EDITORIAL: Legislature must shine light on 'dark money'

In some ways, the Watergate era was a simpler time. The Committee to Reelect the President, Richard Nixon, had a slush fund. Cash from the slush fund moved to the Watergate plotters and the five guys who bungled the burglary of Democratic headquarters at the Watergate Hotel.

In 1974, California voters reacted by overwhelmingly approving the Political Reform Act. The act, which remains a model in many ways, requires public disclosure of campaign donations and created a strong commission to enforce its provisions.

However, the Political Reform Act was written when nonprofit corporations did charitable work. It needs to be updated to deal with nonprofits shells that hide the sources of campaign money.

That became apparent once more last week when the California Fair Political Practices Commission and California Attorney General Kamala Harris concluded a year-long effort to trace $15 million in so-called "dark money" spent to promote Proposition 32, rejected last November. The initiative was intended to block unions from raising money, though its promoters claimed it would have taken special interest money out of the system.

The investigation shed light on a network of nonprofit corporations led by David and Charles Koch, the billionaire industrialists who fund many conservative and libertarian causes and campaigns.

The commission levied separate $500,000 fines on two Arizona entities, the Center to Protect Patient Rights and Americans for Responsible Leadership. A $1 million penalty is not chump change. But because of holes in the 1974 law, the commission could not discover the identities of individual donors.

Assemblyman Richard Gordon, a San Francisco Peninsula Democrat, is carrying Assembly Bill 800, which would make clear that the FPPC can audit a campaign before an election.

A second Gordon bill, AB 914, and Senate Bill 27 by Sen. Lou Correa, D-Santa Ana, would greatly expand disclosure requirements for nonprofit corporations engaged in political activity in California.

All three measures stalled last month as the legislative session ended. Lawmakers should approve the bills in one of their first orders of business when they return in January.