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THE RECALL CAMPAIGN | RECALL NOTEBOOK

Judge OKs Schwarzenegger's Use of $4.5-Million Loan

October 03, 2003

A Sacramento judge refused Thursday to block Republican gubernatorial candidate Arnold Schwarzenegger from using $4.5 million in bank loans to finance the final days of his campaign.

Although Superior Court Judge Loren McMaster denied a temporary restraining order against Schwarzenegger, his decision permits the plaintiff, Bill Camp, executive secretary of the Sacramento Central Labor Council, to pursue his suit after the election.

Contending that the suit was politically motivated, Schwarzenegger's attorneys countersued to seek sanctions against the plaintiff.

Camp's lawsuit accuses Schwarzenegger of violating contributions limits imposed by Proposition 34, passed by voters in 2000. That law restricts to $100,000 the size of loans that candidates may give their own campaigns. However, it allows bank loans of unlimited size if the terms and rates are available to the general public.

City National Bank of Beverly Hills lent the $4.5 million to Schwarzenegger, who is seeking to replace Gov. Gray Davis if he is recalled. Charles H. Bell, Schwarzenegger's attorney, provided the judge with an affidavit from City National saying that the candidate is paying the prime interest rate -- 4% -- which is reserved for a bank's best customers.

The affidavit describes Schwarzenegger as a long-term client, and says the terms "are available to any member of the general public who applies for such a line of credit and who is able to meet the bank's lending requirements."

Earlier in the campaign, Schwarzenegger tapped City National chief executive Russell Goldsmith to serve on his team of economic advisors. City National, like many banks, has a lobby presence in Sacramento and is a campaign donor to Republicans and Democrats.

Encore Appearance on 'Tonight Show'?

Arnold Schwarzenegger announced his candidacy for governor on "The Tonight Show With Jay Leno." Now he might return to the same show -- as governor.

A campaign official and a "Tonight" spokeswoman said that Schwarzenegger probably would appear on the show shortly after the election. A "Tonight" promo had referred to an appearance next week, but a campaign official said the week of Oct. 13 is more probable.

Asked about speculation that Schwarzenegger could make his first post-election address to the public on the "Tonight Show," aides said Schwarzenegger would speak on election night at the Century Plaza Hotel in Century City.

Donations for Davis Hit $1.4 Million in Two Days

Gov. Davis may be trailing in the polls, but he's still a powerhouse fund-raiser.

A rush of large contributions has filled the governor's anti-recall campaign coffers in the last two days. The committee reported that it received more than $1.4 million in donations Wednesday and Thursday as labor unions, Indian tribes and the state Democratic Party aided his effort to keep his job.

Californians Against the Costly Recall of the Governor reported that it had received $250,000 from the California State Employees Assn., the biggest union representing state workers. The American Federation of State, County and Municipal Employees Union also gave $250,000.

The Democratic State Central Committee provided more than $236,000; the United Food and Commercial Workers Union gave $150,000; and the California Teachers Assn. contributed $125,000.

Reed Hastings, chief executive of the Netflix software company and president of the State Board of Education, donated $100,000.

The anti-recall committee also reported having received $75,000 from the Cabazon Band of Mission Indians and $25,000 from the Fort Mojave Tribe of Needles.

Separately, the Morongo Band of Mission Indians reported Thursday night that it gave the committee $200,000 -- one of the governor's largest receipts from a tribe in the recall campaign.

The Other Issa Reveals Himself

With five days until the recall election, Republican gubernatorial candidate Saad Issa has finally put a face to his campaign.

He dropped off a photo of himself at the Los Angeles Times on Thursday -- the first to emerge of Issa, a Caltrans employee who lives in Arcadia.

Issa -- who is not related to Rep. Darrell Issa, the San Diego-area Republican who financed the recall petition campaign -- was one of the first candidates to qualify for Tuesday's ballot.

Saad Issa told The Times last month that he is a serious candidate. In a statement accompanying his photo, he called himself "your protest vote."

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