Gifts That Keep on Giving

U.S. Sen. Kay Bailey Hutchison and other federal officeholders might be able to use their federal accounts for state races after all. That big fat federal appropriations bill kicked out of Congress in the last few hours before Thanksgiving includes a change in campaign finance law that would allow candidates to transfer money from their federal campaign accounts to state accounts.

That's the way the law used to read before the McCain-Feingold campaign finance reforms were passed, and most political observers assumed Hutchison would take advantage of that provision if she decided to return to state government.

But last spring, lawyers poring over federal campaign finance law found it allows some transfers, but no longer allows officeholders to transfer federal money directly to other campaign accounts. You can find people who say that was intentional, and people who say it was a drafting accident. Whatever caused it, it blocked people like Hutchison – and others in Texas and elsewhere interested in moving from federal to state or local office – from taking their federal money with them. Campaign finance lawyers have been poking around for ways to get around the law, but nothing guarantees all the money would be available.

Why's it a big deal?

Hutchison, who is considering a run for governor against Rick Perry, had $6.6 million in her campaign treasury at the end of September. She's up for reelection in 2006 and could use that money to run for reelection, or if President George W. Bush signs the appropriations bill as expected, for governor. Part of the Perry camp's strategy has been to encourage Hutchison to stay in the Senate while urging Texas Republicans to stick with him in the gubernatorial primary. That'd be a big deal if Hutchison started a state account from scratch – not so much so if she starts with enough money on hand to run a couple of months worth of heavy statewide TV.

The transfer provision historically has given feds an opportunity to keep donors on a string. Contributors interested in federal issues give to federal candidates; but those candidates have had the ability to use money raised out there in races back home. As long as there was a chance they'd run for reelection to federal office, donors interested in federal issues had no choice but to keep playing.

Officials with the Federal Election Commission say the change is one of two that were included in the omnibus bill. The other raises the dollar limit on political contributions from one officeholder to another to $2,000, matching what individuals can contribute.

Several Texans had seven-digit stacks of money in their campaign accounts at the end of September, or in mid-October (the date depends on whether an officeholder was required to file an election report or not). U.S. Rep. Jim Turner, D-Crockett, didn't seek reelection after redistricting turned his congressional turf red, but has $1.1 million on hand that could be used for a state race unless the federal legislation unexpectedly fails to pass. Joe Barton, R-Ennis, had $1.1 million on hand; Henry Bonilla, R-San Antonio, had $1.1 million; and Lloyd Doggett, D-Austin, $1.7 million. All but Doggett have been mentioned as possible statewide candidates.

Turner has said he'd like to run for state office if he thinks there's an opportunity for a Democrat to win, and Bonilla and Barton have both been mentioned as possible candidates for U.S. Senate should Hutchison give up her seat. Since that's a federal office, those two will probably be able to apply their war chests to whatever battles they choose.

It's Pitts

Rep. Jim Pitts, R-Waxahachie, is the new chairman of the budget-writing House Appropriations Committee. Talmadge Heflin, R-Houston, lost his spot in the Legislature by 32 votes. Though Heflin remains a member of the House until Hubert Vo takes the oath of office in January, the defeat – made official by the canvassing of the votes this week – automatically costs him his chairmanship, just as it did when Ways & Means Chairman Ron Wilson, D-Houston, lost his primary in March.

With at least a half dozen candidates to choose from, House Speaker Tom Craddick picked a Republican who can claim a fair amount of support from House Democrats. Pitts has several years of budget experience, but isn't seen by the Democrats as a donkey-basher. He got on Appropriations for the first time in 1997 and last session, he was also on the tax-writing Ways & Means Committee. Pitts is on the House Select Committee on Public Education. He was a school board trustee back home before winning a seat in the House in 1992.

Craddick passed over Rep. Vilma Luna, D-Corpus Christi, the vice chair of Appropriations and a member of the conference committee that hammered out the current budget. She's a Democrat, and it's the most important committee in a chamber with 87 Republicans and only 63 Democrats. Craddick didn't miss the criticism former Lt. Gov. Bill Ratliff, R-Mt. Pleasant got for putting Sen. Rodney Ellis, D-Houston, in charge of Senate Finance a few years ago; Luna never had a real chance. Several Republicans were mentioned as replacements before Pitts was picked, including Dianne White Delisi, R-Temple, Peggy Hamric, R-Houston, and Carl Isett, R-Lubbock, each of whom is in good standing with Craddick and is either a present or past member of the budget panel.

Footnote: Only three hours and ten minutes elapsed between the time we got the House press release announcing Pitts' promotion and the email – from other quarters – inviting lobbyists and other interested parties to a December 7 fundraiser in Austin for "Representative Jim Pitts, Chairman-House Appropriations Committee." Suggested donation amounts range from $100 to $5,000.

Four Unsettled House Races

Heflin, meanwhile, wants election officials to recount the votes in his contest. The deadline for requesting an election challenge – asking the House of Representatives to overturn the result and order a new election – is Thanksgiving. But the recount won't have been done by then, so Heflin's lawyers are having a busy week. At our deadline, they were digging around to find advantage in the recounting of votes – Harris County uses electronic voting machines and the only physical things to recount are mail-in and provisional ballots – and trying to decide if the election was flawed enough to convince the House that Heflin was robbed of reelection.

Andy Taylor, a Houston lawyer representing Heflin, said his recount questions concern whether the county officials are going to recount the votes they already counted or if they're willing to consider which of those should be included. In his eyes, the law is unclear about whether to count everything or to decide which of the votes in question was legally cast. As a practical matter, it only applies to paper ballots – the mail-ins and the provisionals – and not to the votes cast and counted electronically. If you could prove a voter shouldn't have voted on Election Day, there would be no way to know how he or she voted, and thus, no way to add or subtract them in a recount. Taylor will be arguing for the one-by-one consideration of each voter and then their vote.

In other instant replays, Democrat Kelly White of Austin wants to check her 147-vote loss to Rep. Todd Baxter, R-Austin. Republican Eric Opiela of Karnes City has asked election officials to recount votes in three of the counties in that House district. He lost by 835 votes to Democrat Yvonne Gonzalez Toureilles of Alice; the two were competing for an open seat (Rep. Gabi Canales, D-Alice, lost in the Democratic primary earlier this year). Gene Ryder, a spokesman for Rep. Ken Mercer, R-San Antonio, said they won't be asking for a recount in his 498-vote loss to Democrat David McQuade Leibowitz, as planned, but still might ask the House to hear a formal challenge. Ryder said they are investigating some peculiarities in the elections and will announce their plans later.

A New Species of Record Vote

Talking Points Memo, a national political blog that leans to the left, has been having one heckuva good time with the congressional vote to change the rule that prevents indicted members of Congress from remaining in the leadership of that institution.

The member most at risk of losing his perch is U.S. House Majority Leader Tom DeLay, R-Sugar Land, one of the architects of the Republican takeover of the Texas Legislature two years ago and, after that majority redrew congressional districts here, one of the chief beneficiaries of the shift from blue to red in the state's delegation.

Travis County has two grand juries looking at that effort right now, and three DeLay associates were indicted a few weeks before the elections. DeLay and his supporters inside and outside Congress have labeled the investigation a "partisan witch hunt," but it's still underway. DeLay has maintained for months that he is not a target of the investigation. And an uncorroborated report from CBS News says he's not on prosecutors' hit list. At the same time, he's collecting donations to a legal defense fund and has local lawyers in Austin bird-dogging the case on his behalf.

The vote to change the indicted leader rule took place in the Republican Conference, and it was a voice vote, apparently, and nobody knows who voted for the rule change and who voted against it. But after U.S. Rep. Christopher Shays, R-Connecticut, came out and said he'd been against it, the bloggers went to work. TPM encouraged its readers to call their Republican member of Congress to ask, prod, nag and cajole them into saying how they voted. In several instances, that led the local news media in various parts of the country to start reporting on the answers. To get the full effect, you have to read a few days worth of postings at www.talkingpointsmemo.com.

About That New Year...

Those Travis County prosecutors and the two grand juries that are working on allegations that sprouted from the 2002 elections will not finish their work this year, and prosecutors say they don't expect any more indictments before the end of December.

Feed that into the parsing machine, and you get this output: One or both of the grand juries will have its term extended, or new grand juries will form in January to continue the investigations that began two years ago. Anything short of indictments is good news for the people who have their tender parts in the wringer, but they probably never thought this would still be going in 2005.

Someone pointed out that this is the longest investigation since... well, not so long ago. Federal officials were all over former Attorney General Dan Morales' business in 1999, and didn't close the deal for three years. And they weren't first: AG John Cornyn, who succeeded Morales before moving on to the U.S. Senate, had been looking into Morales' tobacco settlement dealings before the feds ever showed interest. If you're looking for statutes of limitations, look at the three-year mark, with the clock starting as alleged offenses were committed. If there's any meat, it'll spoil sometime next year.

The prosecutors were temporarily forthcoming after the CBS News report – quoting unnamed sources – that said DeLay was "off the hook" and won't be indicted. The Houston Chronicle got there first, quoting assistant Travis County DA Gregg Cox as saying the investigation is plodding along. "No one has ever named Tom DeLay or any other individual as a target in this investigation," he told that paper. "Nor have we ever said that anyone is off the hook." DeLay, meanwhile, dismissed the CBS report as "political gossip."

What started two years ago as a noisy fight of concern mostly in Texas – heck, mostly in Austin – is now playing out on a national stage. DeLay is talking about it every day, and now DA Ronnie Earle has weighed in withan opinion column for The New York Times scolding Congress for that rule change and saying their concern made it appear they believe DeLay will be charged with something. For that national audience, he repeated defenses familiar in Texas: That he's prosecuted more Democrats than Republicans, that Democrats also accused him of political motives, and that the Republicans are in the sights right now because "you have to have power before you can abuse it."

Says Who?

Sen. Steve Ogden, R-Bryan, still wants to know whether the comptroller has the power to tell lawmakers to stop spending money. You remember this fight. Toward the end of the last regular legislative session, Comptroller Carole Keeton Strayhorn told lawmakers how much money she figured the state would pull in over the next two years. They sent a budget that proposed spending more than that, but which contained a new invention: a provision that ordered the comptroller to make across-the-board cuts if there was less money available than called for. Those cuts would then go to the governor and the Legislative Budget Board, which could then move money around from agencies that could afford more belt-tightening and into agencies that needed more. They cut out some things they didn't want the comptroller, the governor and the LBB to tinker with: debt service, constitutionally dedicated money, money for teacher and state employee retirement systems, the Foundation School Program, or salaries listed in the appropriations bill.

Strayhorn blasted the governor and the Lege for what she saw as a power grab, saying it was unconstitutional for her to approve a spending plan bigger than the revenue she estimated would arrive during that budget period. She said that's the essence of a balanced budget. Lawmakers said their idea still required a balanced budget, but left the Guv and the chief budgeteers more maneuvering room during the two years a budget is in effect. For about 36 hours, everybody was yelling and threatening to go to court, and then they all backed down.

Except they never settled the legal question. Now that another budget is about to be written, Ogden wants to know if the idea is constitutional and he's asked Attorney General Greg Abbott for an official opinion. Abbott isn't pre-judging this, but it's safe to say he's favorably disposed to it. He was on the verge of suing the comptroller on behalf of legislators during the shouting two years ago.

This would ordinarily be a fight only budgeteers could love, but it goes to the heart of a comptroller's hold on state finances, and comes as Strayhorn is considering a challenge to Gov. Rick Perry. She blamed him 18 months ago for opening the issue, and said through a spokesman that she'll "protect our Texas constitution and the independent comptroller's office" this time around. Ogden's letter is at www.TexasWeekly.com/documents/RQ0293GA.pdf.

Location, Location, Location

Even after you adjust the sizes of congressional districts for redistricting, making sure each has the same number of warm Texas bodies in it, the Election Day numbers are all over the board. Republican districts outvote Democratic districts and you can win in a district while getting fewer votes than all the other winners and 13 of the people who lost. That's U.S. Rep. Gene Green, D-Houston, we're talking about in that last example. He got 78,256 votes and won easily. He got fewer votes than any incumbent who sought reelection, including four incumbents who got beat. Eddie Bernice Johnson, D-Dallas, got more votes than any other Democrat running for Congress in Texas – 144,513 – but finished behind 18 Republicans in overall voting. Pete Sessions, R-Dallas, had fewer votes – 109,859 – than any other winning Republican, but still finished ahead of five successful Democrats.

The highest vote-getters in the delegation: Lamar Smith, R-San Antonio, 209,774; Mac Thornberry, R-Clarendon, 189,448; Ralph Hall, R-Rockwall (running as a Republican for the first time), 182,886; Michael McCaul, R-Austin, 182,113; and Michael Burgess, R-Highland Village, 180,519.

The highest vote-getters not in the delegation: Rhett Smith, 121,129, losing to Lamar Smith; Arlene Wohlgemuth, 116,049, losing to Chet Edwards, D-Waco; Richard Morrison, 112,034, losing to Tom DeLay, R-Sugar Land; and Nick Lampson, 108,156, who lost his seat in Congress to Houston Republican Ted Poe. Three other incumbents lost with less than 100,000 votes: Max Sandlin, 96,281; Charlie Stenholm, 93,531; and Martin Frost, 89,030.

Living Large

Since 2000, Houston homebuilder Bob Perry, and his wife, Doylene Perry, have contributed $8,217,750 to state politicians in Texas. That doesn't include what they gave to federal candidates or 527s (Perry funded Swift Boat Veterans for Truth during that group's early forays against Democrat John Kerry last summer) or any groups that don't report their financial activities to the Texas Ethics Commission. It doesn't include contributions recorded in paper reports to TEC before state laws made electronic filing more likely. And it doesn't include late contributions that showed up in the last week of the campaign and that won't be reported electronically until January (paper telegram reports are filed with TEC, but because lawmakers included a loophole in the reporting laws, the agency doesn't post that information for perusal outside of Austin until computer reports are due in January).

Even with the caveats, the numbers racked up by the state's most generous political contributors are huge. By year: 2000, $775,500; 2001, $801,500; 2002, $3,259,250; 2003, $1,596,750; and 2004, $1,784,750. The couple gave $100,000 or more 11 times during those three election cycles, contributing to the Texas Republican Party (four checks totaling $600,000), Texans for Lawsuit Reform (two checks totaling $200,000), to the Yes on 12 campaign to help pass a constitutional limit on damages in lawsuits (one check, $100,000), and to Greg Abbott's campaigns (three checks totaling $350,000; Abbott dropped a bid for lieutenant governor in 2002 and ran for attorney general instead).

The Perrys – they're not related to the governor – spread their money around, making 745 contributions averaging $11,000. Added up by candidate or cause, the couple gave more than $100,000 to each of 21 political committees: David Dewhurst Committee, $270,000; Robert Deuell, $277,500; Kevin Eltife, $300,000; Friends of Ben Bentzin, $102,500; Friends of Carole Keeton Strayhorn, $160,000; Friends of Susan Combs, $220,000; Greg Abbott for Lieutenant Governor, $200,000; Harris County GOP PAC, $130,000; Harris County Republican Party, $194,000; Talmadge Heflin, $122,500; Hillco PAC, $345,000; Jerry Patterson, $160,000; Republican Party of Texas, $1.1 million; Texans for a Republican Majority PAC, $170,000; Texans for Greg Abbott, $487,500; Texans for Lawsuit Reform PAC, $430,000; Texans for Rick Perry, $475,000; Texans for Victor Carrillo, $135,000; Texas Association of Business and Commerce PAC, $105,000; Todd Staples for Texas Senate, $110,000; and Yes on 12, $150,000. That's $5.6 million; everyone else on their list split the remaining $2.6 million.

Flotsam & Jetsam

• The number of nurses in Texas grows every year but lags behind the state's needs, according to a new report from the Department of State Health Services (formerly the Texas Department of Health). Their annual report on the status of things says the state needed another 33,690 registered nurses to reach the national average of nurses for every 100,000 residents. Those numbers are included in a pile of reports on the subject, to be on their website.

• Sure enough, Sen. Jeff Wentworth, R-San Antonio, will be the "master of discovery" in the election challenge filed against Sen. Mario Gallegos, D-Houston. The Senate State Affairs Committee will hold the hearings on the evidence that will eventually go to the full Senate.

• The Texas Higher Education Coordinating Board started watching the progress of 266,578 seventh-graders in the state in 1992 to see what happened to them. It wasn't particularly pretty: 82.1 percent entered the 9th grade, 57.9 percent graduated from high school, 44.7 percent enrolled in college and 13.4 percent got a degree or certificate from a higher education institution within six years of getting out of high school. That's 266,578 in, and 34,815 out.

• Former college dean, ambassador, congressman, U.S. senator and Texas Railroad Commissioner Bob Krueger didn't have a heart attack, but did suffer cardiac arrest, according to a news release put out to tell the rest of us that he's still alive after whatever sent him to the Mayo Clinic. He's home, recovered, and he's quoting Shakespeare, for crying out loud: "A good leg will fail; a straight back will stoop, but a good heart, Kate, is the sun and moon for it shines bright and never changes, but keeps his course truly." That's Henry V, they tell us.

Political People and Their Moves

Three more Texans are now hanging out with the federales. Micaela Alvarez is now a federal judge, replacing David Hittner, a Houston judge taking senior status. Alvarez, a private attorney, will work out of Laredo...

U.S. District Judge Ricardo Hinojosa of McAllen will serve as chairman of the U.S. Sentencing Commission. That panel is in the center of the storm over federal sentencing guidelines; appeals courts in different parts of the country have issued competing rulings on those standards and the commission is supposed to help sort things out...

Richard Roper III, who has been the interim U.S. Attorney based in Dallas, is losing the "interim" adjective. Roper, who won Senate confirmation, was an assistant to U.S. Attorney Jane Boyle, who gave up the big office for a federal judgeship...

The University of Texas named Bobby Ray Inman the interim head of its LBJ School of Public Affairs. He'll replace Edwin Dorn, who announced his resignation last summer. Inman is on the school's faculty. He's a former naval officer and holder of a bowl full of impressive titles: director of naval intelligence, vice-director of the Defense Intelligence Agency, director of the National Security Agency and deputy director of Central Intelligence. He was nominated by President Bill Clinton to head the Defense Department, but withdrew in the wake of controversy stirred by old enemies in Washington. Inman also did time as chairman and CEO of MCC in Austin, at Westmark Systems, and as chairman of the Federal Reserve Bank in Dallas...

Former state Rep. Gerald Hill is leaving Texas State University in San Marcos – he's the development director there – to be senior vice president of advocacy and communications at Seton Healthcare Network in Austin. He'll be working on legislative issues, among other things...

Gov. Rick Perry named Brian Newby, a Fort Worth lawyer with Cantey & Hanger, as his new general counsel. You'll remember that the last general counsel, David Medina, is Perry's appointee for one of two open spots on the Texas Supreme Court. Newby is vice chairman of the board of regents for the Texas Tech University System, and is on the board of the Tarrant Regional Water District. He's also a lieutenant colonel in the Air Force Reserves and the Texas Air National Guard...

Jay Levin is leaving the Texas State Teachers Association, where he's been the chief lobbyist for two decades. Levin started at TSTA as an organizer 25 years ago. He hasn't said just what he'll do next; TSTA hasn't announced a replacement...

Reporter-turned-media critic Sherry Sylvester is leaving Texas Media Watch, which she started with backing from the Lone Star Foundation, to be the new spokeswoman for the Republican Party of Texas. She'll replace Alexis DeLee, who was the incoming subject in an item just like this one three months ago. DeLee is leaving for parts unannounced – she's apparently got a gig lined up – and Sylvester will take over December 1. Her old job was to decry bias in news reports; now she'll be trying to make sure it gets in.

Quotes of the Week

U.S. Rep. Mike Rogers, R-Alabama, telling the Anniston Star why he voted to let indicted House members to keep leadership posts: "I'm an attorney, and any attorney knows you can get an indictment with a ham sandwich. We're trying to raise the standard, to make it so that you don't allow what is purely a political indictment to make someone step aside from a leadership role."

Democratic consultant James Aldrete, giving his party some advice in an interview with the Texas Observer: "We need a faith-based anger, a faith-based populism. We have to take on social ills without being for free sex. We have to take on corporate greed without being against those who want to move up the ladder. That means taking on the bastards but doing it in a language of faith."

Sherry Sylvester, warming to her new job as the voice of Texas Republicans: "The Democrats hold an advantage in that they have an ally in the major metropolitan newspapers. The Republicans have an advantage in that more people vote with them."

Gary Darnell, fired head football coach at Western Michigan, telling The New York Times about a new goal: "I think I want to be a duck. You want to know why? A duck goes in the water when he wants and goes on land when he wants. He goes south for the winter and north in the summer. He eats good. He only eats fish and vegetables. I might be a duck for a while. How about that?"

Texas Weekly: Volume 21, Issue 24, 29 November 2004. Ross Ramsey, Editor. George Phenix, Publisher. Copyright 2004 by Printing Production Systems, Inc. All Rights Reserved. Reproduction in whole or in part without written permission from the publisher is prohibited. One-year online subscription: $250. For information about your subscription, call (800) 611-4980 or email biz@ texasweekly.com. For news, email ramsey@ texasweekly.com, or call (512) 288-6598.