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Fundraising Focus Earns DeLay Wealth of Influence
PACs Widen Clout in Texas and Washington
By Juliet Eilperin
July 22, 2003
In early 2001, Rep. Tom DeLay (R-Tex.) was driving around Austin with his top political aide, Jim Ellis, brainstorming about how to create more Republican-leaning U.S. House districts in Texas. State legislators were redrawing congressional borders to reflect the latest Census figures, and the Democrats who controlled the state House were preventing GOP senators and the governor from approving a plan that would give Republicans maximum advantage.
The two men devised a bold idea: create a political action committee whose sole purpose was to give Republicans control of the state House in the 2002 elections. Then, they surmised, the legislature could draw the districts again in 2003, this time ensuring more GOP seats in Congress.
DeLay's gambit -- building a political money operation in Austin to increase his clout in Washington -- is typical of the innovative and aggressive techniques that have helped make him the House's second-ranking leader, and a politician with extraordinary reach into the worlds of lobbying, federal elections and state politics.
Details of DeLay's fundraising efforts have been reported before. For the first time, however, a public interest group -- Washington-based Democracy 21 -- has assembled a comprehensive picture of his far-flung, interlocking system of committees, which raised a combined $12.6 million in 2000-2002.
The picture that emerges shows that DeLay has gone far beyond being the typical congressional member who sets up a reelection committee and perhaps a separate PAC. The Republican from Houston has established a maze of fundraising and consulting operations, each tailored to address a certain goal or take maximum advantage of federal or state laws governing donations.
He was among the first to create independent "527 groups" at a time when -- unlike now -- they could raise and spend campaign money without disclosing their sources. He has raised millions of dollars through state GOP organizations, which operate under looser campaign laws than do federal committees. He has demanded that senior Republican lawmakers raise $100,000 each and give the money to 10 vulnerable House incumbents.
"If you want to understand the power and influence of House Majority Leader Tom DeLay in Washington, you have to understand the role played by DeLay Inc., his multimillion-dollar money machine," said Fred Wertheimer, Democracy 21 president. "Tom DeLay is the king of congressional influence-money. In DeLay's world, the operating rule is you have to pay to play."
The group's analysis of DeLay's top 100 contributors from 2000 to 2002 reveals a pattern: Each donor gave to at least two political operations linked to the Texan. These committees included his reelection campaign; Texans for a Republican Majority (TRMPAC); the short-lived Republican Majority Issues Committee; and his "leadership committee," Americans for a Republican Majority (ARMPAC) , which had a federal arm and non-federal arm that could collect unlimited "soft money" donations before new campaign finance laws were enacted last year.
Many Donors, Several Causes
The data from 2000 to 2002 testify to DeLay's expansive network. Bob Perry, a Texas home manufacturer, gave to every committee connected to DeLay, for a total of $427,000. Philip Morris Cos., the sixth-ranked donor, gave $138,000, with $110,000 going to ARMPAC's soft-money arm.
Many of DeLay's contributors fall into categories that mesh with his legislative positions. DeLay fought higher tobacco taxes during President Bill Clinton's second term, and three of his top 20 donors are tobacco companies: UST Inc., R.J. Reynolds and Philip Morris, now part of Altria Group Inc.
DeLay oversaw the drafting of the GOP's energy bill in the previous Congress, and energy companies -- which favored the measure -- gave his groups nearly $350,000 between 2000 and 2003. One company was Kansas-based Westar Energy Inc., whose donations have come under scrutiny after the publication of e-mails in which company executives wrote about obtaining "a seat at the [congressional negotiating] table" by giving money to political committees chosen by DeLay and other GOP lawmakers.
Westar gave $25,000 to TRMPAC in May 2002, and a month later Westar executives joined DeLay at a two-day retreat at the Homestead resort in Virginia.
Although DeLay said he never asked Westar for money, he met with company officials after they contributed to TRMPAC, and he backed a provision in the GOP energy bill that Westar keenly wanted. The provision was deleted after Westar came under federal investigation.
Non-Texas donors -- many of them companies and associations with interests before Congress -- accounted for 43 percent of TRMPAC's take. Those giving at least $25,000 could send executives to the Homestead retreat.
The Alliance for Quality Nursing Home Care, represented by lobbyist and Mississippi GOP gubernatorial candidate Haley Barbour, gave $100,000 to the PAC while Barbour was lobbying to block Medicare cuts that would cost the industry tens of millions of dollars. DeLay confidante Jack Abramoff, a lobbyist who represents Mississippi Choctaw Indians, persuaded DeLay in 1995 to reverse course and kill a provision that would have taxed gambling revenue on Indian land. The Choctaws gave $6,000 to TRMPAC.
TRMPAC's executive director, John Colyandro, said professional fundraisers, not DeLay's associates, had control over who was tapped. Those fundraisers included DeLay's daughter, Danielle Ferro.
Ellis said the Texas-based PAC targeted DeLay allies when seeking donations. "It makes sense to go to our friends in Washington because we share the same ideological views," he said. Boosting GOP congressional seats through redistricting, he said, was "part of the pitch."
A Question of Tactics
Craig McDonald, director of the money and politics watchdog group Texans for Public Justice, questioned whether TRMPAC violated state law by using soft money to pay for political expenses rather than strictly administrative ones, and whether it illegally funneled corporate dollars to campaigns. DeLay is "using his access to special interests who want access to Congress, and he's leveraging that to control the politics and agenda of the Texas legislature," McDonald said.
Ellis denies this, saying his group operated under the same rules as other PACs.
All company officials interviewed for this article said they supported DeLay because they agreed with him ideologically, and because DeLay helped achieve their companies' legislative priorities.
"We believe those committees are really effective in accomplishing their goals in terms of party-building and get-out-the-vote efforts that have elected pro-business candidates," said UST spokesman Mike Bazinet.
But donors' interests often are more complex. Some contributors, including a tobacco official who asked not to be identified, said DeLay's leadership position played a critical role in how they spent their money. Corporations have given to congressional leaders, but rarely has a leader been so explicit about rewarding friends and punishing opponents, this official said.
Rep. Mark Foley (R-Fla.) said, "They know, obviously, that he's the second-most powerful person in the House. He controls a lot of legislation."
According to many lobbyists, DeLay offers access that others do not, such as holding select golfing tournaments in Florida, Puerto Rico and elsewhere. He also invites donors to support a nonprofit foundation that he and his wife established for foster children, holding a retreat at Florida's Ocean Reef Club that netted more than $1 million from unidentified donors this year.
"You have more quality time with Tom," said Dan Mattoon of the lobbying shop Podesta-Mattoon. "You feel like you have a reasonable opportunity to bring up any political issues a client's interested in."
A Record of Results
Moreover, DeLay delivers. Abramoff worked doggedly in 1998 on a bill allowing a referendum on Puerto Rican statehood. DeLay brought it to a floor vote and it passed overwhelmingly, although it stalled in the Senate.
DeLay also was attentive to Bacardi, the rum manufacturer involved in a bitter contest with Pernod Ricard over the right to market liquor labeled "Havana Club." Bacardi has fought vigorously against any lifting of the U.S. embargo of Cuba. When lawmakers considered relaxing it in the 106th Congress, DeLay intervened, pulling several colleagues out of trade talks to persuade them to uphold the embargo. Bacardi and people associated with it donated $20,000 to ARMPAC's soft money arm, and another $20,000 to the Texas PAC. Bacardi officials declined to comment.
Just as DeLay delivers legislatively, he delivers in elections. Some leaders use their leadership PACs to subsidize their travel and pay for a large political staff. DeLay pours his money into races. In the last election, then-Senate Majority Leader Trent Lott (R-Miss.) gave less than 7 percent of his money to GOP candidates; DeLay gave nearly 36 percent.
One of the first Republican congressional leaders to recognize the importance of grass-roots mobilization, DeLay devised "STOMP." The program, run by the National Republican Congressional Committee but subsidized in part by ARMPAC, poured volunteers into key districts 72 hours before last fall's elections.
The Texas Model
TRMPAC provides the best example of how DeLay translates his agenda into action. The group identified a slate of promising conservative legislative candidates in Texas, then provided them elaborate services. DeLay and Ellis assembled TRMPAC, which raised more than $1.5 million from individuals and corporations. They hired Colyandro, a former colleague of senior White House adviser Karl Rove, to run the operation.
In addition to cash contributions, the PAC gave the candidates nearly $35,000 in political research, $52,000 in phones to contact potential voters and $12,600 in direct mail. The group paid $27,000 to the Washington polling firm Fabrizio, McLaughlin & Associates; $27,600 to DeLay's daughter's fundraising firm, and $3,300 to Ferro herself.
Eighty-five percent of TRMPAC's candidates won their primaries, Colyandro said, and 77 percent won the general election, adding 17 new Republicans to the Texas House. With the Texas legislature fully under GOP control, lawmakers forged ahead with a congressional redistricting plan strongly favoring Republicans.
TRMPAC's success has generated controversy in Texas, where the Travis County district attorney, Ronnie Earle, is investigating whether a group that issued a joint mailing with DeLay's PAC violated the state's corporate contribution laws. Ellis described as tenuous the connection between TRMPAC and the Texas Association of Business's PAC, noting that prosecutors have not identified TRMPAC as a target of the investigation.
Corporations no longer may contribute to PACs aimed at federal elections, so Ellis is exploring the possibility of establishing state-oriented groups similar to TRMPAC in California and Florida. "We're going to do more of that under the new law," he said. "Our role is to direct resources to campaigns."
Staff researcher Alice Crites contributed to this report.