They arrived in all their fin de siecle glory, disgorged from stretch limos and sleek foreign sedans, each with a freshly pressed tuxedo on his back and an elaborately coiffed spouse on one arm. They made their way to the Plaza Ballroom of the Adam's Mark Hotel with leisurely dignity. They admired the centerpieces of white tulips and purple irises, nodded at golf partners across the room, gawked at the famous quarterback. And when the time came, they cheered and applauded the new governor of Colorado--a politician of exceptional blandness, still shedding the tags from his new tux as he made his grand entrance.
They had cause to cheer. After a quarter-century of dreary Democratic rule, the state was theirs again.
Well, maybe it wasn't theirs exclusively. There were, after all, close to 2,500 people at the inaugural ball for Governor Bill Owens last January, including a healthy contingent of Democrats--so many people that dozens of tables had to be assembled in the foyer of the ballroom to handle the overflow. The captains were only a couple of hundred well-fed bellies in a crowd of cummerbunds; but they had contributed more money to the event than all the rabble surrounding them, and their place was assured. They would not be sitting out in the hall. Many of them, those whose companies had written checks for $25,000 (or, in one case, $50,000) to become a "Corporate Gold Sponsor" of the ball, had already enjoyed some face time with Owens at a private reception at the Governor's Mansion.
So they sat at the favored tables and feasted on beef and salmon. Dessert was a miniature chocolate replica of the State Capitol. They cracked the golden dome and spooned out white mousse. It was, by all accounts, delicious.
Sadly, several of the governor's longtime associates were unable to join in this symbolic devouring of the state. The demand for invitations had been so strong, the acceptance rate so much higher than anticipated, that the planners had to contact some would-be attendees and tell them not to come--even though they'd already shelled out money for tickets (at $150 a pop, rather than the sky-high corporate seats). Among those left in the lurch were ex-legislators and lobbyists whose ties to Owens stretched back a decade or more.
"My wife and I talked about going over to the Adam's Mark and pressing our noses up against the glass," says one former lawmaker. "They oversold it, and some of us were stuck with $300 tickets and rented tuxedos and pissed-off wives."
The Owens inaugural ball was a stunning contrast to Roy Romer's downscale wingdings, where anyone with a ten-dollar admission fee could come meet the guv. The affair raised $1.2 million, almost as much in one night as Owens's gubernatorial campaign had collected through months of gladhanding and grubbery. Planners stressed that the net proceeds would be used primarily to renovate the Governor's Mansion and that thousands of people had participated in other Owens inaugural events around the state that charged as little as ten dollars.
But all of the man-of-the-people hype couldn't hide the fact that two-thirds of the money poured into the celebration came from a few dozen corporations and special-interest groups. The top fifty donors--from US West ($50,000) and Kaiser Hill ($40,000) to Coors ($25,000), Texaco ($15,000), PacifiCare ($12,500) and so on--chipped in a total of $715,000.
The ball neatly spotlighted the cozy relationship between Owens and his biggest campaign contributors. It was also a sign of things to come. The Owens administration is shaping up like an elegant party--one that gives the impression that all are welcome, but a privileged few are definitely more welcome than others. In fact, some of those who thought they were invited turn out to be not welcome at all.
Four months into his governorship, Owens has managed to confound critics and supporters alike. He has proceeded with caution and sweet talk, as befits a man who squeaked to victory in one of the closest gubernatorial races in state history. He has tapped a surprising range of people for his cabinet, including a few Democrats and ex-rival Tom Norton. And he has been widely praised within battle-weary Republican circles for pursuing an agenda--roads, tax cuts, downsizing the bureaucracy--that seems more pragmatic than ideological. Owens may not be the anti-abortion terror that his worst critics feared he would be; in the one litmus test to date of his commitment to the Christian Coalition, he declined to veto funding for family-planning clinics because one of the clinics also performed abortions.
"He's a Reagan Republican," declares ex-legislator Sam Zakhem, who lost a bruising race for the state party chairmanship to the contentious Steve Curtis two years ago. "He believes in the big tent. For too long, our leadership has ostracized the Republicans who didn't agree with them on issues such as abortion."
But in the governor's big tent, the best seats don't come cheap. Owens's pragmatism may be more susceptible to the tug of money and influence than the nudge of personal principles. Several of his key appointments reflect a willingness to seek out the most qualified donor for the job--or, at the very least, to select the candidate backed by the biggest contributor. In some instances, the positions involve regulatory duties in which the appointees have built-in conflicts of interest in overseeing the industries that have enriched them.
Democrats, to be sure, have their own deep-pocket backers to satisfy, including big unions and liberal political action committees. But rarely can the injection of big money into public policy be traced as brazenly as in the case of Bill Owens, who stands poised to make significant changes in the way state government interacts with the private sector. The arc of influence is evident not only in his appointments, but in his legislative agenda--tax cuts for poor, beleaguered mining companies! Reduced liability and scrutiny of insurers, developers and other downtrodden mega-corporations! More privatization of public transit!--which was hustled through the General Assembly before the session ended last week.
In a time of teeming prosperity and revenue surpluses, the emergence of the new governor and his big tent recalls not so much the Reagan years as it does an earlier, more opportunistic era: the Coolidge years, that fat and happy siesta before the crash. The business of Bill Owens's Colorado is business, pure and simple, and Owens is our own Silent Cal. The money does all the talking.
Last year's governor's race was the first under the constraints of the Fair Campaign Practices Act, better known as Amendment 15, the campaign reform passed by Colorado voters in 1996. The measure, now under attack in federal court, was designed to limit the influence of powerful economic interests on statewide elections by banning corporate donations and limiting individual contributions to a maximum of $1,000.
Judging by the gubernatorial election, Amendment 15 did little to stem the tide of corporate money. It did, however, make the major donors in the race more difficult to detect, by channeling their largesse into dozens of small contributions under the legal limit rather than a few hefty corporate donations. The reform also contained loopholes allowing for the formation of supposedly independent political groups that functioned as stealth advocates for candidates, like the Centennial Spirit campaign that blitzed the television airwaves with pro-Owens advertising. Such groups aren't required to divulge the source of their funds--but whether the money comes in one fat check from an industry PAC, in a fistful of small checks from interested parties, or in soft money diverted to party coffers and "educational" campaigns, the players remain the same.
"In the old days, you'd see a big corporate check produced at a fundraiser, maybe a few," recalls one veteran lobbyist. "Now you see a stack of checks from individuals. I doubt that Bill knows who all these people are, but I'm sure he knows the companies they work for."
"Amendment 15 has made the political process more unaccountable than ever before," says Owens spokesman Dick Wadhams, a veteran of several state campaigns. "The limits were so restrictive that it forced the money elsewhere. Millions of dollars were spent on educational campaigns, and we'll never know where that money came from."
Owens assembled the seed money for his campaign in 1995 and 1996, before the limits established by Amendment 15 went into effect. He collected $12,000 apiece from nursing-home moguls Ralph and Trish Nagel; another $3,200 from the Nagels' company, LeGan; $5,000 each from oilman Cort Dietler, developer J.V. Saeman & Co. and Swerdfeger Construction; $3,000 from Coors; $1,500 from US West; and similar amounts from other Colorado companies and out-of-state sources--a total of more than $150,000 raised under the old rules, much of it coming in the final weeks before the deadline. His Democratic opponent, Gail Schoettler, who didn't formally announce her candidacy until early 1998, raised $112,000 during the same period.
The most startling difference in the way the candidates financed their campaigns, though, came after the spending limits kicked in. Owens's campaign reports list more than 5,000 individual contributors, but nearly three-fourths of his war chest--more than $1.2 million out of a total of $1.7 million--came from a core group of several hundred contributors who each gave $500 or more. That's 50 percent more than Schoettler was able to raise from the $500-plus crowd. Although her campaign ultimately amassed $1.24 million, she lagged badly in the number of high-end donors supporting her. Given the closeness of the race, Owens's appeal to moneyed patrons who cheerfully chipped in the maximum allowed--and in some cases, went on to funnel additional cash to the cause through Centennial Spirit or other dodges--may well have been the deciding factor.
A Westword analysis of campaign-finance data reveals that the core group of Owens supporters is heavily concentrated in a few key industries, including construction and development interests; oil and mining companies; cable, telecom and high-tech empires; and health-care firms. Individual donors aren't required to list their occupations and often don't--or they have a spouse or another relative write the check, listing "homemaker" or some other innocuous description. But a search of public records, country-club directories and other sources yielded a profile-by-industry of the vast majority of the top 200 donors to his campaign, those listed as having given $1,000 or more. These top donors account for roughly 20 percent of all the money that Owens raised.
Technically, Owens actually had more thousand-dollar contributors than the records indicate. Many of the contributors who show up further down the list, among the $500 or $250 pikers, such as former US West executive Jack MacAllister, developers John Sevo and John Madden and ski-industry maven Jerry Jones, actually gave the maximum--they just did it by writing a couple of smaller checks, often in connection with the same fundraising event. Others shared the joy of giving with their better half, bifurcating the total. (Should the generosity of John and Janet Elway be considered as one donation? Norman and Sunny Brownstein? Steve and Cindy Farber?) But further analysis of identifiable contributors down to the $500 level only reinforces the profile of the governor's backers presented by the top 200.
Wadhams says he's not surprised by the industries represented. "That sounds like a fairly broad cross-section of industries that employ a lot of people in Colorado," says Owens's spokesman.
Yet these VIP contributors also represent Colorado's own version of Friends of Bill, the corporate powers with the largest stake in Owens's election. The top donors diverge from the sort of industry contributions one expects to find in statewide elections primarily by the lopsided representation of certain sectors, such as construction and resource development companies--and by a glaring absence of labor interests, which were heavily aligned with Schoettler. There are the Nagels, of course, and other health-care company executives, including PacifiCare's Eric Sipf and Hasan Malik of QualMed; a pack of longtime Owens supporters from oil, gas and mining firms; numerous real-estate moguls such as Paul Powers, a principal in the Gateway Park development near Denver International Airport; an array of high-tech and telecom giants, led by US West and J.D. Edwards executives but stretching across the Englewood cable belt; and a host of prominent local attorneys and financiers.
The Owens campaign also enjoyed a notable influx of out-of-state donations. More than a quarter of the campaign's biggest donors reside elsewhere; they range from Chicago bankers to a Salt Lake realtor to one of the founders of Corrections Corporation of America, the Tennessee-based company that has become the world's largest private prison contractor. Significantly, many of the out-of-state donors are the same GOP faithful who coughed up big checks for Wayne Allard's successful 1996 campaign for the U.S. Senate. Owens borrowed heavily from Allard's playbook, tapping not only his contributors but his chief strategist, Wadhams (now the governor's press secretary), as well as finance chair Barb Card (who supervised the Owens inaugural events and now oversees the state's boards and commissions) and chief of staff Roy Palmer (now serving in the same position for Owens).
There is also a substantial overlap between the Friends of Bill list and the quasi-secret membership of Colorado Concern, a powerhouse coalition of eighty-odd top CEOs, developers, attorneys and bankers that has quietly donated to a variety of highway and transit projects and pro-growth candidates over the years. Several Colorado Concern members--legal eagles Brownstein and Farber, Broncos owner Pat Bowlen, Shea Homes veep Joseph Blake, Land Title Guarantee chairman William Vollbracht, developer Burt Boothby, Andy Miller and John Sevo of Sevo Miller, PacifiCare's Sipf and US West CEO Richard McCormick, to name a few--also made significant contributions to the Owens campaign.
It would be simple-minded to suggest that such men were buying anything in particular with their paltry $500 or $1,000 checks. What they were doing was cultivating a relationship, one founded on a shared interest in loosening the constraints of government on the private sector and hurling Colorado's already blazing economy into hyperdrive. In his many years of service to government and industry, Owens demonstrated that he understood their complaints--how taxes, workers' comp claims, lawsuits, red tape and pesky environmental and consumer concerns can rob the businessman of his just rewards--the way a wife understands her husband's mysterious aches and digestive problems. He would be their kind of governor.
The strength of that relationship became clear at the inaugural ball. Here at last was an opportunity for Owens's biggest boosters to declare themselves, unfettered by the constraints of campaign reform. Not surprisingly, the event was dominated by many of the same industries and players who'd already poured money into his campaign. But it was also a chance for those who had earlier supported GOP rival Norton to make amends (Hensel Phelps Construction, a major Norton backer, was a $15,000 "Corporate Silver" sponsor of the ball) and for distant corporations and national lobbying groups to offer tokens of their affection (Microsoft gave $5,000; the National Rifle Association, $1,000).
There was considerable hand-wringing in the Denver dailies about the private receptions offered to corporate sponsors in exchange for the inaugural cash. But the sponsors weren't buying access; they already had that. A one-hour "private" reception with the governor and two hundred other supplicants isn't likely to be as productive as an exclusive appointment that Owens's old friends could arrange any day of the week. The ball was merely a public display of what the campaign had already established, a reminder of who had brought Bill Owens to the head table that night--and who would be waiting to share the goodies.
"Let's face it," declares one prominent donor to the Owens campaign. "The people who give a lot of money have a lot of say about what happens next."
Two weeks after his victory at the polls, Owens named a seventeen-member transition team to help him review candidates for cabinet positions and plot the restructuring of state government. Within a few days, the team had established a series of subcommittees consisting of more than 170 volunteers, including many campaign contributors.
How much influence this cumbersome pack of advisors exerted over the process of picking staffers and shaping state policy isn't clear. One participant describes the Owens transition team as "basically a thank-you to people who helped out on his campaign. We weren't really involved in the selection process beyond passing on resumes," he says. "Our purpose was to outline some things we wanted to see happen and give some input on candidates."
Yet certain members obviously had more input than others. Attorney Trish Nagel was named co-chair of the committee on health-care issues, which amounted to inviting a major nursing-home operator to participate in choosing the watchdog who would regulate her industry (see "Nursing a Grudge," January 7). Other committee chairs, including former Owens legislative cronies Don Ament and Tim Foster, ended up getting cabinet posts themselves; Foster is now the director of the Colorado Department of Higher Education, while Ament heads the Department of Agriculture.
For the most part, though, the transition posts carried more prestige than authority. The teams were encouraged to draft reports on various state agencies, calling for more bang for the buck out of health-care programs and for educational offerings "that closely align with the needs of business and industry," but these were tentative wish lists rather than proclamations of official policy. According to insiders, the crucial decisions about the new administration, including the cabinet appointments, were predetermined by a much smaller group of advisors and major contributors.
"He took a page from Romer's book," says one observer. "You have a roundtable, then you do whatever you were going to do in the first place."
Owens's defenders argue that many of his appointments indicated a willingness to reach beyond the narrow spectrum of his most ardent supporters. Some may have been consolation prizes for Republicans who'd fallen in the service of their party, such as John Suthers, the former El Paso County district attorney who lost his bid for the attorney general's office but wound up in charge of the Department of Corrections. But others show a bit of creative stretching: the naming of conservative Democratic legislator Jim Rizzuto, well-liked by Republican colleagues, to the health-care policy post; the selection of Nancy McCallin, a Democrat and the chief economic analyst for the legislature, to head the planning and budget office; tapping corrections deputy Larry Trujillo, another Democratic ex-lawmaker, to head personnel; and, of course, the stunning announcement that Tom Norton would be the head honcho at the Department of Transportation, a move that promised to heal wounds in the GOP left over from the primary race.
"His appointments have been politically quite astute," says Jon Caldara, the former RTD board chairman who now heads the Owens-friendly Independence Institute. "When you win by only a few thousand votes, you have to be very careful."
But other appointments may have been determined less by political considerations than by the influence of campaign dollars--and the ongoing business relationship that they represent.
"If you shuffle the cards right, you can have someone pick the card you want," says one disappointed suitor, a GOP loyalist who'd sought a key post in the Owens regime. "I don't know what I could say that wouldn't sound like sour grapes, but it was obvious to me that the people they were picking were the ones favored by the heavy donors."
So far the lightning rod for criticism in the Owens cabinet has been Vickie Armstrong, the new director of the Department of Labor (see related story, page 26). Appointing Armstrong, a right-to-work enthusiast who's lobbied against workers' comp benefits, to champion the cause of labor is akin to putting Carrie Nation in charge of a brewery, but it's not the only appointment in which pressures from major contributors may have played a part. Consider these other curious choices:
--Insurance commissioner Bill Kirven is charged with pursuing and resolving consumer complaints against insurance companies, but much of his prior experience has involved defending a major HMO in lawsuits with consumers and others over coverage disputes, liability and other issues. Prior to accepting the state post, Kirven was a local attorney for PacifiCare, whose top executives were major donors to Owens's campaign and his inaugural ball. PacifiCare has been fined more than $80,000 in recent years by the Division of Insurance for performance irregularities, a figure that a division spokeswoman describes as a "mid-level" penalty for a managed-care company of its size.
Kirven has said that he will recuse himself from decisions affecting his former client, but his appointment offers little encouragement to consumer groups that were demanding that the state agency become more aggressive in its enforcement actions. A recent state audit found that the division, which prefers to resolve complaints informally, took far fewer formal enforcement actions against insurers in 1996 than similar agencies in ten other states, despite having the third-highest rate of consumer complaints.
--Ralph Nagel's reward for his steadfast support of the Owens agenda is a spot on the nine-member Colorado Commission on Higher Education. Although the CCHE is basically a layman's board, it's worth noting that the two other Owens appointments to the board, Terry Farina and Marion Gottesfeld, both have prior experience with the business end of higher education in the state: Farina has taught at a state college and served on educational foundations, while Gottesfeld is a trustee at the University of Denver. Nagel's resume lists three master's degrees, but his chief qualifications appear to be his ties to the Independence Institute and Colorado Concern and his desire to reform the structure of public education at all levels, as evidenced by his $100,000 donation to last year's unsuccessful campaign to award tax credits to parents who send their children to private schools. One stated objective of the Owens transition team for the CCHE was to develop "better outreach and inclusion of the business community." Presumably, Nagel is in a position to tell educators what the business community wants from its college graduates: more nursing-home workers.
--The choice of Greg Walcher, Club 20 president and former Bill Armstrong staffer, to head the Department of Natural Resources may be upsetting to environmental groups, but what did they ever do for Bill Owens? Walcher himself wasn't an overly generous donor to the Owens campaign ($25), but the Western Slope business group he represents has close ties with several major oil, gas and mining companies that poured a gusher of money into the campaign and the inaugural ball. Owens's appointments to the oil and gas commission have even closer ties (see story, page 24).
It's too early to tell how these appointments will help determine the overall direction of the Owens administration. But the political and financial agendas embedded in them presage the more passionate relationship between big business and government that Owens and his backers have in mind.
The legislature is doing its best to prepare the way, too. No longer fearful of a Democratic veto, lawmakers have trimmed severance taxes for a few big mining companies and devised a break for the personal-property taxes businesses pay to local governments. They've boosted the role of private contractors in providing public transit services, limited the liability of private businesses for Y2K problems, and sought to immunize agricultural operations from public-nuisance lawsuits. (Before the massacre at Columbine High School doomed the rampant pro-gun legislation, they'd even sent on to the governor a bill barring local governments from suing gun manufacturers. Owens has said he will veto it.) They restricted local government's ability to rein in developers. And they passed an ambitious transportation package that, if approved by voters in the fall, promises to provide a multi-million-dollar windfall for bond firms and construction and engineering companies (see story, page 28).
Of course, Owens loyalists give high marks to the first hundred days of his administration. They say that the governor has been unfairly criticized for appointing individuals whose expertise inevitably arises from their past association with the industry involved. They point out that one of the governor's first official acts was to establish an ethics board, charged with seeing that his appointees don't abuse their positions. (Four out of five of the ethics watchdogs were also contributors to his campaign.) They contend that many of the tax breaks for businesses will benefit consumers, too, in the form of lower prices.
True, the folks in the cheap seats haven't exactly been ignored by the Owens revolution. They have a hard-won, 5 percent tax cut to clutch as the show unfolds. But in the big tent, those up front have the best view of the action in the main ring. As at any exclusive club, access to those seats is by invitation only, and the dress code is strictly enforced.
