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Sacramento Bee
Jan 18, 2004 - 01:00 AM

by Gary Delsohn, Bee Capitol Bureau

Clock runs for debt bond initiative

Governor launches a drive for funds - and his critics are buzzing.
Gov. Arnold Schwarzenegger, his debt-reduction bond trailing in the polls, has just six weeks to raise the $8 million to $12 million aides say is needed to come out victorious in the March election.

While he's just starting to ask for the cash, a well-known Los Angeles consumer group has stepped up its attacks on Schwarzenegger's fund-raising approach, calling him a hypocrite who is far worse than deposed Gov. Gray Davis when it comes to trolling for contributions.

Not to worry, say Schwarzenegger's political staff and supporters. The money will be there.

Schwarzenegger was in Orange County on Friday to hold his first of at least five regional fund-raising meetings, getting together at the Four Seasons Hotel in Newport Beach with business leaders and other potential big contributors.

For about 90 minutes over lunch, the GOP governor and his campaign staff laid out their arguments for his so-called Fiscal Recovery Plan. Marty Wilson, chief fund-raiser for the effort, said follow-up phone calls will come in a few days.

"Hopefully, there will be some six-figure contributions out of this, and that's how we'll raise our money," Wilson said.

Because the money is being used for an initiative and not an individual candidate, contributors are free to give as much as they want. They aren't bound by the legal limit of $21,200 for candidates.

Additional fund-raising sessions are scheduled for San Francisco on Monday, Sacramento on Wednesday and Los Angeles on Thursday.

Allan Zaremberg, president of the California Chamber of Commerce, called the fund-raising target "an achievable goal."

Business leaders will support Schwarzenegger's bond because they can relate to the state's financial problems, he said.

"There's a lot of analogies to a business that has spent more than its revenues and then a new CEO comes in and needs more time to pay off the debt," Zaremberg said. "It's very understandable and pretty simple."

Schwarzenegger told members of the chamber at a Sacramento reception before he took office that he would be back asking for millions of dollars to help implement his Fiscal Recovery Plan.

Now that the campaign has started, Zaremberg has no doubt businesses will respond.

"The business community understands his recovery plan is going to help the California economy," he said. "They are supportive of what the governor is trying to achieve."

Schwarzenegger will have help. Democratic Controller Steve Westly, a co-chairman of the campaign to pass both the $15 billion debt-reduction bond and a companion spending cap, will also solicit money for the effort.

He wasn't at Friday's meeting in Orange County, Wilson said, "but there were Democrats in the room."

Todd Harris, a spokesman for the campaign, said it will be a bipartisan effort.

"The governor will be making the appeal directly at a series of events, but Democrats have committed to participate," he said.

As if to underscore that point, the bond campaign team started a new fund-raising account just for the twin propositions.

It's called Californians for a Balanced Budget/Yes on 57 & 58. It's a complement to Schwarzenegger's California Recovery Team account, but the 57 & 58 entity is designed specifically for Democrats who wouldn't be comfortable contributing to the less-focused Schwarzenegger account.

Money in that account might be used on another ballot campaign on workers' compensation insurance and could also help pay Schwarzenegger's expenses, such as his bills for the Hyatt hotel when he's in Sacramento, Harris said.

"The message to donors is not any different than the message to the public," Harris said. "We lay out the fiscal situation the state is in and we explain to corporate leaders, business leaders and interested parties what the ramifications are if this doesn't pass."

Surveys released last week by the Field Poll and Public Policy Institute of California show the measures trailing, especially with Democrats.

Schwarzenegger will try to raise the money just as the Los Angeles-basedFoundation for Taxpayer and Consumer Rights steps up its attacks onSchwarzenegger for soliciting some of the "special interest" money he repeatedly said he wouldn't seek as he ran for governor.

On Thursday, the group released a letter Ward Connerly, a Republican businessman and controversial affirmative action foe, has sent to friends and clients asking for contributions to help retire Schwarzenegger campaign bills.

"This provides an excellent opportunity for ... California Building Officials, acting as individuals, to pool their resources so that the voice of building officials might be heard," says Connerly's letter. It's dated Nov. 17, the day Schwarzenegger was sworn in as governor.

Connerly said he was asked by a Republican fund-raiser to help raise money for Schwarzenegger and said he only came up with $5,000 and expects nothing in return.

"I did nothing wrong and I certainly don't think the governor is doing anything inappropriate," Connerly said in an interview last week. "None of this is going to affect his ability to raise funds for the upcoming campaign. There's a lot of enthusiasm for it, and I doubt he'll have trouble raising the money."

The Foundation for Taxpayer and Consumer Rights has hammered at Schwarzenegger for months on its "ArnoldWatch" Web site and has created a tip line for people to call or e-mail tips on examples of fund-raising abuses.

The Connerly letter was posted on the foundation's Web site, said JamieCourt, the group's president, "because clearly the signal is being put out to lobbyists by this administration that to give is to be heard. That may be a silent signal that goes out from every administration, but this governor said he wasn't going to solicit or accept special interest money. I never saw a letter that went out when Gray Davis was governor that was this explicit."

Davis was widely criticized during his five years in the Governor's Office for his alleged "pay to play" tactics. Though the former Democratic governor and his aides denied the allegation repeatedly, critics said the perception grew that the only way to get the administration's attention was to contribute to Davis' campaigns.

Wilson said he doesn't think the foundation's attacks on Schwarzenegger resonate with the public or potential contributors.

"The money he is raising is being used to accomplish some pretty significant public policy objectives," Wilson said. "Politics is financed in California by the willing contributions of individuals and companies, and those are the rules of the road. There are always going to be some people who don't like that."
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The Bee's Gary Delsohn can be reached at (916) 326-5545 or gdelsohn@sacbee.com




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