Generators Add to Davis Coffers

Politics: To critics' dismay, he accepts $50,000 from energy firms, saying they're not on 'gougers list.'

By DAN MORAIN
TIMES STAFF WRITER

November 16 2001

SACRAMENTO -- Gov. Gray Davis accepted $50,000 in campaign donations from power companies in October, after having sworn off raising money from them as the energy crisis worsened earlier this year, campaign finance reports show.

Davis and his chief campaign strategist, however, defended the decision to accept the two donations, saying that neither company is among the "gougers" that charged Californians record prices for electricity earlier this year, and that the energy crisis has abated.

During a fund-raising trip to Florida and New York two weeks ago, Davis accepted donations of $25,000 each from Caithness Energy of New York and from FPL Energy of Juno Beach, Fla., a firm related to Florida Power & Light. Both firms are independent power producers that sell electricity in California and are involved in construction of new power plants. "First of all," Davis said Thursday, "the worst of the energy crisis is behind us. My concern was in not taking money from people who were actively selling us power [at high prices] during the difficult early months of 2001. To my knowledge, neither of those companies are active players in that process."

Critics, however, blasted the decision to take the money and the governor's statement that the energy crisis is over.

"Tell that to the 20 million ratepayers who have had their rates go up an average 50% this year," said Harvey Rosenfield, the Santa Monica activist who is working on a possible initiative for next November's ballot. "When ratepayers start getting their money back, he can start taking campaign contributions."

FPL Energy operates wind and solar generators in California; Caithness sells geothermal energy to Southern California Edison. The firms are partners in the construction of a large natural gas-fired plant in Blythe. FPL is seeking Energy Commission approval to build large natural gas plants in Rio Linda outside Sacramento and near Tracy in the Central Valley.

Caithness was among the firms most active earlier this year in seeking payment from Edison. In March, frustrated that it was owed $20 million by Edison, the company placed a lien on an Edison power plant in Nevada. Both Caithness and FPL were considering forcing the utility into bankruptcy.

Last December, as the energy crisis spun out of control, Davis canceled a fund-raiser sponsored by independent power companies. Garry South, the governor's chief campaign strategist, said at the time that Davis would stop taking money from independent power companies and California's privately owned utilities.

"We said we were not taking money from the utilities and from the generators--the Dukes, Dynegys and Enrons who are . . . gouging," South said Thursday. "Our rule of thumb is that if they're on the . . . gougers list, we won't take their money."

South said he and other campaign aides were aware of the donations from FPL and Caithness, and that neither firm was among the companies that sold power to the state at inflated prices. He noted that Davis accepted donations from others involved in power generation earlier this year, including City Power & Light, which supplies power in Long Beach.

Jan Smutny-Jones of the Independent Energy Producers said that the concept of a "gougers list" is "somewhat Nixonian" and that such rhetoric should cease. He said his group represents Dynegy and Duke, as well as FPL and Caithness.

"The governor should be allowed to raise money from whoever he wants," Smutny-Jones said. "FPL and Caithness have significant interests in California and have invested billions. But so have Duke, Dynegy and a number of other players. I don't distinguish between them."

Under legislation by Senate Leader John Burton (D-San Francisco) that Davis signed earlier this year, the governor and other candidates must file reports within two weeks of receiving donations of $5,000 or more. The reports, available on the Secretary of State's Web site, show that Davis took the money at the end of October when he traveled to Florida, Washington, D.C., and New York.

As is his practice, Davis did not publicly disclose that he was heading to the East Coast to raise money. Rather, late on the Friday before he left, his aides issued a statement saying that on Monday, Oct. 29, he would be in Washington to pitch proposals to the Bush administration to use California police as sky marshals on intrastate commercial flights and have National Guard troops take a greater role in airport security.

Altogether, the governor raised at least $150,000 during the four-day tour. His largest donation, one for $50,000, came from Citibank. Davis' expenses were paid for by his campaign. His entourage's expenses were paid for by tax money.

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