Candidates for Local Offices Are Digging Deep into Their Own Pockets

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Tuesday, June 1, 2010 | One of the big stories of this year’s race for governor has been the willingness of Republican candidates Meg Whitman and Steve Poizner to spend millions from their personal fortunes for a shot at the governorship.

But it’s not just the ultra-rich gubernatorial hopefuls who are willing to use their own money to win an election. Candidates for all the major offices up for grabs in the June primary are self funding to some degree, with several ponying up six figures.

Four of the seven contenders for the Fourth District county supervisor seat have used personal loans as a major source of funds. Three of the personal loans exceeded $100,000, and two of those are nearing the $200,000 mark, according to campaign finance disclosure reports filed late last week with the county Registrar of Voters.

Candidates for sheriff and treasurer/tax collector, are making substantial loans to their campaigns as well, the records show.

Personal loans and donations to political campaigns are a longstanding tradition, said county election officials and state campaign expert Bob Stern, a co-author of California’s campaign finance reporting law.

Self-financing can jump-start a little-known contender’s campaign, Stern said, but it also can carry big risks.

“I do know candidates who said it really put them in the hole,” said Stern, president of the Center for Governmental Studies in Los Angeles. “If you win, you get the money back” through campaign fundraisers and other donations.

But if a candidate loses, it can be nearly impossible to recoup.

“It’s almost like going to Las Vegas,” Stern said.

Whitman and Poizner have stuffed an astonishing $92 million of their own money into their GOP gubernatorial primary campaigns, most of it coming from billionaire Whitman, whose personal investment in her race totals more than $68 million, according to a report in last week’s San Jose Mercury News.

But candidates for state offices, like governor, are prohibited from having personal loans outstanding to their campaigns of more than $100,000.

No such restrictions apply to Orange County races.

The top personal lender in the supervisor race, lawyer and Fullerton City Councilman Shawn Nelson, lent his election effort $183,000, according to his disclosure report. And $90,000 of that came in May alone.

Others in that race who loaned their campaigns money:

  • Anaheim City Councilman Harry Sidhu lent his campaign $175,000 within the past year.
  • Lorri Galloway lent $100,000 to her campaign.
  • Computer software consultant Richard Faher raised $28,000 for the campaign, most of it — $27,500 — in loans from himself.

In the sheriff’s race, incumbent Sheriff Sandra Hutchens reported loaning her campaign $99,709. One of her challengers, Anaheim Deputy Police Chief Craig Hunter is owed $17,500 by his campaign, the records show.

In the treasurer’s race, Huntington Beach Treasurer Shari Freidenrich lent her campaign $54,000 and her husband, Clive, paid an additional $22,111 for her statement of qualifications to be included in the sample ballot mailed to all voters.

One of her opponents, CPA and South Coast Community College District Trustee David Lang, lent his campaign $102,073.08.

For the winners, loans, even those that are never repaid, can be considered a smart long-term investment. The jobs pay well, and at the local level, incumbents are rarely unseated unless they become involved in a serious scandal or they get on the wrong side of a very unusual political issue.

A county supervisor’s salary is about $143,000 a year. The job of Orange County sheriff pays about $208,000 and treasurer/tax collector $173,000. In addition, office holders receive attractive health and retirement benefit packages.

But in a race in which substantial personal loans are made by more than one of the candidates, someone will not only end up politically, but also financially, on the short end of the stick come Election Day.

Stern said candidates who really can’t afford to make substantial campaign loans sometimes do it anyway after some arm-twisting by campaign managers.

Candidates can find themselves swept up — or financially swept away — by the idea that just a few more mailers, signs or other campaign buys will get them elected and all their financial troubles will be over.

Or as Stern points out, for losers, campaign loans may be just the beginning of “real problems.”

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