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San Diego City Council scrambles to raise money before new rules

The last lucrative off-season

— The speeches are over, the yard signs are long gone, and the TV reporters are back covering drive-by shootings or bemoaning the possible demise of the Holiday Bowl parade. Campaigns for four seats on the San Diego City Council ended last March with the reelection of Harry Mathis, Christine Kehoe, Barbara Warden, and Judy McCarty. Mathis and Warden ran unopposed, while Kehoe and McCarty faced token opponents. And there won't be anymore council elections until 1998, when Juan Vargas, Valerie Stallings, Byron Wear, and George Stevens are scheduled to face the voters. Thanks to term limits, the mayor can't run again.

But the lack of a campaign didn't end the city council's frantic fundraising during the last six months of 1996. According to financial disclosure records filed last week, it was business as usual as the eight members of the council, along with Mayor Susan Golding, collected a total of $130,793 from a variety of donors, many of whom were employees of special interests with business pending before the council. Since there were no campaigns to spend it on, the money paid for everything from a junket to Israel to a Washington, D.C., speechwriter to cellular telephone service. One enterprising officeholder used the money to pay himself $7000 in back interest on a $12,000 loan he had made to an unsuccessful 1987 council campaign.

Many of these practices have since been outlawed under the provisions of Proposition 208, the campaign finance reform measure passed by state voters in November. It took effect January 1 of this year. No longer will candidates for office be allowed to collect contributions year-round, whether or not a campaign is in the immediate future. "There is a blackout period until six months prior to the election," notes Tony Miller, spokesman for Common Cause, the self-styled citizens lobby that successfully promoted 208. "Then, after the election, a candidate can only raise money to pay off debt during a 90-day period immediately following the election.

"The candidate must also completely distribute any [campaign fund] surplus within the 90 days. The surplus could go to a political party or back to contributors or to the general fund. After that, no more money can be collected." Miller also points out that a campaign committee can't be used as a slush fund to pick up post-campaign tabs for trips abroad or cellular phone bills or speechwriters. "That would be prohibited under the new law."

With the deadline for the new law looming late last year, some San Diego City Council members scrambled to raise and spend money using a creative array of techniques. The most successful local fundraiser was City Councilwoman Valerie Stallings, who staged a December fundraiser billed by her backers as a chance to beat the Prop 208 deadline and collect a campaign warchest sufficient to scare off potential challengers in her next election bout, which won't happen until 1998.

Stallings reported raising $52,076 at $250 a head from a variety of sources, ranging from Douglas Barnhart, whose construction company was awarded the $10 million contract to build the city-sponsored Chargers training facility, to Terence Degelder, listed as an Oceanside resident, who is a sergeant with the San Diego Police Department. Other donors included Stephen Eimer, a real estate developer from Pebble Beach, the tony neighborhood near Carmel, and Ron Fowler, the local beer distributor and recent past president of the San Diego International Sports Council. Dozens of other employees of real estate development firms, city hall lobbyists, and attorneys representing clients with business pending before the council kicked in the maximum $250.

Stallings was able to bank almost $47,000 of the proceeds, spending only $6000 on a variety of fundraising and bookkeeping expenses and leaving herself the most successful city fundraiser of the year. Other members of the council did not raise as much and were not as frugal with their proceeds but did well all the same. The second highest moneymaker, Second District Councilman Byron Wear, collected a total of $35,258 through two committees. In his "Byron Wear for City Council" committee, the incumbent councilman racked up $26,879 in contributions. $250 donors included architects, engineers, lobbyists, lawyers, cable TV company executives, and contractors, as well as the house manager of the Old Globe Theatre. Wear's wife, who also serves as treasurer of the committee, works as a fundraiser for the Globe. Wear's expenditures included refunds of $250 contributions from each of three lawyers who work for Luce, Forward, the firm hired by the council for $250,000 to represent the city in its courtroom battle against Bruce Henderson and the anti-stadium forces. Luce, Forward has also represented Chargers owner Alex Spanos. Wear paid Rancho Santa Fe political consultant Donna Cleary $6498, along with payments to other smaller vendors, leaving him with a cash balance of $3579.

Through his other committee, "Byron Wear for Council '87," set up a decade ago to mount an unsuccessful bid for the council, Wear raised $8379 in the last half of this year. Donors were largely developers, contractors, and real estate interests. Wear used $7947 of the cash thus raised to pay himself deferred interest on a $12,550 loan at 6 percent he had made nine years ago to his 1987 campaign. He also paid himself $331.68 in principal on the loan, leaving an outstanding debt to himself of $12,550.24 and $923.76 in cash.

Common Causes's Miller notes that Proposition 208, with its bar on fundraising between elections, means that it will be much more difficult to raise money to pay off such personal debts in the future. The new law also limits personal loans to $20,000, although it does not require them to be paid off over a specific time schedule. Third in line at the political money tree during the period was Mayor Susan Golding, whose report shows she collected $31,689. Donors included many of the same real estate and stadium construction interests who have given to her before. $250 donors included William Stone of developer Oliver McMillan, engineer Robert Burkett of Burkett & Wong, and Peter and Phillip Mossy, along with two employees of their car dealership.

A group of 14 Cox Cable employees, some from Orange County, anted up $96 apiece during November for a total of $1468. Cox's cable rate increase case is expected to be heard by the city council next month. In November 1995, Cox was forced to pay a $42,000 fine after seven Cox executives and the wife of an executive made 24 contributions totaling $4850 to nine candidates, ranging from some running for the San Diego City Council to Governor Pete Wilson. The employees had been reimbursed by the company, a violation of state and city law. Cox did not respond to a request for comment on the latest contributions. Cox employees also gave to councilmembers Wear and Stevens.

Golding spent $3000 of her campaign cash on Chriss Winston, a Washington, D.C.Pbased speechwriter who once worked for Ronald Reagan and George Bush. Another $1300 paid for a video monitoring service in New York, and about $350 was earmarked to the GTE Mobilenet cell phone company. Though she wasn't officially running for anything, the mayor also paid more than $5000 to her political consultant, Campaign Strategies. Much of the rest went for fundraising and bookkeeping services.

In all, Golding spent more than $49,000, leaving her with a total of $3859 left in the treasury. Since she is subject to term limits, she may now raise and spend no more money under the restrictions of Prop 208. Observers expect her to open a federal exploratory committee later this year to fund her possible bid for the U.S. Senate. Contributions to such committees are limited to $1000 and not subject to Prop 208 restrictions.

Next on the list of city hall off-year money raisers was District Four's George Stevens, who collected $7795. $250 donors included San Diego real estate developer Reese Jarrett; Pardee development vice president David Dunham of Camarillo, California; Pardee executive David Landon of Encino, California; and carpenters union executive John P. Kennedy of Alpine. Dean Spanos of the Chargers gave $250, as did Padres owner John Moores, as well as his wife Rebecca. Stevens spent $3101 for bookkeeping, copying, and postage, leaving him with a year-end cash balance of $5290.

Further down on the end-of-year campaign cash bonanza was Fifth District Councilmember Barbara Warden. She raised $3150. Along with that, Warden went into the last half of the year with $17,744 in the bank but spent $20,894, leaving her with a zero balance. $250 contributors included Gabrielle Soroka, manager of government affairs for Waste Management of San Diego, a trash hauler; Lightning Development's Harlan Friedman of Poway; and Peter N. Kyros Jr. of Cumberland Foreside, Maine, a partner in Potomac Sports Properties, which is developing a large chunk of the north city.

Warden spent the bulk of the funds raised, $2740.95, to reimburse the United Jewish Federation of San Diego county for airfare to Israel. According to newspaper reports, it was a December trip on which she reportedly accompanied Golding. Common Cause's Miller says that under the state's old campaign laws, paying for such personal travel was legal as long as it had a quasi-official basis. In the future, however, junkets, no matter what the rationale, cannot be paid out of campaign funds if there is no campaign in progress. Warden also paid her campaign consultant, Campaign Strategies, $10,505 and held a "thank you" event for supporters at the convention center for $1758. Ranking well below the rest of the council were its other three members: Harry Mathis, who collected $350; Christine Kehoe, who took in $325; Judy McCarty, at $150; and Juan Vargas, who collected nothing. Although he collected little during the final six months of the year, Mathis had a surplus from previous periods of approximately $11,000, $10,800 of which he used to repay loans to himself on Christmas Eve.

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— The speeches are over, the yard signs are long gone, and the TV reporters are back covering drive-by shootings or bemoaning the possible demise of the Holiday Bowl parade. Campaigns for four seats on the San Diego City Council ended last March with the reelection of Harry Mathis, Christine Kehoe, Barbara Warden, and Judy McCarty. Mathis and Warden ran unopposed, while Kehoe and McCarty faced token opponents. And there won't be anymore council elections until 1998, when Juan Vargas, Valerie Stallings, Byron Wear, and George Stevens are scheduled to face the voters. Thanks to term limits, the mayor can't run again.

But the lack of a campaign didn't end the city council's frantic fundraising during the last six months of 1996. According to financial disclosure records filed last week, it was business as usual as the eight members of the council, along with Mayor Susan Golding, collected a total of $130,793 from a variety of donors, many of whom were employees of special interests with business pending before the council. Since there were no campaigns to spend it on, the money paid for everything from a junket to Israel to a Washington, D.C., speechwriter to cellular telephone service. One enterprising officeholder used the money to pay himself $7000 in back interest on a $12,000 loan he had made to an unsuccessful 1987 council campaign.

Many of these practices have since been outlawed under the provisions of Proposition 208, the campaign finance reform measure passed by state voters in November. It took effect January 1 of this year. No longer will candidates for office be allowed to collect contributions year-round, whether or not a campaign is in the immediate future. "There is a blackout period until six months prior to the election," notes Tony Miller, spokesman for Common Cause, the self-styled citizens lobby that successfully promoted 208. "Then, after the election, a candidate can only raise money to pay off debt during a 90-day period immediately following the election.

"The candidate must also completely distribute any [campaign fund] surplus within the 90 days. The surplus could go to a political party or back to contributors or to the general fund. After that, no more money can be collected." Miller also points out that a campaign committee can't be used as a slush fund to pick up post-campaign tabs for trips abroad or cellular phone bills or speechwriters. "That would be prohibited under the new law."

With the deadline for the new law looming late last year, some San Diego City Council members scrambled to raise and spend money using a creative array of techniques. The most successful local fundraiser was City Councilwoman Valerie Stallings, who staged a December fundraiser billed by her backers as a chance to beat the Prop 208 deadline and collect a campaign warchest sufficient to scare off potential challengers in her next election bout, which won't happen until 1998.

Stallings reported raising $52,076 at $250 a head from a variety of sources, ranging from Douglas Barnhart, whose construction company was awarded the $10 million contract to build the city-sponsored Chargers training facility, to Terence Degelder, listed as an Oceanside resident, who is a sergeant with the San Diego Police Department. Other donors included Stephen Eimer, a real estate developer from Pebble Beach, the tony neighborhood near Carmel, and Ron Fowler, the local beer distributor and recent past president of the San Diego International Sports Council. Dozens of other employees of real estate development firms, city hall lobbyists, and attorneys representing clients with business pending before the council kicked in the maximum $250.

Stallings was able to bank almost $47,000 of the proceeds, spending only $6000 on a variety of fundraising and bookkeeping expenses and leaving herself the most successful city fundraiser of the year. Other members of the council did not raise as much and were not as frugal with their proceeds but did well all the same. The second highest moneymaker, Second District Councilman Byron Wear, collected a total of $35,258 through two committees. In his "Byron Wear for City Council" committee, the incumbent councilman racked up $26,879 in contributions. $250 donors included architects, engineers, lobbyists, lawyers, cable TV company executives, and contractors, as well as the house manager of the Old Globe Theatre. Wear's wife, who also serves as treasurer of the committee, works as a fundraiser for the Globe. Wear's expenditures included refunds of $250 contributions from each of three lawyers who work for Luce, Forward, the firm hired by the council for $250,000 to represent the city in its courtroom battle against Bruce Henderson and the anti-stadium forces. Luce, Forward has also represented Chargers owner Alex Spanos. Wear paid Rancho Santa Fe political consultant Donna Cleary $6498, along with payments to other smaller vendors, leaving him with a cash balance of $3579.

Through his other committee, "Byron Wear for Council '87," set up a decade ago to mount an unsuccessful bid for the council, Wear raised $8379 in the last half of this year. Donors were largely developers, contractors, and real estate interests. Wear used $7947 of the cash thus raised to pay himself deferred interest on a $12,550 loan at 6 percent he had made nine years ago to his 1987 campaign. He also paid himself $331.68 in principal on the loan, leaving an outstanding debt to himself of $12,550.24 and $923.76 in cash.

Common Causes's Miller notes that Proposition 208, with its bar on fundraising between elections, means that it will be much more difficult to raise money to pay off such personal debts in the future. The new law also limits personal loans to $20,000, although it does not require them to be paid off over a specific time schedule. Third in line at the political money tree during the period was Mayor Susan Golding, whose report shows she collected $31,689. Donors included many of the same real estate and stadium construction interests who have given to her before. $250 donors included William Stone of developer Oliver McMillan, engineer Robert Burkett of Burkett & Wong, and Peter and Phillip Mossy, along with two employees of their car dealership.

A group of 14 Cox Cable employees, some from Orange County, anted up $96 apiece during November for a total of $1468. Cox's cable rate increase case is expected to be heard by the city council next month. In November 1995, Cox was forced to pay a $42,000 fine after seven Cox executives and the wife of an executive made 24 contributions totaling $4850 to nine candidates, ranging from some running for the San Diego City Council to Governor Pete Wilson. The employees had been reimbursed by the company, a violation of state and city law. Cox did not respond to a request for comment on the latest contributions. Cox employees also gave to councilmembers Wear and Stevens.

Golding spent $3000 of her campaign cash on Chriss Winston, a Washington, D.C.Pbased speechwriter who once worked for Ronald Reagan and George Bush. Another $1300 paid for a video monitoring service in New York, and about $350 was earmarked to the GTE Mobilenet cell phone company. Though she wasn't officially running for anything, the mayor also paid more than $5000 to her political consultant, Campaign Strategies. Much of the rest went for fundraising and bookkeeping services.

In all, Golding spent more than $49,000, leaving her with a total of $3859 left in the treasury. Since she is subject to term limits, she may now raise and spend no more money under the restrictions of Prop 208. Observers expect her to open a federal exploratory committee later this year to fund her possible bid for the U.S. Senate. Contributions to such committees are limited to $1000 and not subject to Prop 208 restrictions.

Next on the list of city hall off-year money raisers was District Four's George Stevens, who collected $7795. $250 donors included San Diego real estate developer Reese Jarrett; Pardee development vice president David Dunham of Camarillo, California; Pardee executive David Landon of Encino, California; and carpenters union executive John P. Kennedy of Alpine. Dean Spanos of the Chargers gave $250, as did Padres owner John Moores, as well as his wife Rebecca. Stevens spent $3101 for bookkeeping, copying, and postage, leaving him with a year-end cash balance of $5290.

Further down on the end-of-year campaign cash bonanza was Fifth District Councilmember Barbara Warden. She raised $3150. Along with that, Warden went into the last half of the year with $17,744 in the bank but spent $20,894, leaving her with a zero balance. $250 contributors included Gabrielle Soroka, manager of government affairs for Waste Management of San Diego, a trash hauler; Lightning Development's Harlan Friedman of Poway; and Peter N. Kyros Jr. of Cumberland Foreside, Maine, a partner in Potomac Sports Properties, which is developing a large chunk of the north city.

Warden spent the bulk of the funds raised, $2740.95, to reimburse the United Jewish Federation of San Diego county for airfare to Israel. According to newspaper reports, it was a December trip on which she reportedly accompanied Golding. Common Cause's Miller says that under the state's old campaign laws, paying for such personal travel was legal as long as it had a quasi-official basis. In the future, however, junkets, no matter what the rationale, cannot be paid out of campaign funds if there is no campaign in progress. Warden also paid her campaign consultant, Campaign Strategies, $10,505 and held a "thank you" event for supporters at the convention center for $1758. Ranking well below the rest of the council were its other three members: Harry Mathis, who collected $350; Christine Kehoe, who took in $325; Judy McCarty, at $150; and Juan Vargas, who collected nothing. Although he collected little during the final six months of the year, Mathis had a surplus from previous periods of approximately $11,000, $10,800 of which he used to repay loans to himself on Christmas Eve.

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