Rambling above the rust-colored cliffs of the Palos Verdes Peninsula, the Terranea Resort is known for its ocean views, world-ranked spa and villas that can command $3,000 a night or more.
The property is less well known as a gathering spot for federal elected officials and the campaign donors they wine and dine.
But one politician was very familiar with the luxurious resort: former House Speaker Kevin McCarthy. In 2 ½ years, the Bakersfield Republican’s election committees dropped nearly a quarter of a million dollars at Terranea, with most of the money coming from a thinly regulated leadership PAC, a Times investigation has found.
As he exits Congress two months after his historic ouster as speaker, political obituaries tout McCarthy’s skills as a prolific fundraiser on behalf of Republican candidates. Also setting him apart from other congressional leaders was his roughly decade-long pattern of using his Majority Committee PAC to spend lavishly on hotels, private jets and fine dining establishments, according to a Times analysis of campaign finance records on file with the Federal Election Commission.
From 2012 through last June, McCarthy’s PAC shelled out more than $1 million on hotels, private air travel and eateries, the FEC records show. That’s more than double the combined total spent by the leadership PACs of the seven other lawmakers who’ve held the top House and Senate positions for their parties during all or part of that period, according to the Times analysis.
Leadership PACs are subject to fewer spending controls than other campaign accounts. In fact, the FEC determined earlier this year that those committees are free to use their money on personal expenses, without limits. Even before the ruling, good-government advocates complained to the FEC that politicians were using their leadership PACs as personal slush funds to subsidize expensive lifestyles. Now, they fear the problem will grow worse.
“Unfortunately, it’s a little bit of the Wild West,” said Michael Beckel, research director for Issue One, a nonprofit organization that studies the role of money in politics. He said the group has “deep concerns” that politicians could use “leadership PAC funds for their own personal enrichment.”
Terranea Resort, a luxurious hotel-and-spa compound, along an ocean bluff in Rancho Palos Verdes.
(Luis Sinco / Los Angeles Times)
It is unclear how McCarthy, who announced his retirement Wednesday, will use the funds remaining in his campaign accounts once he departs the House at the end of the year. But he said in a Wall Street Journal op-ed this week that he intends to continue recruiting GOP candidates for elected office.
The Terranea outlays by McCarthy’s leadership PAC totaled about $124,000 over a 2 ½-year stretch ending in 2018, a period during which he served as House majority leader. In the same time, a second McCarthy committee rang up bills of about $116,000 at the hotel compound. The combined $240,000 pencils out to an average of $8,000 a month.
The McCarthy committees made 20 payments to Terranea in the 2 ½ years that ranged from less than $540 to more than $68,000. Most of the expenditures were listed under the category of “lodging,” and 11 were made in even-numbered amounts, such as $7,500 and $10,000. The reports did not explain why those amounts were in round dollars.
The FEC does not require politicians to disclose on the finance reports many details beyond the recipient, date, amount and general category of the spending. McCarthy’s records do not say who stayed or dined at Terranea courtesy of the committees, and there are no breakdowns for how much the PAC spent per night per room and nothing about what type of rooms, or how many, were rented. The records offer few clues as to whether the spending was in connection with specific fundraising events or any other campaign activities.
Over the last two months, The Times sent interview requests to McCarthy through his office and campaign organization and submitted a list of detailed written questions about spending by his committees. The congressman did not grant an interview, but after follow-up queries, a McCarthy spokesperson replied in writing that the Terranea costs were for “our annual event” at the resort.
“Expenses were for lodging, catering, event room rentals associated with the PAC retreat,” the spokesperson, Drew Florio, wrote.
Florio did not say when the retreat was held or whether there was more than one such event. He did not answer when asked how many people attended and for specific breakdowns of the costs. The spokesman similarly did not answer queries about other expenses, including those incurred at businesses other than Terranea.
Beckel…
Read More: Inside Kevin McCarthy’s PAC: Lavish spending, luxury hotels, private jets