Major Firms Give Heavily to Political Conventions

Some of the nation’s biggest companies, with their outsize appetites for political influence, are helping foot the bill for the Democratic National Convention in Los Angeles.

The dollars--including a substantial amount from corporations dealing with the federal government--are crucial for the financing of the most extravagant act of political theater here since John F. Kennedy accepted the Democratic Party nomination for president in 1960.

Although taxpayers will pay police and transportation costs for the convention, to be held Aug. 14-17, they will not have to provide cash payments for such items as computers and many services.

This comes from the companies. They are pumping in big sums to stage the $35.3-million event, and, in the process, are drawing the skeptical gaze of observers who complain that the contributions are yet another way for money to influence politics and policy.

“The question about these contributions is: What do they get out of it?” said Robert M. Stern, president of the Center for Governmental Studies, a Los Angeles-based research organization.

It’s not a question unique to Los Angeles, where the host committee says it already has raised roughly $31 million in cash and in-kind contributions.

In fact, fund-raising for the Republican gathering in Philadelphia, which will take place two weeks before the Democrats’ Los Angeles gala, is cloaked in greater mystery than the local affair and is burdened by at least one especially controversial donation, a gift from the nation’s largest tobacco company. That contribution is one of more than 200 to the Republicans’ $50-million effort, to which donors have given anywhere from a few hundred dollars to more than $1 million.

“People give that kind of money because they expect something in return,” said Nick Nyhart, executive director of Public Campaign, a national nonprofit organization that advocates comprehensive campaign finance reform. “They’re going to come calling at some point.”

Neither event’s host committee is obliged to release detailed fund-raising information at this point because contributions to the convention groups are not considered political donations.

Nevertheless, organizers of the Los Angeles convention supplied The Times with a complete list of donors and the approximate amounts of their contributions. The host committee in Philadelphia agreed only to disclose a partial list. That roster does not include all donors, nor does it indicate how much each gave.

Still, some additional details were offered in interviews with officials from the two organizations as well as with some of the individual and corporate donors. From them, some clear patterns emerged.

Near the top of both donor lists are AT&T; and Microsoft, two national firms with extensive, contested, coast-to-coast interests. Microsoft is donating roughly $1 million in computer equipment to each event--at precisely the same time that the U.S. Justice Department is urging a federal judge to break the company into at least two parts.

AT&T;, meanwhile, has contributed at least $1 million to each convention in the form of services. Like Microsoft, the telephone company also has significant national interests. It is waging a national campaign to forestall efforts to open its cable lines to Internet service providers, a debate playing out in Los Angeles and many other major metropolitan areas.

For those companies, the conventions offer a rare opportunity: the chance to donate unlimited sums of cash to causes that help advance each party’s candidates for president and at the same time to win the gratitude of local authorities in two of the nation’s largest cities.

They’re not alone. The donor lists are dotted with some of America’s best-known companies: DaimlerChrysler, General Motors and United Parcel Service, for instance, turn up on both convention committees’ rolls. General Motors is donating cars to both efforts, and a local phone company, SBC, has given the Los Angeles host committee cell phones, long-distance service and the like.

Representatives of those firms, however, say they’re not giving to win favors from party bigwigs.

“We believe in the political process,” said Rick Miller, a spokesman for Microsoft. “This is a chance to help these host committees showcase their cities and put on the best conventions possible.”

And, not incidentally, it’s a chance to show off some of Microsoft’s latest software, Miller said, adding that Microsoft contributed to the 1996 conventions as well, long before it became embroiled in anti-trust litigation with the federal government. Miller said he did not know how much Microsoft gave that year or whether it had stepped up its giving this time.

According to Miller, Microsoft will donate roughly $200,000 in cash to each convention, while the balance of its $1-million donations will be in the form of computers and software.

Although large national corporations make up an important part of both convention bankrolls, local leaders in each city also are helping to make ends meet.

In Los Angeles, for instance, SunAmerica--whose top executive, billionaire Eli Broad, recently recaptured his spot as Los Angeles’ richest man--gave at least $1 million to the host committee. AIG, an insurance company that owns SunAmerica, is giving another $1 million-plus.

Staples Center, which is hosting the event, is donating the use of its building, an in-kind contribution worth at least $1 million, given that the center will be shut down for all of August for convention planners to set up, hold their event and dismantle it.

While Los Angeles’ effort is privately financed, Philadelphia’s city government and the state government of Pennsylvania are major donors to that city’s host committee, chipping in $7 million apiece. California and Los Angeles are not cash givers to the event here, but the city is committing roughly $4 million worth of transportation assistance to make sure the buses run on time, and the police overtime bill could run $1 million a day.

While each city has its big backers, public and private, several aspects of the fund-raising clearly distinguish the two efforts. Los Angeles’ host committee, for instance, is significantly more forthcoming with details about who gives it money and in what amounts.

The Los Angeles group lists more than 75 donors who have given at least $5,000 each. Only one name is omitted, according to a source familiar with the group’s fund-raising: that of publicity-shy, Spanish-language television executive Jerold Perrenchio, a close friend of Mayor Richard Riordan who typically makes anonymous contributions and who is said to have donated at least $1 million to the local effort.

By contrast, the Philadelphia committee provided a list of more than 200 contributors, but emphasized that it is only a partial list. Contributors, an attached news release said, have given amounts “ranging from three figures to seven figures.”

David F. Girard-diCarlo, co-chairman of Philadelphia 2000, said his group released only the names of contributors from whom it had permission. “We didn’t list anyone who didn’t give us approval,” he said, adding that all the names and amounts would be filed, as required by law, 60 days after the convention.

Many of the Philadelphia donors gave in small amounts, and many of those who contributed were not political contributors, Girard-diCarlo said. Rather, they are local individuals and companies donating to help Philadelphia show off its first convention since 1948, when Republicans, Democrats and Dixiecrats all gathered in the historic city.

(A historical footnote: Few people in Philadelphia or anywhere will remember the 1948 conventions, but at least one might. South Carolina’s 97-year-old senator, Strom Thurmond, who may attend this year’s event as a Republican delegate, was on hand in 1948 as a representative of the Dixiecrat Party.)

Another difference between this year’s two conventions involves the question of whether anyone can contribute. Philadelphia’s bankroll is aided by a $250,000 contribution from Philip Morris Cos., the nation’s largest tobacco company; the Democrats--taking their lead from presumptive candidate Vice President Al Gore, who has sworn off tobacco money--have no such contribution.

And, finally, on the issue of money, there is this: Philadelphia plans to spend $15 million more to host its event than Los Angeles is opting to spend. Los Angeles officials say that reflects their more prudent, taxpayer-protective philosophy. Philadelphia hosts say it’s because they’re putting on a better show.

“It’s the difference between a top-of-the-line automobile,” Girard-diCarlo said, “and one that’s just serviceable.”

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Who Pays for the Democratic Convention?

PRIMARY PARTNERS

Each has given at least $1 million in cash or in-kind contributions:

* AIG (insurance company)

* Arco* (oil)

* AT&T; (telecommunications)

* General Motors (automotive)

* MaguirePartners* (real estate development)

* Microsoft (software)

* SBC (telecommunications)

* Staples Center* (sports/entertainment)

* SunAmerica* (retirement services)

* United Parcel Service (delivery)

More than 75 other individuals and companies, including Times Mirror (parent company of the Los Angeles Times), have made donations of $5,000 or more to the host committee.

*Los Angeles-based company

Source: LA Convention 2000