When I saw the headline: “Labor unions are paying to help California’s lieutenant governor decorate her office,” I nearly spit out my coffee.
It turns out Lieutenant Governor Eleni Kounalakis raised about $330,000 by “behesting” payments from labor unions, lobbyists and her family business to support a so-called non-profit charity named the Committee to Support the Office of Lt. Governor.
The committee’s purpose at the moment is to pay for fancy furniture and art in Kounalakis’ Sacramento office, instead of an actual charitable purpose. It’s an abuse of the system and while Democrats continue to talk about campaign finance reform, they flaunt the laws whenever possible. They don’t even try to hide it anymore. That’s why we filed a complaint with the FPPC.
Kounalakis hired a top lawyer to help her form the committee and installed a former chair of the Assembly elections committee as the president/director. All are obviously ignoring the laws and the reasons behind them.
Because it benefits her, the funds aren’t charitable in the sense of what the law intended. They should be considered either contributions to an officeholder account or gifts, both of which would be problematic because they are over the limits.
In the mid-nineties, the Fair Political Practices Commission adopted regulations defining a campaign contribution as any payment behested by officeholders. Because officeholders then had to report behested payments as campaign contributions, it inadvertently put a chilling effect on something as wholesome as a grocery store donating turkeys for a Thanksgiving giveaway at the behest of the officeholder.
In 1997, the Legislature fixed the “turkey problem,” a real-life example, by saying a these payments weren’t contributions if they were for legislative, governmental or charitable purposes.
In 2000, voters approved Proposition 34, which focused on money in campaigns. Termed-out officeholders now had the ability to use leftover campaign funds to support their officeholder needs—they just weren’t allowed to raise new funds for those needs, but current officeholders had no way to do so.
For that reason, SB 145, passed in 2006, created officeholder accounts subject to certain limits.
(Full disclosure: I presented this bill to Gov. Arnold Schwarzenegger for his signature.)
Under the current limits, lieutenant governors are permitted to raise $121,100 in contributions that can’t exceed $6,000 in one year from any source. Koulanakis raised twice that amount in contributions substantially larger than $6,000.
Clearly, Koulanakis and her braintrust knew all of this when creating the so-called charity. Her “charity” functions as an officeholder account and should be subject to those limits.
Despite the committee’s generic name, it is clear the formation was intended to benefit Kounalakis. If these aren’t officeholder contributions, then they are gifts—a name for payments designated for use by a public official. Current law sets limits gifts at $500 from a single source in a calendar year. This limit was also exceeded.
This is a serious matter and the FPPC owes it to the public to consider our complaint. I realize this isn’t a Watergate-level scandal, but not only are special-interest groups being permitted to buy influence in unlimited amounts, but we’re sliding down a slippery slope as well.
If public officials are allowed to raise unlimited funds for whatever they say is supporting the office, then what’s next? T.V. ads? It’ll be franking privileges on steroids.
Kounalakis’ committee demonstrates just how easy it is to circumvent Proposition 34’s contribution limits. It is time for the Legislature and the FPPC to act.
I now understand why my old boss, Senator Ross Johnson, an architect of Proposition 34 and former FPPC Chairman, apologized to California voters for supporting Proposition 34—he saw a loophole big enough to store all of the lieutenant governor’s new furniture.