Romney attracts all kinds of money
A Democratic developer is raising money for Republican presidential hopeful Mitt Romney. The Texas financier behind Swift Boat Veterans for Truth also is backing him. So are saints and sinners -- prominent Mormons and an imprisoned tax evader.
With campaign funds pouring in from such diverse corners of the donor world, an incongruous set of election-season numbers has emerged: Romney, with a mere 10% showing in recent polls, is far ahead of his GOP rivals in fundraising.
Romney’s early domination of the money race has come primarily from his broad business, political and religious relationships across the country.
His network includes Massachusetts, where he became wealthy and served as governor; Michigan, where his father was governor in the 1960s; and several Western states, most notably California and Utah.
In the first 90 days of the year, Romney, a Mormon, raised nearly $3 million in the spiritual heartland of the Church of Jesus Christ of Latter-day Saints -- more than Sen. Orrin G. Hatch (R-Utah) has raised in his home state during his three decades in public office.
“A lot of us say this guy is as good as anyone we’ve ever met,” Hatch said in an interview. In Utah, Hatch added, “almost everybody with money, Democrat or Republican, is willing to support him.”
Romney, 60, made his fortune in private equity. More than the other Republicans in the race, he is tapping the world of finance and commerce, at the high and not-so-high ends.
His campaign aides declined to discuss details of Romney’s fundraising, but federal campaign disclosure records reveal the breadth and range of his financial support.
Partners at multibillion-dollar private equity and hedge funds have given millions. Pyramid-like direct-marketing companies based in the Salt Lake Valley have donated hundreds of thousands more.
Inside the machine
To glimpse inside Romney’s fundraising machine, enter a two-story building in Lehi, a small city between Salt Lake City and Provo. The building looks like all the others clustered off Interstate 15, below the Wasatch Range.
Fraser Bullock leases the upper floor for his private equity firm, Sorenson Capital. Upon graduating from Romney’s alma mater, Brigham Young University, Bullock got a job in 1980 at Bain & Co., a Boston-based consulting firm where Romney was a vice president.
In 1984, when Romney split to form the private equity firm Bain Capital, Bullock followed as an original partner. Today, relationships that Romney forged at Bain Capital and Bain & Co. are integral to his fundraising.
When Romney was tapped to revive the scandal-plagued Salt Lake City Olympic Organizing Committee, Bullock became his chief operating officer. Romney cemented his standing with Bullock, and Utah generally, with the success of the 2002 Games.
When Romney decided to run for president, Bullock jumped in. People affiliated with Sorenson Capital have given Romney $67,000 since last year. More significantly, Bullock regularly carves out time to call associates for campaign money.
Romney, a multihundred millionaire, is his own largest donor. He pumped more than $6 million into his winning 2002 run for Massachusetts governor, and an additional $2.35 million to seed his presidential aspirations.
He has raised more than $40 million from other people for his three campaigns, including his failed 1994 effort to unseat Sen. Edward M. Kennedy (D-Mass.). More than half -- $21 million -- came in the first quarter of 2007. Former New York City Mayor Rudolph W. Giuliani took in $14.7 million; Sen. John McCain of Arizona logged $13 million.
To maintain his pace, Romney has scheduled dozens more fundraisers this month, including nine in a three-day period this week in California.
Romney, the least well-known of the major candidates, started airing commercials fully a year before early primary and caucus states begin selecting the GOP nominee. A recent Los Angeles Times/Bloomberg poll showed him with the support of 10% of Republican voters, though some state polls suggest he has gained in Iowa and New Hampshire.
Federal law caps individual donations at $2,300 per election. In a campaign likely to cost $1 billion, the most valuable donors are not those who give the maximum amount, but “bundlers” who persuade others to give.
Bain-related sources contributed at least $475,000, a Times analysis of Romney’s first-quarter fundraising shows. The money came from current and former Bain partners such as Bullock, their relatives and associates including executives of Bain’s client companies. Altogether, Bain sources have donated more than $1 million to Romney, a review of his campaign reports dating to 1994 shows.
Bain-related checks come in bundles large and small. Salvadoran billionaire Ricardo Poma, whose holding company is engaged in a wide array of ventures, was an original investor in Bain Capital. Ernesto Poma, a relative, and others in Ernesto’s Florida firm, Transal Corp., have given Romney $5,000 this year.
In its early years, Bain Capital funded Staples Inc., helping it become a national office-supply chain. Staples executives and their associates have donated at least $51,000 to Romney’s presidential campaign.
EBay Chief Executive Margaret Whitman and Romney have been friends since their days at Bain & Co. Whitman has given Romney campaigns $102,000 and is part of his national fundraising team.
Romney raised $253,000 in Tennessee in the first quarter. In the overall race, that’s a modest sum. But McCain and Giuliani raised less than $95,000 between them in Tennessee. A big reason is William Hagerty, who met Romney early in their careers when Romney was at Bain Capital.
“Twenty years ago, I thought, ‘This is the kind of guy who could be president of the United States,’ ” said Hagerty, one of Romney’s Tennessee finance chairmen and managing director of a private equity firm, Hagerty Peterson & Co., in Nashville. “I knew he had it in his DNA.”
In addition to raising money from his business connections, Romney uses political contacts. His political pedigree dates to the 1960s, when his father, George W. Romney, was Michigan governor and later a Nixon administration Cabinet secretary. Romney raised $1 million in Michigan in the first quarter, more than the other Democratic and Republican candidates combined.
In Massachusetts, Romney raised $2.3 million. Among his donors are people who had business before the state during his four-year tenure or had gubernatorial appointments.
Partners at the Mintz Levin law firm have given him $32,000. As governor, Romney appointed one Mintz partner to a convention center authority, and a second to a transportation finance agency.
Romney’s administration retained Mintz to help knit together his universal healthcare plan, his signature accomplishment and one for which he has gained national attention. When he unveiled the plan, Romney singled out Mintz lawyer Alden J. Bianchi for providing “invaluable legal advice.”
“Most of Mitt Romney’s policy positions are opposite to mine, but I would follow him anywhere,” said Bianchi, a Democrat who has given Romney $1,000. Along with his business and political contacts, Romney has tapped another network: Mormons. Kim Farah, spokeswoman for the Church of Jesus Christ of Latter-day Saints, said the church wouldn’t endorse any candidate. But prominent Mormons are involved.
In Utah, a state that has never been a major source of campaign money, Romney raised $2.8 million in the first quarter, his second-largest source after California. As a second-quarter encore, Romney’s Utah boosters hope to raise an additional $1.5 million.
Salt Lake City developer Kem Gardner, a Democrat, has known Romney since the mid-1980s, when Gardner was tasked by his church to oversee Mormon missionaries in the Boston area, and Romney was a lay church leader in Boston.
During the Olympics, Gardner helped Romney raise money, and he is helping the candidate now. He and his associates have donated $113,000 to Romney since 2005. Raising money for Romney is not hard. He is a “hero” in Utah, Gardner said.
In the Salt Lake Valley, multilevel marketing is a growth industry. Owners of such firms sell products to distributors who sell to other distributors who, on down the line, sell to consumers.
The business is tailor-made for campaigns that rely on big networks of small donors. Romney has tapped into it, collecting at least $360,000 from the companies, many of which distribute dietary supplements.
One such donor is Thomas E. Mower, founder of a firm that sold supplements. Mower, his family members and executives of his former company have given Romney almost $24,000.
Last June, as Mower awaited sentencing on a $1.2-million tax-evasion conviction, Mower donated $5,000 to a Romney campaign account that has since been dissolved. On Jan. 8, a federal judge in Salt Lake City ordered Mower to prison for 33 months. Three weeks later, the Romney campaign reported receiving an additional $2,000 from Mower. After The Times inquired about Mower’s gift, Romney aide Matt Rhoades said the campaign was “returning his [$2,000] contribution immediately.”
Romney’s national finance committee includes Gordon Morton, a founder of XanGo International, a multilevel marketing company that distributes products derived from a fruit called mangosteen.
XanGo owns the Lehi office building that leases space to Bullock’s Sorenson Capital. While Bullock does his high-finance deals, XanGo operates from the first floor, peddling XanGo gear and its main product, a purplish juice mixture, $25 a bottle wholesale. XanGo executives and distributors have given Romney’s committees $78,000.
“Like any industry, we look for people who understand the issues we’re concerned about,” XanGo Vice President Bob Freeze said.
Presidents appoint directors of the agencies that oversee such marketers and their products. In recent years, the U.S. Food and Drug Administration has sent warning letters to at least four companies whose executives have donated a combined $110,000 to Romney’s various campaigns, including one to XanGo in September.
The FDA letter detailed “serious concerns” about claims that the product could help prevent hardening of the arteries, eczema, gum disease, cancer, glaucoma, depression and body fungus. Freeze said that third-party distributors were responsible, not the company, and that the matter had been corrected.
Romney is competing with other Republicans for President Bush’s bundlers, and he has won over several. Among them is Bob Perry who, along with his associates, has donated $112,000 to Romney. The Houston developer was the principal financial backer of the Swift Boat ad campaign against Sen. John F. Kerry (D-Mass.) during the 2004 presidential race.
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Mitt Romney’s campaign donors include longtime friends as well as political and business associates. Among them:
California was Romney’s largest source of money in the first quarter of 2007 -- $3.46 million. Romney tapped many Republicans from the New Majority PAC, a group of business owners who have helped bankroll Gov. Arnold Schwarzenegger’s political career. Santa Monica capitalist Thomas R. Tellefsen and Los Angeles builder Rick Caruso are among Romney’s money bundlers.
Led by Richard Marriott, people associated with the Marriott International hotel chain have given Romney $600,000 since 1994. In Romney’s presidential run, the hotel chain’s network has given at least $173,000. The Marriott and Romney families are longtime friends.
Romney raised $500,000 where he sleeps, his hometown of Belmont, Mass. Romney endeared himself to neighbor Peter Palangian by visiting his dying father in the hospital a decade ago. While at Bain Capital, Romney invested in the Palangian family real estate firm; Palangian’s family has donated at least $17,000 to Romney.
Cincinnati billionaire Carl Lindner, Ohio’s preeminent political donor, and his associates gave Romney $125,000 in the first quarter of 2007. Through his American Financial Group, Lindner’s interests are as diverse as insurance and dairies. His network previously donated $250,000 to Romney-controlled committees.
Detroit builder John Rakolta and others in his firm, Walbridge Adlinger, have donated $120,000. And Romney has used the firm’s plane, for which the campaign paid $20,500.
Source: Times reporting
From his donors
Since his first run for elective office in 1994, former Massachusetts Gov. Mitt Romney has spent $8.6 million of his own money and raised more than $40 million from donors. A breakdown:
$21 million, presidential campaign, first quarter 2007
$8 million, Massachusetts governor
$3.7 million, 1994 U.S. Senate campaign
$2.5 million, federal political action committee
$5.9 million, state accounts*
*National Institute on Money in State Politics, based in Helena, Mont.
Sources: Federal Election Commission; commonwealth of Massachusetts