California lawmakers raise unlimited funds for personal causes

The Sacramento BeeMarch 12, 2012 

California Assemblyman Sandré Swanson formed his own nonprofit foundation last year and raised tens of thousands of dollars from Capitol interests for youth scholarships.

Board of Equalization member Jerome Horton solicited $85,000 in 2010 and 2011, largely from major corporations, to bolster a nonprofit group run by his wife, Yvonne.

Assemblywoman Wilmer Amina Carter raised $34,000 the past two years for her Wilmer Amina Carter Foundation to help students at a Rialto school named after her – Wilmer Amina Carter High School.

Only a handful of California's 132 statewide officeholders solicit for charity foundations they personally founded, but the practice has grown since 1997, when California opted not to set limits on such fundraising.

Pouring big bucks into a lawmaker's pet cause enables special interests to sidestep campaign contribution limits and make a positive impression on those whose votes they need.

Such fundraising also can be a boon to communities, particularly poor ones, in an era of fiscal belt-tightening.

"Some communities rely on movie stars," Horton said. "In poor communities, they rely on their public servants, their elected leaders."

Cumulatively, the Swanson, Carter and Horton foundations have raised money for projects ranging from student scholarships to food centers to tax-preparation assistance. The three officeholders have not been paid by their nonprofits, but analysts say that such ventures pay dividends by polishing political images and reputations.

"It's doing well by doing good," said Jack Pitney, government professor at Claremont McKenna College. "You want to come across as a good guy. A charitable foundation is a way of establishing a name for oneself."

Donors get something, too.

"Special interests are not in the habit of throwing money around," said Phillip Ung of California Common Cause. "This money is spent to influence legislators and other elected officials."

Gov. Jerry Brown has not formed a personal foundation, but as Oakland mayor he founded two charter schools for which he continues to raise money – $2 million to $3 million annually, much of it from groups active at the Capitol.

"The donations to these schools help thousands of Bay Area students obtain a first-rate education," said Elizabeth Ashford, Brown's spokeswoman. "Governor Brown is committed to their success."

Assemblyman Tony Mendoza and his wife, Leticia, jointly formed the Southern California LEAD Foundation – for leadership, education, advancement and development – in 2009 to "improve the quality of life for Hispanic youth" in southeast Los Angeles.

Mendoza, D-Artesia, said he has solicited money for LEAD, but he is not the sole source of its funding and he recalls raising no donation topping $5,000, the level requiring disclosure. LEAD received $26,000 its first year, the only year for which its tax filings are available.

Mendoza said that neither he nor his wife is paid by the foundation and that its fiscal records are in disarray because its treasurer was Kinde Durkee, who was arrested last year and accused of stealing large sums of money from numerous political committees she managed statewide.

Donation limits urged

Contributors to lawmakers' charities, unlike those to their campaigns, are not required to report their donations publicly. Thus, there is no way to verify lawmakers' fundraising claims.

California sets strict limits on campaign donations. Lobbyists cannot give to legislative races, for example, but they can give unlimited sums to a lawmaker's foundation, and contributions of $4,999 or less need not be disclosed.

Ung, of California Common Cause, said that perhaps the state should limit the size of lawmaker-solicited donations to charities with strong personal ties to themselves.

Trent Lange of California Clean Money Campaign went further, suggesting an outright ban in such cases to bolster voter confidence.

For political races, maximum contributions range from $3,900 for legislative candidates to $6,500 for other statewide offices, except governor. Donations to charities are not capped: The largest for Yvonne Horton's foundation was $25,000 from Time Warner Cable; Carter's was $24,900 from Verizon Communications; and Swanson's was $20,000 from the California State Pipe Trades Council.

All three of those top contributors – Time Warner, Verizon and the pipe trades council – are major Capitol players. Cumulatively they spent nearly $1.1 million on lobbyists last year, and they donated more than $2.7 million to candidates or ballot measures in California's 2010 elections, records show.

Eleven of the largest donations last year to Brown's two pet causes – Oakland Military Institute and Oakland School for the Arts – were for $50,000 or more.

Senate President Pro Tem Darrell Steinberg said raising money for good causes is part of a politician's duty.

"If elected officials did not try to raise money for charities, there would be a lot of folks who would be angry because you weren't helping out programs in great need," Steinberg said.

The Sacramento Democrat is no stranger to raising money for causes tied to him: He solicited more than $2 million, much of it from 2007 to 2009, for a tolerance museum project he spearheaded. And he raised $12,500 in 2007 for a nonprofit group from which his brother made a living by introducing students to key figures and sites of the 1960s civil rights movement.

Steinberg said that donations never affect his stand on issues. "Call 'em as you see them, that's always got to be the principle," he said.

Political value questioned

Swanson, D-Alameda, said he formed the Sandre R. Swanson Youth Foundation after a scholarship program by the Black Legislative Caucus received applications totaling a million dollars more than the caucus had available.

"There are a lot of people up here who have a lot of influence because they are elected officials," Swanson said. "I think this is a way for them to use it for good."

Swanson's foundation has received contributions from the California State Pipe Trades Council, Pacific Gas and Electric Co., and the Wanda A. Green Foundation.

Swanson said his foundation will offer scholarship or other opportunities to at-risk youths and to children attempting to better their lives after incarceration or exploitation.

Carter, in 2010 and 2011, received charitable donations from Verizon Communications, San Manuel Band of Mission Indians and the Personal Insurance Federation to boost her foundation's scholarship, leadership and civic education programs.

"My goal is to make sure there are young people who have the values and skills to take care of me when I get old," Carter said.

California Educational Solutions, the foundation run without pay by Horton's wife, has helped to sponsor public events the past two years ranging from a student symposium to a women's business conference and a free income tax assistance program, records show.

The prospect of legislators soliciting from Capitol interests to their own foundation or cause was not discussed 15 years ago when the Legislature passed a law classifying lawmakers' charity solicitations as "behests" and setting no cap on them, records show.

"This is just another loophole that we think needs to be regulated much more strongly or have a lot more disclosure to it," said Ung of California Common Cause.

But Jerome Horton said that additional constraints are not necessarily needed. Sure, politicians look good when they do good for their communities, but the practical benefit is minimal because many charity events target low-income communities where voting rates are low, the Democrat said.

"The disadvantaged and the downtrodden are typically the folks your efforts are focused toward," Horton said.

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