Earlier this week , the California Democratic Party announced that it would no longer accept contributions from the private prison industry, and that it would donate the $160,000 it received from the top two prison operators — GEO Group and CoreCivic — to organizations that assist immigrants and ex-offenders. It was a heartening reversal of pay-to-play politics, made possible by an organized activist movement capitalizing on financial disclosure. But pay-to-play still has a role within the party. According to financial statements, party vice chair Alex Gallardo-Rooker received $30,000 in the first quarter of this year from opponents of a controversial ballot measure that would cap patient payments at outpatient dialysis facilities. She waited several weeks to make a written disclosure of this relationship, contravening the party bylaws. And critics claim that she continues to stay quiet about her role as a paid consultant, even while attempting to persuade party members to oppose the initiative. It’s unclear whether Gallardo-Rooker continued receiving payments after March; second-quarter financial statements have not yet been released. The ballot measure, Proposition 8, is modeled after the medical loss ratio in the Affordable Care Act, which mandates that insurance companies use 85 percent of revenue on medical care. Prop 8 would force dialysis facilities to devote 85 percent of their revenue to actual treatment, and refund patients if annual profits go above that threshold. The goal is to get clinic owners to update equipment and improve training at the 555 privately owned clinics in the state.

The opposition campaign, “No on 8,” claims that capping clinic profits will force widespread closures at a time when more Californians need dialysis. But supporters disagree, emphasizing that it would force reinvestment in patient care rather than executive compensation. Supporters of Prop 8 include labor unions, while the main opponents are the two companies that dominate dialysis treatment — DaVita and Fresenius. They are bankrolling the “No on 8” opposition campaign — the same campaign which has paid Gallardo-Rooker. “An officer of our party failing to disclose her material financial interest in conversations while lobbying against workers is simply not in line with what we claim to stand for,” said Melissa Demyan, co-chair of the party’s resolution committee and a supporter of Prop 8. Gallardo-Rooker, herself a labor leader with the Communications Workers of America, accepted three $10,000 payments as a “campaign consultant” from the opposition campaign, according to state disclosures. “She accepted $30,000 from the ‘No’ campaign. $30,000 is more than I made last year,” said Demyan, whose committee will be deciding whether to endorse the initiative at the party’s executive board meeting this weekend. Under a new bylaw of the California Democratic Party, any “material financial relationship” of over $1,000 with a candidate or ballot measure must be disclosed. For party officers like Gallardo-Rooker, that means filing a quarterly statement itemizing the compensation. The rule also requires party members to disclose their relevant financial relationships whenever addressing party members in meetings or in written communications about the campaign in question.



Photo: Jay L. Clendenin/Los Angeles Times via Getty Images