Donors flock to Brown’s charities

SACRAMENTO —  Gambling halls and arts education may make strange bedfellows. But over the last three years, five Los Angeles-area card clubs have showered more than $100,000 on a Bay Area school for the arts some 400 miles away.

The gifts offered more than a chance to help inner-city kids. They were an opportunity to please the state official who asked for the money, directly oversees the clubs and is widely viewed as the front-runner to be California’s next governor: state Atty. Gen. Jerry Brown.

Since taking office almost three years ago, Brown has raised nearly $10 million for two charter schools, the arts academy and a military institute, that he founded as mayor of Oakland. In addition to tapping the card clubs whose licensing and operations his Bureau of Gambling Control watches over, he has held out his hand to influential industries and the politically connected.

Those who have answered include Zenith Insurance ($95,000), Pacific Gas & Electric ($75,000), AT&T; ($70,000), Wal-Mart ($50,000) and Bank of America ($30,000), state records show. Hollywood producer and Democratic financier Stephen Bing donated more than $1 million.

Such giving allows contributors to simultaneously curry favor and appear to remain above the political fray, said one advisor to a major donor, requesting anonymity for fear of alienating a client.

“It looks altruistic rather than something that’s sheer, raw politics,” the advisor said. Groups are giving to Brown “with the hope that he will keep an open mind should you need to communicate with him in the future.”

Brown said the gifts to his pet charities have no effect on him: “I have an unimpeachable record of integrity.”

Unlike campaign contributions, which voters restricted in hopes of curbing the power of special interests, charitable donations are not subject to limits. Each of the card rooms -- the Bicycle, Commerce, Hawaiian Gardens, Hollywood and Hustler casinos -- gave the legal maximum of $12,000 last year to one of Brown’s campaign accounts. None gave to the Oakland School for the Arts until Brown was attorney general.

Andy Schneiderman, general counsel for Commerce Casino, said the club gives widely to youth causes and that none of it poses a conflict.

“We contribute to philanthropic causes because that is our corporate culture,” he said.

But watchdogs are concerned.

“It’s a very good cause,” said Jessica Levinson, director of political reform at the Center for Governmental Studies in Los Angeles. “But it still raises questions of people trying to influence Jerry Brown.”

Brown ran for president on a pledge to take no more than $100 per donor. But “that system doesn’t work with charity,” he said.

He noted that his job touches every corner of California, so it is misguided to think that “everyone [who donates] is in question,” he said.

‘The Lord’s work’

On a recent sun-soaked afternoon, Brown cleared his schedule to attend, as he often does, a ceremony for 78 newly minted cadets at the Oakland Military Institute. As the uniformed teens marched past the podium, he saluted them.

“This is the Lord’s work,” Brown said of the schools and his fundraising. “ . . . I’m going to continue. As long as I am still breathing and I can make it work, I will.”

Three-quarters of the graduates go to four-year colleges, he said, and all but one passed the high school exit exam last year. The schools are transforming the gang-led ghettos of Oakland “into an environment of hope and possibility,” Brown said.

The military school, which teaches typical math, science and English courses, brings discipline to kids in desperate need of structure, Brown said. The arts academy, at the hub of a revitalized neighborhood, provides an outlet for creative expression with courses in music, dance and visual arts.

His fundraising, he said, “is born of the . . . under-funding of California schools. Are we going to let these kids just rot?”

Brown’s haul for the pair of schools soared after his 2006 election as the state’s chief law-enforcement official. Only donations greater than $5,000 per year that he solicits must be reported publicly, but state records show that in his first full year on the job, he raised at least $3.3 million. That’s equivalent to three-quarters of what he corralled in his last four years as Oakland mayor combined, city records show.

“I’ve achieved greater prominence as I’ve gone from mayor to attorney general, and I suppose if I run for governor and am elected I’ll have even more prominence,” Brown said.

He displayed the same familiarity with top school contributors as he did with student achievement, rattling off some donors and dollars from memory: The philanthropic Annenberg Foundation in Los Angeles gave $1 million. The Bay Area LEF arts foundation gave $750,000, and the Hearst Foundation $150,000.

Some he didn’t mention: $100,000 from the for-profit University of Phoenix and its owners, $130,000 from United Auburn Indian Community and $250,000 from Lytton Rancheria -- both casino operators -- and $110,000 from E&J; Gallo Winery.

Dr. Prem Reddy, owner of the Prime Healthcare hospital chain in Southern California, donated $100,000 to the military school through a foundation, according to his spokeswoman, Jana Bullock.

The gift came less than a week after Brown was elected attorney general, a position that carries the power to approve all nonprofit hospital sales. Brown’s administration has supported one Prime Healthcare hospital purchase and blocked another.

“Dr. Reddy believes that access to high-quality education for all students is an important and laudable goal,” she said.

Investigations

At least two contributors are being investigated by Brown’s office.

Kenwood Investments LLC, whose founder, Darius Anderson, is under investigation as part of a public pension fund probe, has given $15,000 to the schools at Brown’s behest since 2007, before the investigation began.

Anderson’s spokesperson did not return calls seeking comment.

Various arms of Kaiser Permanente have combined to give $175,000 since 2007. The HMO is among those Brown began probing in September over denying insurance claims. The donations, including $215,000 given when Brown was mayor of Oakland, preceded the investigation.

Other donors routinely nourish relationships in halls of power. The private foundation of Ron Burkle, the supermarket magnate and Democratic power broker who once employed President Bill Clinton and Los Angeles Mayor Antonio Villaraigosa, donated $100,000.

Two foundations affiliated with Majestic Realty and its billionaire owner, Ed Roski Jr., have donated $175,000, and Roski has hosted a golf tournament for the military school. Roski is pressing to build an NFL stadium in the City of Industry, which the governor recently aided by signing an environmental waiver into law.

And Bing, who bankrolled a 2006 ballot measure and has contributed to other initiative campaigns, donated more than $1 million to the arts academy through a company called B. Co., according to Brown’s office.

The attorney general dismissed as the “silliest thing I’ve ever heard of” any suggestion of a connection between Bing’s political influence and his giant gift.

Bing publicist Paul Bloch said: “We don’t ever comment on anything.”

--

[email protected]