IN-DEPTH COVERAGE
The Atlanta Journal-Constitution’s Capitol team has scrutinized campaign finance as part of its larger examination of ethics under the Gold Dome. A recent article, for example, documented the flow of special-interest money by mapping contributions from outside state legislators’ districts.
When Gov. Nathan Deal’s team began searching for donors to stock a $1 million political fund, it didn’t have to look far.
Businesses that do billions of dollars of work with state government were happy to help Real PAC, an “independent” committee promoting the political status quo, including Deal’s re-election next year.
An Atlanta Journal-Constitution analysis of contributors found that they received about $4.3 billion in payments from state agencies in fiscal 2012, the last year for which figures were available. More than half of all donors were companies or executives with companies doing business with the state.
About three-fourths of donors or their companies have also given directly to Deal’s gubernatorial campaigns. As an independent political action committee, Real PAC is separate from Deal’s political campaign and can’t legally coordinate with it. But Real PAC and Deal’s campaign had the same fundraiser —Deal’s daughter-in-law — the same consultant, the same law firm, even the same printer. Deal has been a “special guest” at Real PAC events, including one during last year’s Republican National Convention in Tampa.
Randy Evans, Deal’s campaign lawyer, said the donor list isn’t particularly surprising. Big companies like AT&T, UnitedHealthcare, Blue Cross and Blue Shield of Georgia, and a nursing home industry that survives on government funding, typically give to whomever is in power.
“There is a benefit to being an incumbent,” Evans said.
But former state Adjutant General David Poythress, a two-time Democratic gubernatorial candidate who serves on the board of Common Cause Georgia, called it “an indictment of our whole election system, not just in Georgia, but nationwide.”
“This is a classic way people who want favors at the public trough buy them,” Poythress said. “They just look at it as a cost of doing business. Forget about the ethics, forget about legality, they are going to do it if they can get away with it because they know there is a return on their investment.”
Real PAC was started in 2011 by Deal’s business partners, friends and supporters to sell the governor and the Republican Party’s “brand” heading into next year’s elections. Through June 30, it had raised about $950,000, all in big-dollar donations ranging up to $50,000 per check. Under state law, donors could not give $50,000 directly to Deal’s campaign. The limit is $16,300 per election cycle, including a potential primary runoff campaign.
Among the donors were:
- UnitedHealthcare and Blue Cross and Blue Shield of Georgia, both of which bid to be the sole supplier of health insurance to 650,000 state teachers, employees, retirees and their family. Records show UnitedHealthcare, the current supplier, received almost $2.8 billion from the state in 2012. Blue Cross, which won the bid to replace UnitedHealth, was paid about $17 million. United contributed $50,000 to Real PAC, Blue Cross $25,000. And both contributed to Deal's campaign.
- Nursing home companies and the nursing home lobby. The lobby contributed $50,000 to Real PAC. UHS-Pruitt Corp., which operates nursing homes all over the state, and its companies donated another $100,000. UHS' affiliates and executives have also contributed more than $60,000 to Deal's campaigns. Several other nursing home companies also contributed to Real PAC and Deal's campaign. The nursing home industry receives more than $1 billion a year in government payments.
- AT&T made three $25,000 contributions. Besides doing business with state and local governments, the company has traditionally been one of the strongest lobbies at the Capitol. The company and its top executive have contributed at least $7,500 to Deal's campaigns.
- WellCare of Georgia, which received more than $1.1 billion in state payments, contributed $50,000 to Real PAC and has given at least $6,600 to Deal campaigns. The Real PAC contribution from WellCare was listed as being received the same day that a Medicaid official said he planned to extend WellCare's contract with the state, although Medicaid officials said the decision had been made earlier.
Several other companies that do business with the state, from hospitals to road contractors, also donated to Real PAC and to Deal’s campaign.
Most see it as the price of staying active in a political process that is vital to their industry.
“Health care is a critical issue facing our country, and WellCare believes it’s important to be engaged in the policy debate and in the politics that shape policy,” Bryan Baier, vice president of government affairs for WellCare said in a statement when the AJC contacted the company about its contribution.
While Real PAC is legally independent from the Deal campaign, donors understand that they are supporting the governor’s re-election.
Sage Rhodes, spokeswoman for AT&T, said, “We believe that Gov. Deal has been successful in building an environment that encourages employers like AT&T and many others to invest and grow jobs in Georgia.”
Tracey Lempner, public relations director for UnitedHealthcare’s Southeast Region, said, “We appreciate Gov. Deal’s commitment to a pro-business climate.”
Evans, the Deal lawyer, said there was “no correlation at all” between the contributions and getting state business.
Evans said he should know. He represents UnitedHealthCare in its lawsuit against the state over awarding the state employees health care business to rival Blue Cross.
“Some (of the donors) are doing business with the state, some lost their bid to do business with the state,” he added.
Real PAC began putting out ads in September that credit Deal and lawmakers with saving the HOPE scholarship, creating jobs, tax reform and sound fiscal management. Evans said the ads, which may be used during the upcoming campaign season, promote the Republican “brand,” although they also give lip service to bipartisanship by emphasizing that Deal, the Republican majority and the Democratic minority worked together to solve problems.
“If you are the party in power, you want to make sure you keep your brand intact,” Evans said. “There is also concern about the national (Republican) brand tarnishing the state brand. It’s a defensive move to make sure the brand stays in place.”
Some of the Real PAC/Deal donors support Republican causes, but many if not most donate regardless of who is in power.
For instance, the nursing home Pruitt family donated about $40,000 to Democratic Gov. Roy Barnes’ re-election campaign in 2001 and 2002. A few weeks after Republican Sonny Perdue upset Barnes in the 2002 elections, they gave $10,000 to Perdue.
One of the first donors to Real PAC, Georgia Crown Distributing, and its chairman, Donald Leebern, are typically among the biggest contributors to politicians in charge. Leebern and his family contributed about $30,000 to Barnes’ re-election campaign in the two years before the 2002 elections. Leebern wrote a check to Perdue about a month after he won office.
Leebern’s company gave Real PAC $50,000, and he and his family have given about $85,000 to Deal’s campaigns. After winning office, Deal reappointed Leebern to the University System Board of Regents, a body he has served on for 22 years, contributing to and winning new terms from Democratic and Republican governors over that time.
University of Georgia political scientist Charles Bullock, an expert on state politics, said such giving is simply the way elections have long been funded.
“People who are interested in politics and have a stake in it and have a good relationship with the incumbent want to see that incumbent re-elected,” Bullock said. “If they make the assessment that Deal is going to be re-elected, they want to be on his side.”
But Poythress said contributions from big-money donors like those to Real PAC skew the political system in favor of contributors who have millions if not billions of taxpayer dollars at stake.
“Clearly those kind of contributions have a corrupting influence,” he said. “No one can say with a straight face that they are not effected by that kind of money.”
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