Funneling of money was legal, Chvala says
10:47 PM 8/18/03
Scott Milfred State government reporter

In his first words on the issue outside a courtroom, state Sen. Chuck Chvala insisted Monday that he didn't break the law if he funneled large campaign donations through a Washington, D.C., group and back to Wisconsin.

In fact, Chvala says in a two-page press release, other top Wisconsin politicians have done the same thing.

"You may not like it - in fact, I don't like it - but the bottom line is that this type of activity has been going on for years, and the courts and agencies charged with regulating elections have decided it is appropriate and legal," Chvala said.

The head of a campaign finance reform group said Chvala, D-Madison, is missing the point.

"He's talking about legal laundering" of campaign donations, said Jay Heck, executive director of Common Cause in Wisconsin. "He's right. Other groups have done that. He's not the only group.

"But he is the only one charged with allegedly setting up an illegal entity or enterprise to take in huge amounts of money that's then utilized to help other players in Wisconsin elections," Heck said.

Common Cause released an analysis last week of money funneled through the Washington-based Democratic Legislative Campaign Committee. Common Cause found that Wisconsin donors gave by far more money, $1.26 million, to the DLCC than donors from any other state since mid-2000.

The DLCC spent $695,000 in Wisconsin, which was the most in any state except Virginia. About $322,000 was sent to Independent Citizens for Democracy, a group Chvala is accused in court of setting up and controlling. The ICD paid for advertising that helped Chvala's fellow Democratic senators in Wisconsin win elections and keep Chvala in power as Senate majority leader, Heck said.

"Under Wisconsin law, a candidate can only control his own campaign committee," Heck said. "He can't control another entity."

Chvala declined to comment Monday beyond his written statement, which did not mention the ICD or specifically address the 19 felony charges he's facing in Dane County Circuit Court. Chvala's charges, which he denies, include extortion and misconduct in office.

Chvala is accused of telling donors they could keep their political contributions "under the radar" by sending them "across the Potomac" to the DLCC, a criminal complaint says. The Washington Post reported the FBI is investigating the DLCC and whether it broke U.S. money-laundering laws by helping Chvala evade state campaign finance laws.

In his statement, Chvala said a bank official told him Senate Majority Leader Mary Panzer, R-West Bend, asked the bank to send a donation to a Republican group Chvala didn't name.

Chvala also cited more than $700,000 in American Indian donations to the Democratic National Committee that came back to Wisconsin to pay for TV ads helping Democrats, including Gov. Jim Doyle.

Heck said those incidents are different than the charges against Chvala. Panzer didn't steer a donation to an independent group that she secretly controlled, he said. The tribal donations that ended up helping Doyle also were legal at the time, Heck said.