Replying to Critics, Brown Cancels Gala : Tribute: Commerce designee calls off corporate event to remove the appearance of conflict, even though he still views it as ‘appropriate.’

Commerce Secretary-designate Ronald H. Brown, responding to criticism, on Wednesday canceled a planned Kennedy Center gala in his honor that was to have been funded by corporations likely to be affected by his actions as a Cabinet member.

Brown, chairman of the Democratic National Committee, announced through a spokeswoman that he was canceling the “Friends of Ron Brown” gala, even though he considers it “entirely appropriate” for the next commerce secretary to be feted by big business.

Brown made the decision to cancel the party in consultation with President-elect Bill Clinton, sources said. Dee Dee Myers, Clinton’s spokeswoman, praised Brown for doing “the admirable thing by removing even the appearance of a conflict.”

The announcement of the cancellation came after The Times reported that the Sunday night party was being paid for entirely through $10,000 contributions from such corporate giants as J. C. Penney, Anheuser-Busch, Pepsico, Textron, NYNEX and Sony Music Entertainment.

Brown’s critics viewed corporate sponsorship of the event as evidence that he has not adequately cut his ties with the business community that he has represented as a lobbyist. Clinton has promised that his Administration will halt the so-called “revolving door” that allows people to move back and forth between lobbying and government service.

Fred Wertheimer, president of Common Cause, a citizens group, said that, if Brown hopes to quell this controversy, he must pledge to disclose all future contacts with his former clients, his lobbying firm and the companies from which he raised money as chairman of the Democratic Party.

“There are serious questions on the table about how Ron Brown and the Clinton Administration are dealing with conflict and potential conflict questions,” Wertheimer said. “They need to have a process whereby there will be ongoing public disclosure whenever Brown is contacted by these people.”

Corporate funding of the Brown gala was disclosed at a time when some Senate Republicans are said to believe that they were not tough enough in questioning Brown at his confirmation hearings before the Senate Commerce, Science and Transportation Committee last week. As a result, these Republicans have resolved to be tougher on the Clinton nominees whose hearings are yet to come.

“The wind has changed up here,” one Senate GOP source said. “There is a resurgent effort to look tougher on the Clinton nominees.”

Republicans also are expected to press their request for Brown to provide the Commerce Committee with a copy of the severance agreement he has negotiated with his employer, the Washington lobbying firm of Patton, Boggs & Blow, which will provide him with a payment of up to $1 million.

Myers said that Brown has been meeting with his lawyers to determine whether he can comply with the request. She said that he must decide whether providing it to the committee would violate the confidentiality of his deal with the firm.

At the same time, a Commerce Department source said that the controversy over Brown’s corporate ties might make his confirmation “a little more difficult” but probably would not keep him from being confirmed.

Sen. Alfonse M. D’Amato (R-N.Y.), a member of the committee, said that Republicans were afraid of being criticized for questioning Brown too closely. “The first time the Senate would be more diligent than it has been, the media would come down on it like a ton of bricks,” he said.

Ginny Terzano, press secretary of the Democratic National Committee, said that Brown decided to cancel the Kennedy Center gala only because he wanted “no distractions to the inauguration and the important work ahead.” She emphasized that the party had been scheduled long before Brown was nominated as commerce secretary and was intended to honor his work as Democratic chairman.

Unspent funds for the party will be returned to the sponsors, according to Terzano, although much of the money the corporations contributed already has been spent to rent the Terrace Theater at the Kennedy Center, to hire a caterer and to produce a video tribute to Brown.

Two other parties designed to pay tribute to Brown during the Clinton inauguration also have been canceled, Terzano said. They were to have been sponsored by the Democratic National Committee and the two teachers’ unions, the American Federation of Teachers and the National Education Assn.

The Kennedy Center tribute was planned by several friends of Brown, led by Yolanda Carraway, a former employee of the DNC, who then sought corporate sponsorship for it.

Executives of J. C. Penney, Anheuser-Busch, Pepsico, Textron, NYNEX and Sony Music Entertainment acknowledged they had contributed to the party, but they denied that they were trying to seek influence with Brown. In addition, Martin D. Payson, who resigned recently as vice chairman of Time-Warner, said that he had made a contribution.

Although NYNEX officials last week denied that they were helping to sponsor the event, they acknowledged Wednesday that they had contributed. John Glover, NYNEX’s Washington representative, said that last week he had been unaware of a contribution by one of the firm’s subsidiaries.