Democrats Top Donors Against Welfare Plan : Prop. 165: State Central Committee pours $479,000 into fighting initiative that would give Wilson new budget authority and reduce aid to poor. But backers of measure are far ahead in fund raising.

By PAUL JACOBS

Oct. 7, 1992 12 AM PT

TIMES STAFF WRITER

SACRAMENTO — The state Democratic Party has become the largest contributor against Gov. Pete Wilson’s ballot initiative, Proposition 165, donating $479,000 in the last three months, according to a report filed with the secretary of state and made available Tuesday.

The money from the Democratic State Central Committee is the largest single contribution against the Wilson initiative, which would reduce welfare benefits and give the governor new powers to control state spending.

“We saw this as an opportunity to stop Pete Wilson from his power grab,” said Bob Mulholland, political director for the state Democratic Party. The initiative, along with Wilson’s leadership of President Bush’s reelection campaign in California, are “a test of Pete Wilson’s political survivability in the state,” said Mulholland, who predicted that Bush and the ballot measure would be defeated in California.

The committee campaigning against Proposition 165, calling itself Taxpayers Against Deception, reported raising $1,639,000 during the three months ending Sept. 30. Much of the money has come from public employee unions, including the California State Employees Assn., which has contributed $409,767 to defeat the initiative since the beginning of the year.

The Wilson-run Proposition 165 committee, United California Taxpayers, reported raising $1,261,472 from July through September, with much of the money coming from contributions of $100 or less, according to campaign spokeswoman Amy Albright.

In the past, Proposition 165 opponents have criticized Wilson’s fund raising on behalf of the measure because a large portion of the contributions have come from the state’s major corporations and their executives.

“Our average contribution is $18,” Albright said. “There is tremendous grass-roots support for this initiative.”

The largest corporate contribution in the three-month reporting period was $9,500 from Safeway supermarkets. However, the biggest single donation was a $535,000 no-interest loan from the governor’s campaign committee.

Since the beginning of the year, the committee supporting Proposition 165 has raised more than the opposition by almost two to one--$2.6 million compared to $1.7 million for the opponents. Both sides have spent heavily on broadcast advertising.

“Unlike the groups who are fighting this initiative, our campaign has the backing of tens of thousands of individuals from all walks of life,” said “Yes on 165” campaign director George Gorton. “The ‘No on 165’ committee has received most of its money from powerful special interest groups who have a vested interest in blocking reforms that threaten to cut spending on their programs.”

Among the labor unions contributing to defeat the Wilson initiative are the California State Council of Service Employees, which has donated $179,869 since the beginning of the year; the California Teachers Assn., $135,149, and the California Assn. of Highway Patrolmen, $100,000.

Proposition 165 is a two-part initiative that would give the governor broad emergency powers to cut state-funded programs when estimates show that expenditures exceed revenues or when the Legislature and governor cannot reach agreement on a new budget at the end of a fiscal year.

The measure also would sharply drop grants given primarily to poor mothers and children through Aid to Families With Dependent Children.