Fund-Raising Limits for Supervisors Have Loophole: Initiatives

Los Angeles County supervisors are circumventing voter-approved restrictions on political fund-raising through an unusual use of the initiative process.

They mount campaigns for or against countywide initiatives. Because such campaigns are not covered by campaign funding restrictions, the supervisors can collect unlimited contributions from corporations with business before the county.

Although all of the money goes toward the initiative campaigns, the supervisors get an indirect benefit because their names and photographs are featured on some campaign mailings and they are identified with popular causes.

Supervisors are limited to $1,000 contributions for their election campaigns under the terms of an initiative they themselves placed on the ballot in 1996 that won overwhelming approval. Another limitation, under state law, permits them to accept only $10 from companies that do business with the Metropolitan Transportation Authority. Supervisors serve on the MTA board.

But a wide range of donors with interests before the county and MTA have given well over those limits to the initiative campaigns backed by supervisors.

The greatest amount of this unrestricted fund-raising occurred this fall, as three supervisors mounted a campaign to scuttle a well-funded effort to expand the Board of Supervisors. Incumbent supervisors have historically opposed enlarging the five-person board because it might dilute their considerable political power.

Supervisors turned to developers, contractors, lobbyists and others for financial support. The full extent of the fund-raising is unclear, because one committee run by allies of Supervisor Mike Antonovich has failed to disclose its contributors. State and county law requires such disclosure. The committee said it had been told the deadline was January.

The three supervisors who opposed the initiative--Antonovich, Supervisor Don Knabe and Supervisor Zev Yaroslavsky--raised money for the campaign against it, the committee’s director said. Though those contributions have not been publicly disclosed, they include at least one $6,750 donation from Newhall Land and Farming, which hopes to build the largest subdivision ever on county land in Antonovich’s district. Supervisors approved the development last year, though it is on hold because a judge has ruled that adequate environmental studies were not done.

But even before board expansion appeared on the ballot, supervisors were raising money above campaign finance limits from companies with interests in their decisions.

Knabe last spring launched an initiative to strip senior county managers of their civil service protection. Among the $5,000 contributors to the campaign to pass that measure were also Newhall Land and Farming, and Pacific Bell, which won a $270-million contract from the Board of Supervisors a month after it contributed.

The supervisor with the longest record of involvement in such initiative campaigns is the author of the county’s own campaign finance restrictions--Yaroslavsky.

Donors Say They Give Because of Issues

Yaroslavsky’s 1998 initiative to halt the use of sales tax money to construct the subway received a donation of $25,000 from a developer and longtime Yaroslavsky backer who later won the county’s help in refinancing two projects in the supervisor’s district.

His name is Alan Casden, a developer who won county support for selling bonds to refinance two apartment buildings.

Casden did not return a phone call. County officials said the bond proposal was routine and cost the county nothing.

The supervisors say that their fund-raising for initiatives is perfectly legal and that they do it because of strongly held beliefs.

“They’re initiatives, just like everyone else does,” Knabe said. “It’s my voting right as a member of the public to do whatever I can against it or to support it, and I’m not ashamed about it at all.”

Supervisors said that during the board expansion fight they needed to match an opposing campaign that received contributions of up to $100,000 from county unions.

And donors say they give to support issues rather than curry favor with supervisors. “We tend to get involved in initiatives both on the statewide level and the local level when we feel there would be a benefit” to the public, said Marlee Lauffer of Newhall Land and Farming.

Until 1996 there were no restrictions on political contributions to supervisors. They regularly raked in donations of between $5,000 and $25,000, stockpiling millions of dollars in campaign funds.

When he was elected to the board in 1995, Yaroslavsky vowed to change that. In 1996, with voters poised to approve stringent statewide campaign finance regulations in the form of Proposition 208, the board placed on the ballot its own campaign reform measure.

Not only does it restrict election contributions to $1,000 per contributor per year, but it prevents supervisors from raising campaign funds until 18 months before they are up for reelection.

The three initiative campaigns--to oppose board expansion, to stop the subway and to weaken civil service--turned out to have a major impact on the public in Los Angeles County. The measure to expand the board was particularly important to the supervisors. They viewed expansion as a direct challenge to their political power, which is all but supreme on election day because they usually face no significant opposition.

The most far-reaching initiative for the majority of residents was Yaroslavsky’s measure to halt the use of county sales tax money for subway construction.

Yaroslavsky took money from his supervisorial campaign treasury and gave it to a new committee, created to manage the anti-subway campaign.

Initially, Yaroslavsky ran the committee, but he removed himself to permit receipt of unlimited contributions.

The MTA initiative passed overwhelmingly.

Yaroslavsky said he sees nothing wrong raising money for initiatives that he would not be able to raise for his own reelection.

“I’m an activist political figure. I fight for things,” said Yaroslavsky, ticking off a list of prior initiatives he sponsored. Those initiatives are “not a way to get around [fund-raising limits] because it’s not promoting my candidacy.”

And he defended the right of companies that do business with the county or MTA to contribute to the efforts. “These are people who have a right to contribute to campaigns,” he said.

In addition to the original anti-subway committee, another was set up by Rick Taylor, Yaroslavsky’s longtime political advisor, and by Seymour Lauretz, Yaroslavsky’s campaign treasurer.

After the anti-subway measure passed, the committee stayed in business. It raised and spent money money on mailers backing a wide range of candidates and initiatives. Those mailers often had Yaroslavsky’s picture and looked like the slate mailers that deluge voters before each election.

Wayne Avrashow, who became chairman of this committee, said the group is independent of Yaroslavsky.

“It’s Wayne and Rick’s committee,” said Avrashow, an attorney, lobbyist and fund-raiser. He said Yaroslavsky’s photo was used on mailers because he is a popular official on the Westside.

As a slate mailer committee, the body received most of its money in donations from political groups that felt its mailer would help their campaign.

One organization that bought a spot on the mailer was the parent company of the Los Angeles Athletic Club. It paid $10,000 for a plug for the state park bond measure on the March ballot. The measure, designed to finance parks all over California, would bring in enough for the state to buy the club’s property in Topanga Canyon. A week before the donation, the supervisors voted for a small rent increase on land the club leases in county-owned Marina del Rey. The athletic club did not return a phone call.

This year the committee changed its methods and began accepting large contributions that had no apparent connection to the slate mailer.

Two law firms representing the county in litigation against the tobacco industry that Yaroslavsky had pushed the board to authorize--Greene, Broillet, Taylor, Wheeler & Panish of Santa Monica and Robinson, Phillips & Calcagnie of Laguna Niguel--contributed $15,000 each in February.

The second initiative of vital importance to the board was the measure to expand its membership to nine seats. The proposal was backed by organized labor and political and community leaders who said the board was too small and unrepresentative.

The committee run by Yaroslavsky’s allies kicked its fund-raising into high gear to defeat expansion.

“I called dozens of people to stop what I thought was just a power grab,” said Avrashow, referring to efforts by termed-out legislators to find new jobs through expanding the board. Yaroslavsky helped raise money.

Donations Flood Committees

The donations flowed in: $50,000 from another Casden company. Attorney and lobbyist Neil Papiano, who is representing a company seeking a contract to harvest tissues from the county coroner’s office, gave $25,000. He did not return calls seeking comment.

Another $25,000 contribution came from Maximus, a Virginia-based company to which supervisors had recently awarded a $9.9-million contract to run part of the county’s welfare-to-work program. Yaroslavsky was the swing vote on the controversial deal, breaking with his usual labor and anti-poverty group allies.

“Our contribution strategy is to support good and efficient government,” Maximus spokeswoman Rachael Rowland said when asked about the donation.

Zeke Avila & Sons, a Ventura-based company that is seeking to extend its contract to operate a golf course in a county park, gave $4,000 on the advice of its lobbyist, Steve Afriat. “I called and said ‘This is probably something that would be a good idea for you,’ ” Afriat recalled in an interview. “There’s no reason you would want to see the bureaucracy grow.”

Other contributors include an engineering company that contracts with the MTA--Daniel, Mann, Johnson and Mendenhall. The company, which would otherwise not be allowed to give more than $10 to Yaroslavsky, gave $2,500 to the committee.

Those contributions helped fund $150,000 in radio ads against the board expansion measure as well as mailers with three pictures of Yaroslavsky that also erroneously implied that Gov. Gray Davis opposed the initiative. Political consultant Taylor said he consulted with Yaroslavsky on the mailers’ design but that the mistake was his fault.

In addition, another anti-expansion committee was formed. It had ties to Supervisor Antonovich.

The group’s listed treasurer is Richards Barger, Antonovich’s regular campaign treasurer. It is directed by Victoria Otter, a former Antonovich aide. Also on its board of directors is Toni Balian, a longtime Antonovich fund-raiser, members say.

The committee asked Antonovich, Knabe and Yaroslavsky to help raise money for the campaign.

In an interview, Antonovich said, “I don’t control the committee, and the committee deals with issues related to state and local business interests.” The presence of his allies on the committee, he added, is due to “philosophical overlap.”

The third initiative that attracted supervisorial interest was Knabe’s measure to eliminate civil service protection for top county executives.

The measure, which passed, permits department heads to hire and fire top managers. Proponents said the managerial level included old-timers who remained on the county rolls even though they had been demoted years ago.

Knabe pushed the initiative as a cost-cutting measure.

There was no significant opposition, but Knabe raised $137,000 for a campaign to pass the measure, which spent all but $12,000 on advertising, mailers and fund-raising. Most contributors gave $1,000 or less, but several gave more. Besides Pacific Bell and Newhall Land and Farming, other big donors were Vestar Inc., which wants to build a shopping complex in Marina del Rey--in Knabe’s district--and gave $2,500, and Sonnenblick-Del Rio, a developer that leases office buildings to county departments and also gave $2,500. Laidlaw Transit, an MTA contractor that would not be allowed under state law to directly donate to the supervisor, contributed $500.

Knabe said there was nothing wrong with the donations. “They’re not giving to me personally,” he said.

Knabe acknowledged many of the donors were companies that support his reelection campaigns. When using the initiative process, he said, “I’m going to go to my friends.”