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Representative Doc Hastings, Chairman Representative Howard Berman, Ranking Member Committee on Standards of Official Conduct U.S

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Representative Doc Hastings, Chairman Representative Howard Berman, Ranking Member Committee on Standards of Official Conduct U.S June 23, 2006 Representative Doc Hastings, Chairman Representative Howard Berman, Ranking Member Committee on Standards of Official Conduct U.S. House of Representatives HT-2, The Capitol Washington, DC 20515 Dear Chairman Hastings and Ranking Member Berman: Published reports indicate that serious questions exist about whether Representative John Doolittle (R-CA) has engaged in activities in violation of House ethics rules. Democracy 21 calls on the House Ethics Committee to conduct an investigation of Representative Doolittle’s activities and to determine whether he has violated the ethics rules. Under House Ethics Committee rules, the Committee has its own authority to initiate and conduct an investigation, regardless of whether a formal complaint has been filed with the Committee. Ethics Committee Rule 18 states, “Notwithstanding the absence of a filed complaint, the Committee may consider any information in its possession indicating that a Member . may have committed a violation of the Code of Official Conduct . .” The Ethics Committee recently relied on Rule 18 to open, on its own initiative, three ethics investigations, into the activities of Representatives Robert Ney (R-OH) and William Jefferson (D-LA), and into activities by House members related to former Representative Randy Cunningham (R-CA). We urge the Committee similarly to open an ethics investigation under Rule 18 into the activities of Representative Doolittle. Background Information According to published reports, Representative Doolittle’s wife, Julie Doolittle, is the owner and president of a fundraising company, Sierra Dominion Financial Solutions, which is retained by and serves as a fundraising consultant to Representative Doolittle’s campaign committee and his leadership PAC. According to a story in the San Diego Union-Tribune, Sierra Dominion was founded in March 2001 and is based at the Doolittles’ home in Oakton, Virginia. 2 According to the story, the company was launched by Representative Doolittle’s wife in March 2001, two months after her husband was named to the Appropriations Committee, and has no phone listing or Web site, and no known employees other than Julie Doolittle.1 Published reports state that Julie Doolittle’s company, Sierra Dominion, receives a 15 percent commission on the contributions that it raises for Representative Doolittle’s political committees. Under this arrangement, Sierra Dominion is paid 15 percent of every campaign contribution made to Representative Doolittle’s authorized campaign committee (the John T. Doolittle for Congress Committee), and to his leadership PAC (the Superior California Federal Leadership Fund), for which Sierra Dominion is involved in the fundraising. As a story in the Sacramento Bee stated, “By paying her [Julie Doolittle] a commission, 15 percent of every contribution goes into the Doolittles’ household budget.” 2 The Sacramento Bee story states that Doolittle “confirmed” that “his arrangement with his wife’s company is to pay her a flat 15 percent commission on what she brings in for the campaign, even when he is making the actual solicitation calls.” This means that even when Representative Doolittle is himself making the solicitations and raising contributions for his political committees, a portion of those contributions are being paid as fees to his wife’s company and inuring to Representative Doolittle’s benefit by going into his family income. According to The Washington Post, “Mrs. Doolittle has received at least $215,000 from Mr. Doolittle’s various campaign committees since 2001. This doesn’t include $6,800 in payments to another of Mrs. Doolittle’s companies, Events Plus, before she started doing his fundraising work. She’s taken in nearly $100,000 during the 2006 campaign alone.”3 The article in the San Diego Union-Tribune (March 19, 2006) states that Julie Doolittle’s company does not serve as a fundraising consultant to any political committees other than those of her husband. According to the article, the only other known clients of the company have been Greenberg Traurig (the lobbying firm that employed Washington lobbyist Jack Abramoff), Abramoff’s Washington restaurant, Signatures, and the Korea-U.S. Exchange Council, a group founded by Ed Buckham, the former chief of staff to former Representative Tom DeLay (R-TX). 1 D. Calbreath, “Congressman Doolittle, wife profited from Cunningham-linked contractor,” The San Diego Union-Tribune (March 19, 2006). 2 D. Whitney, “Fundraising group assails the Doolittles,” The Sacramento Bee (April 20, 2006). 3 “The Doolittles’ Rich Deal,” The Washington Post (April 21, 2006). 3 According to published reports, the practice of fundraisers receiving commissions in the form of a percentage of the funds raised is considered by professional fundraising associations as unethical and is contrary to industry practices and standards. According to an article in the Sacramento Bee (April 20, 2006): Rep. John Doolittle’s practice of paying a 15 percent fundraising commission to a company owned by his wife violates the ethical standards of the industry, a national group of fundraising professionals told the congressman this week. The 27,000-member Association of Fundraising Professionals said in a letter to Doolittle that its long-standing ethics code “explicitly prohibits percentage-based compensation” and urged his campaign to cease doing so with Julie Doolittle’s company, Sierra Dominion Financial Solutions. The Sacramento Bee article quotes Paulette Maehara, the head of the Association of Fundraising Professionals, as saying of the practice of charging a percentage-based commission for fundraising services, “This is absolutely not the standard in the industry.”4 The Bee article further states that another fundraising professional organization, the American Association of Fundraising Counsel, “similarly regards commission-based fundraising as unethical, according to the organization’s Web site,” which states that “Contracts providing for a contingent fee, a commission, or a fee based on percentage of funds raised are prohibited.” The San Diego Union-Tribune article (March 19, 2006) also reported that some of the fees paid to Julie Doolittle’s company were based on a percentage of contributions provided by defense contractor Brent Wilkes and his associates and lobbyists to Representative Doolittle’s committees, and that Doolittle helped get $37 million in “earmarked” federal funds for Wilkes’ company. Wilkes was named as a co-conspirator in the bribery case involving former Representative Duke Cunningham (R-CA). According to the San Diego Union-Tribune (March 19, 2006) article: Acting as her husband’s campaign consultant, Julie Doolittle charged his campaign and his Superior California Political Action Committee a 15 percent commission on any contribution she helped bring in. 4 The Web site of the Association of Fundraising Professionals contains a “Code of Ethical Principles and Standards of Professional Practice.” Principle 16 states, “Members shall not accept compensation that is based on a percentage of contributions; nor shall they accept finder's fees.” Principle 17 states, “Members may accept performance-based compensation, such as bonuses, provided such bonuses are in accord with prevailing practices within the members' own organizations, and are not based on a percentage of contributions.” See http://www.afpnet.org/ka/ka-3.cfm?content_item_id=1068&folder_id=897. 4 As a member of two key committees in the House—Appropriations and Administration—Doolittle is well-positioned to help contractors gain funding through congressional earmarks. Between 2002 and 2005, Wilkes and his associates and lobbyists gave Doolittle’s campaign and political action committee $118,000, more than they gave any other politician, including Cunningham. Calculations based on federal and state campaign records suggest that Doolittle’s wife received at least $14,400 of that money in commissions. Meanwhile, Doolittle helped Wilkes get at least $37 million in government contracts. The article further states regarding Doolittle’s assistance to Wilkes in obtaining earmarks for Wilkes’ company, PerfectWave: Wilkes had more success with PerfectWave, which offered a technology that could limit the amount of background noise transmitted over electronic communications. Doolittle has publicly admitted that he helped Wilkes get the $37 million in federal contracts for PerfectWave through the “earmark” process, in which legislators pencil in funding for specific projects. In October 2002, as Doolittle pushed for funding for PerfectWave, Wilkes and his associates donated $7,000 to his campaign and $10,000 to his political action committee. Julie Doolittle made $1,500 from Wilkes’ contributions. Id. The article further states that, Wilkes held a fundraising dinner for Doolittle in November 2003 attended by 15 guests who were either employees or business partners of Wilkes. According to the article: Over the next four months, members of the group gave a total of $50,000 to Doolittle’s political action committee. Federal and state election records show that Julie Doolittle claimed commissions on most of these contributions, even though there is no evidence that she planned the fundraising dinner or encouraged the contributors to donate to her husband. Id. An article in The Washington Post reported on the same events: In the latest example of . backstage dealings, Rep. John T. Doolittle (R- CA) told The Washington Post that he helped steer defense funding, totaling $37 million, to a
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