Gary Hart's presidential campaign became a center of controversy again yesterday after a report that a California videotape producer helped underwrite Hart's campaign expenses in his 1984 race and his original bid for the 1988 nomination in what could be a violation of campaign finance laws.
The Miami Herald -- which triggered former senator Hart's withdrawal from the campaign last May with the story that he had spent the night with model Donna Rice -- made the allegations. It reported yesterday that the producer, Stuart Karl, personally paid more than $15,000 in Hart campaign bills during the 1984 Democratic National Convention, wired thousands of dollars more to Hart campaign accounts, put a Hart advance man, Dennis Walto, on his firm's payroll in 1986 at $3,000 a month and provided private jet flights and helicopters for use by Hart and his aides.
Federal election laws allow individuals to donate a maximum of $1,000 to a presidential candidate and allow employers to assign a worker to a campaign for only an hour a week unless the work is reported as an in-kind contribution.
Karl's firm also is listed in Federal Election Commission records as settling a $96,000 debt with Hart for television production from the 1984 campaign for 10 cents on the dollar, according to an FEC spokeswoman.
Yesterday, while campaigning in New Hampshire, Hart was deluged by reporters asking about the Herald story. He declined to answer several specific questions, but his campaign later put out a detailed statement in which it said it thinks that all government rules were followed. Sue Casey, campaign manager, said that, because of the questions, the campaign will ask the FEC to review all services from Karl and "abide by its ruling."
Hart said he knew Walto was being paid by Karl. "I was aware that he was on a payroll," Hart said. "The question is was he doing work for the person who was paying him." He also said that he "wouldn't be surprised" if he had flown on Karl's private jet, but thought his campaign had paid for the trips.
Michael Cheroutes, who handled logistics for Hart's 1984 convention operation, said yesterday the expenses Karl paid in connection with the convention included "the understanding those expenses would be billed back to the campaign."
Cheroutes said he assumed those expenses are part of the $96,000 that FEC records show Hart owed to Karl's firm. The Herald reprinted some of the checks, which were written on Karl's personal bank account not on the corporate account that was owed money by the Hart campaign.
The Hart campaign's statement said Walto did volunteer work for Hart while he was employed and paid by Karl in 1986 but said Hart was not a formal candidate at the time and that "it is unclear" whether that dual role was improper. "The charges raised involved friends and supporters who were trying to do what they thought best," the statement said.
One Hart adviser said Karl was planning to sell videos of Hart's 1988 campaign for $30 and that Walto helped "set up shoots" while he traveled with Hart. Walto told reporters in Des Moines yesterday that he "performed duties for" Karl and was a volunteer for the Hart campaign.
Oliver Henkel, Hart's 1984 campaign manager, and James Dwinell, his deputy, both said in interviews yesterday that they were unaware of the payments by Karl described in the Herald story.
Dwinell said Karl sent in several $1,000 checks from relatives and friends to the Hart campaign early in 1984 and then bought the campaign's office furniture for about $10,000 just before the Iowa caucuses.
Hinkel said the campaign was "fastidious" in trying to comply with FEC regulations. He noted that the FEC audit of the 1984 race found only minor violations of spending limits and no allegations of illegal contributions.
Hart, who has been dogged by questions about his unpaid 1984 campaign debt since reentering the 1988 race last month, said yesterday he asked his staff to check the accuracy of the allegations. He said he will take responsibility for any irregularities. "I will hold myself responsible for whatever happened and not shift the blame to anyone else," he said. "Obviously, a candidate cannot know every detail."
It the Democratic debate in Iowa last week Hart said that he holds himself to high standards in both public and private morality. He has made a point, for instance, in not accepting political action committee money in his presidential campaigns.
Karl, who became wealthy marketing videocassettes for actress Jane Fonda and Playboy, could not be reached for comment yesterday. He resigned last spring from Lorimar Home Video and is being sued by the company for allegedly taking more than $229,000 from a contractor and failing to repay more than $113,000 in loans.
A spokeswoman for Lorimar said the company was unaware that Karl had hired Walto at $3,000 a month during 1986.
A key figure in the Herald story is Rama White Middel, a former aide to Karl. She wrote the checks that paid for the 1984 convention materials.
She also told the newspaper that Karl had her wire transfer thousands of dollars to Hart accounts. "There were at least two or three times when a large amount needed to be wired into a bank account and it had to do with paying Hart debts," Middel said.
Staff writers Edward Walsh and T.R. Reid contributed to this report.