Money, Politics Beget a Feud

Outraged that the San Clemente Chamber of Commerce spent nearly a fourth of its general fund on three City Council candidates in the last election, the mayor said she’ll ask the council to reconsider its financial support of the business group.

The chamber contributed nearly $80,000 to its own political action committee as part of an effort to unseat one councilman and reelect two incumbents in the November election. The targeted councilman was reelected, however, and one of the incumbents was defeated.

The campaign spending angered some city leaders and chamber members, who questioned whether using chamber funds on local races was proper since the city gives the business group grants and services, and subsidizes its rent.

“If they have enough money to spend almost $80,000 on a political campaign,” said Mayor Stephanie Dorey, “I don’t feel they need to be taking handouts from the city.”

The chamber leases a 2,250-square-foot downtown building from the city for $100 a year and receives $40,000 in grants for activities and events that promote business in the seaside community. The chamber also receives in-kind contributions in staff help, printing, police services and other assistance at chamber events such as the Fiesta 5000 run, charity golf tournament and other events.

Dorey said the expenditures and rent subsidy will be reviewed next month when city officials take stock of their own budget.

The chamber money helped buy political ads in local publications as well as signs and direct-mail literature to support incumbents Susan Ritschel and Scott Diehl and non-incumbent candidate Joe Anderson. Ritschel was reelected; Diehl was not. Anderson was elected while Wayne Eggleston -- the targeted incumbent -- won reelection comfortably.

The chamber’s political spending probably was “overkill” and is unlikely to be repeated, said Lynn Wood, the group’s president and CEO. Just the same, she said, the chamber has a natural interest in supporting “pro-business” council candidates.

At issue are the amount spent in the campaign and whether the chamber went too far by pumping its own funds into the election rather than letting its political action committee seek outside contributions.

By way of contrast, the Newport Beach Chamber of Commerce’s political action committee, which spent about $12,000 on council candidates in the last election, raises its money independently of the chamber, said Richard Luehrs, the chamber’s president.

The political action arm of the Santa Ana chamber, which spent about $30,000 on council and school board races, also keeps its activities and funds separate from the chamber’s general fund.

Chambers of commerce are increasingly involved in politics, said Dave Kilby, vice president of the California Chamber of Commerce, which advocates for chambers. He warned that many chambers “are addicted” to city funds and find it difficult to function without them.

“If they get involved in politics,” Kilby said, “they need to be aware that there is a great potential that the city money will dry up.”

One member of the San Clemente chamber said he was surprised not only by the amount of chamber money spent but that members weren’t consulted.

“I wasn’t polled as to whether I wanted my money used as a chamber member to the PAC,” said Ron Runolfson, owner of Ron’s World, a model train and hobby store.

Eggleston is upset that the chamber tried to oust him and considers him something less than a business-friendly candidate. Eggleston suspects it’s his opposition to the proposed extension of the Foothill South toll road that put him on the wrong side of the chamber.

“I’m against the toll road,” he said, “and they think it’s pro-business. I just don’t think it’s environmentally sound.”

The toll road extension is a volatile issue that has split environmentalists and government planners. Advocates of the road extension see it as a means of uncorking congestion, while opponents contend that it will destroy precious brushlands.

The chamber’s endorsements were based on answers to a questionnaire that all candidates were invited to fill out, Wood said. Of the six candidates on the ballot, only the three the chamber endorsed bothered to complete the questionnaire, she said.

Eggleston is not pacified.

“I am no longer willing to give the chamber a free ride on public funds,” he said. He also said he’s requesting an appraisal of the office space the chamber uses so that rent can be adjusted.

“I think the chamber in any city plays a very valuable role,” Eggleston said. “But in this city, what the chamber did was very shady.”

Wood said she doesn’t believe that using the chamber’s own funds for political purposes was inappropriate, but “in hindsight, I wouldn’t do it again.” She said she intends to recommend that the chamber follow the lead of its counterpart in Irvine.

“The PAC gives each candidate $500 and puts their name in a newsletter. And that’s it.”