Frost Now Faces Funding Probe

Posted June 22, 2004 at 6:46pm

Even as Congress teeters on the edge of an all-out ethics war, one is already under way in Texas, featuring two of the most powerful Congressmen from their respective parties.

Former Democratic Congressional Campaign Committee Chairman Martin Frost (D) and House Majority Leader Tom DeLay (R) stand at the center of this skirmish — and Ronnie Earle, the district attorney of Travis County, Texas, holds their political fates in his hands.

For several months, it has been widely known that Earle is looking into alleged wrongdoing by DeLay’s Texans for a Republican Majority political action committee. Then, earlier this week, Earle revealed that — at the behest of Republican state Sen. Bob Deuell — he has also opened an investigation into possible illegal contributions by Frost’s Lone Star Fund.

Frost is accused of overseeing accounts that took money donated by corporations or labor unions and gave them directly to legislative candidates — which, if true, would violate Texas law.

The campaign of Rep. Pete Sessions (R), Frost’s opponent this fall, denied collaborating with Deuell on the complaint. But Deuell said Tuesday that he had talked to Sessions about it and “asked him what he thought.”

“[Sessions] said, ‘Do what you think is right,’” Deuell added.

On Tuesday, Earle announced that his office has begun a formal examination of the complaint filed by Deuell on May 25.

“Texas law is clear: Direct or indirect corporate or labor contributions to candidates is a felony offense,” Deuell wrote in a letter to Earle.

Earle’s investigation is just the latest chapter in a long-running grudge match between two men who are widely viewed as leaders of their respective delegations.

Both complaints concern whether the two Members used 527 committees they controlled to make corporate contributions to legislative candidates during the past cycle. Under Texas law, corporate donations can only be spent on “administrative” costs and cannot be contributed directly to a state candidate.

The linkage of state legislators to donations by DeLay and Frost is noteworthy because DeLay worked aggressively to get the GOP-controlled state Legislature to redraw Texas’ Congressional map last year — a battle in which Frost led Democratic opposition.

Indeed, the Republican gains that enabled them to take over the Texas House in 2002 for the first time since Reconstruction were fueled by the very donations by TRMPAC and the Texas Association of Business that Earle is now investigating.

The imbroglio resulted in the drawing of a disadvantageous district for Frost, who had long spearheaded Congressional redistricting for Texas Democrats. The new map parceled Frost’s old 24th district into five new districts, all of which are favorable to Republicans.

Earle’s investigations, however, are dismissed by backers of both DeLay and Frost as distractions. “This whole complaint has nothing but political motivation,” alleged Frost spokesman Justin Kitsch. “There is no basis for the complaint.”

Frost himself referred to the investigation as a “smokescreen by Republicans to divert attention away from the investigation into Tom DeLay’s activities.”

DeLay spokesman Jonathan Grella shot back that, “Frost is a one-trick pony. For too long, he’s been trying to excuse his transgressions and ineffectiveness by spewing conspiracy theories and blaming others.”

The impact of Earle’s investigation on the Frost-Sessions race remains unclear. Democrats say the investigation of Frost could wrap up as soon as the next few weeks, while Republicans argue that the allegations are more serious than even they had initially thought.

Deuell’s complaint centers on a financial report by the Lone Star Fund that documents the committee’s contributions and expenditures from July 1, 2000, to Sept. 30, 2000.

In that filing, Frost showed $257,000 raised, only $60,000 of which came from individual contributors. The fund spent $127,000 in that period, which, Deuell argued, means that Frost donated nearly $60,000 in corporate dollars to state legislative candidates.

Frost’s campaign responded that he kept two entirely different 527 accounts — one in Washington that held corporate contributions and another in Texas that held individual contributions — and that the money in the two accounts was never mixed.

Kitsch, the Frost spokesman, said documentation proving that the candidate kept separate accounts have been submitted to Earle.

“Unlike Tom DeLay, my leadership PAC maintained two entirely separate accounts,” Frost said in a statement.

The disparity between funds raised and spent in the report cited by Deuell was made up for by leftover cash on hand, he added.

The dueling investigations of Frost and DeLay commingle complex state politics with the ever-volatile relationship between the two parties in Washington.

This cross-pollination of political landscapes was further complicated by the timing of Earle’s investigation into Frost.

His announcement came on the same day that outgoing freshman Rep. Chris Bell (D) leveled a formal complaint with the Committee on Standards of Official Conduct alleging a range of abuses by DeLay that included the TRMPAC contributions.

To Democrats, the Deuell complaint is entirely about state politics, and Frost’s involvement was an unfortunate byproduct.

“Not only is this a baseless response to the TRMPAC allegations but this was a challenge to Ronnie Earle and he called their bluff,” said one Democratic House aide familiar with Texas politics. “This was an attempt to paint Earle with a partisan brush.”

The role of Earle — one of the nation’s most high-profile district attorneys — is also drawing attention, since he has long been a thorn in the side of state Republicans.

“Any merit or lack thereof was really second fiddle to whether Ronnie Earle would look at this,” the source said.

Republicans counter that an attempt to make this about Earle obscures the potential wrongdoing by Frost. “Pete Sessions and Tom DeLay have no control over Ronnie Earle’s office,” said Sessions’ campaign manager, Chris Homan. “Earle made a decision to pursue a criminal investigation based on the information presented to him.”

Homan added that while Sessions had no plans to file an ethics complaint, he wouldn’t be surprised if one materialized somehow.

“Martin’s been around for a very long time,” said Homan. “During that time he has made a lot of enemies.”