PACs give LI reps 'extra pocket' for donor cash

From left to right: Tim Bishop, Gregory Meeks, From left to right: Tim Bishop, Gregory Meeks, Carolyn McCarthy, Steve Israel, Peter King. Photo Credit: Newsday Composite

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WASHINGTON - Long Island's five members of Congress have raised a total of $1.1 million in the past three years outside of their campaign committees through a controversial conduit for money called leadership PACs.

These political action committees, whose purpose is to raise and distribute money to parties and other politicians, are separate from traditional campaign committees and operate under looser rules.

Politicians can't use a leadership PAC to pay for a race for office -- that's what campaign committees are for -- but can use it for just about anything else, election lawyers said.

With his Build America PAC, Rep. Gregory Meeks (D-Queens) bought NFL tickets and paid for annual fundraiser weekends at a Las Vegas casino to lure donors.

Rep. Carolyn McCarthy (D-Mineola) used her CAP PAC for "destination fundraising" at golf resorts in Arizona and on Chesapeake Bay as well as tickets to a Coldplay concert.

The biggest PAC in the Long Island delegation belongs to Rep. Steve Israel (D-Huntington), chairman of the Democratic Congressional Campaign Committee, who has held fundraisers for his New York Jobs PAC at the party's Washington headquarters.

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As a group, the Long Island lawmakers, including Reps. Tim Bishop (D-Southampton) and Peter King (R-Seaford), reported they have distributed much of their PACs' money -- $692,800 -- to colleagues and other candidates. Israel is responsible for most of that -- he runs a lean operation with an overhead of 6 percent. But Meeks and at times McCarthy spent half or more of what their PACs raised on expenses, including travel, lodging and catering at resorts.

 

Way to get more money

Politicians set up the PACs as a second fundraising arm, offering supporters and interest groups a way to give more money and gain greater access.

"It's an extra pocket on the politician's coat," said Sheila Krumholz, executive director of the nonprofit research group Center for Responsive Politics.

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With their campaign committees, politicians can collect as much as $5,200 from individuals and up to $10,000 from interest groups. By also setting up a leadership PAC, politicians can get another $5,000 each from an individual or a group.

Suzanne Robbins, a public policy professor at George Mason University in Virginia, said the PACs are useful for smoothing relationships among members, party building and fulfilling ambitions.

Critics of the influence of money in politics say they should be abolished. Donald Wolfensberger, a senior scholar on Congress at the Wilson Center think tank, say the PACs help distort how Congress works by rewarding fundraising prowess more than legislative skills.

The most controversial aspect of leadership PACs is that, unlike campaign committees, their funds can be spent for personal purposes -- though politicians say they use the money for political, fundraising or administrative costs.

Former Federal Election Commission chairman Trevor Potter of the Campaign Legal Center calls leadership PACs at best a circumvention of contribution limits and at worst "legal slush funds."

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A handful of ambitious members of Congress created the PACs in the 1970s, but now 410 of them -- four out of five -- have one, according to data kept by the FEC and the Center for Responsive Politics, which tracks political money. Those leadership PACs raised $112 million and gave $54 million to other committees in the 2012 election cycle.

 

Defended as necessary

Long Island lawmakers defend their leadership PACs -- and how they use them -- as legal and necessary in an electoral system where cash is key.

"Frankly, I hate the damn things," Israel said. "Until we have campaign finance reform, I play by the same rules as my competitors."

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Here's a look at the Long Island members' PACs:

Every year since Meeks founded Build America PAC in 2002, he has staged a fundraiser for it at a Las Vegas casino hotel. The PAC's events at the Aria casino since 2011 helped raise $214,870 but they also accounted for $37,200 of the PAC's $189,747 in expenses.

The PAC's contributions to candidates: $28,500.

Meeks blamed basic costs for the fact that 88 percent of the money the PAC raised went to expenses: "I got to pay rent, I got to pay for phones."

In 2011, a complaint filed with the FEC by the National Legal and Policy Center, a conservative watchdog group, alleged Meeks used his PAC for personal use to pay $8,063 in 2010 for a Las Vegas gambling vacation.

Meeks said that was for the annual Las Vegas fundraiser that he said collected $56,000.

The FEC sided with Meeks. And, noting the loophole for leadership PACs, the FEC said even if he was on vacation, the law doesn't bar personal use of PAC funds.

One group that has donated to Meeks' PAC is the rent-to-own industry, which has lobbied to head off new consumer-protection rules and to pass its own bill.

Besides giving $20,000 to Meeks' campaign and PAC since 2008, it has funded the Congressional Black Caucus PAC, which Meeks chairs.

The industry represents businesses that offer leases to mostly low-income customers that end in purchases of appliances and furniture with installment payments that can total three or four times the item's original retail price.

A coalition that includes the Consumers Union charges the industry bill would pre-empt laws in four states and result in higher costs for customers.

Meeks is the bill sponsor.

He said it provides transparency and maintains a needed service he knows firsthand because he used it in law school to furnish his apartment.

Asked about the industry donations to him and his PACs, his response was: "I think that relationship is what it is."

 

Fundraising soared

Israel acknowledged that the leadership PAC he created in 2006 has grown as he advanced in the House.

While on the Armed Services panel in 2006, he raised $69,250, much of it from defense contractors, for his Defending America's Future PAC.

After moving up to Appropriations, his renamed New York Jobs PAC raised $96,000 from a wider set of donors in 2010.

And after rising to DCCC chairman in 2011, Israel's PAC quadrupled its take to $416,144. It has raised another $282,853 so far for this election.

Israel gave $565,000 to Democrats in the past three years, has $93,267 in the bank and spent 6 percent on expenses -- among the lowest of any PAC.

"It's probably fair to say that because I'm in the leadership supporters are more enthusiastic," Israel said of donors.

McCarthy has been host of a series of "destination fundraisers" -- events in attractive settings -- after founding CAP PAC in 2003.

It spent $26,000 for a 2007 weekend at the Boulders Resort in Carefree, Ariz., which features a world-class golf course and horseback riding.

And it paid $17,000 to host events in 2009 and 2010 at the Harbourtowne Center and the Inn at Perry Cabin on the Chesapeake Bay in St. Michaels, Md.

Those were among costs that pushed the PAC expenses to half of the $101,100 raised in 2007-08 and three quarters of $48,750 collected in 2009-10.

The events were needed to attract as many donors as possible, said McCarthy spokesman David Chauvin. "In fact, we wish we raised more," he said.

As she retires this year, McCarthy is closing CAP PAC.

Over its lifetime, CAP PAC gave 60 percent of its funds to Democrats, including $46,000 of $54,000 raised since 2011.

But in a surprise for the top gun-control advocate in the House, McCarthy supported NRA-backed candidates such as Rep. John Barrow (D-Ga.).

The PAC funded them, Chauvin said, to help Democrats win the House in 2006 -- the only way to pass gun safety laws.

Interest groups put money into CAP PAC.

McCarthy introduced a bill on March 1, 2007, to block Medicare payment cuts for X-rays and ultrasounds and impose a two-year hold on cuts for MRIs and other procedures.

Over the next three months, the American College of Radiology, which lobbied Congress for that measure, maxed out on contributions to McCarthy's campaign fund: $10,000. Then on June 5, the radiology PAC gave CAP PAC $5,000.

Chauvin said the donations aren't relevant since McCarthy has gotten money from a range of groups promoting causes including health care.

The bill "is completely in line with [her] legislation focusing on patient rights," he said.

 

Name in an acronym

Bishop set up his leadership PAC in 2011 to help his party and colleagues but also to get around contribution caps.

He created an acronym to evade the ban on using his name in its title: "Building Infrastructure, Harnessing Our Priorities" -- BISHOP.

"We all have supporters, either individuals or PACs," he said. "It's not at all unusual for individuals to support both a campaign and his or her PAC."

Bishop's friend Robert F.X. Sillerman, his wife and daughter gave $15,000 to his campaign fund, then the maximum $15,000 to his PAC.

It was Sillerman who referred a constituent to Bishop in 2012 for help getting a permit for fireworks at his son's bar mitzvah. Bishop requested a campaign donation as he assisted Eric Semler. A complaint about that request led to a House Ethics investigation, whose outcome is still pending.

Eight of 10 labor union PACs that gave to BISHOP PAC had already given the $10,000 legal limit to his campaign fund.

BISHOP PAC has collected $98,550 since 2011. It has been idle this year.

The PAC gave $53,300 to Democrats, including $10,000 to the New York State Democratic Party in 2012 and $30,800 to Israel's DCCC a month before the 2012 election.

The PAC didn't hold a fundraiser. Instead, Bishop said, "I did several in-person solicitations. I did phone calls."

Still, after paying a Washington-based fundraiser $7,000, the PAC also paid $14,500 to his daughter Molly, who runs Bishop's campaign fund. Bishop said he shifted part of her fee from the campaign to the PAC.

"Any time I see family members benefiting from campaign committees and leadership PACs it raises red flags," said Craig Holman of the liberal advocacy group Public Citizen.

Bishop defended the pay, saying, "She's a damn good fundraiser and also somebody I trust completely."

King is on his second leadership PAC, though he said, "I don't like raising money."

In 2006, he created KINGPAC -- "Know-how and Integrity for our National Government" -- and raised $67,225 from New Yorkers and PACs.

But King spread little among House colleagues -- just $6,000. He gave more -- $14,678 -- to the Nassau County and Seaford GOP. He closed the PAC in mid-2008.

King said he set up his new American Leadership Now PAC in December to pay for travel and fund like-minded candidates as he tests the waters for a 2016 presidential run.

The PAC has raised $53,150 so far -- most of it at a recent Boston fundraiser -- and King has spent $19,711 on expenses, including $1,518 for travel.

"I want to raise enough to get around. Like I'm going back to New Hampshire in June," King said. "I need something to keep myself solvent."

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