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State's top 100 political donors contribute $1.25 billion

In a state with nearly 38 million people, few have more influence than the top 100 donors to California campaigns – a powerful club that has donated overwhelmingly to Democrats and spent $1.25 billion to influence voters over the past dozen years.

These big spenders represent a tiny fraction of the hundreds of thousands of individuals and groups that donated to California campaigns from 2001 through 2011. But they supplied about a third of the $3.67 billion lavished on state campaigns during that time, campaign records show.

With a few exceptions, these campaign elites have gotten their money’s worth, according to an analysis by California Watch of data from the National Institute on Money in State Politics and state finance records.

The state’s top 100 donors gave nearly five times as much to winning candidates as they did to losers. And they helped steer initiative campaigns to success as well – about 55 percent of every dollar they contributed to propositions aided a winning campaign, the analysis shows.

Some of these top 100 donors are continuing to donate heavily in the 2012 election cycle. For their part, tobacco companies Philip Morris and R.J. Reynolds have spent more than $30 million since January to defeat an initiative on tomorrow’s ballot that would increase the cigarette tax.

“Major players with major stakes in statewide issues are going to make sure their opinions are heard,” said Jack Pitney, a political science professor at Claremont McKenna College who focuses on California issues.

Given its size and wealth, California automatically sets national records for campaign donations – more money is spent here on politics than in any other state.

Not surprisingly for California, the top 100 directed their money in large part toward the Democratic Party, which controls the governor’s office and the state Legislature. Overall, these top donors – 50 wealthy individuals and 50 special interest groups analyzed by California Watch – gave twice as much to Democratic candidates as they did members of other political parties.

But there was a split: Special interest donors favored Democrats, while individual donors favored Republicans by a slim margin.

When broken down, records show the top 50 group contributors – including labor unions, energy companies and tribal governments – were three times more likely to give to Democratic candidates. The top 50 individuals, however, gave slightly more to Republicans.

The state’s most extravagant individual donor and biggest campaign loser is Stephen Bing, the real estate scion and Hollywood producer. He gave more money than any other individual to a state campaign – $49.5 million in 2006 to support Proposition 87, known as the alternative energy oil tax, which failed.

But Bing proved that a handful of California’s richest special interests and individuals have an outsized voice in elections here. The campaign he spearheaded became one of the most expensive in California history, drawing more than $156 million in contributions. Chevron, Aera Energy and Occidental Oil & Gas donated a combined $80 million to fight Bing’s measure.

The biggest special interest donor, the California Teachers Association, spent more than $118 million on campaigns in the state during the past five election cycles and the first half of this one. The union has focused overwhelmingly on initiatives, spending $100 million of that war chest advocating and opposing ballot measures over the past dozen years.

More than a third of its spending went to fight just four propositions that were key pieces of Gov. Arnold Schwarzenegger’s attempted government overhaul in 2005. The measures – all of which failed – would have extended the probationary period for teachers, altered the formula for funding public schools, required employee consent on union dues and removed redistricting powers from the Legislature.

Eight tribal governments also made the list of top special-interest donors. But two stood out: The Pechanga Band of Luiseño Indians and the Morongo Band of Mission Indians spent a combined $80 million in 2008 supporting four propositions to expand tribal gambling operations; they all passed.

Individual donors favor GOP

Bing, who also donated to Democratic candidates, was a bit of an outlier among the largest individual donors. The five most generous donors gave twice as much to Republicans than to Democrats.

Andrew “Jerry” Perenchio, the former chairman and CEO of Univision, and Charles T. Munger Jr., a wealthy Stanford physicist, were the state’s second- and third-largest donors. Perenchio gave at least $9.3 million to the state’s GOP, and Munger, who contributed mostly to ballot measures, is active in Republican politics.

California Watch, working in partnership with a Stanford University investigative reporting class, attempted to reach several of the top 50 individual donors. None would comment for this article.

But some of the elite institutional contributors were more open. The California Teachers Association, which has 325,000 members, said it uses an internal council of more than 800 members to vote on which candidates and causes to support.

When collecting dues from its members for political causes, the union operates a two-tiered system. Members give $8 each year to a committee that supports candidates and $36 annually to a ballot measure committee. They have the right to opt out of both committees.

Paul Bailey/Flickr Protesters slam Gov. Arnold Schwarzenegger at a 2010 rally supporting the California Teachers Association, the state’s top-ranked campaign donor. The group spent a large portion of its political budget fighting Schwarzenegger during his administration.

To campaign against Schwarzenegger’s 2005 ballot measures, members voted to increase its annual contributions to $60 for three years.

“We were starting to see a lot of things surface that we felt were dangerous and we needed to defend against,” said Dean Vogel, president of the union. “It wasn’t so much a need to promote anything, but a way to defend against egregious attacks against public education.”

Among the top 50 individual donors, men dominate the ranks. Only five are women.

Ann Howland Doerr donated $3.1 million, most of it on two successful proposition battles. She spent $1.9 million for Proposition 71 in 2004, which supported stem cell research, and she gave $1 million to defeat Proposition 23 in 2010, which would have suspended California’s law to curb greenhouse gas emissions. Doerr’s husband, venture capitalist L. John Doerr III, gave more than $9 million to political causes and was the state’s fourth-largest donor.

Self-funded candidates were not included in the analysis, leaving former eBay CEO Meg Whitman off the list. Whitman spent more than $140 million on her failed gubernatorial campaign in 2010.

California Watch’s analysis focused on data through 2011. The numbers include money donated to state candidates and initiatives, but does not include federal campaigns or money donated to independent expenditure committees, which allow contributions in unlimited amounts to benefit candidates.

This year, California's large donors are continuing to exert influence with donations to fight ballot initiatives, according to data from the California secretary of state’s office.

Along with Philip Morris and R.J. Reynolds, which are spending tens of millions to fight Proposition 29 on tomorrow’s ballot, Pacific Gas & Electric and Perenchio each donated $100,000 this year in support of Proposition 28, which would alter the state’s term limit law.

Tobacco companies have a long history of big spending in California initiatives. R.J. Reynolds and Philip Morris combined to spend $60.5 million opposing Proposition 86 in 2006, which also would have increased taxes on cigarettes. More than $83 million was donated in support and opposition of the measure, but proponents of the tax were vastly outspent, 4 to 1.

In practice, one individual or group with deep pockets can have a greater impact on ballot measures than with any single candidate’s election. Under campaign finance laws, individuals and groups are limited in how much they can give to candidates. But donations to committees supporting or opposing ballot measures are effectively unlimited.

For donors, despite a lower success rate, an initiative campaign is a safer bet.

“When you give money to a person, that person could end up being a disappointment,” Pitney said. “A ballot initiative is an inanimate object. It cannot double-cross you.”

Equal chances in ballot measure spending

Thad Kousser, a political science professor at UC San Diego, said groups opposing initiatives have just as much chance of success as groups supporting them. In a recent study, Kousser and a colleague found that from 1976 to 2004, money spent for or against ballot measures had equal effects on the outcome.

“You can’t get anything passed with just money in California,” he said. “You can’t just spend your way into public support.”

Kousser said he doesn’t see a direct relationship between donating to candidates and influence. On a per-dollar basis, he said, direct lobbying can be more effective.

“Campaign contributions open a legislator’s door to you,” Kousser said. “You need to send the lobbyist to walk through the door if that access is going to get you anywhere. Partly, you spend that money on campaigns to make sure your voice is heard during the lobbying.”

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AT&T spread its contributions around more than any other top donor. The company donated to more than 700 different campaigns. Less than 10 percent of the nearly $10 million it donated went to ballot measures. Of the rest, $3.7 million went to Republicans and $5.3 million went to Democrats.

Pacific Gas & Electric, the third-largest donor, gave to nearly 600 different campaigns for political candidates. Democrats received $3.2 million, compared with $1.8 million for Republicans. The majority of its $67 million in donations went to support or oppose ballot measures.  

Political contributions come from the company’s shareholders fund and not from public utility customers’ payments, spokeswoman Lynsey Paulo said.

“We think it’s important to participate in the political process,” Paulo said. “That includes contributions to campaigns and engaging with individuals who have the potential to make decision to affect our customers, employees and our company.”

Democratic political strategist Bob Mulholland said specific issues motivate top donors more than individual candidates, which is one of the reasons why propositions garner large contributions from a select group.

“Some people don’t wake up every day thinking about politics, but they are moved by things that are happening in the world,” he said. “They have the resources to spend, and they believe in the cause.”

Mulholland, who is not employed by any campaigns this year, is a delegate for California at the Democratic National Convention in September. He sees top donors making up less of a role in state politics as technology enables campaigns to target and tailor messages to unique donors and elicit small donations.

“The future means more money,” he said. “Yes, certain groups will continue to donate, but the future is more campaigns will have more donors. That’s good for campaigns because that allows you to quickly raise money when you’re under attack. You have a large pool you can go to.”

This story was edited by Robert Salladay and Mark Katches and copy edited by Nikki Frick and Christine Lee.

Filed under: Money & Politics

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