The Kingdom and the Power

Page 7 of 9

The Hotze that Harmon claims to know is the opposite of the devious, shifty, untruthful figure sketched out by Jones and Wong.

"He's really very engaging, very smart," says Harmon, who then pauses. "I don't think anybody you've talked to would say they don't like him."

Consultant Allen Blakemore is in a good position to discuss the angled relationships between Hotze, his political action committees and the private companies Hotze has set up.

Blakemore says he is paid by Hotze for political work, but you won't find the payments listed on any filing with the Texas Ethics Commission. His paychecks from Hotze, explains Blakemore, come directly from Forrest Marketing. Asked whether Forrest and Texas 2000 were created simply to keep Hotze's political activities out of the reporting process, Blakemore replies, "I believe so."

Hotze's PACs also pass money between themselves, leading Blakemore to crack that Hotze stuffs contributions he receives into whatever hole he needs to fill on a given day. To make things even more incomprehensible, Texas 2000 itself received a $1,000 political contribution from Harmon's Committee for a Well Qualified Judiciary, with no explanation how a private business could qualify for a campaign contribution.

The money train runs two ways between Blakemore and Hotze. Blakemore and Associates has contributed $19,500 over the past two years to Citizens for American Restoration and another of Hotze's PACs, Houston Republican Forum. Blakemore is credited on PAC filings with giving two checks totaling $7,000 to Citizens for American Restoration on the same day back in April 1994, though he claims the money was actually given over a longer period. That generosity made other consultants suspicious that what Blakemore was actually doing was laundering contributions from candidates he represents who don't want their names associated with Hotze.

Blakemore says that's not true. "It's illegal to accept a contribution for the purpose of giving it to someone else," he says, likening his contributions to the Hotze PACs to giving money to the Republican Party. "We see things going on that are of benefit to all of our clients and candidates and say this is part of the cost of doing business. It helps my people and helps me win elections." Somehow it didn't quite work that way for Martha Wong, who was shafted by Hotze despite having Blakemore as a consultant.

Another GOP candidate who's angry at Hotze is state senator-elect Jon Lindsay. The former county judge contributed heavily to the Committee for a Well Qualified Judiciary, which passed the money on to Hotze's operations. But Hotze endorsed Lindsay's opponent in the Republican primary, Jerry Dumas, who came within two points of beating Lindsay after benefiting from some of his campaign largess.

"Without Hotze's support, Dumas would have been a double digit loser," says one consultant with close ties to Lindsay.

If Frank Harmon hasn't found anybody who doesn't like Steve Hotze, he probably hasn't spoken with Betsy Lake for the past few years. A former Harris County Republican chair, Lake fought Hotze for control of the local party during her two terms, the first of which was largely consumed in a guerrilla war between the two. "If I could have used my energy toward doing positive things for the party rather than have to worry 24 hours a day about what Dr. Hotze and his inner circle of friends were up to," says Lake in a resigned tone, "what more we could have accomplished?"

Lake describes herself as burned out on politics as a result of that struggle. After her first election in 1992, Hotze and his supporters on the county party's executive committee seized the regular Republican administrative apparatus and its west-side head-quarters on Augusta. "They thought I would act like a woman and just quit and give them what they wanted," laughs Lake. "Well, I hung on. I didn't let them run me off."

Lake responded to the challenge by creating her own fundraising mechanism and setting up headquarters on Chelsea in the Museum District. Hotze, true to his form as a political loner who likes to dictate rather than work in committee, eventually tired of party administrative duties. Snafus such as failing to pay the office phone bill resulted in a well-publicized service shutdown in the Augusta headquarters. He eventually closed that operation and went back to running his own political show out of his Katy medical clinic. After Lake was succeeded by Gary Polland, the party reunited at the Chelsea offices.

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Tim Fleck
Contact: Tim Fleck