L.A. Mayor Race on Pace to Break Funding Records

While much of the nation was riveted last fall on the protracted presidential campaign, candidates seeking to become the next mayor of Los Angeles quietly set a pace to shatter the record for raising and spending money in a city election.

By New Year’s Day, the six major candidates vying for the chance to run the nation’s second-largest city had pulled in nearly $9 million in campaign contributions. And the fund-raising fervor has only intensified since then, virtually ensuring that this year’s campaign will surpass the $10.7 million raised eight years ago.

Those war chests arm the candidates for the most competitive mayor’s race in modern Los Angeles history. But large amounts of cash are only one part of the equation.

Bound by campaign finance laws that limit contributions while making it possible for a wealthy candidate to pay his or her own way, the mayoral aspirants are each adopting subtly different strategies. Already, several are testing the limits of the laws, and all are looking to capitalize on their strengths as they chart competing courses for securing victory in April or June. (If no one wins a majority April 10, there will be a runoff between the top two vote-getters June 5.)

A few examples:

* Steve Soboroff, a millionaire commercial real estate broker, turned down $667,000 in public matching funds and may pour in his own money instead. Many observers wonder whether Mayor Richard Riordan, who has endorsed Soboroff, will launch an independent campaign to help elect his unpaid senior advisor.

* Kathleen Connell, another well-heeled contender, is pledging to limit her use of personal funds to no more than $100,000, the maximum that a candidate can give and still accept partial public financing. She is leaning on local law firms, women’s groups and others to chip in for her campaign.

* City Councilman Joel Wachs, one of the city’s longest-serving public officials, tapped his contributor network and reached out to the arts community for support. In addition, Wachs, who is running for the first time as an openly gay man, has supplemented his fund-raising base with contributions from that community.

* Former Assembly Speaker Antonio Villaraigosa used some of the money raised while he was speaker to put his face on television when Los Angeles voters were considering a statewide park bond issue last spring.

* Rep. Xavier Becerra (D-Los Angeles) spent hundreds of thousands of dollars on his congressional campaign last fall to reinforce his base despite being the overwhelming favorite to win reelection.

* City Atty. James K. Hahn used his current office and long-standing place in Los Angeles politics to assemble a formidable fund-raising team. Curiously, that group includes longtime supporters and a few former adversaries--most notably lawyer Ted Stein, who ran against Hahn for city attorney in 1997--bound in part by their conviction that he is the likely victor.

The relative successes of the six campaigns are demonstrated by clear demarcations in the field. As of the end of last year, two candidates--Soboroff and Hahn--had raised more than $2 million each. Two others--Villaraigosa and Wachs--had raised between $1 million and $2 million. And the remaining two--Connell and Becerra--were trailing with less than $1 million apiece.

Pursuit of Funds Intensifies

Although the candidates’ approaches to raising and spending money differ, their goal is the same: to have enough cash on hand to win over likely voters.

With less than three months to go before the April 10 election, pursuit of the almighty campaign dollar is an urgent necessity. The quest for contributions consumes large amounts of a candidate’s time at cocktail parties and fund-raising dinners, private receptions and neighborhood coffees, on the phone and in person.

The pressure is enormous. Not an evening goes by in Los Angeles that one of the six major candidates is not drumming up support and money.

“It’s extremely important to be able to communicate,” Hahn said. Campaign contributions provide “the horsepower to get that message across.”

For the consultants who advise each of the candidates, raising money is a vital task, one that dominates the early months of the campaign.

Understandably, they are careful about what they discuss in public. Indeed, like poker players closely guarding their cards, campaign consultants generally avoid sharing their game plans. “I don’t want to tip my hand,” said Soboroff’s consultant, Ace Smith.

But most consultants agree on the basics: Money pays for some mix of television and media advertising, direct mail, plus field operations and phone banks to identify and target likely voters.

Most important, the candidates and their consultants must calculate the best way to take full advantage of the city’s campaign finance rules to get their message out.

Complicating every aspect of political fund-raising in Los Angeles are the city’s complex campaign finance rules.

Under those provisions, contributors may give just $1,000 to a candidate for citywide office. In City Council districts, the contribution limit is $500.

Because of the limits, Villaraigosa said, “It is not an exaggeration to say I’ve probably spent 10 times as much time on the phone to raise $1.5 million as I did raising $13 million in 2 1/2 years as speaker.”

But the limits are accompanied by provisions that allow candidates to accept partial public financing in return for abiding by the caps on spending and contributions.

Los Angeles is one of only a few major cities in the nation with a voter-approved system that provides public funds. The infusion of up to $667,000 in matching funds to a mayoral candidate can be a major shot in the arm during the crucial closing weeks of the campaign.

To receive public money, a candidate must demonstrate the ability to raise at least $150,000 in contributions of $500 or less. And the would-be mayor must agree to a series of restrictions.

The candidate cannot, for instance, spend more than $2.2 million on the primary campaign and cannot devote more than $100,000 of personal money to the race.

Contributions made by individuals to citywide candidates within a year before the election are eligible to be matched dollar for dollar up to $500. Contributions from businesses, political action committees and labor unions cannot be matched.

The purpose of those laws is to blunt the power of special interests and force candidates to develop a broader base of financial support. For the most part, officials say, it works.

“When candidates are able to get up to one-third of their campaign funds from the public, it helps them be more focused on the public’s interest than on any special interest,” said LeeAnn Pelham, executive director of the city’s Ethics Commission.

Pelham added that matching funds provide “an important way for relatively small contributors to have a magnified voice in our city’s campaigns. It provides a way to have their voice heard, a way to have candidates who don’t have access to large personal funds to get their message out.”

Candidates Make Use of Loopholes

But there are loopholes--as well as consequences for taking advantage of them. If a wealthy candidate like Soboroff rejects matching money--as he has done--he is free to contribute whatever he wants to his own campaign.

The moment he exceeds $30,000 in personal contributions, however, the other candidates are freed from the contribution limits. That means they can go back to their donors and seek as much as $7,000 from a single source, as long as that person’s total contributions in all city races do not exceed that amount.

The contribution limits are lifted for others in the race only up to the amount of the personal funds invested by a wealthy candidate.

Riordan used this provision when he gave a total of $6 million to his mayoral campaign in 1993, eclipsing a crowded field that included then-Councilman Michael Woo, Wachs and Assemblyman Richard Katz.

This time, it is Soboroff whose personal fortune makes him the most capable of adopting Riordan’s 1993 game plan. However, Soboroff’s considerable wealth is far less than Riordan’s, so he will have to proceed more prudently.

Soboroff would not discuss how much he intends to give his campaign beyond the $20,000 he has already donated.

However, Soboroff said he believes he and others in the race will end up spending more than the $2.2-million limit. If Soboroff breaks the spending cap--as seems likely--the expenditure limit comes off for the other candidates.

His consultant, Smith, explained that Soboroff “starts way behind the curve” because he is not an elected official and must introduce himself to voters. “A career politician’s name ID is worth a lot of money,” he said.

So it costs a candidate like Soboroff more money to build his standing with voters. “We make no apologies for that,” Smith said. “It’s just a fact of life.”

One key moment that all the campaigns are watching is the date that Soboroff begins running television advertisements. In 1993, Riordan’s first commercials began in late February, after which he poured money into the campaign. Smith would not say when he expects Soboroff to buy his first chunk of television time, though other campaigns are expecting it sometime during the next month.

Connell said she began fund-raising in early October and has devoted very little time to raising cash compared to others in the race. Despite the late start, the controller said she is “confident we are going to have a very effective budget for this campaign. We will be more than competitive in both the mail and TV.”

Like most of the others, Becerra said he expects to reach the $2.2-million spending limit with matching funds. Because of the size and the sprawling nature of the city, the congressman said he must raise the money to compete on television, radio and in the mail.

But he acknowledged that it may be difficult for him to buy a great deal of television time because of the high cost in the nation’s second-largest media market. Los Angeles television reaches viewers throughout most of Southern California.

“I don’t need a voter in Ventura,” Becerra noted.

While that is true, most political consultants still consider television spots the most cost-effective way to reach voters in Los Angeles, where the electorate is notoriously averse to political news and where local television provides virtually no coverage of local government and politics.

Bob Stern, one of the architects of the state’s and city’s political reform laws, said the cost of campaigning in Los Angeles is driven up by the dearth of local political coverage on television news programs.

The result, Stern said, is that local politics, already expensive, is made even more so by the region’s media climate. In the end, he and other observers agree, it takes cash to win.

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Public Financing for L.A. Campaigns

Los Angeles is one of the few cities in the nation with a voter-approved system of partial public financing for city election campaigns. In an effort to reduce special interest influence at City Hall, the system provides public matching funds to candidates who agree to limits on contributions, spending and use of their own money for their campaigns. The following information applies to mayoral candidates.

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Major Candidates Accepting Matching Funds

Xavier Becerra

Kathleen Connell

James K. Hahn

Antonio Villaraigosa

Joel Wachs

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Major Candidate Refusing Matching Funds

Steve Soboroff

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Contribution Limits

$1,000 per donor in primary campaign

$1,000 per donor in runoff campaign

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Public Matching Funds*

$667,000 maximum in primary

$800,000 maximum in runoff

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Limit on Personal Funds to Get Matching Funds

$100,000 per election

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Spending Limits

$2.2 million in primary

$1.76 million in runoff

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Loopholes

If a candidate rejects public financing and spends more than the $2.2 million limit, the spending cap is lifted for all other candidates in the race.

If a candidate gives more than $30,000 in personal funds to his or her own campaign, the $1,000 limit on contributions is lifted for all others in the race. The other candidates are then free to raise up to $7,000 from a single contributor as long as that contributor has not given more than that amount in city races. The higher contribution limits end when the other candidates raise an amount equal to the level of personal funds donated by their opponent.

*

* Only contributions from individuals made within a year of the election are eligible to be matched dollar for dollar up to $500.

Source: City Ethics Commission

Researched by JEFFREY L. RABIN / Los Angeles Times