Schwarzenegger Taps Insiders at Fundraiser

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The Los Angeles Times

SACRAMENTO — In the political equivalent of a premiere, Gov. Arnold Schwarzenegger, who campaigned on a promise that he would not solicit special interest money, turned to Capitol insiders for donations Wednesday in his first Sacramento fundraiser since taking office.

To attend the event at the Sheraton Hotel two blocks from the golden-domed Capitol, donors paid up to $21,200 — the maximum that individuals can give to Schwarzenegger’s gubernatorial campaign committee. That sum entitled them to two tickets, a photo with the governor and dinner with him and about 100 other contributors. For $500, individuals could attend a reception.

There was no red carpet, but several television cameras were on hand to record the arrival of roughly 600 lobbyists, clients and others who came to the event. As the contributors filtered in, a small gathering of protesters from the Foundation for Taxpayer and Consumer Rights, a consumer group based in Santa Monica, demanded access in return for a payment. Their offering: 21,200 green jelly beans. They didn’t get past the hotel’s front door.

Money from Wednesday’s event will add to the $2.24 million Schwarzenegger has raised since ousting Gov. Gray Davis in the Oct. 7 recall election. More than half of that sum came from Davis’ traditional donors — oil companies, developers, a major lender and an array of other interests.

“Anyone who believed candidate Schwarzenegger’s claims that he would be different has got to very disappointed,” said Jim Knox, director of California Common Cause.

By comparison, Knox noted, Gov. Pete Wilson raised $1.2 million during his first six months in office in 1991. Gov. Gray Davis raised $6 million in his first six months in 1999.

The events’ sponsors included the California Manufacturers & Technology Assn. and developer Alex Spanos, owner of the San Diego Chargers football team. Spanos, his family and executives in his firm have donated $344,000 to Schwarzenegger since the recall campaign began in the summer.

“Networking opportunity,” lobbyist J. Kevin Pedrotti said, explaining why he was attending on behalf of one of his clients.

Pedrotti noted that he was not attending on behalf of the Indian tribes he represents that own casinos. Schwarzenegger has said that he will refuse money from public employee unions and Indian tribes that own casinos, noting that he would have to negotiate with them over labor contracts and compacts governing gambling.

He also has a policy of not accepting money from trade groups that represent a single industry — such as the California Restaurant Assn., the California Motor Car Dealers Assn., and the California Realtors Assn. But although he turns down money from such groups, he does accept money from companies and from individual members of the groups.

Since the election, donors with significant interests in real estate and construction have given at least $472,000 in contributions to Schwarzenegger. Companies involved in financial and insurance industries have given him $444,000. Professionals, such as lawyers, accountants and dentists, have given $147,000. Companies involved in health care and pharmaceuticals have donated $144,000, and $105,000 has come from the entertainment industry.

Among the individuals who helped finance Davis’ campaigns and are now making contributions to the new governor is San Diego Padres owner John Moores. Along with his wife and individuals from his firm, Moores has given $63,000 to the Republican governor since the recall. Moores and his wife had given $225,000 to Davis before the $21,200 limit took effect. Davis appointed Moore to the UC Board of Regents.

And Schwarzenegger has taken at least $113,000 from firms that have contracts with the state. Many of his donors employ lobbyists who push for and against legislation each year.

“If anyone thinks that by contributing $50,000, someone is going to have a leg up, it’s ridiculous,” said Marty Wilson, one of Schwarzenegger’s top political aides.

The fare for Wednesday’s event was a cut above most Sacramento fundraisers. The $500 reception featured sushi, lamb chops and shrimp scampi, plus an open bar.

“The wine wasn’t as bad as it is at most fundraisers,” said John Mockler, who long had been an education lobbyist.

The entertainment also was better than most — provided by the governor himself.

Samples: “Schoolkids can’t spell simple words like ‘Schwarzenegger.’ … This is the time of year when people talk about heavy-set men with large red noses — but enough about Sen. Edward Kennedy,” the uncle of Schwarzenegger’s wife, Maria Shriver.

The governor also made reference to the fact that the event was attended by “special interests.” He noted that he spent much of the recall campaign denouncing them — and he thanked them.

“He’s a lot funnier than any recent governor,” said lobbyist Bob Naylor, a former Assembly Republican leader whose firm, Nielsen Merksamer, has a client list that ranges from oil giant BP to tobacco companies and several counties.

Some candidates turn down money from tobacco companies, gun manufacturers or the oil industry. Although Schwarzenegger accepts money from oil companies, he is the rare, or perhaps only, California officeholder who refuses money directly from trade groups that represent such mainstream businesses and professions as homebuilders and physicians.

“I don’t understand it,” said Steve Thompson, who oversees governmental affairs for the California Medical Assn., whose donations have never before been turned down. He said he had offered a contribution on the group’s behalf shortly after the recall election, but was rejected.

“Frankly,” Thompson said dryly, “our feelings are hurt that we can’t attend a political fundraiser because we get so few invitations.”

One of the sponsors of Wednesday’s event was the California Manufacturing and Technology Assn. — a trade group.

Schwarzenegger’s aides noted that the association represents such broad-based firms as aerospace giant Northrop Grumman, the pharmaceutical firm Baxter Healthcare Corp. and the makers of Budweiser beer, Anheuser-Busch Cos. The group’s interests are varied, ranging from the cost of electricity, health care and workers’ compensation insurance to tax policy.

Schwarzenegger political advisor Wilson said the governor’s ban on money from trade groups remains in place “for now,” leaving open the possibility that the policy could change.

He described the original decision to reject such money as a “judgment call,” adding that a “single-issue trade group would be more closely aligned with voters’ perception of what is a special interest.”

The fundraiser in Sacramento was the fourth the governor has held since taking office five weeks ago. He plans to hold a fifth next month in San Francisco. Initially, Schwarzenegger’s aides said the money would be used to help Schwarzenegger pay off a $4.5 million bank loan he took out to help fund his campaign.

On Wednesday, Wilson said no decision has been made about the debt’s repayment. At least some of the money is being used to “pay off bills left from the campaign” and to pay accountants and attorneys who will represent the governor in routine state audits of candidates’ campaign accounts, he said.

Some lobbyists took a pass on Wednesday’s event. One, who spoke anonymously to avoid offending the governor, said it would be a “pretty typical political evening,” only more crowded and with less opportunity to talk to the man in charge.

“It is going to be a mill,” he said. “You’d be talking to the same people you talk to all the time.” Besides, he added, his corporate clients that are big businesses “don’t need to stand in a photo line” to be heard.

GRAPHIC: PHOTO: ON THE OUTSIDE: Jerry Flanagan, of the Foundation For Taxpayer and Consumer Rights, points to a jar full of 21,200 jelly beans, symbolizing the limit to campaign contributions of $21,200, that he tried to use to enter a fundraiser for the governor. PHOTOGRAPHER: Associated Press

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