Campaign Could Top $50 Million

Gov. Gray Davis, the candidates who hope to replace him and groups with an interest in the outcome of the Oct. 7 recall election probably will spend $50 million, and perhaps twice that much, between now and the vote, according to campaign consultants and experts.

The pace of spending, particularly after Labor Day, probably will surpass that of last fall’s election for governor.

“Keep the kids away from the television and also the mailboxes,” said Bill Carrick, a Democratic consultant with no candidate in the recall. “I don’t think this is going to be pretty. Do you?”

The rules governing the raising and spending of money for the recall -- like the rules for several other aspects of the unprecedented campaign -- remain unclear. The Oct. 7 election will be the first in which a California governor faces a recall vote, and many of the statutes governing the ballot are untested.

The California Fair Political Practices Commission, having written some fund-raising rules earlier this year, is expected at its next meeting to further grapple with regulations governing committees established to advocate the recall. The meeting is set for Aug. 7.

In the meantime, Davis, a prodigious fund-raiser during his first term, has raised $2.2 million so far this year. The money has gone into his campaign fund and the committee to defeat the recall.

But he will need much more. California campaigns almost always play out primarily over the airwaves, and Davis’ current campaign kitty is sufficient for a little more than a week of television advertising.

Davis campaign spokesman Roger Salazar estimated that the governor and his backers would raise and spend $10 million to $15 million, much of which would flow through the anti-recall committee set up by the governor’s political backers, Citizens Against the Costly Recall.

“We’ll match whatever the other side does,” Salazar said.

Davis will enter the campaign with some legal and political advantages.

Proposition 34, the ballot initiative passed in 2000 that limited direct donations to candidates, restricts people seeking statewide office this year from accepting more than $21,200 from a single donor.

But a separate provision says that the target of a recall can raise money without regard to those limits.

Despite his low standing in the polls, Davis retains the power of incumbency, with influence over many state government decisions that affect companies, unions and wealthy individuals. Davis insists that he never ties decisions to donations. But some groups and individuals with stakes in legislation may think it prudent to make donations.

“He has so much clout,” said Robert Stern, of the Center for Governmental Studies in Los Angeles. A prime motivation to give “is called fear,” he said.

The governor’s power includes line-item veto authority over any spending proposal in the $100-billion state budget, and the campaign is scheduled to be in full swing just as roughly 1,000 bills from this year’s legislative session hit Davis’ desk.

So far, however, judging by his public filings to date, Davis has not raised money at anywhere near his rate in the past.

In his first term, Davis raised $70 million. In the months leading to last year’s election, he was raising $2.5 million a month.

Some Democrats suggest that, this time around, Davis may be having difficulty raising money because of polls showing that his popularity is very low. Some unions, Davis’ largest source of money in the past, have been caught off guard by the recall; some are tapped out.

The California Teachers Assn., among the biggest spenders on state politics, won’t decide until next month whether to spend money on the recall, said John Hein, who oversees the union’s political operations.

Another of Davis’ largest donors, the California Correctional Peace Officers Assn., has given no money to the governor this year. The administration, trying to fill a $38-billion budget gap, is pressuring the union to defer a raise of about 7% that is called for in its current contract.

Lance Corcoran, executive vice president of the prison officers union, called the recall a “colossal waste of time.” But the union hasn’t decided whether to help Davis. “At this point,” Corcoran said, “we’re reviewing our options.”

On the other side of the ballot, Davis’ challengers will be limited by Proposition 34. There are, however, two major exceptions.

Most significant, there are no caps on how much of his or her own money a candidate may spend. Individuals may also lend their campaigns as much as $100,000, under rules set up to govern the recall.

A senior advisor to Rep. Darrell Issa (R-Vista) said his campaign to replace Davis will cost “a minimum of about $10 million.” Issa, who made a fortune in the car alarm business, already has spent at least $1.7 million to get the recall on the ballot.

“My dream budget would be $18 million to $20 million,” said the advisor, Ken Khachigian, an Orange County attorney and consultant.

Michael Huffington, the former congressman from Santa Barbara who lost a race for the U.S. Senate in 1994, and businessman Bill Simon Jr., who narrowly lost to Davis in November, have both established exploratory committees, and both have shown a willingness to spend heavily on their political ambitions.

Huffington spent $30 million in his campaign against U.S. Sen. Dianne Feinstein, a Democrat. Simon lent and spent $10 million in his losing campaign last year.

According to his most recent disclosure statement, Simon had not yet repaid his loans. His next financial disclosure report is due this week.

Two other millionaires, the actor Arnold Schwarzenegger and former Los Angeles Mayor Richard Riordan, also are contemplating entering the race.

Candidates without personal fortunes -- and there could be several, including Sen. Tom McClintock (R-Thousand Oaks) -- may have a hard time raising enough money to be heard above the chatter.

“A 60-day election cycle is fast and furious,” said Sean Walsh, an advisor to Schwarzenegger. “If you’re not Arnold Schwarzenegger, you need millions of dollars just to get people to recognize your face.”

The other major exception to campaign spending limits involves committees set up to support and oppose the recall.

A 1981 U.S. Supreme Court ruling held that states may not limit donations to such committees. Authorities may be able to limit the size of contributions if they determine that candidates control the committees.

Rescue California, the pro-recall committee that has been funded primarily by Issa, has a budget of $15 million, said consultant Dave Gilliard, who oversees the committee. “I consider that a minimum,” he said. “I want to get that to $21 million.”

Although their donations are unlimited, the committees also face higher costs. By law, candidates may buy television advertising time at the lowest rate a station charges. Stations can charge full ad rates to ballot-initiative committees, often 25% higher than the rate candidates pay, Carrick said.

As the campaign progresses, there will be strict public disclosure rules regarding donations. Donations of $1,000 or more must be publicly disclosed on the secretary of state’s Web site within 24 hours.

The other sources of potential spending are groups independent of the candidates that have interests in the race.

Trial lawyers, often among the biggest spenders in California elections, are contemplating an independent campaign.

Los Angeles attorney Raymond Boucher, vice president of Consumer Attorneys for California, said that the lawyers had not established a budget, but that a $1 million effort to repel the recall was “not out of the ballpark.”

The California League of Conservation Voters, which regards many of the likely Republican candidates as threats to environmental programs, also intends to join the fight. The league teamed with unions and lawyers last year to spend $1 million in independent campaigns on behalf of Democratic candidates for the Legislature.

“Whatever people think of Gray Davis,” said David Allgood, Southern California director of the organization, “this is not a way to run a government.”