The big money race in the March 3 L.A. County municipal elections is Los Angeles City Council District 4, the race to replace the inimitable Tom LaBonge. A whopping 14 candidates are on the ballot, and a surprisingly large number, including some little-knowns, have a chance of making the May 19 runoff. David Ryu and Joan Pelico are among those who've raised hundreds of thousands of dollars.
Campaign finance laws limit their direct contributions to $700. But cash amounts given to Independent Expenditure Campaigns – special interest—backed efforts also known as IEs or Super PACS – are unlimited, because the U.S. Supreme Court says this money equals speech and can be given unfettered.
Three CD 4 candidates have these IE committees: David Ryu, Wally Knox and Steve Veres. Only Wally Knox is widely known in Los Angeles, because he used to be a legislator.
On paper, the PAC for Steve Veres, using the grammatically dubious name of "Safe Neighborhood & Better Schools for Steve Veres for City Council 2015," is the fattest, having spent $85,000 so far, mostly on glossy mailers like this one.
But how could they possibly afford it? The PAC has only raised $35,000 – $25,000 from the United Food and Commercial Workers Union Local 770, and $10,000 from Cordoba Corporation, a construction management company.
The remaining $50,000 is essentially debt, owed by the Veres Super Pac to a political consultant, John Shallman.
Shallman insists that nothing untoward is going on—he claims the IE committee/PAC was hastily assembled, and the checks have come in slowly.
Now we have learned from Shallman something that voters needed to know weeks ago:
The big infusions of cash are pouring in from three big unions: the International Alliance of Theatrical Stage Employees, or IATSE, a union that represents many in the entertainment industry; the Teamsters union; and a plumbers unions (it's still unclear which locals are cutting the checks).
That makes Steve Veres, who most voters have probably not heard of until this week, a heavy union man in the race.
For weeks, Veres has been quietly backed by unions, an alliance that has hurt other Los Angeles city candidates in the past.
Shallman says in an email it was all an honest and proper failure to disclose.
"Because this organization was formed less than two weeks before ballots were mailed out," — we aren't sure why they would wait so very long — "we were forced to release mailers before checks were physically in the door," says Shallman in an email. "As such, we have gone way above what the law requires by voluntarily releasing the names of organizations that committed resources in order to ensure transparency."
So this is all about transparency?
Veres' opponents and absentee ballot voters haven't had the luxury of knowing about it. Remember, the mailers people are getting promoting Steve Veres don't tell us where the major funding is coming from.
"They sent out four mailers that did not state who the major donors are," says Doug Herman, a consultant for Carolyn Ramsay, Tom LaBonge's chief of staff, who's running among the 14 candidates hoping to replace him. "It does lead one to think something’s fishy’s going on."
That $50,000 worth of shadow spending by the pro-Veres forces represents a potential loophole in campaign finance law.
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SHOW ME HOW
When, say, Michael Bloomberg wants to give a million dollars to influence a school board race, that's perfectly legal. But he's got to disclose that. And the glossy mailers and TV ads that he pays for have to say at the bottom, "Major funding by Michael Bloomberg," or something like that.
You can buy an election (or try to anyway – Bloomberg lost) just as long as people know who is buying it.
Many of this year's L.A. City Council candidates – including every single incumbent – have an IE working on their behalf. Scratch that — City Councilman Jose Huizar has five of them (or so it would seem from campaign finance disclosure forms). And there's an IE for City Council member Nury Martinez that got $25,000 from some seemingly random accountant in Burbank.
The difference is, we found out about those. The big unions trying to put Steve Veres in the May 19 runoff have worked things so that voters wouldn't know about the piles of money — until now.