A political action committee with ties to the Legislature’s Latino Caucus announced it was closing down Tuesday, a day after the state Fair Political Practices Commission said it is investigating one of the group’s contributions.
Yes We Can, a political fundraising committee that has attracted the attention of the FBI, filed papers declaring its termination on the last day of 2013. The PAC made a $25,000 contribution on Jan. 2 to a nonprofit group run by a brother of Sen. Ron Calderon, the Montebello Democrat who is the subject of a federal corruption investigation.
The FPPC announced Monday that it is opening an investigation to find out who decided to send the money to Californians for Diversity, a nonprofit group run by Calderon’s brother, former assemblyman Tom Calderon.
The contribution was the only “civic donation” that Yes We Can ever made, according to its campaign finance filings.
The committee accepted $299,200 in donations from interest groups in 2013, and spent almost $406,000. Expenditures included $260,000 to another political committee, as well as roughly $48,000 to the CordeValle golf resort in Santa Clara County, $46,000 to political fundraiser Julie Sandino, and $25,000 to the Wilke, Fleury law firm – one of its partners, lobbyist John Valencia, is treasurer of Yes We Can.
In a statement, Valencia said the committee “concluded fundraising activities in the Fall of 2013, and has completed disbursement on all outstanding obligations.”
“With no plans to engage in activities in the 2014 election cycle, and to avoid unnecessary payment of a routine annual filing fee now statutorily required of ‘active’ committees, the committee has filed all necessary termination paperwork effective December 31, 2013.”
The PAC, which opened in 2011, hosted fundraising events that featured face time with members of the Latino Caucus, including its chairman, Sen. Ricardo Lara, D-Bell Gardens. A flier for a $10,000 per person fundraiser at the CordeValle golf resort this fall, for example, invited guests to enjoy an overnight excursion with Lara and other Latino Caucus members. The event featured dinner, an after-dinner cigar party, a spa treatment or round of golf, a buffet breakfast and “lunch on the course,” according to the invitation.
On Tuesday, however, the Latino Caucus began working to distance itself from the Yes We Can PAC. In emails between The Sacramento Bee and Valencia that date back to October, Valencia did not dispute that the Latino Caucus and Yes We Can were affiliated.
But a new spokesman for the caucus, Democratic political consultant Roger Salazar, said Tuesday that Yes We Can is separate from the Latino Caucus.
“It’s an independent expenditure committee that the caucus does not have any control of whatsoever,” Salazar said.
Who controlled how the PAC spent its money will be an essential question for the state’s political watchdog as it investigates. If a sitting legislator directed its expenditures, the committee would not be considered independent under the law. Instead, said FPPC chief Gary Winuk, it would be considered a candidate-controlled committee, which would greatly limit how money could be spent and restrict the amount donors could give to $4,100. Independent committees, on the other hand, can accept unlimited contributions from interest groups.
“It comes back to who is calling the shots,” Winuk said. “If it’s a public official or a candidate, then it’s their committee.”
If the committee is truly independent but a legislator requests it make a charitable contribution, then that would become a so-called “behested payment,” Winuk said, which the law requires legislators to report.
It remains unclear who asked Yes We Can to make the $25,000 contribution to Tom Calderon’s nonprofit.
The contribution is described in a 124-page FBI affidavit that alleges Ron Calderon took $88,000 in bribes from an undercover agent and a hospital executive. The affidavit suggests that Yes We Can made the $25,000 contribution to settle a dispute between Calderon and Lara over who would be chairman of the powerful caucus.
The affidavit describes a secretly recorded conversation between Calderon and an undercover agent in which the senator says that he and his brother planned to draw income from the Californians for Diversity nonprofit.
“Tom and I down the road, we build that up, we can pay ourselves,” Calderon said, according to the affidavit. “Just kind of make, you know, part of living.”
Call Laurel Rosenhall, Bee Capitol Bureau, (916) 321-1083. Follow her on Twitter @LaurelRosenhall.