Candidates Awash in Cash After Donation Curbs Fall


As Democrats Al Checchi and Rep. Jane Harman spent their own wealth on television ads touting their campaigns for governor, less well-heeled candidates took advantage of the demise of fund-raising limits to raise millions of dollars during the first 10 weeks of the year.

Campaign fund-raising statements made public Tuesday show that the four major candidates for governor raised a combined $24 million through March 17. By the June 2 primary, the sum is sure to top the record $28 million spent on the gubernatorial primary four years ago.

The statements are the first to be filed since a federal judge struck down Proposition 208, which capped individual political donations at $1,000.


With all restrictions off, several state candidates raked huge individual donations--huge, that is, for politicians other than the self-financing Checchi and Harman. Several pulled in individual six-digit donations.

Assembly Speaker Antonio Villaraigosa (D-Los Angeles) raised almost $1.1 million, a surprisingly large sum given that he has been leader of the lower house for less than a month. His money came from virtually every group with issues pending in the Capitol.

Senate President Pro Tem John Burton (D-San Francisco), the new Senate leader, raised $742,000, including $100,000 from Mercury General, an insurance company that specializes in workers’ compensation insurance. He received $75,000 from Zenith Insurance, another major workers’ compensation firm.

Sen. Bill Lockyer (D-Hayward), running for the Democratic nomination for attorney general, led all candidates other than those running for governor with a campaign bank account of $3.3 million.

But the biggest fund-raiser by far was former Northwest Airlines Chairman Checchi, whose personal wealth tops $800 million. Checchi opened his own bank accounts to give his campaign $11.4 million. He took no money from any other donor.

Altogether, Checchi has spent $18 million since he entered the race last year--all of it his own money.


A breakdown of Checchi’s spending shows that he spent more than three-fourths of his money--$6.3 million of the $8.8 million he doled out during the first 10 weeks of the year--to buy commercial time on television.

Additionally, he paid $2.2 million to Shrum, Devine & Donilon, the consultant that produced the television spots.

Checchi purchased commercial time in virtually every media market, from El Centro to Los Angeles to Salinas to Chico. His single largest purchase was at KABC in Los Angeles--$568,735. Reflecting his effort to win the votes of new citizens, Checchi spent heavily on ads airing on Spanish-language television stations.

His report shows that he spent $220,864 for time on the Spanish language station KMEX in Los Angeles. That’s only slightly less than what he spent on CBS and NBC affiliates in Los Angeles, and on network affiliates in the San Francisco Bay Area. Darry Sragow, Checchi’s campaign manager, said Checchi is spending 15% of his television money on Spanish-language stations.

“Latino voter participation has been increasing dramatically,” Sragow said. “We want to appeal very directly to that segment of the electorate.”

Rep. Jane Harman (D-Torrance), who entered the race less than a month ago, raised $4.5 million--only $285,000 of it from others. She and her husband, Sidney, loaned her campaign the remaining $4.25 million.


Harman’s full report had not been received by the secretary of state in Sacramento on Tuesday, so it was not known who her donors were. She spent $4 million. Like Checchi, she is spending by far the bulk of her money on the airwaves.

Lt. Gov. Gray Davis, the other major Democratic candidate, raised $1.2 million in the first 10 weeks of 1998. He ended the reporting period with $4.66 million in the bank, a respectable sum in years without self-financing multimillionaires running. Davis, holding off spending until the primary gets closer, spent only $429,000 during the 10-week reporting period.

Labor unions, long one of Davis’ main sources of money, gave Davis a combined $120,000. Beverly Hills developer Louis Gonda of Lexington Commercial Holdings gave Davis his largest single donation, $150,000. Gonda was ranked No. 217 on the most recent Forbes 400 of richest Americans, with an estimated worth of $800 million.

Jerry Perenchio of Chartwell Partners in Los Angeles gave Davis $100,000. Perenchio is a Hollywood entrepreneur and movie producer.

Trial lawyers donated significant sums to Davis, in excess of $40,000. San Diego attorney William Lerach gave him $20,000. Lerach, who specializes in bringing class-action shareholder lawsuits against publicly traded corporations, was the major backer of an initiative two years ago to make such lawsuits easier to bring in state court.

ICN Pharmaceuticals Inc. of Costa Mesa gave Davis $50,000, while Gail Zappa, the widow of rock musician Frank Zappa, chipped in with $10,000.


The one major Republican candidate for governor, Atty. Gen. Dan Lungren, raised almost $2 million during the first 10 weeks of 1998, and had $3.7 million in the bank as of March 17. Lungren spent $1 million.

Lungren’s largest single source of money was the insurance industry. Led by Farmers Insurance, which gave him $50,000, insurance company donations amounted to $240,000.

Lungren’s largest individual donation was $100,000 from Foster Friess of Wyoming. Friess is the lead manager of the $8.2-billion Brandywine Fund and is a longtime conservative donor.

Sen. Ken Maddy (R-Fresno), the former Senate minority leader who must retire this year because of term limits, gave Lungren $70,000.

Major industrial firms chipped in too. Bechtel, the large San Francisco engineering firm, and two Bechtel family members gave a combined $14,000. Arco gave $10,000 and Chevron gave $25,000.

Lungren also received large sums from the state’s agriculture industry, a mainstay of Republican candidates. Ernest and Julio Gallo gave him $45,000.


Gallo, long among the largest Republican donors, turned bipartisan this year, giving Lockyer $50,000 for his campaign for the Democratic nomination for attorney general.

Lockyer also is receiving large sums from unions, including $25,000 from hotel and restaurant workers and $30,000 from a carpenters union. Another major source is trial lawyers, among them San Diego lawyer Lerach, who donated $10,000.

Lockyer’s challengers for the Democratic nomination lagged far behind his $3.3 million. Sen. Charles Calderon (D-Whittier) had $1 million, including $360,000 in loans. San Diego lawyer Lynn Schenk had $350,000, including a loan of $100,000.

Republican Dave Stirling, running for the Republican nomination for attorney general, had a relatively paltry $77,000 in the bank. His main foe, Orange County Dist. Atty. Michael Capizzi, had $311,000.