Stealthy wealthy: How Harold Simmons' political giving has benefited his business empireBy Bill Allison Mar 13 2012 11:21 a.m.
|Photo by the Dallas Morning News|
(This is the first in an occasional series that will shine a light on little known but highly influential donors.)
Even under the post-Citizens United campaign finance rules that unleashed a new generation of mega-donors, Harold Simmons stands out as old political money.
The Dallas-based billionaire, dubbed the king of superfund sites after acquiring an environmentally-challenged company, has gotten plenty of attention for the $10 million he’s given super PACs in the first four months of this year.
But a closer examination of the record shows that Simmons’ 2012 donations are just the tip of the iceberg.
Since 1989, a Sunlight analysis has found, Simmons, his wife and daughters, his family trust and the companies he controls have poured at least $34.8 million into political orgranizations, campaigns and parties. Employees of Simmons companies have given $2.8 million more. Beneficiaries have included super PACs such as American Crossroads, and – before the Citizens United ruling made such convenient depositories for large donations possible – so-called 527 groups like Swift Boat Vets and POWs for Truth, famous for their attack ads against 2004 Democratic nominee John Kerry.
Simmons’ giving goes back decades. A review of records from the Center for Responsive Politics, the National Institute on Money in State Politics, the Federal Election Commission, the Internal Revenue Service, the Texas Ethics Commission and other state election bodies reveals that he has a long history of writing large checks to politicians and political groups in a position to benefit himself and his businesses.Simmons has contributed amounts as small as $100 and as large as $5 million. He gave $3 million to the Swift Boat Vets and POWS for Truth, which ran ads attacking 2004 Democratic presidential nominee John F. Kerry's record in Vietnam, and more than $2.8 million to the American Issues Project, which ran ads in 2008 linking Barack Obama to '60s era radical Bill Ayers. He pumped $1.9 million into a Texas group, the Texans for Lawsuit Reform PAC, that's made it harder for plaintiffs to sue big businesses. And he's among the top super PAC donors--Simmons, his company and his family trust have donated a total of $14 million to American Crossroads, $500,000 to Winning Our Future, which supports presidential candidate Newt Gingrich, $100,000 to Restore Our Future, which supports Mitt Romney, and $100,000 to the American Prosperity Fund, which supported the campaign of Texas Gov. Rick Perry. Overall, Simmons has contributed more than $1.2 million to Perry's campaigns.
Simmons has also used lobbyists, advertising campaigns and the courts to advance his interests, while contributing to groups seeking to limit access to the courts by other plaintiffs in Texas. Federal records show that his companies have lobbied the federal government on a host of issues, with firms representing them reporting some $6 million in fees since 1998. Over the years, according to lobbying records and media accounts, Simmons:
- Successfully battled against rules to discourage leveraged buyouts;
- Had a tax break -- potentially worth as much as $80 million -- inserted into a bill to avoid capital gains taxes on the sale of a beet sugar refinery he owned;
- Won approval from the state of Texas for a low-level nuclear waste dump in Andrews, Texas;
- Then won a $75 million county-guaranteed bond issue to finance expansion of that facility;
- Received an extension of a protectionist measure that benefits his U.S.-based titanium operations.
His business empire began modestly enough in 1961, when Simmons invested $5,000 of his own money and a $95,000 loan to purchase a Dallas drugstore. By 1973, he'd parlayed that into a string of pharmacies across Texas, which he sold to the Jack Eckerd Corp. for $50 million in stock. A number of his deals led to legal problems--a federal grand jury indicted him in 1974 for allegedly looting and bankrupting an insurance firm he owned (he was acquitted) and in the 1980s, he ran afoul of pension regulations, when a judge ruled in 1985 that he had raided a union pension fund for workers of Keystone Consolidated to purchase stock in Amalgamated Sugar, a beet sugar refiner that Simmons bought in 1982.
Though a generous underwriter of political groups that back tort reform and other limits on lawsuits, Simmons has made use of the courts himself. One of his companies, Waste Control Specialists--which only won a permit to dispose of low level radioactive waste in 2009--sued the Energy Department in 1997, and again in 1999, for awarding a waste disposal contract to Envirocare, a Utah-based company that did have permits; both suits were dismissed. Simmons spent decades attempting to win approval to dispose of radioactive waste at a site in Andrews, Texas--first from the Nuclear Regulatory Commission and then from the state of Texas. At the end of 2003, the state legislature approved a one-month window during which firms could apply for a permit; Simmons donated more than $185,000 to state lawmakers, politicians and parties that year. The project was controversial--three staffers of the Texas Commission on Environmental Quality resigned in 2007 to protest the project, citing the danger of contaminating aquifers that run under the site by burying deadly waste there--but Simmons ultimately won approval.
William Lundquist, Waste Control Specialists' chief executive officer, describing the company's strategy for winning approval for the licenses, wrote that they enlisted the University of Texas Southwest Medical Center in its efforts. "University personnel, including a Nobel Prize winner, agreed to appear on camera to discuss the need for such a disposal site, without actually endorsing the WCS site specifically," he wrote. Simmons, his wife and daughter Lisa have given or pledged more than $100 million to the center, according to a 2010 news release.
In 2009, Waste Control Specialists persuaded the Andrews County commissioners to consider a $75 million bond issue to help the company finance construction of its facility there. In a referundum, the bond issue passed by a narrow, 3-vote margin, and survived a court challenge. The bonds were issued in November 2010.
While Waste Control Specialists will actively seek deadly material--storing radioactive waste will earn it tens of millions of dollars a year--some of the companies Simmons acquired had such bad environmental records that he became known as the king of superfund sites. In 1985, backed by funds from Drexel Burnham Lambert, the high-flying 1980s leveraged buyout and junkbond specialists that collapsed in bankruptcy in 1990, Simmons launched a hostile takeover of National Lead Industries, a firm whose operations began in the 19th century and that had a string of polluted sites across the country, including smelting operations in Granite City, Ill., and a Pedrickton, N.J. facility that recovered lead from spent automobile batteries. Both sites, flagged in the 1980s as environmental hazards before Simmons had acquired the company, remain on the EPA's list of Superfund sites.
In the 1990s, NL Industries faced a different environmental challenge: municipalities and state attorneys general filed suit against the company, along Sherwin-Williams Co., DuPont Co. and other companies that sold lead-based paints prior to 1978, when the government banned their use. In 1999, Rhode Island became the first state to file suit, and in 2006 won its case against NL Industries and two other defendents. The companies appealed, and two years later Rhode Island's Supreme Court ruled in their favor, dismissing the suit and saving the defendants billions in costs to remove lead paint from homes and apartments.
In Texas, Simmons has contributed to limit the ability of plaintiffs to sue. Among the larger recipients of his largesse is the Texans for Lawsuit Reform PAC, which in May 2011 celebrated Gov. Rick Perry's signing of a bill it lobbied for that contains provisions--including requiring plaintiffs in tort cases that lose to pay the fees of those they sued--long sought after by business interests. Simmons gave the group $1.9 million between 2000 and 2011. Perry has gotten more than $1.3 million in support from Simmons in his gubernatorial and presidential runs. Simmons also contributed $100,000 to the Yes on 12 campaign, a ballot referendum that allowed the Texas legislature to cap damage awards for pain and suffering in lawsuits against medical providers; Texas voters approved the ballot initiative in 2003.
Sometimes Simmons' prominent giving has worked against his business interests. In 1997, President Bill Clinton used the newly enacted--and short-lived--line item veto to eliminate a tax provision that, media accounts suggested, could have saved Simmons as much as $80 million in capital gains taxes on the transfer of Amalgamated Sugar, a beet sugar refinery, to a farmers' cooperative. Simmons complained at the time that he was unfairly singled out--most stories identified him as a big Republican donor--and insisted that he had already received his tax benefit.
Over the course of a prolific career of donating, Simmons had one run-in with the Federal Election Commission. In the wake of the collapse of Drexel Burnham Lambert and the criminal convictions for securities and tax law violation of junk bond king Michael Milken, Congress began considering measures to rein in the corporate raiders. At the time, Simmons had his sights set on Lockheed Corp., one of two companies that later merged to form Lockheed Martin, the huge defense contractor. Simmons didn't pull off the Lockheed deal, which fell apart in 1991. While he was still seeking to acquire the aerospace firm, he contributed $120,000 while his family members contributed $130,000 more to then-President George H.W. Bush and to key members of Congress who could stop legislation to regulate hostile takeover attempts, according to a 1990 report in the Los Angeles Times that analyzed FEC records. The Times story concluded that Simmons had exceeded the amount that individuals could legally contribute to federal candidates--then set at $25,000. Though the Federal Election Commission fined Simmons $19,800 in 1993 for exceeding the limits, Simmons ended up with the payoff: Congress did not pass legislation to rein in the raiders.
Through a spokesperson, Simmons declined to comment for this article.
Joshua Hatch contributed to this post.
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