Campaign Cash Flows Around Rules

Political consultants and wealthy interest groups are skirting contribution caps and disclosure requirements as they pump millions of dollars into last-ditch attempts to sway the electorate.

In some instances, donors are loading independent campaign war chests with six-figure checks -- far more than the law allows them to give directly to candidates. The money is paying for mailings and television ads that promote friendly politicians and attack others who may disagree with them.

In other instances, contributors are giving hundreds of thousands of dollars to little-noticed county campaign committees that are controlled by political parties. The committees, in turn, are transferring money to candidates in tough races at opposite ends of the state.

Under state law, candidates must disclose any donation of $1,000 or more within 24 hours. The disclosures include the identities of contributors. State law also restricts donors to giving $3,300 to legislative candidates, $5,600 to statewide candidates and $22,300 to gubernatorial candidates.

But there are no caps on the amounts that wealthy interests can spend on campaign activity done independently of candidates. And disclosure requirements for such efforts are far more lax.

Why look for ways to hide donations?

“It’s the same reason the U.S. military develops stealth bombers,” said Republican Rob Stutzman, who, like many Sacramento consultants, is working on such a campaign, details of which he would not disclose. “You don’t want your opponents to see you coming.”

With the Nov. 7 election day fast approaching, however, stealth campaigns are beginning to take shape -- albeit barely.

Four Southern California Indian tribes that own casinos poured $3.1 million into a new independent campaign committee in recent days, filings with the California secretary of state’s office show. The tribes had sought major expansion of their gambling operations in late August, only to be rebuffed by Assembly Democrats.

The tribes issued a news release last Wednesday that announced the committee’s formation. The release quotes Daniel Tucker, chairman of the Sycuan Band of Kumeyaay Indians and spokesman for the campaign:

“We have come together to help Democrats and Republicans who understand the challenges facing Native Americans and who care about moving California’s economy forward. A strong economy is important to all Californians, including Native American families.”

The tribes’ announcement makes no mention of the stalled legislation to authorize their expansion.

In public filings with the secretary of state, the committee disclosed spending $20,000 on behalf of one Assembly Democrat who voted for the gambling expansion, $260,000 on behalf of four Assembly Republican incumbents and $493,000 on behalf of Sen. Jeff Denham (R-Salinas), who faces a challenge from a well-funded Democrat.

Political consultants believe that the tribes are about to spend additional sums on behalf of Tony Strickland, the Republican nominee for state controller, and Sen. Tom McClintock (R-Thousand Oaks), who is running for lieutenant governor. Both candidates have voted with the tribes in the past. At the same time, public employee unions have spent more than $360,000 on behalf of McClintock’s foe, Democratic Insurance Commissioner John Garamendi.

It is common knowledge that savvy campaign consultants want to maintain the element of surprise. Consider, for example, veteran campaign consultant Bill Butcher.

Butcher hopes to generate interest -- and donations -- for an independent campaign that he would oversee to assist Sen. Chuck Poochigian (R-Fresno) in his run for attorney general against Oakland Mayor Jerry Brown, a Democrat. Candidates by law can have no control over such independent efforts.

In a memo obtained by The Times and dated last Friday, Butcher told potential Poochigian supporters about the committee he envisioned called “Citizens for a Strong Attorney General.” The memo touted a private poll that suggested that Brown was vulnerable although leading in all public polls.

Butcher’s memo boasts that “fund-raising has commenced in a serious way to fulfill the mission of electing Sen. Poochigian.” However, Butcher has not made any public disclosure of donations, although the law generally requires public disclosure of contributions of $1,000 or more.

Democratic consultant Ace Smith, who is managing Brown’s campaign, has filed a complaint with the California Fair Political Practices Commission, which enforces campaign finance law. Such complaints rarely are decided before elections.

Smith denounced the effort as particularly bad given that the aim was to elect the state’s top law enforcement officer.

“The reason why people use independent expenditures is to subvert campaign finance laws,” Smith said. “These people need to come out of the shadows and report what they’re doing and how much they are spending.”

Butcher did not return phone calls.

In recent years, both Democrats and Republicans have bypassed contribution caps by using their parties’ once-sleepy county central committees. Donations made to county parties can come in five- and six-figure amounts, money the committees can spend without limits on candidates’ behalf.

An added allure of this strategy is that state law allows the identities of donors to remain secret if they give to county committees during a three-week period in October. This year, their identities won’t become known until next Thursday.

The use of county committees involves a simple two-step dance: A donor gives to the committee and the committee then gives to the candidate.

If the source is controversial, the candidate can keep the money at arm’s length. In the past, donations to county committees have come from insurance, oil, tobacco and gambling interests -- generally not the sort of money politicians like to accept directly.

In the two months ending Sept. 27, the Monterey County Republican Committee took $500,000 from tribes that own casinos. It reported spending $380,000 on Denham’s campaign by the end of September. Any money spent in October won’t be known until next Thursday.

“Everything we’ve done has been done correctly and properly,” said Brandon Desicki of the Monterey County Republican Committee.

Republicans pioneered the tactic in 2002 when an insurance company donated $1 million to a variety of county committees, which in turn spent it to help elect Republican candidates.

The San Diego County Democrats, primarily using money from organized labor and other elected officials, have shifted $650,000 to help the campaign of Cathleen Galgiani, a Democrat who is running for a Stockton-area Assembly seat.

Did Democrats take a page from the GOP?

“Certainly,” said Jess Durfee, San Diego County Democratic Central Committee chairman. “We’ve got to stay competitive.”

dan.morain@latimes.com

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