Group is no ordinary PAC

Express-News Austin Bureau, March 15, 2004

AUSTIN -- On election night 2002, Uvalde lawyer Leland Kerby received a call from Texans for a Republican Majority, an Austin group that had just helped the GOP snag a historic majority in the 150-member Texas House.

John Colyandro, TRMPAC's executive director, wasn't phoning to celebrate.

Instead, he wanted Kerby to determine whether Democratic Rep. Pete Gallego of Alpine truly lived in his district, and if not, prepare to stop Gallego's re-election, which he won with 71 percent of the vote, from being certified.

Gallego has said the house in question was being remodeled at the time.

Kerby had folks look into the matter and, as he retells it, said to Colyandro: "I've got this guy, I've got him cold."

The late-hour effort fizzled a few days later when Colyandro canceled the project; after all, 88 Republicans won House seats, giving the GOP its majority and setting up Rep. Tom Craddick, R-Midland, to become the first Republican speaker in more than a century.

But the up-and-down episode lingers as a sign of how TRMPAC proved different from other political operations -- rollicking, groundbreaking and in the end possibly illegal, at least according to Travis County prosecutors. They suggest the group misspent corporate funds for political purposes -- a characterization Colyandro and others dispute.

Prosecutors are looking into how TRMPAC and the Texas Association of Business, the state's leading business lobby group, spent millions of corporate dollars to launch a powerful wave of partisan change. The wave could peak in November, with Republicans possibly winning a 22-10 margin in the Texas congressional delegation thanks to the contours of U.S. House districts redrawn by the GOP-led 2003 Legislature.

TRMPAC and TAB "made the difference," said lobbyist Bill Clayton, a former Democratic House speaker. "With big money, they got it done."

Critics contend the groups subverted state law forbidding political action committees from using corporate money for anything other than getting started and administrative expenses.

A Travis County grand jury has subpoenaed hundreds of documents -- including Kerby's bill for nearly 15 hours of research.

The materials are not public, but hundreds of other documents have been filed in civil lawsuits by lawyers for defeated Democratic House candidates and counselors for TAB and TRMPAC.

Neither group disputes they spent more than $2 million in corporate aid.

TAB, which spent corporate funds on leaflets praising GOP legislative candidates and criticizing their Democratic foes, say the mailouts to voters in more than 20 House districts were protected free speech, not illegal expenditures, because none directly urged a vote for or against a candidate.

TRMPAC's organizers say no items or services -- ranging from group fund raising to a poll to legal bills, travel, entertainment, printing, stationery and postage -- ran beyond permitted administrative expenses.

Depositions show TRMPAC succeeded with no employees. Everyone aboard -- including two fund-raisers -- was a contractor or volunteer. Though TRMPAC claimed a downtown space, accountant Russell Anderson said he moved operations to his office and that its official telephone was a cell phone "never used by anybody."

The group gained financial traction largely by tapping Warren Robold, a Washington-based fund-raiser already affiliated with Americans for a Republican Majority, a political arm of House Majority Leader Tom DeLay of Sugar Land.

Robold's job was "trying to gather large donations," said Bill Ceverha, TRMPAC's treasurer. A promotional handout used by Robold sought contributions of up to $100,000 to help TRMPAC boost candidates and "increase and maintain our majority of statewide and legislative offices."

"Unlike other organizations, your corporate contribution to TRMPAC will be put to productive use," it states. "Rather than just pay for overhead, your support will fund a series of productive and innovative activities designed to increase our level of engagement in the political arena" through candidate recruitment, monitoring campaigns, message development and market research.

Colyandro said the group started too slowly to recruit candidates and never completed issue messages. With Robold's help, though, the group collected about $600,000 in corporate checks.

Donors include Questarra Corp., Diversified Collection Services Inc., El Paso Energy, Constellation Energy Group, Burlington Northern Santa Fe Railway, Williams Companies Inc., Westar Energy, Reliant Resources Inc., Sears, Roebuck & Co., Phillip Morris Mgt. Corp., Belmont Oil & Gas Corp., Old Country Store Inc., UPS PAC, Bacardi USA Inc., AT&T, Perfect Wave Technologies, US Risk and Cornell Companies.

TRMPAC leaders were each questioned on why checks totaling $152,000 were delivered to 14 GOP House candidates through Craddick shortly before the 2002 elections. Ceverha said the TRMPAC checks were sent to Craddick for convenience.

Colyandro said Craddick was going to an event with the candidates. He has since said the checks were sent through Craddick because he and Ceverha deserved credit for the expected wins.

The trio also were questioned on TRMPAC's sending $190,000 in corporate funds to a Republican committee in Washington. Less than two weeks later, the GOP group made contributions totaling the same amount to seven Texas House candidates. State law bars corporate funds from being given to state candidates.

Anderson said the identical amounts going and coming back "just wouldn't be worrisome to me. I have complete confidence in the attorneys at the Republican National Committee that they would follow the letter of the law." TAB and TRMPAC have questioned the motives of defeated Democrats filing suit -- and one attorney's tactics.

An attorney for TAB states in a court filing that an attorney for defeated Democrats tried to recruit two defeated Libertarians to his lawsuit. A footnote states, "It appears the crime of barratry may have been committed," referring to the questionable practice of lawyers soliciting business without cause.

Candidates Rob LeGrand and Michael Badnarik said in affidavits the unsolicited lawyer called them and then sent the lawsuit.

Professor Geary Reamey of St. Mary's University School of Law said suggesting barratry in court is inappropriate unless an attorney has filed a grievance with the State Bar of Texas or complained to a district attorney.

Cris Feldman, the lawyer under fire, said he faces no grievance. Feldman, denying wrongdoing, said foes "are doing everything possible to divert attention from their clandestine laundering of corporate cash."