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The San Francisco Chronicle
Jan 03, 2004 - 01:00 AM

by Lynda Gledhill, Chronicle Sacramento Bureau

Governor's fund-raising gambit draws ire;

One of new committees isn't covered by contribution caps, has nearly $200,000
SACRAMENTO -- Gov. Arnold Schwarzenegger has established two new fund-raising committees, including one that is not subject to any campaign finance restrictions.

The just-created California Recovery Team committee already has taken in nearly $200,000, mostly in large contributions that exceed the $21,200 limit on contributions to a governor.

Because it is set up as a lobbying committee and is not specifically designed to help Schwarzenegger get re-elected, there are no limits on contributions.

The committee is designed to finance "grassroots lobbying" efforts such as public rallies and letter-writing campaigns. Schwarzenegger has said he wants to "go directly to the people" if lawmakers do not take action on his major proposals.

"It's designed to provide a platform for the governor to take his legislative and ballot measure priorities directly to the public -- through appearances, earned media events and perhaps even paid advertising," Schwarzenegger political adviser Marty Wilson told the Associated Press.

But consumer advocates said Schwarzenegger was breaking his promise to the people of California that he would end politics as usual.

"In a way, what he is doing is more deceptive than what (former Gov.) Gray Davis ever did," said Doug Heller, consumer advocate for the Foundation for Taxpayer and Consumer Rights. "That's what is so shocking -- he said he would be cleaning house, but he's just building his own political house from the same kind of special-interest bricks that Davis did."

The committee also will be the principal campaign vehicle to pass two ballot initiatives Schwarzenegger persuaded legislators to place on the March 2 ballot: Proposition 57, a $15 billion bond to help the state refinance its deficit, and Proposition 58, a mandate to balance the budget, restrict future borrowing and require a reserve fund. Aides to the governor said that the committee could spend $8 million to $12 million persuading voters to approve the two ballot measures.

Robert Stern, president of the Center for Governmental Studies in Los Angeles, said Schwarzenegger was taking advantage of the fact that people wanted to give him money.

"If people are throwing money at you, why not take it?" he said. "The people who are giving money now get a two-fer. They get to influence him, and they get to be with him. I think there are a lot of people who just want their picture taken with a star."

While the committee is legal, Stern said, it violates the spirit of campaign finance laws voted on by the people.

"It still creates the same appearance of corruption that the law was designed to correct," he said. "I would urge him to voluntarily comply with the limits."

Six companies have donated nearly $200,000 to the California Recovery Team as of Friday. The largest donation was $50,000 from Southern California Edison. All of the other money came from out-of-state insurance businesses.

"I dare Schwarzenegger to say these are not special interests," Heller said.

Donations of the second committee, Californians for Schwarzenegger, will be subject to campaign limits set by voters. While the election is being set up as a re-election committee, aides said that was not necessarily a signal that Schwarzenegger has decided to seek a second term.

"Don't misconstrue it as an announcement for re-election," said Rob Stutzman, Schwarzenegger's communications director.

The fund was set up to help pay for political and personal costs of the governor, including personal political travel, the salaries of some political aides, and may defray some of Schwarzenegger's personal costs in Sacramento, including the suite at the Hyatt Hotel where he has stayed since his inauguration.
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The Associated Press contributed to this story. E-mail Lynda Gledhill at lgledhill@sfchronicle.com






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