Hearthside Lobbying for Energy;

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Firms won a key vote after their agents held fund-raisers in private homes for lawmakers.

The Los Angeles Times

SACRAMENTO — Only hours before the committee she chairs was taking up a bill to re-regulate parts of California’s power system, Assemblywoman Sarah Reyes was the guest of honor at a small, private fund-raiser billed as a “Night of Chocolate Decadence.” It was hosted by lobbyists for the state’s largest utility and other energy companies opposed to the pending legislation.

The next day, after the bill had its first hearing, another member of the Assembly Utilities and Commerce Committee was feted at a sumptuous birthday bash organized by the same group — lobbyists for Pacific Gas & Electric Co. and Sempra Energy, and an executive who supervises lobbying activity for Calpine Corp.

Guests at each function were asked to donate $1,000 to the campaign accounts of Reyes, a Fresno Democrat, and Assemblyman Lloyd Levine (D-Van Nuys), who celebrated his 34th birthday.

Ten days later, the committee defeated the re-regulation bill, SB 888, without a single member voting in favor. In fact, most of the members — including Reyes and Levine — chose not to vote at all.

Each of the lawmakers, as well as spokesmen for the lobbyists and the companies they represent, said that there had been no discussion at either event about pending legislation and that the dinners had not been intended to influence committee members on any particular bill. But one company, PG&E, said through a spokesman that it would nevertheless ask for a review from an outside law firm to be sure there had been no violations of law.

Ostentatious fund-raising is a capital tradition, but even by Sacramento standards these gatherings were unusual, and not just because of their proximity to the vote.

The events occurred in the homes of the lobbyists, permitting donors the kind of discreet access to lawmakers that they would never have at a standard meet-and-greet fund-raiser. The location also meant that the lobbyists did not have to reveal their roles, because California law exempts fund-raisers held in private homes from certain disclosure requirements. Hosts need not report their involvement unless the costs of putting on an event exceed $500.

And they were such intimate affairs that they flew below the radar of the capital tipsheets and campaign finance watchdogs, which regularly publicize scheduled fund-raisers. At a time when the energy industry is trying to rebuild an image battered by California’s electricity crisis, operating outside the spotlight was a decided advantage.

The private dinner circuit has other attractions for energy lobbyists. Under California law, lobbyists are prohibited from giving lawmakers gifts or even taking them to meals that cost more than $10.

Under Proposition 34, approved by the voters in 2000, individual and corporate donors cannot give contributions of more than $3,000. But nothing in the law prohibits lobbyists from maximizing their own clout by bringing together a group of donors with common interests and collecting the legal limit from each in one fell swoop.

“California now has a system where the size of your Rolodex matters more than the size of the check your company can write,” said Ray LaRaja, a political science professor at the University of Massachusetts and an expert on campaign financing.

“What they’re doing is consistent with what’s happening at the federal level. It’s clear to everyone who arranged the fund-raiser and who brought in the checks,” he said.

Besides the affairs for Reyes and Levine, the energy lobbyists have been holding similar fund-raisers for other members of the utility committee. Assembly members Joe Canciamilla (D-Pittsburg), Fabian Nunez (D-Los Angeles) and Manny Diaz (D-San Jose) were entertained at lobbyists’ dinners in January, May and June, respectively. A dinner is scheduled in August for Assemblyman Keith Richman (R-Northridge), who is committee vice chairman, and one planned for last Tuesday for Mark Ridley-Thomas (D-Los Angeles) was postponed.

Only Reyes and Levine had fund-raisers that closely coincided with consideration of SB 888.

The measure was proposed by Sen. Joe Dunn (D-Santa Ana) to “end, not mend” the utility deregulation plan that marketers allegedly manipulated to cause billions of dollars in higher utility rates during 2000 and 2001.

Considered the most controversial and far-reaching energy bill of this legislative session, the measure had its first utilities committee hearing on July 2, the same day as the Levine fund-raiser.

Both Reyes and Levine said the fund-raisers had been scheduled months in advance.

“I think it was by accident,” Reyes said, referring to the timing.

“Every committee has a particular mission, and it is not unusual for committee chairs to have fund-raisers during the legislative session, no matter what the committee is dealing with,” she said.

She said she often receives contributions from lobbyists on both sides of measures before her committee. For example, she said, lobbyists for labor and renewable energy producers, who favored SB 888, attended a fund-raiser she had the week before at Chops, an upscale eatery near the Capitol. That event was publicized in a newsletter that circulates weekdays around the capital.

Levine said his event was keyed to his 34th birthday.

It had been planned two months earlier and, at the time, “we had no idea when the bill was coming up.”

“I never have and never would base any decision on any money I raised or who I raised it from,” he said.

Dunn, who said he had not known about the events, called the timing “disturbing.”

A lobbyist for consumers, Doug Heller of the Foundation for Taxpayer and Consumer Rights, complained that the intimate dinners had given interests that could afford to make campaign donations a leg up on environmental and consumer groups that could not.

“This is the perfect example of why we should ban fund-raising during the legislative session — because the money is just too close to the decision-making,” Heller said.

Canciamilla, whose dinner on Jan. 30 was the first in the series, said a group of lobbyists who represented energy interests seized on the idea of joining forces to hold fund-raisers that would be both lucrative and enjoyable. They would take turns hosting the dinners and helping each other round up potential donors.

“We decided it would be more fun than the usual drive-by event,” he said. “I think I suggested, ‘Don’t do what everybody else does. Don’t get a restaurant and have a cocktail party.’ “

An e-mail invitation from Kassandra Gough, director of government and legislative affairs for Calpine, told donors, “This is part of a series of FUNdraisers Carolyn Veal-Hunter, Carolyn McIntyre, Cindy Howell and Lorraine Paskett and I have been hosting.”

Paskett works for PG&E, and Howell and McIntyre represent Sempra. Veal-Hunter is employed by a lobbying firm whose clients include PG&E. None of the lobbyists would comment.

Although most legislators said they could not remember how much money had been raised at their events, estimates from others ranged from $10,000 to $20,000.

For his event, Canciamilla recalled loading up his car with food and utensils because the hostess did so little cooking that she didn’t have a fully stocked kitchen.

The legislator said he manned the stove while the others served.

From that came the idea that lawmakers would be participants as well as beneficiaries. In keeping with the chocolate theme, the dinner guests at Reyes’ event were treated to the assemblywoman’s “special chocolate martini” and desserts that included her “special chocolate chip cookies and chocolate cheesecake.”

Invitees to Ridley-Thomas’ party — later postponed — were promised that the droll assemblyman would read “excerpts from Dr. Seuss’ Green Eggs and Ham.” Those speaking for the lobbyists and the companies they represent said that they had been diligent in making sure the fund-raisers complied with state laws, but that they had not directly participated in the planning or organizing of the events.

“Our company takes our legal responsibility very seriously, and we fully report our lobbying activities,” said PG&E spokesman Ronald Low.

He said the company had made contributions to Nunez, Canciamilla, Diaz and Levine in connection with the fund-raisers, but not to Reyes.

Campaign disclosure law requires that companies report their contributions — monetary or in-kind — but there is no requirement that the location or sponsorship be described.

Although the company had opposed SB 888 when it was first heard by the Assembly committee, Low said it had switched to a neutral position just before the vote after Dunn agreed to make changes it requested.

Lawmakers who voted against Dunn’s bill said their opposition had nothing to do with their relationship with lobbyists but stemmed from feelings that the bill was ill-timed and poorly drafted.

“I think there’s clear evidence that the bill wasn’t ready to be passed,” Levine said. “We do need to overhaul the patchwork policies that are serving as our energy policies ….but something that big shouldn’t be rushed.”

Nunez said he couldn’t think of any legislators who would change their view on bills because of a fund-raiser.

“It’s hard to decipher what happens in Sacramento… People think every legislator is bought off,” he said. “But I don’t know one member of the Legislature who is going to change their point of view on legislation based on a fund-raiser.”
On lobbyists’ party lists:

Lobbyists for California’s largest utility and two giant power generators have been holding intimate fund-raisers in private homes for members of the Assembly Utilities and Commerce Committee, which hears legislation relating to energy issues.

– Assemblyman Joe Canciamilla (D-Pittsburg), Jan. 30 at the home of Lorraine
Paskett, lobbyist for PG&E.

– Assemblyman Fabian Nunez (D-Los Angeles), May 1 at the home of Kassandra
Gough, director of government affairs for Calpine.

– Assemblyman Manny Diaz (D-San Jose), June 4 at the home of Kassandra Gough,
lobbyist for Calpine.

– Committee Chairwoman Sarah Reyes (D-Fresno), July 1 at the home of Carolyn
Veal-Hunter, a lobbyist for PG&E.

– Assemblyman Lloyd Levine (D-Van Nuys), July 2 at the home of Lorraine
Paskett, lobbyist for PG&E.

Canceled at last minute:

– Assemblyman Mark Ridley-Thomas (D-Los Angeles), July 15 at the home of
Cindy Howell, lobbyist for Sempra.

Scheduled for next month:

– Assemblyman Keith Richman (R-Northridge), Aug. 19, location not yet
Source: Pacific Gas & Electric, Sempra Energy and Calpine Corp.
Times staff writer Nancy Vogel contributed to this report.

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