The deep-pocketed advocacy group, which provided crucial support to Treasurer Gina Raimondo last year in her push to pass the landmark state pension overhaul, received between $100,000 and $500,000 from a Houston billionaire who was a trader for the ill-fated energy company Enron, The Wall Street Journal revealed Tuesday night.
A spokesman for John Arnold, 38, and his wife, Laura, confirmed their donations to the paper. Arnold founded Centaurus Advisors LLC, a Houston-based hedge fund, with $8 million of his own money in 2002. He closed the fund earlier this year. Arnold’s net worth is estimated at $3 billion by Forbes magazine.
Reached late Tuesday night, EngageRI spokesman John Duffy declined to discuss the Arnold’s financial support. “We respect the privacy of our donors and we continue to do so,” he said. The group is organized as a 501(c)4 and is not required to disclose its donors.
Duffy said EngageRI has received almost $1 million since it was created in the summer of 2011, suggesting the Arnolds provided between one-tenth and half the money EngageRI has raised so far. The group has spent about $740,000 lobbying for the pension changes.
A review by WPRI.com shows the Arnolds also donated directly to Raimondo on May 18.
John Arnold gave $2,000 to Raimondo’s campaign and another $1,000 to Hope Now PAC, a political action committee chaired by Warwick Rep.-elect Joe Shekarchi, Raimondo’s 2010 campaign manager, and staffed by Jackie Baginski, Raimondo’s campaign finance director, according to R.I. Board of Elections records. Laura Arnold also gave $1,000 to Hope Now PAC.
The Wall Street Journal revelation about the Arnolds’ donations to EngageRI comes the same day the paper’s editorial page lambasted Governor Chafee for talking with union leaders about a settlement to end their lawsuit challenging the pension law. “It’s too bad the governor has decided that taxpayers must lose in order for him to win re-election,” the editorial said.
The Arnolds have supported President Obama and other Democrats. Their nonprofit Laura and John Arnold Foundation lists public pensions as one of its policy focuses, and they have backed changes in California and other places. Last year the Arnold Foundation co-hosted a conference on the issue along with the George W. Bush Institute at Southern Methodist University in Dallas.
“The cost of public employee benefits in most states and communities is unsustainable,” the foundation’s website says. “The economic and social costs of this looming crisis are potentially crippling to our nation. We seek to remedy this untenable situation by promoting transparency and concrete solutions that address the problem in a manner that is comprehensive, lasting, and fair to all parties.”
Josh McGee, the foundation’s vice president for public accountability initiatives, praised the treasurer in a Houston Chronicle op-ed last June reflecting on the failed attempt to recall Wisconsin Gov. Scott Walker.
“Raimondo, the touted pension champion in Rhode Island, is now the most popular politician in her state, primarily due to her leadership on this difficult issue,” McGee wrote. “Other leaders would be well-served to heed Raimondo’s mantra, ‘This is about math, not ideology,’ before they fall into a budgetary abyss.”
John Kilduff, a partner at hedge fund Again Capital LLC, described John Arnold as “legendary” in a Bloomberg News interview earlier this year. “There are contenders and pretenders, and he was a contender,” Kilduff said.