Donations welcome, but 'gifts' forbidden

A loophole in the state's new law that keeps lawmakers from taking gifts from lobbyists allows them to solicit big money for committees.

Published January 1, 2006

TALLAHASSEE - Starting today, it's illegal for a state legislator to take a free lunch from a lobbyist. No more football tickets. No fancy dinners. Not even a cup of coffee.

But as an election year dawns, the financial ties that bind lawmakers and lobbyists are stronger than ever.

The sweeping gift ban lawmakers approved three weeks ago was hailed as a big step toward breaking the shackles of special interest favoritism that has allowed lobbyists to court legislators over meals, drinks, golf outings and other perks.

But Florida still allows lawmakers to control political fundraising committees that are supported through donations that come almost exclusively from lobbyists and their clients, with no limits on how much money they can contribute.

In Florida in 2006, a lobbyist cannot buy a legislator a stick of gum. But it's still legal for a lobbyist to give $10,000 to a fund controlled by a legislator. They have used the money as political slush funds for expenses such as meals, plane tickets, rental cars, computers, furniture and cell phones.

And it's legal for lawmakers to solicit the contributions.

Critics say it's a loophole wide enough to drive a catering truck through, and it undercuts the highly touted lobbyist gift ban that was approved on Dec. 8.

"I think they all stink, to be honest with you," Gov. Jeb Bush said of the funds. "If there's a way to tighten that up as well, we ought to do it." State and federal laws allow the creation of political committees that can legally accept contributions of any amount to influence elections. The unrestricted donations, chiefly from corporations, businesses and wealthy individuals, are known as soft money.

The most common types of these committees are the committee of continuous existence or CCE, and a 527, so named for a provision in the federal tax code.

By setting up a CCE or 527, legislators can collect unlimited donations just as political parties do. The CCEs and 527s are exempt from the $500 contribution limit that applies to a lawmaker's re-election campaign fund, and a 1990 state Division of Elections opinion says a CCE can spend money "for the purpose of influencing the results of an election."

CCEs used to be composed of dues-paying members of trade groups, such as firefighters, nurses, Realtors and sheet-metal workers. In the past few years, legislators have created their own, using special interest donors as their dues-paying members.

Today, the soft-money solicitations are more visible than ever. Legislators require themselves to disclose every dollar raised and spent on a Web site.

The largest fund of all has $1.1-million, and is controlled by the lawmaker widely seen as the most powerful, Senate President Tom Lee. The Valrico Republican was a leading supporter of the all-out ban on gifts and has been outspoken in his criticism of special interest power in Tallahassee.

In 2003, a year before he became Senate president, Lee founded Floridians Uniting for a Stronger Tomorrow. The 527 was created at a time when Lee's allies were resisting Bush's proposals on medical malpractice reform, and Lee anticipated attack ads against the GOP senators in the 2004 elections.

But after raising more than $1-million, Lee never needed to buy ads to defend senators. He has spent about $71,000 on political consulting, fundraising, travel and equipment, with the rest collecting interest in the bank.

On its Web site, www.flust.com the fund lists as its statement of purpose the need to "turn back the tide of special interests."

Yet the donors to Lee's fund are a veritable who's who of special interests: hospitals, banks, utilities, racetracks, trial lawyers, teachers' unions and others. However, Lee has opposed some of the fund's big donors, such as BellSouth and Sprint, on major legislation.

Now, as Lee seeks the statewide Cabinet position of chief financial officer, the fund threatens to become a political controversy. Because of the flexibility in state law on how the money in these funds is used, Lee could take donations collected for one purpose and use them on something else: namely, his run for CFO.

A Republican rival for CFO, Rep. Randy Johnson, R-Celebration, is pressuring Lee to support closing a "loophole" that allows such liberal use of soft money to support Lee's statewide campaign.

"I've been for campaign reform legislation since I came into the Legislature," Lee said after receiving two letters from Johnson. "We'll take it under advisement. I want to be helpful and do the right thing for Florida."

Lee acknowledged that legislators solicit money from lobbyists. "Frankly, they're asked," Lee said, "and it's a very intimidating ask."

Lobbyists often refer to the practice as a "shakedown" because they are asked to ante up while their clients are seeking action from the Legislature.

Lobbyist Jack Cory said the Legislature's vote to ban meals and gifts was "ridiculous." He said the problem is soft money, and the ever-rising cost on businesses to buy their way into the political process.

As Cory sees it, the now-defunct $100 limit on meals and gifts was working: it blocked deep-pocketed interests from showering lawmakers with gifts, but still let small business owners and civic activists sponsor modest receptions for lawmakers.

"Nobody is going to do anything improper for under $100," said Cory, who has lobbied in Tallahassee for the past 35 years. "Where you get into problems is the $50,000 and $100,000 soft money contributions. Both political parties are sucking the system dry. That's where people are losing faith in the system."

A few lawmakers, such as Rep. Ken Gottlieb, D-Hollywood, have tried without success to ban legislator-controlled soft-money accounts.

Even some lawmakers who solicit soft money to further their political agendas say the practice is indefensible, but as long as it's legal they have to try to keep pace with the political opposition.

"I really do believe that unlimited soft money is a bigger threat to the process than the free meals from a lobbyist," said Sen. Dave Aronberg, D-Greenacres. "It's like an arms race. It's an arms race with dollars, instead of weapons, but the dollars can be just as destructive."

As chairman of the Florida Mainstream Democrats, Aronberg raises money for two funds to recruit and support moderate candidates and rebuild the party in small, rural counties. He finds himself outnumbered by Republican lawmakers seeking to strengthen the GOP or promote their interest in leadership positions.

Sen. Mike Bennett, R-Bradenton, raised nearly $100,000 through a fund called Citizens for Housing and Urban Growth.

The largest contribution is $25,000 from Robert Schemel of Delray Beach, a nursing home industry executive. Telecommunications giant Verizon gave $10,000 in November.

Sen. Mike Fasano, R-New Port Richey, formed Floridians for Principled Government (www.flpg.net) After raising $36,500 in 2005, he said, he stopped soliciting donations because Sen. Ken Pruitt, R-Port St. Lucie, urged him to raise money for the state party instead.

"I created it," Fasano said. "We wanted to help candidates and causes that want to have fiscally responsible, conservative-type government in Florida."

Fasano's CCE received $5,000 contributions from Amscot, a Tampa financial services firm; Florida Police Benevolent Association; Medical and Financial Management of Stuart; Concrete and Products Association PAC; and the Florida Osteopathic Medical Association.

The fund's expenditures in 2005 included three contributions of $500 each to other Republicans and checks totaling nearly $5,000 to Fasano personally, plus $1,200 to Cingular.

Sen. Nancy Argenziano, R-Dunnellon, raised $5,000 from HCA, the for-profit hospital chain, for a fund she called the Committee for the Determination of the Good, the Bad, and the Ugly (www.combug.com)

Argenziano said she chose the unusual name because interest groups and some legislators chose bland-sounding names that belie the true reason for a fund's existence. She said her goal is to raise enough money to promote independent-minded candidates like herself.

"I'm trying to send a message," Argenziano said. "It sickens me. It nauseates me. And I feel very bad for the citizen out there."

Times staff writer Joni James and researcher Deirdre Morrow contributed to this report. Steve Bousquet can be reached at bousquet@sptimes.com or 850 224-7263.