The true cost of the special election

When Governor Arnold Schwarzenegger and his advisers decided to write initiatives, gather signatures and call a special election, they kick-started the engine of a political-campaign monster truck that usually spends off-cycle years, such as this one, in the garage.

If Schwarzenegger had not called for the November 8 special election, California’s political consultants would remain largely silent, working instead for corporate clients, for smaller local elections or to drum up business for the 2006 political circus.

This is not campaign season. This odd-numbered year is supposed to be something of a political downtime.

Instead, the state’s campaign-season industry is revving at 4,500 rpm—everyone from political operatives and attorneys to sign-makers and mailing services are raking in dough from both Schwarzenegger and those who oppose him.

Take, for example, a single television ad, like the one touting the four initiatives backed by Schwarzenegger. You’ve seen it. The one with the tired and ticked-off-looking woman at the end saying, “Let’s face it: Sacramento is screwed up.”

You may have seen it during the 6 o’clock news broadcast on Channel 3, KCRA. The governor’s California Recovery Team paid $4,000 for that 30-second spot, according to the contract between the political committee and the station.

It was part of Schwarzenegger’s first major ad buy, a $2 million statewide television campaign during the last week in September. It included about $275,000 to reach Sacramento-region TV viewers, according to contracts between the California Recovery Team and the region’s three biggest stations: KCRA, KXTV Channel 10 and KOVR Channel 13.

The $4,000 is a small blip in what may shape up to be a quarter-billion-dollar special election, which includes money from taxpayers’ pockets (the secretary of state’s most recent estimate shows county elections offices will spend about $45 million to hold the off-year election), but the ad buy provides a glimpse into the scores of consultants and companies making money because of the special election.

For example, the ad was scheduled to air 63 times on KCRA, which produces the city’s most-watched local news broadcasts, at a cost of $132,200. The station takes in $112,370 of that total. The remaining 15 percent is available to be paid as commission to the company that worked with the station to buy the airtime. In the governor’s case, that media buyer was listed as the Media Partnership Corp. That Norwalk, Conn., company made as much as $300,000 from that one week of ad placements. The actual amount paid to Media Partnership is agreed upon by the company and the campaign manager. There is no standard for how much consultants are paid.

“There’s no rules here. It’s just whatever you can negotiate,” said Darry Sragow, a Democratic strategist who is not working on any campaigns related to the statewide special election.

Todd Harris, a principal of the consulting firm Navigators and spokesman for the governor’s initiative campaign, said Don Sipple chose the airtime buyer. Sipple, who produces the governor’s television ads, was paid a $75,000 consulting fee in July by the governor’s campaign. In the past three months, the California Recovery Team paid a variety of companies about $400,000 in other airtime and production costs.

The cost of a campaign television commercial is much more than the cost of production and airtime.

Large campaigns typically employ a pollster and conduct focus groups to help design a commercial. The California Recovery Team has paid more than $270,000 this year to McLaughlin & Associates for polling and survey research.

Plus, the governor’s California Recovery Team has employed 38 consultants or companies and spent nearly $1.5 million in nebulous “campaign consultants” in the past three months, according to its most recent expenditure list reported to the secretary of state.

But even with those finance reports filed to the secretary of state’s office, figuring out which companies and consultants are responsible for which tasks is difficult.

“There’s no way of knowing exactly how that money’s being utilized,” said David Fink, an organizer with The Foundation For Taxpayer and Consumer Rights. That Santa Monica-based nonprofit runs ArnoldWatch, a project that examines where special-interest money intersects with the governor’s politics.

Schwarzenegger’s moneyman, Marty Wilson, did not return SN&R’s phone calls or e-mail seeking comment for this story.

But Republican consultant Dan Schnur tempered the assumption that California’s political consultants owe their entire 2005 income to the special election.

“They’re certainly not starving in off years,” said Schnur, founder of Command Focus, a Sacramento firm that has not worked on behalf of any special-election campaigns.

Still, some consultants are making more than they would otherwise, he acknowledged. And small firms that would be scrounging for work this year are picking up jobs that bigger firms would have taken on otherwise.

For a handful of Republican strategists, Schwarzenegger has been their golden ticket.

“Everybody loves to have a wealthy, self-financing candidate. That’s everybody’s dream. That’s magic-wand stuff,” Sragow said.

Television stations would not broadcast blank screens if not for a special election, but the additional advertising demand increases their prices, say station managers.

In a non-election year, television stations stick to product commercials. General Motors cars. Burger King meat-on-meat-on-meat sandwiches. But the flood of political advertising allows them to charge more for airtime, both with the corporate clients and with political campaigns.

In fact, TV stations prefer the initiative-driven special election to a more typical candidate race. Federal laws require stations to charge political candidates their lowest advertising rates, but those laws do not apply to political “issues,” such as propositions. So, the California Recovery Team and the Alliance for a Better California (a coalition that opposes Schwarzenegger’s initiatives) are paying just as much for airtime as are Enzyte’s “Meet Bob” commercials and David Spade’s repetitive tries at humor on behalf of Capital One.

Of course, the money being spent on and by Arnold’s army of consultants will pale in comparison to that being spent by his opponents. So far, a variety of political groups formed to oppose the governor’s initiatives have spent almost three times as much money as his California Recovery Team.

So, if the “Year For Reform” does not turn out to be the year of reform the governor hoped it would be, who gains from this special election? Clearly, it is the consultants and television stations whose revenues will be higher than otherwise.

But the question “Who gains?” begs another: “Who loses?”

Democratic consultant Garry South, of course, predicts that the four propositions the governor has endorsed all will fail and that consulting heads will roll. In a small political shop like the one he ran for former Governor Gray Davis, it would be clear that South would be blamed and canned, he said, because all decisions ran through him.

But Schwarzenegger does not have a political shop like the one South ran. Schwarzenegger has hired up all of the state’s top-notch Republican consultants and amassed himself a landmark-sized team of captains.

With so many consultants dipping their hands into Schwarzenegger’s campaign-strategy cookie jar, it may be hard to pin the blame of failure on one person or firm.

And, really, on November 9 it will be too late to do so, because on that Wednesday, campaign season begins in earnest, and Schwarzenegger’s second gubernatorial bid will have to shift into gear.