Republican, does not boost staff salaries through campaign funds, partly to ensure that roles don’t become blurred, a spokesman said.

A state employee holds a “state position where the taxpayers pay,” said Steve George, an aide to Guinn. A campaign aide, by contrast, is a “private citizen [acting] in a different capacity. It just helps to show the clear delineation between the two positions.”

In Texas, by contrast, Republican Gov. Rick Perry allows aides to receive campaign money, though any political work they do must be on their own time, said a press aide.

Aides to Michigan Gov. Jennifer Granholm, a Democrat, do not get campaign money on top of their state salary.

That practice has “never been done, never been discussed,” said Press Secretary Elizabeth Boyd.

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Times staff writer Dan Morain contributed to this report.