WellPoint, AT&T, Altria Step Up Donations

Recent large donations to Republican-supporting groups underline how important some races will be to pharma and others

(Bloomberg) — WellPoint Inc. has given $842,000 to a group backing Republicans running for statewide offices this year, almost as much as the company has donated to candidates in U.S. congressional elections.

The contributions by the nation's largest health insurer underline the attention that companies are giving to state races, even as those campaigns are overshadowed by federal elections that will determine which party controls Congress.

WellPoint, AT&T Inc. and Altria Group Inc. are among those that have helped Republican committees raise more money for state elections than their Democratic counterparts. At stake is the makeup of legislatures that will redraw congressional districts next year and decide on issues such as whether to chip away at the nation's new health-care law.

"The election this time has a more important impact" than in past years, said Paul Smith, a congressional redistricting expert with the law firm of Jenner & Block LLP in Washington.

"And it will be multiplied over future elections" as redistricting is used by the majority party to redraw the electoral map to increase its chances of winning seats.

Democrats may have the most to lose with redistricting: Of the 27 state legislative chambers most likely to change hands after the November elections, 20 are now Democratic-controlled, said Tim Storey, an elections analyst for the Denver-based National Conference of State Legislatures.

Corporate Money

The Republican State Leadership Committee, the main fundraising arm for the party's candidates for lieutenant governor, state legislator and attorney general, took in $12.8 million as of June 30, compared with $9.6 million for its Democratic counterparts, Internal Revenue Service filings show.

The Republican group received another $1.5 million on Aug. 31, from the U.S. Chamber of Commerce alone. Seventeen of the biggest donors to the committee, whose chairman is Ed Gillespie, a former aide to President George W. Bush, are companies. They include Wal-Mart Stores Inc. and Exxon Mobil Corp., as well as WellPoint. Also contributing were two trade groups, the Pharmaceutical Research and Manufacturers of America and the Entertainment Software Association, whose members include the Walt Disney Co. and Microsoft Corp.

People "are concerned about how the states are being run," said Gillespie. National Democratic Party committees have outdone the Republicans at the federal level, raising $359 million for the 2010 elections, compared with $323 million for the rival party, Federal Election Commission filings show.

'Playing Defense'

Yet the Republican Governors Association has outraised its Democratic counterpart, $58 million to $40 million, including a $1 million contribution from News Corp., the New York-based media company whose chairman is Rupert Murdoch. "Democrats are playing defense just about everywhere," said Storey.

Nationwide, Democrats now control 60 state legislative chambers to 36 for the Republicans. The balance of power matters because every 10 years the states redraw the lines for congressional and state legislative seats to reflect population shifts so each district has roughly the same number of residents.

Frank Donatelli, a former aide to President Ronald Reagan, said corporate giving is driven by the perception that Republican-controlled legislatures are friendlier to business. "These companies have a lot of regulatory and tax issues; generally speaking, they'd much rather have a Republican legislature," said Donatelli, the chairman of Gopac, which funds Republicans running for state and local office.

Used to It

Michael Sargeant, executive director of the Democrati Legislative Campaign Committee, said he wasn't concerned. "We're used to being outspent by Republicans," he said. The $842,000 that Indianapolis-based WellPoint and a subsidiary gave to Gillespie's group for state elections was up from $35,000 in 2008; IRS filings show. The company gave nothing to Democrats. WellPoint has donated more than $890,000 to 2010 federal candidates, about 70 percent of which went to Republicans.

WellPoint was critical of aspects of President Barack Obama's health-care overhaul. State officials must put provisions of the law in place, and some state attorneys general are suing to overturn it in court.

Kristin Binns and Jon Mills, WellPoint spokesmen, didn't respond to requests for comment. Dallas-based AT&T, the largest U.S. phone company, gave $249,866 to Gillespie's group and $173,000 to the Democrats. Michael Balmoris, an AT&T spokesman, declined comment.

'Active Participants'

Two tobacco companies were among the largest corporate givers. Winston-Salem, North Carolina-based Reynolds American Inc. donated more than $600,000 to the Republicans and about $60,000 to the Democrats, and Richmond, Virginia-based Altria, the largest tobacco company, contributed $418,124 to the Republicans and $155,000 to the Democrats.

"We're active participants in the political process," said David Sutton, an Altria spokesman. Laura Payne, a Reynolds spokeswoman, had no immediate comment. Several banks affected by the new financial regulation law weighed in. Charlotte, North Carolina-based Bank of America Corp., the biggest U.S. bank, gave $120,000 to the Republicans through Aug. 31 and the same amount to the Democrats through June 30. Citigroup Inc., based in New York, gave $150,000 to the Republicans in July.

Shirley Norton, a Bank of America spokeswoman, and Molly Millerwise Meiners, a Citigroup spokeswoman, declined to comment.

"The decisions that are made in these state houses have a direct impact on our quality of life," Gillespie said. "This year, it also has a big impact on the composition of Congress."

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