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The Los Angeles Times
Dec 03, 2006 - 01:00 AM

by Peter Nicholas

Fundraising beat goes on for Gov.;

Special accounts help Schwarzenegger add to his record cash totals.
SACRAMENTO, CA -- Reelection is behind him, but Gov. Arnold Schwarzenegger is keeping his fundraising operation at full throttle, asking donors to pay for a stylish inauguration and seeing to it that he continues to fly private jets and stage public appearances worthy of a Hollywood celebrity.

The governor's political team has approached Chevron Corp., PG&E, Blue Cross of California, AT&T and other businesses, asking for tens of thousands of dollars to pay for a two-day celebration surrounding his Jan. 5 inauguration.

As a newly elected governor taking office in 2003 amid a fiscal crisis, Schwarzenegger staged a relatively modest inauguration. But with the economy improving, his aides said a more festive event is in order. The occasion even has its own "executive producer" -- Carl Bendix, a friend of California First Lady Maria Shriver.

A copy of the invitation shows that for $50,000, donors can purchase a "gold" sponsorship that includes 10 tickets to a reception Jan. 4, four reserved seats for the inaugural ceremony the next day and a table for 10 at a legislative luncheon.

"Silver" sponsorship is $15,000 and buys a pair of tickets to the reception, two for the swearing-in and two for the luncheon, among other perks.

The money goes to a nonprofit committee that can take donations of any size.

At the same time, Schwarzenegger is taking advantage of a new fundraising law he signed three months ago meant for politicians like himself who, for the time being, don't have another race to run. His attorneys have set up a special "officeholder" account that allows him to collect up to $200,000 a year for assorted expenses (though not for a political campaign); donors can give $20,000 apiece per year.

As a lame duck, Schwarzenegger is barred from raising money through a reelection fund and wants the new account to underwrite the professional-quality lighting and sound, private air travel and satellite feeds that are fixtures of his operation, aides said. Contributions to the fund must be publicly disclosed.

Another political account is devoted to what Schwarzenegger's aides call "legislative advocacy." If the governor wants to travel around the state urging passage of a particular bill, he intends to use that fund to cover the costs, aides said. Donors must be disclosed.

The fund is not new; the governor has used it to wage ballot campaigns. But he sees less need for that in his second term and plans to use the fund to push his legislative agenda.

The fundraising drive comes as the Schwarzenegger administration is setting a second-term agenda being watched closely by some of the companies paying into the governor's accounts.

One of Schwarzenegger's priorities in the next term, for example, is implementing a new law meant to curb emissions that contribute to global warming. Chevron and other energy companies that must comply with the law have a stake in how it is put into effect.

Campaign watchdog groups said the officeholder account in particular, with its $200,000 threshold, amounts to another vehicle for donors to influence the governor.

"It's designed to enable officeholders to get money from people who want something from them," said Robert Stern, president of the nonpartisan Center for Governmental Studies in Los Angeles and former general counsel to the state's Fair Political Practices Commission.

"I have no problem with a limited officeholder account," Stern said. "But $200,000 is way too high. They are taking advantage of people coming before them."

The bill authorizing such accounts languished in the Legislature for a year. At midnight in the final hours of the last legislative session, the measure, by Sen. Kevin Murray (D-Culver City), was revived and passed. The governor signed it Sept. 29.

As Schwarzenegger bolsters his fundraising, aides insist he wants to make campaign finance reform part of his 2007 agenda. One idea the governor is considering is a ban on fundraising in the months when state officials are negotiating a new budget, the aides said.

Schwarzenegger, who has raised a record-setting $114 million since jumping into the recall campaign in 2003, has not embraced proposals that would lower caps on what politicians can accept.

"The governor has always said that the issue is stopping the practice of money in, favors out," said Schwarzenegger's communications director, Adam Mendelsohn.

Organizers of the governor's inauguration say they do not yet know how much the events will cost; activities are still being planned. But the invitation that went to donors mentions a reception for sponsors at the California Museum for History, Women and the Arts; the legislative luncheon in the Capitol rotunda; and a party in the ballroom of the Sacramento Convention Center the night of the inauguration.

The centerpiece is the swearing-in, set for 11 a.m. at Sacramento's Memorial Auditorium.

Writing the governor's speech for the occasion is Landon Parvin, who also worked for President Reagan. Schwarzenegger will use the forum to lay out a long-term vision for the state, Mendelsohn said.

He will talk about "how he will spend his final term building the California for 20 years from now that he wants for the people of this state," according to Mendelsohn.

So far, Southern California Edison has pledged $15,000 for the inaugural events. PG&E, Chevron and AT&T have said they will probably help. Schwarzenegger aides said that although they're not required by law to reveal the names of donors, they will do so voluntarily on the governor's campaign website: http://www.joinarnold.com .

Other parts of the fundraising apparatus are murkier.

A nonprofit jobs commission that underwrites some of the governor's public events here and abroad also raises money from California businesses. The group last disclosed contributors more than a year ago.

Mark Mosher, acting executive director of the commission, said donors would be revealed at an unspecified date "in the future, on a timeline that works for our accountants."

Mosher is principal of a San Francisco consulting and lobbying firm, whose website says that "when you need a decision or vote to go your way, [the company] can get you direct access to the decision-makers."

A special nonprofit residence foundation pays for Schwarzenegger's 1,800-square-foot hotel suite at the Hyatt Regency, across the street from the Capitol. George Kieffer, president of the foundation, said the group has raised $90,500 over the last year from 14 individuals and companies. Donors' identities may remain secret by law.

Kieffer disclosed their names voluntarily. They include Lowe Enterprises, a Los Angeles real estate firm; Herzog Contracting Corp., a Missouri construction contractor with offices in California; and Mercury Air Group Inc., a Los Angeles aviation services firm. Kieffer's list did not say how much each donor gave.

With money coming in from so many sources, and with no uniform method for disclosing donations, it is hard for people to keep track of who is supporting Schwarzenegger and whether they're profiting from the relationship, watchdog groups said.

Sheila Krumholz, acting executive director of the Center for Responsive Politics in Washington, D.C., said Schwarzenegger "should be credited with disclosing donors" to his inauguration fund.

But she added: "Providing lots of additional avenues for donors to seek access and influence makes it difficult for voters to understand the facts behind how policy is decided. It's important that this information be made available so that you can draw the most accurate conclusions about how policy is formed."

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$114 million = Record total raised by Gov. Arnold Schwarzenegger since the recall race in 2003

$200,000 = Limit on annual collections for the governor's new "officeholder" account

$20,000 = Annual sum that donors can give to the new account

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Contact the author at peter.nicholas@latimes.com




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