Power PAC Steps Out of Spotlight

For the better part of the 1990s, the conservative California Independent Business PAC was among the most free-spending political outfits in the Golden State.

But these days, this GOP grizzly is in hibernation.

Phone calls to the political action committee, a klatch of four wealthy families led by Orange County philanthropist Howard Ahmanson, now land in the Azusa home of its part-time secretary, her two cockatiels squawking in the background.

The group’s Pasadena office, once a year-round Republican nerve center, is shuttered. Its three full-time staffers and myriad political gofers are pared down to a lone secretary catching stray calls.

Those are telling changes for a group that was a dominant player in state politics, giving more than $9 million in the last five years to conservative candidates and causes. In 1994, that money helped Republicans seize the Assembly for the first time in a quarter-century.

“They were the paradigm of big money coming into the process to influence elections,” said Tony Miller, a Democratic campaign reform activist and former acting secretary of state. “They fueled the engine that resulted in the Republican takeover.”

Lately the news has been bad for the group. It has been buffeted by the state’s new campaign contribution law and brushed by bad press about a surreptitious GOP effort to influence a pivotal 1995 special recall election in Orange County to replace Assemblywoman Doris Allen.

Some conservatives worry that the PAC won’t reemerge as a force unless the courts strike down Proposition 208, imposed in November by voters, which caps contributions to political groups at $500.

They also say the group’s biggest donors--Ahmanson and his wife, Roberta--seem burned out by the bad publicity linked to the PAC.

“I’m concerned,” said Assemblyman Steve Baldwin, an El Cajon Republican who got more than $200,000 from the group to help him capture his seat in 1994. “These guys seem to be taking themselves out of the ballgame.”

Others say it is hardly so dire, that the group may well reemerge in a new form to help the conservative cause.

“Any suggestion that they’re undergoing some unique or special transition might be a little bit premature,” said Wayne Johnson, a Sacramento political consultant who has run several campaigns backed by the group.

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As the California Independent Business PAC group slumbers, political groups run by teachers, doctors and trial lawyers are gearing up for 1998. They too face strict limits on donations they can collect, but should be able to overcome the restrictions by having their myriad members make direct donations.

The conservative group can’t pull such sleight of hand. Founded by savings and loan heir Ahmanson and Orange County manufacturer Rob Hurtt, who used his own wealth to campaign for and capture a state Senate seat in 1993, the PAC has always been composed of a handful of wealthy men and their wives.

What it lacked in membership it made up with money. Last year, it contributed $2.6 million to political campaigns in the state. The mighty California Teachers Assn., which has 269,000 members and traditionally gives more than any other group, donated $2.7 million.

With such largess, the Independent Business PAC has virtually rebuilt the Statehouse’s Republican caucus in its own image.

Using the fiscally strict practices of the business world, it kept a tight grip on how money was spent and carefully screened candidates, yielding a crop that was mostly white, male, conservative and Christian.

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While the Independent Business PAC espoused traditional family values, it sometimes practiced politics with bare knuckles.

Its members weren’t shy about using stealth campaign tactics if necessary. Most notable was the group’s efforts in last year’s Republican primary to vault the nephew of member Ed Atsinger, a Christian radio magnate, to victory over maverick GOP Assemblyman Brian Setencich for a Fresno seat.

Former employees are now coming forward to describe tactics they say the group used on occasion. They tell tales of masquerading as Democrats to infiltrate campaigns and combing trash cans--they dubbed it “Dumpster diving”--to gather intelligence on foes.

“What bothers me most about them is they try to portray themselves as these upstanding Christians and yet they will stoop to the most unethical means,” said Mark Jackson, Setencich’s former chief of staff. “It is anything to win, and it is wrong.”

None of the PAC’s current members--Ahmanson, Atsinger, dirt bike magazine publisher Roland Hinz and manufacturer Rich Riddle--returned calls for comment. Their attorney also declined to comment.

But they have numerous defenders among the Republican elite.

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“To my mind, they came across as ordinary citizens who just felt very strongly about the issues and were financially in a position to contribute to candidates,” said Ron Unz, a Silicon Valley entrepreneur who briefly joined the PAC after an unsuccessful gubernatorial run in 1994. “In many ways they were more like your next-door neighbor than a politician or consultant.”

Hurtt, who broke away after winning a seat in the Senate, said he hopes that the group’s leaders will “retain their resolve.”

“They’ve done a great thing for the state of California,” he said. “They’ve proven that a small group of people can get together and make a difference.”

In the Capitol, Democrats have long groused that the group exerted undue influence over conservatives it financed. Republicans counter that it did nothing to sway their views, asking nothing in return for the hefty contributions. Meanwhile, they argue, liberal labor unions spend huge sums backing Democrats and hiring armies of lobbyists to shape the law.

“The Democrats are vilifying them for doing exactly what the unions have done for the Democrats for years--fund campaigns,” said Assemblyman Robert Prenter, a Hanford Republican and Atsinger’s nephew. “It’s hypocrisy.”

Hurtt was the driving force behind formation of the group, dubbed Allied Business PAC, before it adopted its current moniker in 1995. He recruited the other members with a vision of creating a counterforce to liberal interest groups and of yanking the GOP leadership away from moderates seemingly content in the minority.

The group launched its first assault on the status quo in the 1992 Republican primary, winning 12 of the 14 open seats against a slate backed by Gov. Pete Wilson and other moderates.

With victory, power shifted to newly anointed Assembly GOP Leader Jim Brulte and the political action committee. Republican leaders say Brulte and Danielle Madison, the group’s executive director, coordinated on most campaign activities--strategic planning, candidate selection, expenditures--to marshal the GOP takeover of the Assembly in 1994.

Tony Russo, a Republican political consultant, said the group mastered the political chessboard, zeroing in on where to spend time and money. It also became a clearinghouse for information. When it came to knowing who would or wouldn’t run, Russo said, “they did it better than the caucuses or anyone else.”

Now with contribution limits, the PAC’s prognosis is grim. But it isn’t dead yet.

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An October court test is set for Proposition 208. If it is slashed, the California Independent Business PAC could go back to business as usual.

Even if the law is upheld, some loopholes remain.

State regulators may allow unlimited contributions to PACs if the money goes for ballot measures and not candidates. Under that scenario, California Independent Business PAC might be able to remain a player on some of the more substantial issues of the day.

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Wealthy donors can also still spend unlimited money through so-called independent expenditure campaigns, but it would probably mean the group’s four members would have to finance the campaigns individually instead of through the Independent Business PAC.

Moreover, there is no lid on donations to nonprofit political groups, which can shape public opinion with issue-oriented advertising showing the gulf between liberals and conservatives.

Democratic leaders hardly expect Ahmanson and the rest to just disappear.

“They are the backbone of Republican Party finance in California, or certainly were in 1994,” said Senate Leader Bill Lockyer (D-Hayward), an archfoe of the group. “They’re wealthy and they’re political. You have to consider they could reemerge.”