Poizner Runs A Rocky Path To Governor’s Race

Published on

13 months until the GOP primary, the insurance commissioner has
grappled with turnover among campaign advisors, $150,000 in unpaid
inaugural fund bills and questions about his donors.

He has pledged to run the state more efficiently if elected governor,
but staff turmoil and lingering troubles with his inaugural fund are
roiling the nascent campaign of state Insurance Commissioner Steve

the Republican primary still 13 months away, Poizner, a leading
contender, is on his third campaign manager. Several top advisors have
bowed out or taken diminished roles.

The instability in his
campaign’s upper ranks comes as the fund that Poizner set up to pay for
his 2007 inaugural festivities is emerging as a potential millstone for
the Silicon Valley mogul. The nonprofit Poizner Inaugural Fund spent
more than $375,000, much of it on celebrations in San Jose and

But that included nearly $150,000 in bills that
Poizner left unpaid, the bulk of them for more than two years, until
The Times inquired about them. Poizner, who made a vast fortune as a
pioneer in mobile-phone tracking devices, wrote personal checks last
week to cover the balance.

"It’s like anything else: You’ve got
some clients who pay quicker than others," said Wayne Johnson, a
political consultant whose firm recovered $38,625 from Poizner’s
inaugural fund last week for bills that it submitted in early 2007.

fund’s delays in paying its lawyers, accountants and consultants give
rivals an easy line of attack against a multimillionaire candidate who
vows to run a state with chronic fiscal troubles "as efficiently and
effectively as possible."

Poizner said he had hoped to raise
enough money to repay the vendors, but the fund reported only two
donations over the last two years: $25,000 from the Sycuan Band of the
Kumeyaay Nation and $50,000 from Mainstay Business Solutions, a firm
owned by the Blue Lake Rancheria Tribe.

"It hasn’t been the
highest priority in the world, so now it’s gotten old enough that I
think it’s not worth trying to raise money for anymore," Poizner said
Tuesday in an interview.

Also problematic for Poizner,
politically if not legally: The inaugural fund accepted two
contributions from insurance donors despite his 2006 pledge to refuse
the industry’s money if he was elected commissioner. To take it "would
be like refereeing a game while being on one of the teams’ payroll,"
Poizner told guests at his inaugural luncheon.

But a day
earlier, Poizner’s inaugural fund accepted $5,000 from the California
Assn. of Health Plans, a trade group whose members include Aetna, Blue
Shield of California, CIGNA HealthCare of California Inc., and Kaiser
Foundation Health Plan. Five weeks later, the fund accepted $1,000 from
AIMS Acclamation Insurance.

Poizner, whose policy of refusing
insurance industry donations has won praise from consumer advocates,
said Tuesday that he would return the money. "I don’t want to have any
connection at all with the insurance industry," Poizner said. "When
it’s time for me to really come down hard on the insurance industry as
the regulator . . . it’s important for me to do that."

Rosenfield, a consumer advocate who endorsed Poizner for insurance
commissioner, described the inaugural fund as improper, even if it is
legal. Gov. Arnold Schwarzenegger and other officials have set up
similar funds.

"No public official should ever maintain a sort
of off-the-books entity that collects money from donors, whether that
elected official regulates them or not," said Rosenfield, who now sees
Poizner’s record on consumer protection as mixed.

inaugural fund, which also covered costs of his transition into office,
disclosed the names of donors who gave $5,000 or more in reports to the
state Fair Political Practices Commission, as required by law. Poizner
released additional details of its finances after a request from The

Donors include Applied Materials ($15,000); the
California Retailers Assn. ($10,000); Watson Land Co., Lack
Construction Inc., Pacific Gas & Electric Co., and the California
Autobody Repair Political Action Committee ($5,000 apiece).

fund’s main expenses included the inaugural luncheon for more than 500
guests at the Tech Museum of Innovation in San Jose, and a reception
for 150 in Sacramento. Catering, entertainment, flowers and hall rental
cost at least $62,712.

Poizner, who wrote $147,500 in personal checks to close the books, said it was "time to just get that done and move on."

is also trying to move on from a major staff shake-up. His campaign
chairman, Jim Brulte, told supporters in February that Poizner had put
together "a top-notch group of experienced and successful California
professionals, including Wayne Johnson and Matt Rexroad."

Johnson, a top Poizner strategist for years, stepped aside weeks later.

a veteran Sacramento consultant brought in to replace Poizner’s first
campaign manager, Brian Seitchik, also departed. Rexroad ceded the job
to James Bognet, a policy specialist who has worked on multiple
campaigns but never managed one.

Also gone from Poizner’s team
is Marty Wilson, a Schwarzenegger campaign veteran. Poizner’s lead
strategist now is Stuart Stevens, a prominent Republican media
consultant in Washington. Stevens, a top campaign advisor to former
President George W. Bush, has run governors’ races across the nation,
but never in California. "It’s not been a stable environment," Wilson
said of Poizner’s inner circle. "God knows they’ve got plenty of time
to correct the course, as long as Steve puts in place a professional
team that he will trust to do their jobs and listen to their advice."

turnover on a campaign team is often less of a problem than later
upheaval. But for Poizner, the loss of nearly every seasoned California
operative on his campaign could pose challenges.

"It takes a
lot of luck and money and intelligence and timing, and heaven knows
what else," USC political analyst Sherry Bebitch Jeffe said. "But it
can be done."

As part of the campaign shuffle, Poizner has
recruited several veterans of former Republican presidential hopeful
Mitt Romney’s campaigns, including Stevens and Bognet.

about his rapid shift in campaign advisors, Poizner said, "I’ve got to
tell you, honestly, I am so pleased with where my campaign is right

[email protected]

Consumer Watchdog
Consumer Watchdoghttps://consumerwatchdog.org
Providing an effective voice for American consumers in an era when special interests dominate public discourse, government and politics. Non-partisan.

Latest Videos

Latest Releases

In The News

Latest Report

Support Consumer Watchdog

Subscribe to our newsletter

To be updated with all the latest news, press releases and special reports.

More Releases