FUNDING SHATTERS ELECTION RECORDS BUT SOME SAY CASH IS TURNING OFF VOTERS.

Byline: HARRISON SHEPPARD Sacramento Bureau

With a month still left before the election, this year's ballot measures have already shattered fundraising records as wealthy corporate interests dig deep to fight billions of dollars in potential new taxes.

And in the governor's race -- where the two candidates face off in their first and only debate at 6 tonight -- Gov. Arnold Schwarzenegger already enjoys a comfortable margin in public opinion polls and also maintains a spending edge over state Treasurer Phil Angelides, according to new finance reports.

Schwarzenegger has raised about $32 million this year, spent $31 million and had $2.4 million cash on hand as of Sept. 30, according to the latest reports.

Angelides raised $16 million this year, spent $31.6 million and had $2.8 million cash on hand.

Meanwhile, combined spending by both sides of Proposition 87 -- a tax on oil production to fund research into alternative energy sources -- hit $104.5 million Friday, surpassing the previous record for a single measure of almost $94 million set by Proposition 5, the Indian gaming measure, in 1998.

Ultimately, campaign finance activists say this year's overall spending has simply served to further turn voters off from politics, as they are overwhelmed by negative advertising.

``As campaign spending records have fallen by the wayside, voter participation has plummeted,'' said Ned Wigglesworth, a policy advocate for California Common Cause. ``The massive amounts of political spending have not led to a more engaged and educated electorate, but to a disengaged and marginalized electorate.''

For Democrat Angelides, the bulk of his spending came during his tough primary battle against state Controller Steve Westly. Since the primary, Angelides has spent about $3.5 million, while Republican Schwarzenegger, who had no primary challenger, has spent $14.4 million since July 1.

Tonight's debate is a chance for Angelides to use free media exposure to try to catch up to Schwarzenegger. But analysts say a strong performance by Angelides alone won't make a big difference; Schwarzenegger will have to commit a major gaffe for the challenger to gain much ground.

``It's a very narrow window of opportunity because relatively few Californians will see the debate,'' said Jack Pitney, government professor at Claremont McKenna College. ``But there's always the chance that the governor can make a campaign-changing mistake.''

``Schwarzenegger, as we've seen lately, has a lively way of speaking. But he's also capable of great discipline when the situation demands it.''

Meanwhile, some political analysts said they are not surprised that fundraising for the ballot measures has risen so high this year. Several of the measures seek to impose hundreds of millions of dollars in new taxes on corporate interests.

Bob Stern, president of the nonpartisan Center for Governmental Studies in Los Angeles, said the most surprising thing about spending on the oil- tax measure is that a single individual -- who appears to not have much personal financial stake -- is contributing so much of his own money to promote the measure.

Hollywood producer Steve Bing has spent $40 million to promote Proposition 87 -- and that's believed to be a record for any individual anywhere in the country spending from his own pocket on a single ballot measure. The measure is expected to generate $4 billion for alternative energy research over a 10-year period.

``When you consider the oil companies are facing a $4 billion tax -- how much would you be willing to spend to save yourself $4 billion?'' Stern said. ``The surprising thing is the individual taking on the oil companies -- an individual who has no financial stake in this thing. He just wants it to happen.''

The Center for Governmental Studies estimates that, adjusted for inflation, the 1998 record set by the Indian gaming measure would actually be about $121 million in today's dollars. The oil-tax campaign is likely to hit that level well before the election.

Bing is a producer who reportedly inherited $600 million from his grandfather, Leo, who made his fortune in New York real estate. Yusef Robb, a spokesman for the pro-87 campaign, noted that Bing and his family have given millions to a variety of causes throughout the state, including the arts, the environment and education.

``It's hard for everyday Californians to compete against the oil companies,'' Robb said. ``That's why we're fortunate that Steve Bing stepped up to the plate to speak up for those Californians who are being held hostage by the oil companies.''

The biggest contributors to the campaign to defeat Proposition 87 include Chevron, which has given at least $22 million, and Aera Energy, which has given about $12 million. Al Lundeen, spokesman for the anti-87 campaign, said the oil companies have spent so much because they felt the public was not well-informed about the potential economic consequences of the measure.

``We're doing the best we can to explain what's in the initiative,'' Lundeen said. ``I understand people can disagree and conclude differently about what the results of provisions of the measure are. But those provisions need to be spoken about and advertising pushes that kind of discussion.''

harrison.sheppard(at)dailynews.com

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