Political donations are ‘staggering,’ thanks to legal loopholes, report says

California’s political fundraising laws are so full of holes that candidates for state office have collected an average $344,503 a day -- more than $1 billion -- since contribution limits took effect eight years ago, state regulators say.

A report released Monday by the Fair Political Practices Commission concludes that although voters approved donation limits by passing Proposition 34 in 2000, “the goal of reducing special interest money remains elusive.”

“The amounts of money raised are staggering,” commission Chairman Ross Johnson said. “It raises very serious questions about the potential for undue influence, the potential for corruption.”

Direct individual donations to candidates are limited to $3,900 for a contender for the Legislature and $20,900 for a person running for governor. But elected officials also raise money for other purposes -- officeholder expenses; legal defense campaigns; support for, or opposition to, ballot measures.

Committees established for those purposes have raised $156 million, according to the report, “The Billion Dollar Money Train.”

Ballot measure accounts have no contribution limits. Individual donations to those have been as high as $2 million.

“These methods allow candidates and officeholders to evade the intent of the people of California,” Johnson said, adding that he hoped that the report would trigger a debate about possible changes to the law.

James Sutton, an attorney for many state politicians, challenged the report’s grim conclusion about the $1 billion raised.

“This is a good thing, not a bad thing,” Sutton said, “because the money is spent on mailers and radio ads and television ads discussing the public policy issues important to people.

“The FPPC should be applauding that amount and hoping it is higher.”

Gov. Arnold Schwarzenegger has been one of the most prolific users of candidate-controlled ballot-measure committees operating outside the Proposition 34 restrictions.

Spokeswoman Julie Soderlund said the governor has done so “because it’s the only way to accomplish reform he felt was important to California. The legislative process is broken.”

Kathay Feng, executive director of California Common Cause, called for the contribution laws to be rewritten to plug loopholes.

Her group had pushed for a much stricter measure that California voters passed in 1996.

That measure, Proposition 208, would have limited individual donations to candidates for the Legislature to $250, or $500 if the candidate accepted spending limits.

But Proposition 208 was challenged in court, and the Legislature put Proposition 34 on the ballot to supersede it.

“All of the loopholes written into Proposition 34 by the Legislature were purposeful so they could legally circumvent the limits approved by voters in Proposition 208,” Feng said.

Johnson, a former state senator from Orange County who helped draft Proposition 34, said the legislation was the best compromise that could be reached then but that it is time to revisit the issue.

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patrick.mcgreevy@latimes.com