Anaheim Mayor Harry Sidhu paid off 2016 state Assembly campaign debts and put a dent in his 2018 mayor campaign debt after heavily fundraising since December in both campaign committees. It’s a move some local politics experts said is an example of loopholes in campaign finance regulations.
Sidhu paid off the $100,000 he loaned himself to run in the 2016 state Assembly race through cash contributions, while also paying down $40,000 of the $150,000 he loaned himself for the 2018 mayoral race.
Sidhu’s Assembly committee was largely inactive between late 2016 and December 2018, after he was elected mayor, according to campaign finance data.
Since then, he began receiving cash donations for the 2016 Assembly campaign. From Oct. 21 to Dec. 31, 2018, Sidhu raised $8,000 in the Assembly committee.
From Jan. 1 to June 30, Sidhu raised a little over $95,000 in the Assembly campaign committee.
Sidhu didn’t answer questions about his campaign finances.
“Sorry, I can’t talk right now. I have to go home,” Sidhu told Voice of OC after an Aug. 13 Anaheim City Council meeting.
Fair Political Practices Commission (FPPC) spokesman Jay Wierenga, speaking generally and not specifically about Sidhu’s campaign finances, said double fundraising isn’t illegal.
“So, generally speaking, it is permissible to have multiple committees open at once. But, each committee must be used only for expenses associated for that election,” Wierenga wrote in an Aug. 6 email.
Wierenga said any leftover funds in a state committee could be transferred to a local campaign committee as long as debts have been paid and the funds aren’t “surplus.”
“Campaign funds held by a non-incumbent defeated candidate or a candidate that withdrew become surplus on the 90th day after the post election reporting period following the election,” reads the FPPC campaign manual.
Wierenga said if a person pays off their campaign debts, they should close the campaign committee and they are able to transfer funds before the money becomes surplus.
According to the latest campaign finance filing, Sidhu has less than $1,200 in his Assembly committee.
California State University Fullerton political science professor Stephen Stambough said the double-fundraising Sidhu did to pay back debts to himself is odd.
“Yeah it’s legal. It’s weird — wouldn’t necessarily say it’s unethical, so long as he doesn’t use the money for other things,” Stambough said.
Stambough, an expert in local elections and campaign finance, said the contributors to the 2016 Assembly committee aren’t supporting his statewide campaign, but his position as mayor.
“The gray area — where it becomes murkier — is that people who are contributing to the campaigns to retire that old debt are not doing it in support of his 2014 campaign or 2016 campaign. They’re doing it in support of his current mayoral campaign,” Stambough said.
Chapman University political science professor and local politics expert, Mike Moodian, said Sidhu’s fundraising shows loopholes in the campaign finance regulations.
“What this shows is that there are loopholes in the Fair Political Practice Commission’s rules and savvy politicians know how to exploit them,” Moodian said. “It’s a way of influencing people in power.”
Sidhu also loaned himself $150,000 for the 2018 Anaheim Mayoral election and he paid down $40,000 of that debt, according to campaign finance data covering Jan. 1 to June 30.
Some people and groups who donated to Sidhu’s 2016 assembly campaign beginning late last year also donated to his mayor campaign, like Angels baseball team Vice President Dennis Kuhl and the Support Our Anaheim Resort (SOAR) political action committee, along with various resort area interests and support from the Chamber of Commerce.
Kuhl gave Sidhu’s Assembly campaign $2,000 and $1,600 to Sidhu’s 2018 mayor campaign.
SOAR contributed $4,200 to Sidhu’s 2016 Assembly campaign and $2,000 to his 2018 mayor campaign — both contributions are dated after the 2018 November General Election.
The Anaheim Chamber of Commerce contributed $2,000 to the 2016 Assembly campaign and heavily financed campaign services for Sidhu’s 2018 mayoral bid.
According to campaign finance data, the Chamber of Commerce spent nearly $240,000 on Sidhu’s 2018 campaign for mayor. The Chamber paid for consulting services, digital advertising, polling and political mailers for Sidhu.
Stambough said double-fundraising is something the state Legislature may want to address.
“So leaving all those campaign organizations technically running from a finance side creates a problem that regulators and lawmakers may want to address in the future. It’s an obvious loophole, but he’s not doing anything illegal,” he said.
Moodian said the public will have to pressure the state Legislature and the FPPC to reform campaign finance rules.
“You never see politicians out there shouting for reform or changes. That we need to fix a system that’s broken in many ways,” he said. “What you do see is political animals and savvy politicians are exploiting these loopholes. That’s what Sidhu is doing.”
Sidhu hosted at least two fundraising events this year, according to digital fliers.
One fundraiser was at the Anaheim House of Blues March 27, according to an email flier. Chamber of Commerce ambassador Amelia Castro helped coordinate the fundraiser and was the contact person in the email.
“For any donors who have already contributed the maximum amount allowed to Sidhu for Mayor – 2018, We would gratefully accept your contribution to retire the remaining debt from Harry Sidhu for State Assembly 2016 campaign,” reads the email
The email also notes the differences in maximum contribution limits for an individual: $2,000 for the mayor campaign and $4,200 for the state Assembly campaign.
Castro, who’s a Chamber of Commerce ambassador, is also on the board of directors for the private spending advisory group, Anaheim First.
The group, which was first publicly disclosed at the State of the City address in March, has ties to the Chamber of Commerce and SOAR. The City Council voted in April to give the group $250,000 to conduct a survey of the city in order to make spending recommendations on $250 million over the next 10 years.
“Reminds me of the old quote, ‘Money is the mother’s milk of politics,’ and these politicians thrive on being able to raise money and pay off campaign debt. So that’s what Sidhu is likely doing,” Moodian said.
During public comment at Council meetings, residents have routinely criticized the Anaheim First group as a political extension of the Chamber of Commerce and SOAR to influence more spending on the resort area.
Since April, Anaheim First has run full-page advertisements in nearly every issue of the Anaheim Bulletin section of the OC Register that runs Thursdays. Most of the ads feature a picture of Sidhu with a quote from him. He’s the only member of the Council to be pictured on the ads, so far.
The group is expected to begin its study soon and will be holding community meetings starting this month, beginning with West Anaheim’s District 1 at the West Anaheim Youth Center, Aug. 28 at 5:30 p.m.
Todd Ament, CEO of the Chamber of Commerce, also donated to Sidhu’s 2016 Assembly campaign when he gave $2,000 June 19. Ament listed himself as owner of TA Consulting on the campaign finance form.
TA Consulting also gave Sidhu’s mayor campaign $2,000 in June 2018. A search of the California Secretary of State’s business registry shows no TA Consulting business registered to Ament.
Ament also sits on the Anaheim First board of directors and told the City Council in April that the Chamber of Commerce originally came up with the idea at its leadership retreat two years ago — contradicting what Anaheim First representatives told people at a June community meeting when they said it was created by residents in April 2018.
The Chamber of Commerce also received a no-bid, $425,000 contract with Anaheim after Sidhu brought the item to the City Council in June.
The contract essentially states the Chamber will help bring in new businesses and retain existing ones for Anaheim. Additionally, the contract calls for full-page advertising of Anaheim in four issues of the Chamber-run Business Advocate Magazine; a column promoting the city in its newsletter for 10 issues and in 40 issues of its e-newsletter; and social media promotions of Anaheim.
The Chamber will also market the city at the stadium during an Angels luncheon by recognizing the city “as lead sponsor with marketing equal to title sponsorship level,” according to the contract. “Marketing will include city logo on key marketing materials, signage, website and at-event materials.”
Anaheim owns the stadium and the move comes as the city and Angels baseball are slated to start negotiations on a new stadium lease.
In January, Sidhu brought what many thought was a temporary lease extension of the Angels, who originally opted out of their lease in October 2018.
The lease, which was amended in January, nullified the Angels October 2018 lease termination and reinstated the old lease that runs until 2029. It also extended the team’s termination window to December 31 of this year, during which the team can terminate the lease at anytime.
Angels President John Carpino contributed $2,000 to Sidhu’s 2018 mayor campaign December, a month after the general election.
Moodian said Sidhu’s double-fundraising from business interests, coupled with the lease extension, the Anaheim First group and the Chamber of Commerce contract are a textbook example of political influences.
“This is a textbook example of the influence of special interests in politics, 101,” Moodian said. “These types of things aren’t illegal, but it just shows you we have holes in the system that we need to address.”
Sidhu also got himself voted to the city’s negotiating team with the Angels in July, which includes City Manager Chris Zapata and City Attorney Robert Fabela.
Councilman Jose Moreno, who unsuccessfully tried to get himself and Councilwoman Denise Barnes on the lead negotiating team, was able to schedule a City Council discussion at a future meeting of potential deal points in the negotiations, like market-based rent or a larger share of direct stadium revenue.
Sidhu objected to the move at the Aug. 13 meeting and said the city already has the lead negotiating team, which he sits on, to formulate deal points. Fabela, the city attorney, said Moreno’s proposal is within the Council’s purview.
Stambough said, since Sidhu’s double-fundraising moves are legal, the public may have to take action if they want to see the campaign finance rules reformed.
“It’s legal and if people find it to be problematic, that’s a question for the public. That’s why the public has the right to know all this,” he said.
Moodian said residents are going to have to continuously pressure the FPPC and State Legislature to address some of the campaign finance loopholes.
“In the city of Bell when the LA Times revealed that the city manager and city council was ripping off taxpayers, it was a resident-led movement that saved the city of Bell,” he said.
“Greater citizen participation, outrage, lobbying elected politicians — all the above,” could help reform campaign finance laws, Moodian said.
Spencer Custodio is a Voice of OC staff reporter. You can reach him at firstname.lastname@example.org. Follow him on Twitter @SpencerCustodio.