“California Governor Gavin Newsom has quietly solicited millions of dollars in campaign donations from state vendors, key people, employees, or their affiliated corporate political action committees,” Open the Books reports. “While progressives decry corporate money in politics, Governor Gavin Newsom has embraced the highly unethical practice of soliciting campaign cash from state contractors.”
In late August, the Globe shared a new report by Open the Books, which sued, and then had to file 442 California Public Record Act requests – one with each state agency – in order to obtain California’s line-by-line spending by state agencies. California’s Controller, Betty Yee, rejected their sunshine request for state spending, claiming she “couldn’t locate” any of the nearly 50 million bills she paid in 2019.
“Follow the money” used to be the first order of business of the “watchdog” media.
Open the Books is a non-profit organization which “works hard to capture and post all disclosed spending at every level of government – federal, state, and local.”
What Open the Books auditors found in California’s state spending was “979 state vendors who gave $10,561,828 in political donations to Gavin Newsom during his 2010, 2018, recall election, and 2022 election cycles. Meanwhile, these companies reaped $6,201,978,173 in state payments.”
That’s a $10.6 million investment for a $6.3 billion return.
That appears to be a very nice return on investment for the state vendors companies.
Open the Books lists some of the companies who gave campaign cash to Gov. Newsom and separately received significantly more in state payments:
I. MAJOR HEALTH CARE COMPANIES – Gave $691,615 in campaign donations and received $1.9 billion in state payments.
Anthem Blue Cross (health insurance provider) received $844,875,535 in state payments while donating $69,305 during Newsom’s 2018 and 2022 elections— $40,000 of that was during the 2022 cycle.
UnitedHealth Group (managed health care and insurance provider) received $544,245,717 in state payments while donating $120,900 between the 2018 and 2022 cycles — $62,000 was donated in the 2022 cycle. Even the Chief Compliance Officer Joy Hia donated $500 to the 2022 campaign.
Centene Corporation (Fortune 500 managed care company) and Health Net, LLC, a major subsidiary, which provides health plans for those with Medicare and Medicaid, received $206,155,778 in state payments while donating $242,550. The company itself donated $121,800 while then-CEO Michael Neidorff gave $120,400 between 2018 and 2022. Not included is an additional $120,400 from wife Noemi Neidorff. Michael Neidorff passed away on April 7, 2022.
Kaiser Permanente received $172,217,805 while employees donated $35,910 including the vice president of government relations, Gary Cohen ($5,000 | 2018 election).
Blue Shield of California received $74,283,100 in state payments while donating $102,550 including $70,200 from the company and $32,350 from key executives and employees.
Masimo Corporation, a health-tech company, received $3,820,654 in state payments and gave $120,400 to Newsom’s 2018 and 2022 races – half of the donations came in 2022.
II. MAJOR UTILITY COMPANIES – Gave $405,601 in campaign donations and received $430,416,420 in state payments:
Pacific Gas & Electric Company (PG&E) based in San Francisco heavily criticized for its role in the California wildfires and recently came out of bankruptcy. The company received $323,777,292 in state payments (FY2021) and gave $123,929 in donations for the 2018 election. These donations included five and six figure gifts from five C-suite execs including CEO Geisha Williams ($10,000). Due to continuing scandals, Newsom stopped taking donations from PG&E after his election in 2018. The company also gave $358,000 between 2011-2018 to Newsom’s wife, Jennifer Siebel Newsom’s charity.
Edison International, with subsidiaries Southern California Edison and consultancy, Edison Energy, LLC, received $100,575,389 in state payments and gave $67,850 in campaign donations through the company, key employees, and staff. Additionally, the company’s trade association, Edison Electric Institute, donated $15,000 to Newsom’s 2018 race.
Calpine Corporation, the largest generator of electricity from natural gas and geothermal sources in the United States with 33 facilities in California received $3,134,154 in state payments and gave $109,822 in campaign donations. CEO Thad Hill gave $10,000 and other top execs gave $12,500 to Newsom.
California Water Service Company (Cal Water) received $2,121,724 in state payments and gave $94,000 between Newsom’s 2018 and 2022 campaigns.
California American Water Company, a subsidiary of American Water – the largest publicly-traded water and wastewater utility in the U.S. – received $807,861 in state payments and gave $10,000 through their employees PAC in the 2018 election. American Water also gave at least $5,000 to the governor’s wife’s charity in 2019.
“In all these examples, the donations came from the organization itself or its executives, employees, subsidiaries, partners, or political action committees during Newsom’s 2010, 2018 and 2022 election cycles,” Open the Books explains.
That’s just the tip of the iceberg. And it appears the First Partner benefitted as well.
Open The Books also found “pay to play” vendor contributions going to the first partner, Jennifer Siebel Newsom, who they say solicited state vendors for donations to her charity, The Representation Project.
Here’s what they found:
Major corporations with state contracts or business before the state gave the charity five and six figure gifts. The Sacramento Bee and Washington Post previously identified the companies and today we know just how much those corporations reaped in state agency payments. (23 and Me is the only donor that wasn’t on the state vendor list, however, they had an interest in 2021 state legislation regulating the use of consumer genetic data.)
IRS 990 informational returns for The Representation Project show that Siebel-Newsom took $1.5 million in salary from 2013-2021 and another $1.6 million in payments to her private company, Girls Club Entertainment since 2012.
Open The Books notes that in all the examples identified in the report, no quid-pro-quo is alleged or implied; however, the patterns are troubling. “In fact, the individual transactions are legal at arm’s length. But that’s precisely the problem. Politicians preside over, in essence, a legalized money-recycling scheme aimed at monetizing incumbent political power.”
That is precisely the problem. Politics is an industry in and of itself in California, and a very profitable one for those who know how to pay to play.
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