donors

Newport Beach businessman Dale Dykema is a highly sought-after guest when potential Republican presidential candidates visit California.

He recently attended an intimate dinner with former Florida Gov. Jeb Bush, a cocktail party headlined by Wisconsin Gov. Scott Walker and a half-hour tete-a-tete with New Jersey Gov. Chris Christie.

In the last quarter of a century, Dykema, 85, has donated hundreds of thousands of dollars to GOP candidates, party organizations and political action committees. He has yet to make up his mind on whom to back — and more importantly, whom to raise money for — in the 2016 presidential campaign.

“There are just so many candidates in the race. I’m completely on the fence,” said Dykema, founder of TD Service Financial Corp., a company that provides foreclosure services for the mortgage industry. In 2012, he said, he settled quickly on former Massachusetts Gov. Mitt Romney, but for the upcoming election he may wait until after the first couple of primaries before deciding.

The size of the field — well over a dozen likely candidates — coupled with the lack of a clear favorite mean many Republican donors in California share Dykema’s reluctance to commit.

“Normally, there’s a candidate that the entire establishment is behind and there’s this huge fundraising juggernaut for one person,” said Jon Fleischman, a state GOP official from Anaheim Hills and publisher of an influential conservative blog. “This year, no one has the brass ring already in hand. We’re seeing a lot more listening and a lot less giving early.”

On the Democratic side, state donors are already uniting behind former Secretary of State Hillary Rodham Clinton, the party’s overwhelming favorite. She raised millions for her nascent campaign at events hosted earlier this month by entertainment and business leaders.

As Republican donors weigh their choices, they’re grilling the 2016 candidates on a range of issues, including immigration, religious freedom and net neutrality. They’re doing so in homes in Bel-Air, boardrooms in the Silicon Valley, parties in Orange County and GOP functions all over the state — a nod to California’s primacy in what is known in political circles as the “invisible primary.”

California probably doesn’t matter in the nominating fight. Its June 7, 2016, presidential primary is almost certainly too late to affect the GOP’s process. The state is also too Democratic to put it in play in next year’s general election. But California is the biggest source of campaign cash in the nation.

In the 2012 election, presidential candidates directly raised more than $112 million from California’s deep-pocketed donors. That’s almost the combined total raised in the next two most-generous states, Texas and New York, according to the Center for Responsive Politics. These figures do not include the millions donated to party committees and outside groups such as “super PACs” that are not controlled by a candidate.

Not surprisingly, given California’s tilt toward Democrats, President Obama was the biggest beneficiary then, raising $62.8 million here for his reelection bid, according to the center. But GOP candidates also filled their campaign coffers here — Romney collected $41.3 million, and the rest of the Republican field raised nearly $8 million.

Romney’s extensive fundraising network in California, which he cultivated over nearly a decade, became available to others when he decided in January not to run again.

“We’re talking a lot about it, but no one’s committing to anyone right now,” said Bret de St. Jeor, a Modesto businessman and Romney fundraiser in 2012. “It’s just flat-out too early…. Let’s hear a little bit more. Let’s hear the opening statements from the other candidates before we start jumping on somebody’s bandwagon.”

Donors “love the courting process,” said Shawn Steel, a Republican National Committee member from Surfside in Orange County. “Most of the serious candidates are coming to California repeatedly, and their mission is to establish a rapport as early as possible … and to try to meet as many folks as possible.”

Steel, who is undecided, recently co-hosted a meet-and-greet and intimate dinner for Walker at the tony Pacific Club in Newport Beach. He noted that the field includes multiple candidates who appeal to the same GOP faction, whether it’s establishment voters, social conservatives or tea party groups.

Many potential candidates, he added, have connections to California, or have the opportunity to grow support.

Former Hewlett-Packard Chief Executive Carly Fiorina retains backers from her unsuccessful run against Sen. Barbara Boxer in 2010, Steel said. Former Texas Gov. Rick Perry developed ties to the state during his unsuccessful 2012 presidential bid, in part because one of his top strategists is a longtime and well-respected California GOP fundraiser.

Walker is a familiar face in California’s donor community, as he is across the nation, because of his fierce fight against unions in Wisconsin. Kentucky Sen. Rand Paul has spent considerable time wooing the libertarian streak that runs through Silicon Valley. Florida Sen. Marco Rubio has blown away audiences with his oratory, Steel said. And Bush’s family has long-standing alliances in the state.

Jeb Bush’s brother, former President George W. Bush, was a prodigious fundraiser here, performing a “cash-ectomy on the California donor community” whenever he visited, Fleischman said. “It was staggering.”

Those relationships haven’t sealed the deal for Jeb Bush here, but they do provide an edge for the yet-undeclared candidate that was visible during a recent, lucrative fundraising swing through the state.

“I really wanted to see him run before his brother ran,” said venture capitalist William H. Draper III, who went to Yale with their father, President George H.W. Bush, and served as his finance chair in his unsuccessful 1980 presidential run.

Draper, a former president of the Export-Import Bank of the United States, co-hosted an East Palo Alto fundraiser for Jeb Bush’s committee.

Susan McCaw, a major fundraiser for George W. Bush who served as his ambassador to Austria, said she was impressed by Jeb Bush’s record as governor of Florida and his support for education and immigration reform. She and her husband held a fundraiser for his political action committee at their Bel-Air home.

“I think he has the best chance of beating Hillary in the general,” she said.

Electability was the one quality nearly every donor — committed or not — mentioned as a priority.

John Jordan, a tech entrepreneur and vintner who has spent millions on Republican causes, plans to make a decision over the summer. He is hosting a dinner for Walker at his Healdsburg vineyard and expects to huddle with Paul soon. His sole focus, he said, is backing the candidate who could win the White House in 2016 by attracting the various factions of GOP voters as well as less ideologically driven general-election voters.

“In a pretty cold-blooded way,” Jordan said, “it has got to be someone that can unite the base, that they will like enough to turn out for … but at the same time isn’t someone that’s obnoxious.”

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A U.S. Court of Appeals in Washington on Tuesday overturned a decision requiring organizations that run election-related television ads to reveal their funders, saying a lower court erred in finding that Congress intended to require such disclosure — a victory for some of the biggest groups participating in the 2012 campaign.

In an unsigned decision, the three-judge panel wrote that it was “doubtful” that Congress anticipated how campaign finance rules would change and sent the case back to the lower court for further review.

But for the remainder of this election the ruling lets up the pressure on GOP-allied organizations such as the U.S. Chamber of Commerce, Americans for Prosperity and Crossroads GPS, which changed their ad strategies after a federal judge ruled this spring that Congress intended such groups to disclose their donors.

INTERACTIVE: Spending during the 2012 election

“We’re just delighted,” said Thomas Kirby, an attorney for the Center for Individual Freedom, one of two groups that pursued an appeal of the case. “CFIF believes that the right to engage in political speech should not be needlessly conditioned upon the loss of anonymity.”

Rep. Christopher Van Hollen (D-Md.), who brought the original case against the Federal Election Commission that upheld the donor disclosure requirement, issued a statement saying the appellate decision “struck a blow against transparency in the funding of political campaigns.”

“The Court of Appeals’ decision today will keep the American people, for the time being, in the dark about who is attempting to influence their vote with secret money,” he added.

The case hinges on the FEC’s interpretation of the 2002 McCain-Feingold Act, a landmark campaign finance reform measure that, among other things, required groups that engage in “electioneering communications” to reveal all their contributors.

Five years later, the FEC issued a rule stating that such organizations only had to reveal the donors who gave for the purpose of financing TV ads.

Van Hollen — backed by lawyers from the campaign finance reform organizations Democracy 21, Public Citizen, Campaign Legal Center and the law firm WilmerHale — sued the FEC, arguing that the rule created a major loophole that undermined the intent of the McCain-Feingold Act. A federal judge agreed, ruling on March 30 that the FEC had overstepped its authority.

“Congress intended to shine light on whoever was behind the communications bombarding voters immediately prior to elections,” Judge Amy Berman Jackson wrote in her decision.

Her ruling threw out the 2007 rule and reinstated a 2003 FEC regulation that required organizations doing electioneering to report all donations of $1,000 or more dating back to the first day of the preceding year.

That triggered a scramble among politically active groups on the right that have been fighting efforts to force them to reveal their funders. Despite the fact that they are organized as nonprofit social welfare organizations – or, in the case of the Chamber, as a trade group — the groups began running explicitly political ads, taking advantage of the conflicting patchwork of campaign finance rules that did not require disclosure of those doing “express advocacy.”

That move came with its own risk: paying for overtly political spots could jeopardize their tax status.

INTERACTIVE: Battleground states map

Such a tactic is no longer necessary after Tuesday’s ruling by the appellate court, which declared that the McCain-Feingold Act is “anything but clear” in light of major court cases that have followed it, including the Supreme Court’s 2010 decision in Citizens United.

The panel chided the FEC for not clearly dealing with the changes in the law or defending its stance in court. The appellate court sent the case back to the lower court, ordering it to refer the matter back to the FEC to defend its current rules or issue new ones.

But with the FEC locked in partisan gridlock, it remains unclear whether the six commissioners will be able to come to agreement on how to proceed.

Campaign finance reform advocates said they were not giving up, saying they still believed they had a strong argument to make at the district court level if the FEC chooses to defend the current rules.

“The Court of Appeals got it wrong,” said Fred Wertheimer, president of Democracy 21. “There is no way Congress enacted a statute to result in no disclosure of contributors when the statute calls for all disclosure of contributors.”

Wertheimer said his group would also continue to press the Internal Revenue Service to scrutinize the activities of groups such as Crossroads GPS that claim to be nonprofit social welfare organizations.

But he admitted that in the prospect of forcing such organizations to reveal their donors this year has been effectively shut down.

“They’ll go back to doing electioneering and claim that their campaign ads are not campaign ads,” Wertheimer said.

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