Breakfast Fund-Raiser May Have Violated Prop. 208

A fund-raising event hosted by seven members of the Los Angeles City Council and attended by powerful business and labor leaders is under attack by government watchdog groups, who charge that it violated strict new campaign finance laws.

The Feb. 13 breakfast meeting attracted about 130 people, including union organizers, lobbyists and business executives who were asked to bankroll a charter reform measure on the April ballot that will include a slate of candidates.

The guests were asked to pledge $1,000 to $25,000 each, far in excess of what is allowed under Proposition 208, a landmark reform measure that was passed in November.

Authors of Proposition 208 say it limits such contributions to $250. The fund-raising goal of the event was reportedly $750,000.

“I think that is a violation of the spirit and the letter of 208,” said Tony Miller, the executive director of Californians for Political Reform and an author of Proposition 208.

Miller and representatives of other watchdog groups say the event is the first such attempt at circumventing Proposition 208.

But Harvey Englander, the veteran campaign consultant who organized the event, said the fund-raiser was a simple business endeavor that is not affected by the new finance limits.

He argued that the breakfast guests paid him to distribute a mailer supporting a ballot measure to create a charter reform panel. State law imposes no limits on contributions to ballot measures.

The controversy focuses on Englander’s plans to include on the same mailer a slate of candidates for that panel, which he said he will choose in consultation with council members and others, at no extra cost to the candidates or the contributors.

Proposition 208 authors and sponsors argue that the candidates are benefiting from the fund-raising event, and therefore the contributions are subject to the proposition’s limits.

Englander’s attorney, Cary Davidson, insisted that the money collected at the event came in the form of payments to Englander for his services, not campaign contributions, and are therefore not subject to Proposition 208 limits.

“We are working within the rules,” Englander said.

The controversy over the fund-raiser is being played against the background of a power struggle between the council and Mayor Richard Riordan over a ballot measure to create an elected panel to overhaul the city charter.

Most of the money for Riordan’s slate--which came in the form of contributions of $25,000 to $100,000 each--was raised just before Proposition 208 contribution limits took effect Jan. 1.

However, the breakfast fund-raiser attended by the council members at the City Club in downtown Los Angeles took place more than a month after the law took effect. Englander organized and paid for the event.

Council members who spoke at the fund-raiser said the event was an attempt to stockpile money for a council-backed slate that would rival the mayor’s candidates.

Craig Holman, co-author of Proposition 208, argues that Englander has, in fact, created a so-called “independent expenditure committee.” Such committees are limited under Proposition 208 to contributions of no more than $250.

Under state law, individuals and interest groups can spend an unlimited amount of their own money to endorse a candidate, as long as the candidate does not have any control over the money.

However, if individuals pool their funds to support a candidate, they have created an independent expenditure committee, Holman said.