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Corporate gifts flow to incumbents

THE BALTIMORE SUN

Maryland's campaign finance system operates more like a protection plan for incumbent politicians and the business interests who buy access to them, with corporations concentrating their investments on lawmakers who wield the most power in Annapolis, according to new studies that examine four years' worth of state elections data.

Donations flow most heavily to a relatively small number of legislative leaders who seldom face serious election challenges, the studies found. Without competition, top lawmakers are often free to redistribute funds to their colleagues, cementing their positions of influence.

Much of the cash is contributed by a handful of groups, including health care, lawyers and builders, whose interests are frequently the subjects of bills in the state capital.

"The pattern is clear: These business contributions that go overwhelmingly to incumbents are first and foremost designed to influence legislation, not election outcomes," said Paul S. Herrnson, a University of Maryland, College Park professor and director of the Center for American Politics and Citizenship, one of the studies' authors. "Business interests are primarily concerned with gaining access to legislators who can influence the policy-making process."

Though corporate executives are typically closer in ideology to the Republican Party, Herrnson notes that in Maryland they make most of their contributions to Democrats, whose party holds majorities in both houses and dominates the legislative agenda.

The studies analyzed about 150,000 campaign contributions during the 1998 election cycle. For the first time, they identified donors' occupations or economic interests where possible.

Undertaken by the Center for American Politics and Citizenship and the Progressive Maryland Education Fund, an advocacy group pushing for public campaign financing, the two analyses found that:

The average General Assembly incumbent candidate received about three times as much as the average challenger. Senate candidates in uncontested races, on average, raised more than those facing credible challengers.

Most of the money to incumbents went to those with the most influence - committee chairmen and party leaders. Sixteen of the state Senate's 41 members received 50 percent of the contributions that went to Senate incumbents. Three of the 16 faced competitive races.

Of the $16.7 million collected by General Assembly candidates for the 1998 election, $5.9 million was from business-related interests, more than from any other source, including individuals, political parties and candidate self-funding.

A few industries dominate the giving. Health care groups, lawyers and lobbyists, and real estate and construction groups and executives gave $2.8 million during the 1998 cycle - 48 percent of corporate donations.

Because Maryland's campaign donation limit is higher than those for some other states and the federal government, small numbers of donors can disproportionately influence the funding of campaigns. Thirty-one percent of donations to legislative candidates were made in amounts greater than $500; 19 percent was raised in amounts larger than $1,000.

"Money is flowing into this State House, and it is corrupting the process," said Del. John Adams Hurson, a Montgomery County Democrat who wants to create a commission to study public campaign financing. "Anybody who says it's not is wearing rose-color glasses. I think big corporations and big donors not only buy access, but they steer legislation."

Large donations from businesses and other interest groups begin accumulating well before elections, having the effect of dissuading opposition at the ballot box.

Incumbents in the House of Delegates raised more than $6 million before the 1998 election year began and before most challengers had announced their candidacies.

Some findings contradict common sense but strengthen the link between incumbency, power and large donors. It might seem that contested races should cost more than noncompetitive ones, but that's often not the case in Maryland.

For example, Senate candidates in uncontested races raised an average of about 5 percent more than the amounts raised by candidates in competitive races during the 1998 cycle - $88,229 vs. $83,682.

Once they've raised sufficient funds for their own uses, Maryland lawmakers can spread money to other candidates, cementing their leadership and power.

During the last election cycle, candidates transferred $466,706 to other politicians. Top among those transferring funds to their colleagues were Sen. Thomas L. Bromwell, chairman of the Finance Committee, who distributed $21,800 of the $513,164 he raised, and Senate President Thomas V. Mike Miller, who gave out $16,350 of his $480,270.

Pro-business bills benefit

Access obtained by business interests and their lobbyists means that legislation helping deep-pocketed industries or corporations has a far greater chance of approval than proposals that help poor families or those accused of crimes, said Sean Dobson, director of the Progressive Maryland Education Fund's Electoral Reform Project, who has analyzed business and consumer legislation during the past several sessions.

Proposals requiring banks doing business in Maryland to provide low-fee basic checking died in Annapolis for four consecutive years. The banking industry, which fought the proposal, contributed $536,311 to Maryland candidates during the 1998 cycle, according to the campaign data.

Bills encouraging energy conservation and requiring utility companies to get some of their power from renewable sources failed during last year's legislative session, but two years earlier the state deregulated the electric industry.

During the four-year election cycle that ended in 1994, companies that generate and distribute electricity and their largest corporate customers donated $467,640 to Maryland politicians, the studies found.

"A majority of the members of the General Assembly, deep in their hearts, want to do the right thing," said Dobson. "They want to stick up for the little guy. But put yourself in the shoes of a busy lawmaker with one staffer and a big pile of phone messages late at night. Of course he's going to return the message of a $4,000 contributor first. Wouldn't you?"

Gary R. Alexander, a leading State House lobbyist, said Maryland's donation limit of $10,000 to all candidates in a four-year cycle prevents any group or business from gaining an upper hand.

"As a former legislator, I know that the best bills, the best ideas, come from regular folks," Alexander said. "People can pick up a telephone and talk with anyone in state government. Anyone who wants to participate in the process can do it."

The studies involve the first comprehensive effort to match campaign donations with occupations and industries. Under Maryland campaign finance law, donors do not have to disclose their employers; fewer than half of states require such reporting. The National Institute on Money in State Politics in Helena, Mont., combed through four years of paper reports covering the 1998 election cycle, creating an electronic database that allowed it to attach an economic interest to 62 percent of donations.

The institute gave its database to the university group and to Progressive Maryland, which hopes to create a public campaign finance system in Maryland similar to programs in Maine and Arizona, and ones recently approved in Massachusetts and Vermont.

Under such a system, candidates would receive public funds if they demonstrated broad support by collecting a certain number of smaller donations in their district. If outspent by opponents who use private funds, they get a limited amount of offsetting public money.

Freedom from fund raising

"Not having to go out and fund-raise frees up a candidate to touch base with folks at a grass-roots level," said state Rep. Marilyn Canavan, a Democrat from Waterville, Maine, who was first elected in 2000 after participating in the state's Clean Money system. "It is a very freeing feeling to sit in a committee, and listen to all sides of an issue, and not have to worry at all about whether any campaign contributions might be forthcoming because of given decisions I might make."

Sen. Paul G. Pinsky, a Prince George's County Democrat who is the lead Senate supporter of public campaign financing, said he is optimistic that a study commission could be created this year.

"I think in an election year, given Enron, to vote against it may be a difficult vote," he said.

Sun electronic news editor Michael Himowitz contributed to this article.

Campaign donations

During the 1998 election cycle, contributors gave $16.7 million to candidates for the General Assembly. The National Center on Money in State Politics, based in Montana, created a database that attached an occupation or employment to more than 60 percent of the contributions, information that is not required to be reported under Maryland law.

Donation sources

Business: $5.9 million, including health (doctors, hospitals): $1 million; real estate/construction: $985,431; lawyers and lobbyists: $782,845; finance: $450,394; insurance: $425,554

Individuals: $5 million

Candidate self-funding: $1.5 million

Political parties, slates and candidate transfers: $1 million

Labor unions: $751,567

Ideological groups (e.g. anti-gun control, abortion rights advocates): $122,641

Miscellaneous: $2.4 million

Donation recipients

Casper R. Taylor Jr., House speaker, Allegany Democrat: $989,104

Thomas L. Bromwell, Senate Finance chairman, Baltimore County Democrat: $513,164

Thomas V. Mike Miller, Senate president, Prince George's Democrat: $480,270

Sen. Perry Sfikas, BaltiMore Democrat: $238,726

Del. Mark K. Shriver, Montgomery Democrat: $211,338

Michael E. Busch, House Economic Matters chairman, Anne Arundel Democrat: $196,911

Sen. James E. DeGrange Sr., Anne Arundel Democrat: $195,980 Martin G. Madden, former Senate minority leader, Howard Republican: $187,726

Sen. Jean W. Roesser, Montgomery Republican: $166,403

Sen. Gloria G. Lawlah, Prince George's Democrat: $165,500

SOURCE: Center for American Politics and Citizenship; National Center on Money in State Politics

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