Big donors work loophole

Novelist John Grisham gave $4,600 earlier this year to the campaign of Democrat U.S. Senate candidate Kay Hagan. That's the maximum allowed under federal election law.

Grisham didn't stop there.

About the same time, Grisham gave $28,500 to a national Democratic committee that has spent millions of dollars tearing down Hagan's opponent, Republican incumbent Elizabeth Dole.

Backers of both candidates -- often at the urging of their campaigns or supporters -- have exploited a loophole in federal election laws to bypass normal campaign contribution limits, which are designed to lessen the influence of big donors.

Supporters of the candidates have given hundreds of thousands of dollars to national party committees that have played a critical role in North Carolina's Senate race.

Consider:

* Billionaire Kirk Kerkorian, a major figure in shaping Las Vegas, gave $4,600 to Dole's campaign in July 2007. About the same time, Kerkorian gave $28,500 to the National Republican Senatorial Committee, which has run ads criticizing Hagan as a big spender.

* Hagan's father, Joe Ruthven, a Lakeland, Fla., businessman, gave her the maximum contribution last November. The next month, Ruthven gave $28,500 to the Democratic Senatorial Campaign Committee.

* R.D. Faber, a Merrill Lynch investment banker from New York, gave $2,250 to Dole in June and about the same time gave $28,500 to the GOP Senate committee.

Dole lost money edge

Dole, as an incumbent with a web of Washington connections, might have had an advantage this year when it came to campaign money. She had raised $13.8 million for her re-election committee by the end of September, compared with $5.3 million that Hagan has raised, according to reports filed with the Federal Election Commission.

The Democratic Senatorial Campaign Committee has helped erase Dole's financial edge. The committee poured money into the race this summer, with an ad campaign -- estimated to cost $7 million by the Dole campaign -- that portrayed Dole as old and ineffective. The most talked about ad featured two elderly men in rocking chairs, discussing whether Dole was 92 or 93. The punch line was that they were talking about her Senate effectiveness rating, not her age.

"It's like you are running against Chuck Schumer, to be honest," Dole said, referring to the New York Democratic senator who is chairman of the Democratic Senatorial Campaign Committee.

More recently, the National Republican Senatorial Committee has been running an expensive independent campaign tearing down Hagan.

The Washington-based campaign committees have raised their war chests from contributors from across the country.

But some of the money has come from contributors who had already given all they could to the campaigns of Dole and Hagan.

An analysis of campaign records shows that, as of June 30, a group of supporters who contributed a total of almost $200,000 to Hagan's campaign collectively contributed $1.7 million to the Democratic Senatorial Campaign Committee.

A group of supporters who contributed a total of almost $400,000 to Dole's campaign collectively gave $1.5 million to the National Republican Senatorial Committee during the same period.

Donors who contributed the maximum to Hagan and gave large donations to the Democratic Senatorial committee include: Smith Bagley, a Washington tobacco heir; Jane D. Hartley, former CEO of the G7 Group, a New York-based consulting group; former U.S. Ambassador Jeanette Hyde of Raleigh; business executives Randall and Leonard Kaplan of Greensboro; Anthony E. Malkin, the head of a New York real estate investment firm; Laura Ross, a New York lawyer; and investor George Soros of New York, a major backer of Moveon.org.