Dan Morain

Dan Morain: Wayward lobbyist is part of the Capitol money machine

Dan Morain
Dan Morain

Lobbyist Kevin Sloat, the latest Capitol insider to be outed by his own hubris, apparently thought he needed an edge, whether he did or not.

A veteran of more than two decades in politics, Sloat built one of the most prominent lobby operations in town, not to mention a fancy Arden Arcade mansion, created to host lavish fundraisers for legislators and other high officials.

His driveway was carved so as to park multiple cars for his catered soirees. He poured wine, cognac and Scotch that cost hundreds of dollars a bottle, and handed out expensive cigars. Sloat, Higgins, Jensen & Associates became the sixth largest billing lobby firm in town, with $13.5 million in receipts since 2011, and $50 million since 2000.

The Fair Political Practices Commission will vote this week whether to fine Sloat $133,500 for violating the Political Reform Act of 1974 by exceeding limits on the value of gifts lobbyists are permitted to give to legislators, and failing to disclose non-monetary campaign contributions in the form of providing the venue for lawmakers’ fundraisers.

He and his firm will survive, alter their practices, probably, and pay the penalty, a cost of doing business.

But there is a troubling context for this case, coming as it does when one senator is under FBI scrutiny and another remains in office despite having been convicted of felony charges of lying about where he resided.

Sloat’s case is another facet of the impact of money on policymaking, policymakers and the people who enable them. Although part of what he did apparently crossed lines, much of it was perfectly legal, all part of the culture. The story is told in records of campaign donations, the FPPC complaint and a suit by a spurned employee. Sloat didn’t talk; he faces various proceedings.

For all his connections and clout, Sloat is, like all members of the Third House, a middleman. He was a go-between, shuttling among his clients, a telecom giant, a huge pharmaceutical corporation, an electricity utility, and other big shots and legislators. He served all of them well.

He made sure that Senate President Pro Tem Darrell Steinberg could get his hands on hard-to-get tickets for the 49ers playoff game against the New York Giants in 2012, plus field passes. The 49ers, one of Sloat’s clients then, made the tickets available. It was perfectly legal because Steinberg paid for them.

Later that year, the National Football League franchise used Sloat’s shop to persuade lawmakers to introduce legislation that helped cement the deal for the 49ers’ new $1.3 billion football stadium in Santa Clara County. The 49ers’ ownership, after paying $567,845 to Sloat’s firm in the past three years, announced on Friday it was ending its relationship with Sloat; it got what it paid for.

California law bars lobbyists from donating money to state officeholders and candidates. But there’s nothing to prevent lobbyists from helping donors direct money to politicians who are or could be most helpful, all part of the service. By my count, the largest of Sloat’s 49 clients doled out no less than $37.5 million on California campaigns in the past three years.

Rhonda Smira tells much of the story in her wrongful termination suit, which she filed on Christmas Eve in 2013. It is a messy suit; people around Sloat accuse her of wrongdoing, but she faces no charges.

Smira, who wouldn’t talk with me, worked for Sloat from 2000 until August 2012. Her duties included establishing “an understanding as to how much money the candidate or elected office could expect to receive by attending the fundraiser,” her suit says.

Sloat, a Republican, hosted two fundraisers in 2012 for Gov. Jerry Brown and Proposition 30, the $6 billion tax hike ballot measure the governor advocated.

Public records don’t detail how much Sloat’s events generated. But in 2012, nine of his clients – Verizon, lottery contractor GTECH, Anthem Blue Cross, Anheuser-Busch, the California Medical Association, PG&E, the Yocha Dehe Wintun Nation, Aera Energy and a charter school association – gave $1.16 million to the Yes on Proposition 30 campaign.

They all want something from the Legislature and governor, all of it legal, no doubt.

Sloat had been the guy to see for tee times for legislators wanting to play the Capay Valley golf course owned by his client, the Yocha Dehe, and for shows at the tribe’s Cache Creek casino.

The Yocha Dehe, like all casino owners, care deeply about pending Internet gambling legislation. Any Internet gambling bill must pass through the Governmental Organization Committees of each house.

Sloat’s clients have given no less than $91,450 in direct donations to Assemblyman Isadore Hall, the Los Angeles Democrat who is chairman of the Governmental Organization Committee.

Smira’s suit says Sloat arranged for “Assemblyman A” to buy a piece of art from a Cuban artist at a “deep discount.” Smira’s lawyer, Jesse Ortiz of Sacramento, told me “Assemblyman A” is Hall. Hall’s spokesman declined to discuss the matter.

Sloat’s clients donated another $64,350 to Sen. Rod Wright, D-Los Angeles. Wright is carrying one of the main Internet gambling bills, and chaired the Senate Governmental Organization Committee, until he gave up the assignment after he was convicted of perjury conviction for lying about where he lived. Hall is running to replace Wright.

The Yocha Dehe, like Sloat’s other clients, violated no laws by donating to Hall, Wright or anyone else in the Legislature. As the law required, they all reported.

Sloat, who got his start as Gov. Pete Wilson’s legislative affairs secretary, is an intelligent guy who knows the Capitol and didn’t need to bend laws. Along the way, he became part of the fabric, and it has frayed.

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