Will Hedge-Fund Billionaire Assist Inslee By Spending on Washington Races?

By Jordan Schraeder, May 7, 2014, The News Tribune

Gov. Jay Inslee has an ambitious agenda for shrinking Washington’s carbon footprint. The 2014 midterms could decide whether his plan has much of a chance – and the spending decisions of a California billionaire could be critical.


A crusader against climate change, Tom Steyer last year plowed more than $500,000 of his hedge-fund fortune into Washington elections. Most of it targeted a single state Senate race – one that Inslee and Steyer had discussed as they struck up a working relationship last May, records and interviews show.


This year, with many more races on the ballot, the balance of power in the Senate is up for grabs. Steyer’s political adviser suggested in an interview his interest in the state hasn’t waned.


“It’s not a series of isolated one-offs where you come in, spend some money and then leave and are not heard from again,” Chris Lehane said of Steyer’s strategy. “This is designed to be a sustained effort to work with our friends in states like Washington, consistent with what they think is in the best interests of their state.”


The possibility unsettles local Republicans, especially after news reports that Steyer has plans to spend as much as $50 million of his own money and $50 million raised from others in 2014.


“You don’t think that in every race we’ve got to think about what happens if Steyer lands in this race with $500,000, or in two races with $500,000, or three races with $500,000?” said Puyallup Sen. Bruce Dammeier, who chairs Senate Republicans’ campaign committee. “So it does change the landscape.”


The oil and gas companies on the other side of the climate debate, Inslee said, have plenty of money to air their own views.


“If you had 100 Mr. Steyers, it wouldn’t make up for the dollars on the other side of this controversy,” the Democratic governor said in an interview.


Republicans and breakaway Democrats Rodney Tom and Tim Sheldon hold a 26-to-23 Senate majority. Democrats may win back the departing Tom’s seat this fall, but they face a tough fight to hold on to a Federal Way-area open seat. Even if they win both, they also would need to unseat a Republican, such as Andy Hill of Redmond or Steve O’Ban of Tacoma.


Around this time last year, e-mail records show, Inslee met with Steyer after a fundraising breakfast they attended in Seattle for the group Climate Solutions. The governor says they met for the first time that day and talked about the perils of climate change, including the effects of more acidic oceans on Washington’s oyster industry.


But they also talked politics, Inslee said – specifically, about Nathan Schlicher. The Gig Harbor Democrat had been appointed to the Senate but was facing a challenge from Port Orchard Republican Jan Angel. Steyer listened.


“It’s obvious that he was interested in finding a way to help candidates who were going to advance a clean-energy agenda,” Inslee said.


Some of Steyer’s money made its way to Whatcom County Council contests seen as crucial in whether a coal-export terminal was built there. But most of it helped bankroll the effort to keep Schlicher, in a race that set a record for total spending with more than $3 million, mostly from groups not controlled by the candidates.


Angel prevailed, with her own out-of-state help. Her allies included pharmaceutical, insurance and tobacco companies, notes Collin Jergens of liberal group Fuse, a spokesman for the committee targeting Angel.


It’s more worrisome when one checkbook is big enough to buy influence, Dammeier said.


“It’s important that our elected officials preserve their independence,” he said, “and at $500,000, wow. They’re doing that for a purpose.”


Washington Republicans have begun to view Steyer much as liberals see the Koch brothers, the billionaire industrialists who spend money nationally on conservative causes.


But Democrats say Steyer’s motivations differ from business interests trying to pad their bottom lines.


“I respect people who want to protect their bank account, too,” Inslee said, “but I might have even a little more respect for those who want to take care of Mother Earth with their hard-earned dollars.”


Records show Inslee and Steyer crossed paths twice more. Steyer hosted him among other officials at his San Francisco home, where Inslee said they spoke only in passing. After the election, Inslee called Steyer to discuss the outcome.


In January, Inslee’s staff briefed Lehane and a Steyer staffer on the status of climate policy and the political landscape. Inslee policy adviser Keith Phillips said the talk didn’t include specific 2014 races or campaign spending.


Inslee said Steyer has no special access to him. He and his staff have had several meetings with the oil industry, for example.


Dammeier said he worries Steyer is promoting ideas that sidestep the Legislature through executive action. In a major executive order last week, Inslee set up a task force to design a market-based system for limiting greenhouse-gas emissions, akin to a cap-and-trade plan. The governor said the state must meet emissions limits it has set in law.


The order could also be the first step in developing a clean-fuel standard that Inslee may be able to implement on his own. But to create a carbon market, he needs the Legislature.


It’s no slam dunk even if Democrats take over. But its chances are slim if the Republicans stay in control.


Inslee said he’s looking for GOP allies on climate, but so far has found only resistance.


Lehane said one of Steyer’s three criteria for getting involved in races has been the potential to advance real changes on climate policy.


“Washington state is a state that would be potentially poised to be able to do that,” Lehane said, “if you had the right representation in the statehouse.”


-This story was reported in collaboration with Austin Jenkins of public radio’s Northwest News Network. See his report here.



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