Campaign Fundraising Skyrockets

Times Staff Writer

Fundraising for the special election called by Gov. Arnold Schwarzenegger to implement his policy agenda is approaching $200 million, and the price of television time for political ads is hitting new heights.

With less than six weeks to go before the Nov. 8 election, those who have raised and spent include the nation’s pharmaceutical companies, followed by public employee unions and then the governor, campaign finance reports filed with the state Thursday show.

In most years, Schwarzenegger’s fundraising would be eye-popping. Collecting money at a clip of more than $3 million a month, the governor has amassed $28 million to promote the four initiatives that embody his proposed changes to state government, and raised $2 million for his 2006 reelection bid.

But the combined $30 million places him a distant third in fundraising, behind his main rival, public employee unions.


Public school teachers’ main union and other government workers have raised $70 million to fight three of the governor’s measures, including one, Proposition 75, that could restrict their ability to raise campaign money.

But drug makers are the biggest spenders. They’ve raised more than $80 million, have spent almost $50 million and have $31.3 million in the bank. They are seeking to convince voters to back Proposition 78, their solution to prescription drug costs, and oppose Proposition 79, a measure pushed by organized labor and some consumer groups to cut drug prices.

Political experts, as well as campaign consultants working both for and against the governor’s package of initiatives, agree on one point: The heavy spending is helping to distort the already costly market for television airtime.

“We are in an unconventional year where we’re likely to see $500 million spent, beginning to end,” said Barbara O’Connor, director of the Institute for the Study of Politics at Cal State Sacramento. “The normal rules of the game are not operant.”


The cost of reaching a statewide television audience, which might have been $1 million or $1.5 million per week a few elections ago, now hovers at $4 million. Such costs, in turn, are leading to increased levels of fundraising.

“A statewide media buy is about $4 million -- actually a little more for a week,” said Republican consultant Wayne C. Johnson, who is working to pass Proposition 77, which would strip legislators of their power to draw their own districts. “I don’t think it has ever been this high.”

Democratic consultant Bill Carrick, managing the campaign against Proposition 77, said, “The political impact of this is that the ability to change public perception is more limited, because you’re not going to be able to get your information out.”

Schwarzenegger and his rivals are focusing mainly on four initiatives: Proposition 74, which would make it harder for teachers to win tenure; Proposition 75, which would require that public employee unions get members’ permission to use their dues for political campaigns; Proposition 76, which would grant governors more power over the budget and could curtail public school spending; and Proposition 77, the redistricting measure.


The main committee established to support the reapportionment measure reported having raised $3 million, compared to $1.66 million raised by its opponents. Schwarzenegger is the largest single donor to the Proposition 77 committee; he gave $1.25 million of his own and $500,000 from one of his campaign funds.

Steve Poizner, a wealthy Silicon Valley entrepreneur and a Schwarzenegger ally who is running for California insurance commissioner, has donated $1.25 million in favor of the redistricting measure.

Senate President Pro Tem Don Perata (D-Oakland) and Assembly Speaker Fabian Nunez (D-Los Angeles) are leading the effort to defeat the initiative.

Each has formed a campaign committee to raise money to oppose Proposition 77. Several members of California’s congressional delegation also are opposing the initiative. The California Republican Party filed a complaint Wednesday with the state Fair Political Practices Commission, alleging that Nunez has used his fund to bypass a state campaign finance law that limits to $3,300 the amount one officeholder can give another. Several Democratic Assembly members gave five-figure donations to Nunez’s account.


On Thursday, Lance Olson, Nunez’s campaign attorney, called those contributions “inadvertent” and said money donated to the Committee to Protect California’s Future -- No on 74, 75, 76 & 77 over a $3,300 limit had been returned.

GOP attorney Charles Bell said the Republicans intend to pursue the complaint.

Meanwhile, organized labor has largely avoided spending to defeat Proposition 77, and instead is focused on defeating propositions 74, 75 and 76. The unions have been spending heavily for the last three weeks, airing ads statewide attacking Proposition 75 -- the measure to restrict labor’s ability to raise money for political purposes.

Campaign finance reports filed Thursday show organized labor has spent $36.2 million on television ads, including $17 million to oppose Proposition 75.


Backers of 75 reported raising $1.3 million. Retired investor Frank Baxter, who has donated $251,000, and former Los Angeles Mayor Richard Riordan are leading the drive to raise money in support of the measure.

Reports filed before Thursday show that in recent months labor unions have poured $70 million into the campaign to defeat propositions 74, 75, and 76. The California Teachers Assn., which represents 330,000 public school teachers, is leading the effort, donating $45.5 million.

“When you have as much money as these government employees have, you can construct any type of reality you want,” said Rob Stutzman, Schwarzenegger’s campaign spokesman. “The sheer wealth that is being spent to protect their interests is not going unnoted by voters.”

Public opinion polls show Schwarzenegger-backed measures trailing badly. O’Connor and others note that polls also show most Californians oppose having a special election in what otherwise would be an off-year for campaigns.


Schwarzenegger filed reports showing his campaign has spent $7.4 million on television ads so far this year. Schwarzenegger fundraiser Marty Wilson said the governor’s campaign is spending more than $2 million a week on television.

The governor’s other expenses include $588,000 paid to Hartman Studios, which stages his public appearances; $252,000 for DC Navigators, one of his main consulting firms; and $9,988 paid to Wolfgang Puck for catering.

Drug companies reported spending $37 million on television advertising so far this year to back Proposition 78 and oppose Proposition 79. They’ve also hired some of the top consultants in California, paying $180,000 to a firm headed by Bob White, former chief of staff to Gov. Pete Wilson and an advisor to Schwarzenegger; and $350,000 to Willie Brown, the former Assembly speaker.

Other groups that filed campaign finance reports Thursday include:


* Independent power-generating companies, which reported giving $1.7 million to defeat Proposition 80, an initiative to partly re-regulate the electric utility industry. Constellation Energy of Maryland is the largest donor, at $1.3 million.

* Abortion rights advocates reported raising $1.5 million to defeat Proposition 73, which would require parental notification before minors obtain abortions. Backers of Proposition 73 had raised $1.1 million. Stan Devereux, a spokesman for the Yes on 73 campaign, acknowledged that the money raised was not sufficient to finance a high-profile television campaign.

“We realize that time is running out and that there are a lot of competing initiatives that are buying airtime,” he said. “We’re hopeful that we will be part of that effort.”

Times staff writers Nancy Vogel, Lisa Girion and Jenifer Warren contributed to this report.