Legislators’ Incomes Boosted by Largess of Special Interests

Legislative leaders and committee chairmen who played an influential role in deciding the fate of legislation last year received thousands of dollars apiece in outside income and gifts from special-interest groups affected by their decisions.

Records filed with the Fair Political Practices Commission and the secretary of state show that 15 legislators in key positions of power received a total of at least $396,599 in salaries, speaking fees and gifts from businesses and groups that sought to influence the Legislature’s actions.

Not all legislative leaders and committee chairman subsidized their income with sizable payments from special interests. But those who received the largest amounts of money and gifts were generally in key positions to influence legislation.

Annual Reports

Reports of such payments, disclosed by legislators this month in their required yearly statements of economic interest, come at a time when the Legislature is struggling to improve an image tarnished by the bribery scandal surrounding fireworks manufacturer W. Patrick Moriarty. Former Assemblyman Bruce Young (D-Norwalk) was convicted last month on five charges of mail fraud in the affair and at least one current legislator is under investigation in the case.

Now, even some of the lawmakers who were major recipients of outside income from special-interest groups last year say the time has come to place a limit on such payments.

“A higher salary and severely restricting outside income would be a much better way to go,” said Senate President Pro Tem David A. Roberti (D-Los Angeles), who received at least $36,879 worth of speaking fees and gifts last year from a broad spectrum of groups that sought to influence legislation.

Senate Republican Caucus Chairman John Seymour of Anaheim said: “When you abuse anything, there is going to be a hue and cry for reform. . . . Some people’s price is $1. Some people’s price is $10 million. I guess that’s why we do need reform.”

Seymour, the No. 2 Republican leader in the Senate, received at least $21,093 in speaking fees and gifts from special interests last year. But even he said he was “shocked” by the surge in legislators’ outside income.

Assembly Speaker Willie Brown (D-San Francisco), the Legislature’s most powerful member, was by far the leader in collecting outside income from special-interest groups. The Times reported recently that Brown received at least $124,425 in legal fees, honorariums and gifts from businesses and organizations that sought to influence legislation.

Legislation Planned

Brown has said he will propose legislation that would ban all outside income for legislators while increasing their salary to as much as $85,000 a year. They now receive $37,105 annually and a tax-free allowance of $75 a day when the Legislature is in session.

While the bulk of the legislators’ outside income last year was in the form of honorariums and gifts, some lawmakers were also on the payroll of companies that had a stake in decisions made by the Legislature and state agencies.

One such lawmaker was Senate Republican Leader James W. Nielsen of Rohnert Park. He received at least $10,000 in salary from Roy Riegels Chemical Co., a distributor of the controversial herbicide Bolero that has been blamed for the bitter taste in Sacramento’s drinking water, raising questions of a potential health hazard.

Earlier this year, Nielsen lobbied members of a regional water board who were considering restricting the use of Bolero and threatened one board member that he would not support her reappointment, which requires confirmation by the Senate, if she voted to limit use of the chemical.

Nielsen, a 17-year employee of the company, acknowledged his lobbying activities but said they did not constitute a conflict of interest because he was representing farmers who live in his district, not his employer. “The fundamental question is, did I lobby to enrich myself, and the answer is conclusively no,” he said.

In addition to his salary, Nielsen accepted $19,107 in honorariums and gifts from health care, agricultural, banking and other organizations, bringing his total income from special-interest groups to at least $29,107.

While Nielsen was working for Roy Riegels, Sen. Diane Watson (D-Los Angeles) chairwoman of the Senate Health and Human Services Committee, received $5,700 to sit on the board of directors of Blue Shield of California, one of the state’s largest health insurance companies.

Blue Shield’s Lobbying

Blue Shield, in a disclosure statement it was required to file with the secretary of state, reported that it lobbied the Legislature on 75 bills last year, including five bills that came before Watson’s committee. The company reported it was also interested in a bill by Watson that would have allowed union members to receive unemployment benefits more quickly.

But Watson said she had no conflict in sitting on Blue Shield’s board of directors and voting on legislation. Watson, whose nine-year term on the board ended in November, said she has disqualified herself from voting in cases where there has been a potential conflict of interest--although she could not recall any such instances in 1986.

“I didn’t see any conflict in any of the bills, particularly the ones I carried,” she said. “No deals have been cut.”

Besides the money she received from Blue Shield, Watson also accepted $5,574 in other gifts and honorariums from special interests, bringing her total to $11,274.

Another lawmaker on the payroll of a private company was Assemblyman Gary A. Condit (D-Ceres), chairman of the Assembly Governmental Organization Committee. He received $24,000 last year for working part time for National Medical Enterprises, which operates hospitals and health-care facilities throughout the country. Condit, who was first elected in 1982, said he has worked for the company for 14 years and helps with marketing strategies and public relations.

According to the hospital company’s disclosure statement filed with the secretary of state, the firm lobbied legislators on 43 bills last year. National Medical Enterprises is also a major campaign contributor and gave thousands of dollars worth of gifts and speaking fees to a variety of key legislators in 1986.

Conflict of Interest Denied

But Condit said he has never had a conflict of interest in performing his legislative duties because he abstained from voting on bills when he learned his outside employer had sponsored them. He said he could not recall any specific bills he had disqualified himself from voting on but said it had happened “at least two times” since he took office.

“Anything that National Medical Enterprises is pushing for its own corporate interest, I would abstain from voting on,” he said. Condit also noted that he has declined to serve on the Assembly Health Committee because he wants to avoid any appearance of a conflict of interest.

Other major recipients of outside income and gifts from identifiable special interests last year were:

- Senate Business and Professions Committee Chairman Joseph B. Montoya (D-Whittier), who received at least $32,468. Most of his outside income came from health care and other professional groups regulated by his committee.

- Assemblyman Mike Roos (D-Los Angeles), who last year was majority floor leader, received at least $21,000 in gifts and speaking fees from insurance and banking industries, apartment owners and other interests.

- Sen. Wadie P. Deddeh (D-Chula Vista), chairman of the Senate Revenue and Taxation Committee last year, received $16,483 in honorariums and gifts, including $10,000 in speaking fees, from the San Diego Community College District Foundation.

- Senate Judiciary Committee Chairman Bill Lockyer (D-Hayward) received $15,088 in speaking fees and gifts, including $3,713 from attorney groups who have a stake in much of the legislation acted on by his committee.

- Senate Democratic Leader Barry Keene of Benicia received $14,823 in honorariums and gifts from interests that included banking, cable television, attorney and health-care organizations.

- Assembly Republican Leader Pat Nolan of Glendale received $12,866 in gifts and speaking fees from special-interest groups. Major donors included health care organizations, banks and Dow Chemical Co.

- Assembly Utilities and Commerce Committee Chairwoman Gwen Moore (D-Los Angeles) received $12,730 in honorariums and gifts from special-interest groups, primarily from telephone and cable television groups who are affected by legislation her committee considers.

- Assembly Health Committee Chairman Curtis R. Tucker (D-Inglewood) received $12,504 in speaking fees and gifts, almost of all of it from groups interested in health care legislation.

- Sen. Daniel E. Boatwright (D-Concord), who last year was chairman of the Senate Appropriations Committee, which must approve all spending bills, received $11,860 in speaking fees from organizations that sought to influence legislation, including $2,500 from health care groups, $2,500 from the building industry and $2,000 from a utility-backed group interested in legislation protecting a tax break for geothermal energy producers.

Another large recipient was Sen. William Campbell of Hacienda Heights, a former Senate Republican leader, who no longer holds a leadership position in the Legislature but is an entertaining speaker. He received $14,059 in honorariums and gifts from groups with an interest in legislation.

All of these figures reflect only income from groups that registered with the secretary of state as the employers or clients of lobbyists or who are known to have an interest in specific legislation. Most of these legislators also receive thousands of dollars in gifts and honorariums from sources that did not have an obvious interest in legislation last year.

Practice Defended

Some legislators who accepted substantial outside income defended the practice, saying they needed the money to maintain homes in their districts and the capital.

“Try living on $37,000 (in salary) when you have a wife and parents you are trying to support,” Roberti said.

Roberti and other lawmakers interviewed by The Times insisted that the payments and gifts created no conflict of interest when they voted on legislation affecting the special-interest groups that paid them.

Under the Political Reform Act passed by the voters in 1974, public officials are prohibited from participating in decisions that affect their own financial interests. Public officials have a financial interest, according to the law, if they receive a payment or gift of $250 or more from a specific entity.

As the law has been interpreted by the Fair Political Practices Commission, public officials do not have a conflict of interest if their vote affects an entire industry--not just the individual or business that is the source of their gift or income.

Lawmakers can avoid a conflict of interest by disqualifying themselves from voting or otherwise participating in a decision.

However, because of a loophole in the law, state legislators and other elected state officials are specifically exempted from any penalty for conflict of interest violations. Furthermore, no state agency has the duty of investigating cases involving state officeholders.

The bill proposed by Speaker Brown would amend this provision and subject state officials for the first time to the conflict of interest penalties that apply to other public officials.

Reporting Limitations

In many cases, it is impossible to tell how much a legislator made from an outside employer--or even whether a legislator has an employer whose interest in legislation could create a conflict.

Nielsen, for instance, is required to report only that his salary from Roy Riegels Chemical Co. exceeded $10,000 last year and he will not say how much he actually received.

Twelve of the Legislature’s 120 members practice law. But they are not required to identify who their clients are unless their share of income from a single client exceeds $10,000.

Similarly, at least three other lawmakers--Assemblyman Richard Polanco (D-Los Angeles), Assemblyman Gil Ferguson (R-Newport Beach) and Sen. Don Rogers (R-Bakersfield)--who have their own consulting firms are not required to name their clients unless their share of income exceeds $10,000.

Furthermore, it is sometimes difficult to identify special-interest groups that are concerned with legislation because many do not employ full-time lobbyists or fail to register with the secretary of state.

The pattern of giving by special interests is perhaps easiest to see in the cases of several committee chairmen.

Tucker, the Assembly Health Committee chairman who accepted a total of $12,504 in speaking fees and gifts from groups with an identifiable interest in legislation, received practically all of it--$12,271--from health care businesses and organizations.

For instance, he received $4,678 in hotel accommodations and speaking fees from two medical political action committees, $3,306 in transportation and meals from National Medical Enterprises, and $1,548 in hotel accommodations, meals and transportation from Pfizer Pharmaceuticals.

“They want special consideration--you know it and I know it,” Tucker explained. “But it just doesn’t work that way. . . . You must never attach contributions to any of the bills that come into my office.”

Although Tucker makes a practice of accepting speaking fees and gifts, he said they actually have little value to him and have no effect on the decisions he makes.

‘Buying Absolutely Nothing’

“I don’t know what you can buy for $12,000,” he said. “An automobile like a Hyundai. I don’t need that. You’re buying absolutely nothing.”

Moore, the Assembly Utilities and Commerce Committee chairwoman, received roughly 80% of her reported speaking fees and gifts from groups that had legislation before her committee. She took $6,785 in transportation, lodging, speaking fees and meals from telephone companies and $3,028 in air fare, limousine service, meals, entertainment and speaking fees from the California Cable Television Assn.

And Watson, the chairwoman of the Senate Health Committee, received roughly 90% of her reported outside income and gifts from medical care groups. That includes the $5,700 from Blue Shield, $1,450 in air fare, speaking fees and meals from pharmaceutical manufacturers and $1,000 from National Medical Enterprises.

“I’m called on to speak to people in the health care industry because they sense if you are a chair then you must know something about the subject,” she said. “I am just pleased to have supplemental income because it is difficult as a single person to maintain oneself in this office.”

Watson also said she favored retaining the present system over raising lawmakers’ pay and banning outside income. “I think we get into more trouble increasing our salary than accepting outside income,” she said.