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The Sacramento Bee
Feb 04, 2004 - 01:00 AM

by Margaret Talev, Bee Capitol Bureau

Recall total: $89 million spent

Schwarzenegger and his allies accounted for $27 million of the total election tab.
Advocates and opponents of California's historic recall election spent at least $89 million in last year's whirlwind race, and some are still trying to dig themselves out of the hole financially, according to new campaign records.

Reports filed this week with the secretary of state show Gov. Arnold Schwarzenegger and his supporters spent about $27 million on his successful campaign to unseat his predecessor, Gray Davis, last October.

Of the money Schwarzenegger controlled, $22.8 million went to promote the wealthy actor's candidacy while another $4.2 million advocated removing Davis.

"We think it was money well spent," said Dave Gilliard, a Republican consultant whose committee, Rescue California, spent another $3.6 million gathering voter signatures to put the recall on the ballot.

Those working to keep Davis in office spent at least $21 million, according to the reports, which document spending through the end of last year.

About $12 million was spent collectively on so-called independent expenditures, money spent on behalf of or against a candidate by an outside group.

Part ballot measure, part governor's race, the recall introduced unprecedented dynamics to a typically high-spending California political battle.

At $89 million, it was not the costliest campaign in terms of one-year spending. In 1998, Davis, Republican challenger Dan Lungren and the two millionaires Davis dispatched in the Democratic primary - Al Checchi and Jane Harman - combined to spend $121 million.

In the following gubernatorial race, more than $111 million was spent in 2002 alone. Davis spent $64 million to Republican Bill Simon's $36 million, while the two losers in the GOP primary - Bill Jones and Richard Riordan - combined to spend another $11.5 million.

But in terms of money raising, last year's campaign may represent the fastest call to arms. It took only eight months from the time activists announced plans for a recall until Election Day. Most of the money had to be raised from scratch. In standard governor's races, candidates have four years to raise money, even if they spend most of it in the final months.

Now, nearly four months after the recall election, millions of dollars remain in outstanding loans and bills from various groups. Californians Against the Costly Recall, for example, reported $506,000 in unpaid bills and not enough cash on hand to cover those expenses.

Friends of Cruz Bustamante, through which the lieutenant governor raised money to campaign for Davis' job, reported $490,000 in outstanding bills. Political commentator Arianna Huffington's campaign owed $218,000.

The tab still drawing the most controversy is $4.5 million in bank loans taken out by Schwarzenegger.

In the past, such loans have allowed candidates to be repaid months later by powerful special interest groups, and campaign finance watchdogs say that keeps voters in the dark until after an election. This time, a Democratic activist sued to prevent that from happening, arguing that election law no longer permits such loans.

Last week, after a judge ruled Schwarzenegger could not tap donors to repay the loans, the governor made headlines by declaring the ruling "fantastic" and insisting he'd always intended to repay it with his own money, contradicting weeks of statements from his advisers.

Bob Stern, president of the Center for Governmental Studies in Los Angeles, said the governor's reaction to the judge's decision undermined his credibility. "He should have just said, 'I accept the court's decision and I'm not going to appeal it,' " Stern said.

The latest finance documents indicate that, at the end of last year, Schwarzenegger had a net surplus of about $700,000 in donations from others that he might have used to begin repaying the loan had the judge allowed it. The loans come due at the end of this month. Schwarzenegger advisers say they will refund to donors any money left over after all the 2003 bills are paid.

Meanwhile, another campaign finance watchdog took issue with $1.3 million the latest reports showed being transferred from one of Schwarzenegger's committees to another governed by stricter finance limits.

Jamie Court, president of the Foundation for Taxpayer and Consumer Rights in Santa Monica, said the transfers may be legitimate under the state's complex campaign finance laws but seem to contradict Schwarzenegger's promise to make campaign financing easier for voters to track.

"He said he'd come to town and make campaign finance laws transparent," Court said. "He has so many committees, and he's moving around so much money, it looks more like an Enron bank statement."

Schwarzenegger adviser Marty Wilson said the fund transfers were made in consultation with the Fair Political Practices Commission to cover shared expenses such as advertising and overhead between the two campaigns.

"I think the only person who's confused is Mr. Court - he doesn't understand the law," Wilson said.

Among other major gubernatorial candidates, finance reports showed close to $20 million was spent by two committees controlled by Bustamante. State Sen. Tom McClintock spent $2.3 million. Businessman Peter Ueberroth, who dropped out of the race before Election Day, spent $3.9 million. Huffington's campaign spent $1.1 million. Green Party candidate Peter Camejo spent about $500,000. Businessmen Bill Simon and Garrett Greuner spent $1.1 million and about $600,000, respectively.

About the Writer
---------------------------
The Bee's Margaret Talev can be reached at (916) 326-5540 or mtalev@sacbee.com.
Alexa H. Bluth of The Bee Capitol Bureau contributed to this report.




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