Election 2012
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Stealth group of corporations funds pro-GOP campaign in Senate races

Published: Wednesday, Oct. 24, 2012 - 12:00 am | Page 1A

Attack ads hammer the message to voters: Democrats Cathleen Galgiani and Fran Pavley are wasting your money by pocketing tax-free salaries of $180,000 and $261,000, respectively.

"Paid for by California Senior Advocates League," say separate ads in fiercely contested state Senate races featuring Pavley, an Agoura Hills state senator, and Galgiani, a Stockton assemblywoman.

The ads are powerful, but false. The group's name is fetching, but deceptive: California Senior Advocates League is a drop box in Sacramento. Its funding is hard to find but comes largely from oil, tobacco, energy, insurance, drug and other corporations.

The league is part of a network of committees under the control of Rob Lapsley, president of the California Business Roundtable, that is trying to stop Democrats from winning a two-thirds supermajority in the Senate. The effort is sidestepping the state Republican Party to fight for election of GOP candidates, raising more than $4.5 million this year.

Taxpayer advocacy, not politics, is touted by the network. A group called Reform California Now is the core, largely bankrolling other groups that produce the campaign ads: Californians Against Wasteful Spending, Citizens for California Reform, Inland Empire Taxpayers Association and the Senior Advocates League. For the primary, it funded other committees, too.

Chevron has contributed $1.25 million to Lapsley's program. The California Real Estate Association has given $625,000; Phillip Morris, $250,000; and Pharmaceutical Research and Manufacturers of America, $250,000. Other key donors include Sempra Energy, Farmers Insurance and Anthem Blue Cross.

Charles T. Munger Jr., a Stanford University physicist, has contributed $750,000.

The attack ads against Pavley and Galgiani vastly overstate their pay – each make $95,291, plus about $30,000 in per diem for living expenses. The ads say only that the Senior Advocates League paid for them. That group's disclosure statements cite Reform California Now, so voters must follow an online trail to find specific donors.

Bob Stern, a co-author of the state's Political Reform Act, said "there's nothing illegal about it, but it's certainly misleading."

Parke Skelton, Pavley's campaign strategist, said the net effect is to "disguise the fact that their money is coming from sources that would damage their candidates if voters knew."

But Allan Hoffenblum, publisher of the California Target Book, which handicaps legislative races, noted that Reform California Now and other state PACs provide substantially more disclosure than national nonprofit groups that pour millions into campaigns without ever saying who gave the dollars to them.

Such a nonprofit group, based in Arizona, last week donated $11 million to the effort to defeat tax increases in Proposition 30 and pass union campaign restrictions in Proposition 32 without disclosing donors.

"Sometimes you've got to be resourceful," Hoffenblum said of identifying donors to the state super PACs. "But eventually you can track them down."

Lapsley, through a spokesman, said that he serves Reform California Now as a volunteer. He referred calls to attorney Chip Nielsen, who declined to discuss the group's dealings but said it has been scrupulous in complying with disclosure law.

Key targets for attack now are Galgiani in the 5th Senate District, based in San Joaquin County; Pavley in the 27th Senate District of Los Angeles and Ventura counties; and Democrat Richard Roth, an attorney, in Riverside's 31st Senate District. All three seats are seen as key battlegrounds in the Democrats' effort to reach a veto-proof two-thirds majority in the Senate.

For the June primary, the group also boosted some Democrats it apparently deemed business-friendly or beatable by a GOP opponent in next month's runoff – Steve Clute, for example, who finished behind Roth for the right to butt heads with current Assemblyman Jeff Miller, R-Corona.

Even within the GOP, Reform California Now is not the only major independent expenditure group; private campaigns are ubiquitous in politics.

The Democratic Party and supportive public employee unions have spent millions this year on left-leaning candidates. One key labor union committee, for example, has a similarly uplifting name, Opportunity PAC.

JobsPAC, a Republican group tied to the state Chamber of Commerce, is bankrolling efforts to boost key Assembly GOP candidates.

But Reform California Now is unusual because of the number, complexity and secrecy of its intertwined committees, which allow business interests to sidestep the state GOP and flex its own muscle.

Tom Del Beccaro, state GOP chairman, said that elections law is becoming increasingly complicated and paving the way for Byzantine matrixes by groups of all stripes.

"Republicans welcome those groups that are helping us get our message out," he said.

Privately, some Republican consultants say that weakness within the state GOP has fueled Reform California Now. Republicans lost every race for statewide office in 2010, and party affiliation has fallen to 30 percent of registered voters.

Del Beccaro said he would prefer direct donations to campaigns and immediate disclosure. But he understands why interest groups would want their own big PACs, he said.

"They want to exert their influence in a particular direction, and the law accentuates their ability to do that, so they're taking advantage of it," Del Beccaro said.

Sidestepping a party also allows interest groups to spend money boosting weak candidates of the opposing party in primaries, a tactic emerging from the new top-two primary system, Hoffenblum said.

Gary Winuk, Fair Political Practices Commission chief enforcement officer, said state law does not limit the number of interconnected political groups, provided that a donor to one does not earmark that his dollars ultimately go to another.

But more committees exchanging more dollars invariably means more hurdles for voters to track donors, said Phillip Ung, California Common Cause policy advocate.

"This is a main reason voters are becoming more cynical about politics," he said.

© Copyright The Sacramento Bee. All rights reserved.

Read more articles by Jim Sanders



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