CALIFORNIA ELECTIONS / ATTORNEY GENERAL : Lungren and Smith Trade Shots Over Fund-Raising

Republican state attorney general candidate Dan Lungren on Thursday attacked his Democratic foe, Arlo Smith, for “violating the spirit” of campaign finance laws by accepting $362,000 in campaign loans, mostly from his wife.

Lungren, at a Sacramento press conference, called on Smith to retire the loan before the November election so that it is clear to voters whom Smith will receive the funds from to repay the debt.

“It appears that Arlo is waiting until the November election to retire this massive debt--when he can freely solicit funds from the special interests,” said Lungren. “This may be technically legal, but it is unethical nonetheless.”

San Francisco Dist. Atty. Smith later called Lungren’s statements “wild, reckless and irresponsible” and said that he intends, if possible, to retire the debt before the election. Already, Smith said, approximately $90,000 in additional loans from him and his wife, Helen Hale Smith, have been repaid by the campaign.

“Here’s a desperate guy,” Smith said. “We’ve basically out-raised him and he didn’t have a contested primary.”

State campaign finance records made public this week showed that Lungren raised $433,186 during the first six months of the year, and had $216,965 cash on hand as of June 30. Smith, who waged a successful uphill primary battle against Los Angeles County Dist. Atty. Ira Reiner, raised $804,236, and had $181,825 cash on hand as of June 30. About half of Smith’s funds came from loans made by him and his wife--$355,356 of which remains outstanding.

At his press conference, Lungren, noting that the loans are not listed on Smith’s campaign forms as community property, asked the Democrat “to come clean . . . (and) let us know the source of your (loan) funds.”

Smith said later that funds came from loans he and his wife have taken on their house. When they bought the St. Francis Woods residence in the mid-1950s, Smith said, it cost $50,000, but it is now worth between $750,000 and $900,000.

“The house is paid off,” said Smith. “We just happen to be an old-fashioned couple. . . . Everything we own is community property.”