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http://www.washingtonpost.com/wp-dyn/articles/A25766-2003Jul21.html

washingtonpost.com
Fundraising Focus Earns DeLay Wealth of Influence
PACs Widen Clout in Texas and Washington

By Juliet Eilperin
Washington Post Staff Writer
Tuesday, July 22, 2003; Page A01


In early 2001, Rep. Tom DeLay (R-Tex.) was driving around Austin with his
top political aide, Jim Ellis, brainstorming about how to create more
Republican-leaning U.S. House districts in Texas. State legislators were
redrawing congressional borders to reflect the latest Census figures, and
the Democrats who controlled the state House were preventing GOP senators
and the governor from approving a plan that would give Republicans maximum
advantage.

The two men devised a bold idea: create a political action committee whose
sole purpose was to give Republicans control of the state House in the 2002
elections. Then, they surmised, the legislature could draw the districts
again in 2003, this time ensuring more GOP seats in Congress.

DeLay's gambit -- building a political money operation in Austin to increase
his clout in Washington -- is typical of the innovative and aggressive
techniques that have helped make him the House's second-ranking leader, and
a politician with extraordinary reach into the worlds of lobbying, federal
elections and state politics.

Details of DeLay's fundraising efforts have been reported before. For the
first time, however, a public interest group -- Washington-based Democracy
21 -- has assembled a comprehensive picture of his far-flung, interlocking
system of committees, which raised a combined $12.6 million in 2000-2002.

The picture that emerges shows that DeLay has gone far beyond being the
typical congressional member who sets up a reelection committee and perhaps
a separate PAC. The Republican from Houston has established a maze of
fundraising and consulting operations, each tailored to address a certain
goal or take maximum advantage of federal or state laws governing donations.

He was among the first to create independent "527 groups" at a time when --
unlike now -- they could raise and spend campaign money without disclosing
their sources. He has raised millions of dollars through state GOP
organizations, which operate under looser campaign laws than do federal
committees. He has demanded that senior Republican lawmakers raise $100,000
each and give the money to 10 vulnerable House in***bents.

"If you want to understand the power and influence of House Majority Leader
Tom DeLay in Washington, you have to understand the role played by DeLay
Inc., his multimillion-dollar money machine," said Fred Wertheimer,
Democracy 21 president. "Tom DeLay is the king of congressional
influence-money. In DeLay's world, the operating rule is you have to pay to
play."

The group's ****ysis of DeLay's top 100 contributors from 2000 to 2002
reveals a pattern: Each donor gave to at least two political operations
linked to the Texan. These committees included his reelection campaign;
Texans for a Republican Majority (TRMPAC); the short-lived Republican
Majority Issues Committee; and his "leadership committee," Americans for a
Republican Majority (ARMPAC) , which had a federal arm and non-federal arm
that could collect unlimited "soft money" donations before new campaign
finance laws were enacted last year.

Many Donors, Several Causes
The data from 2000 to 2002 testify to DeLay's expansive network. Bob Perry,
a Texas home manufacturer, gave to every committee connected to DeLay, for a
total of $427,000. Philip Morris Cos., the sixth-ranked donor, gave
$138,000, with $110,000 going to ARMPAC's soft-money arm.

Many of DeLay's contributors fall into categories that mesh with his
legislative positions. DeLay fought higher tobacco taxes during President
Bill Clinton's second term, and three of his top 20 donors are tobacco
companies: UST Inc., R.J. Reynolds and Philip Morris, now part of Altria
Group Inc.

DeLay oversaw the drafting of the GOP's energy bill in the previous
Congress, and energy companies -- which favored the measure -- gave his
groups nearly $350,000 between 2000 and 2003. One company was Kansas-based
Westar Energy Inc., whose donations have come under scrutiny after the


committees chosen by DeLay and other GOP lawmakers.

Westar gave $25,000 to TRMPAC in May 2002, and a month later Westar
executives joined DeLay at a two-day retreat at the Homestead resort in
Virginia.

Although DeLay said he never asked Westar for money, he met with company
officials after they contributed to TRMPAC, and he backed a provision in the
GOP energy bill that Westar keenly wanted. The provision was deleted after
Westar came under federal investigation.

Non-Texas donors -- many of them companies and associations with interests
before Congress -- accounted for 43 percent of TRMPAC's take. Those giving
at least $25,000 could send executives to the Homestead retreat.

The Alliance for Quality Nursing Home Care, represented by lobbyist and
Mississippi GOP gubernatorial candidate Haley Barbour, gave $100,000 to the
PAC while Barbour was lobbying to block Medicare cuts that would cost the
industry tens of millions of dollars. DeLay confidante Jack Abramoff, a
lobbyist who represents Mississippi Choctaw Indians, persuaded DeLay in 1995
to reverse course and kill a provision that would have taxed gambling
revenue on Indian land. The Choctaws gave $6,000 to TRMPAC.

TRMPAC's executive director, John Colyandro, said professional fundraisers,
not DeLay's associates, had control over who was tapped. Those fundraisers
included DeLay's daughter, Danielle Ferro.

Ellis said the Texas-based PAC targeted DeLay allies when seeking donations.
"It makes sense to go to our friends in Washington because we share the same
ideological views," he said. Boosting GOP congressional seats through
redistricting, he said, was "part of the pitch."

A Question of Tactics
Craig McDonald, director of the money and politics watchdog group Texans for
Public Justice, questioned whether TRMPAC violated state law by using soft
money to pay for political expenses rather than strictly administrative
ones, and whether it illegally funneled corporate dollars to campaigns.
DeLay is "using his access to special interests who want access to Congress,
and he's leveraging that to control the politics and agenda of the Texas
legislature," McDonald said.

Ellis denies this, saying his group operated under the same rules as other
PACs.

All company officials interviewed for this article said they supported DeLay
because they agreed with him ideologically, and because DeLay helped achieve
their companies' legislative priorities.

"We believe those committees are really effective in accomplishing their
goals in terms of party-building and get-out-the-vote efforts that have
elected pro-business candidates," said UST spokesman Mike Bazinet.

But donors' interests often are more complex. Some contributors, including a
tobacco official who asked not to be identified, said DeLay's leadership
position played a critical role in how they spent their money. Corporations
have given to congressional leaders, but rarely has a leader been so
******** about rewarding friends and punishing opponents, this official
said.

Rep. Mark Foley (R-Fla.) said, "They know, obviously, that he's the
second-most powerful person in the House. He controls a lot of legislation."

According to many lobbyists, DeLay offers access that others do not, such as
holding select golfing tournaments in Florida, Puerto Rico and elsewhere. He
also invites donors to support a nonprofit foundation that he and his wife
established for foster children, holding a retreat at Florida's Ocean Reef
Club that netted more than $1 million from unidentified donors this year.

"You have more quality time with Tom," said Dan Mattoon of the lobbying shop
Podesta-Mattoon. "You feel like you have a reasonable opportunity to bring
up any political issues a client's interested in."

A Record of Results
Moreover, DeLay delivers. Abramoff worked doggedly in 1998 on a bill
allowing a referendum on Puerto Rican statehood. DeLay brought it to a floor
vote and it passed overwhelmingly, although it stalled in the Senate.

DeLay also was attentive to Bacardi, the rum manufacturer involved in a
bitter contest with Pernod Ricard over the right to market liquor labeled
"Havana Club." Bacardi has fought vigorously against any lifting of the U.S.
embargo of Cuba. When lawmakers considered relaxing it in the 106th
Congress, DeLay intervened, pulling several colleagues out of trade talks to
persuade them to uphold the embargo. Bacardi and people associated with it
donated $20,000 to ARMPAC's soft money arm, and another $20,000 to the Texas
PAC. Bacardi officials declined to comment.

Just as DeLay delivers legislatively, he delivers in elections. Some leaders
use their leadership PACs to subsidize their travel and pay for a large
political staff. DeLay pours his money into races. In the last election,
then-Senate Majority Leader Trent Lott (R-Miss.) gave less than 7 percent of
his money to GOP candidates; DeLay gave nearly 36 percent.

One of the first Republican congressional leaders to recognize the
importance of grass-roots mobilization, DeLay devised "STOMP." The program,
run by the National Republican Congressional Committee but subsidized in
part by ARMPAC, poured volunteers into key districts 72 hours before last
fall's elections.

The Texas Model
TRMPAC provides the best example of how DeLay translates his agenda into
action. The group identified a slate of promising conservative legislative
candidates in Texas, then provided them elaborate services. DeLay and Ellis
assembled TRMPAC, which raised more than $1.5 million from individuals and
corporations. They hired Colyandro, a former colleague of senior White House
adviser Karl Rove, to run the operation.

In addition to cash contributions, the PAC gave the candidates nearly
$35,000 in political research, $52,000 in phones to contact potential voters
and $12,600 in direct mail. The group paid $27,000 to the Washington polling
firm Fabrizio, McLaughlin & Associates; $27,600 to DeLay's daughter's
fundraising firm, and $3,300 to Ferro herself.

Eighty-five percent of TRMPAC's candidates won their primaries, Colyandro
said, and 77 percent won the general election, adding 17 new Republicans to
the Texas House. With the Texas legislature fully under GOP control,
lawmakers forged ahead with a congressional redistricting plan strongly
favoring Republicans.

TRMPAC's success has generated controversy in Texas, where the Travis County
district attorney, Ronnie Earle, is investigating whether a group that
issued a joint mailing with DeLay's PAC violated the state's corporate
contribution laws. Ellis described as tenuous the connection between TRMPAC
and the Texas Association of Business's PAC, noting that prosecutors have
not identified TRMPAC as a target of the investigation.

Corporations no longer may contribute to PACs aimed at federal elections, so
Ellis is exploring the possibility of establishing state-oriented groups
similar to TRMPAC in California and Florida. "We're going to do more of that
under the new law," he said. "Our role is to direct resources to campaigns."

Staff researcher Alice Crites contributed to this report.

© 2003 The Washington Post Company

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