ROANOKE TIMES
Copyright (c) 1996, Roanoke Times
DATE: Tuesday, May 7, 1996 TAG: 9605070068
SECTION: VIRGINIA PAGE: B-1 EDITION: METRO
DATELINE: RICHMOND
SOURCE: WARREN FISKE STAFF WRITER
Early last year, U.S. Senate candidate Jim Miller set up a political action committee whose "major purpose," he wrote, was to raise money for Republican candidates for the state legislature.
Reports filed with the state Board of Elections show that of the $77,500 Miller's Commonwealth PAC raised, less than 2 percent was passed on to GOP candidates.
More than 90 percent of the money went to pay a group of consultants who now form the core of Miller's Senate campaign, buy a computerized list of Miller's political supporters and pay others who are assisting Miller's campaign.
On Monday, a top adviser to U.S. Sen. John Warner filed a complaint with the Federal Election Commission alleging the PAC was an "illegal scheme" by Miller to support his 1996 campaign and pay off debt from an unsuccessful 1994 Senate bid.
Warner and Miller are rivals in the June 11 Republican Senate primary. The complaint filed Monday was the first eruption in an otherwise quiet campaign.
Miller, federal budget director in the Reagan administration, said the "simply outrageous" charges "reveal the desperation of Warner's campaign."
Managing money through PACs like Miller's has become a common practice, said Larry Sabato, a University of Virginia political scientist. He said other Virginia politicians including former Sen. Paul Trible, Sen. Charles Robb and former Senate candidate Oliver North formed similar committees.
"Filing complaints against the PACs has become a favorite tactic of politicians," Sabato said. "It generates a lot of press, and the FEC doesn't act on the complaint until long after the campaign is over."
Although the Commonwealth PAC made only $1,405 in cash contributions to state campaigns, Miller said it helped Republican candidates in other ways.
Miller said he paid his consultants through the PAC to advise legislative candidates. "They were resource people called to discuss their campaigns and to get referred to other people who could help them."
Miller said the PAC also helped pay his personal expenses for appearing at 96 rallies and fund-raising events for Republicans last year.
"Some of the things I was doing did end up helping my campaign, that's true, but I was also helping others," Miller said. "I double dare anyone to come up with a tape from any of these events where I stood up and said I was running for Senate."
The complaint against Miller was lodged by John Hishta, manager of Warner's campaign.
Miller registered his PAC in Virginia, which has no limits for corporate or personal contributions. Four businessmen contributed $5,000 or more apiece. Koch Industries, a Kansas oil company, gave $25,000; Markel Corp., a Richmond insurance company, donated $10,000.
Hishta argued that the contributions amounted to illegal donations to Miller's Senate campaign because federal law, which oversees U.S. Senate campaigns, bans corporate contributions and caps personal contributions at $1,000 per election.
Miller said the PAC contributions were not mixed with his Senate campaign funds. He said his campaign raised $104,000 last year. "I didn't need the Commonwealth PAC to keep my Senate campaign alive," he said.
The Commonwealth PAC paid $34,000 last year to Victor Gresham, who was Miller's campaign manager in 1994 and is this year. It paid $2,565 to Jonathan Barron, who was Miller's 1994 press secretary. It paid $1,768 to M. Boyd Marcus, Miller's top campaign consultant in 1994 and 1996.
All three of the advisers were quoted in newspapers last year previewing Miller's upcoming campaign. The PAC also paid $2,250 in consulting fees to Miller's son, Felix.
"They all did important work for Republican candidates and they deserved to be paid," Miller said. "There's nothing wrong with that."
Hishta also disputed the PAC's $19,800 purchase of a database of contributors to Miller's 1994 campaign. Hishta claimed the payment was far more than the list's value. Miller said the price - paid to reduce debts left by his 1994 campaign - was fair.
Warner is expected to begin a massive television advertising campaign this week. Hishta would not say whether Miller's PAC would be the topic of the first commercials.
Miller acknowledged the PAC is difficult to explain even though he's confident it was legitimate. "This is a terribly dirty trick because he knows there's no way I can exonerate myself."
LENGTH: Medium: 84 lines KEYWORDS: POLITICS CONGRESSby CNB