WASHINGTON — Of all the investments made by the super-wealthy partners at the private equity firm Bain Capital, perhaps none has a greater potential return than the one they've made in Mitt Romney.
Current and former Bain executives and their relatives have given about $4.7 million to organizations that are dedicated to making Romney the next president of the United States, according to a Center for Public Integrity investigation.
Some Bain associates have been filling Romney's campaign coffers since 2004, long before the former Massachusetts governor officially embarked on a presidential run.
Since then, they've given to political committees in early primary states — some without contribution limits — for both of Romney's presidential campaigns and to federal "leadership PACs" that the candidate controls.
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Most dramatically, they gave at least $3.1 million last year to Restore Our Future, a "super PAC" that Romney doesn't control, which has used the contributions to launch ads against his opponents. Super PACS are the independent groups that have mushroomed since a Supreme Court ruling in 2010 permitted corporations and others to donate and spend unlimited amounts on a candidate's behalf, often with the sources undisclosed.
The Center for Public Integrity examined contribution data from the Center for Responsive Politics, CQ MoneyLine, the Federal Election Commission and state campaign-finance regulators. (Contributions made from 2004 to 2007 to the South Carolina PAC weren't available.)
Romney supporters established one federal and six state-based leadership political action committees — each dubbed a "Commonwealth PAC" — in 2004 and 2006, allowing Romney to raise almost 10 times more money per contributor than he could through his presidential campaigns alone.
Many candidates and elected officials establish PACs to contribute to other candidates and to advance the party agenda, but few were as prolific as Romney's, especially at the state level. In total, current and former Bain executives and their relatives contributed more than $1 million to the state and federal PACs from 2004 to 2011, when Romney wasn't an official presidential candidate.
Much of the Commonwealth money came from 16 current or former Bain executives and their wives, some of whom contributed tens of thousands of dollars in a single day to multiple PACs.
Bain Capital has more than a rooting interest in Romney. Records show that the company spent more than $3.1 million from 2007 through 2011 for lobbying on issues from regulatory oversight of the financial industry to tax benefits for rich investors.
Boston-based Bain Capital LLC was founded in 1984 by Romney and other partners of the consulting firm Bain & Co., which William Bain founded in 1973. Romney worked for both Bain Capital and Bain & Co., which are separate entities. Five of the 16 contributing executives worked at Bain & Co. and the rest at Bain Capital.
Bain Capital specializes in leveraged buyouts and investment in a variety of ventures, including office supply stores and a pizza chain.
Romney left Bain Capital in 1998 to take over managing the debt-ridden 2002 Winter Olympics, but he parlayed his Bain connections to fund his Commonwealth PACs and subsequent campaign organizations.
Romney made his first moves to run for president in 2003, barely six months into his Massachusetts governorship.
The Boston Globe has reported that longtime Bain associate Robert White met with Republican operatives in Washington to discuss Romney's potential candidacy. White, who headed Romney's gubernatorial transition team, had worked on Romney's unsuccessful 1994 U.S. Senate campaign and the 2002 Olympics.
By the summer of 2004, Romney supporters had established a federal Commonwealth PAC and four state Commonwealth PACs, in Arizona, Iowa, Michigan and South Carolina. Once the PACs were set up, the Bain money started pouring in.
In a single day in August 2004, White signed checks for $21,500 to four PACs. He and his wife eventually gave at least $83,000 to the PACs.
Another Bain executive, Paul Edgerley, wrote checks worth $21,500 in a single September 2004 day for four PACs. He and his wife eventually contributed at least $68,000 to the PACs.
William Bain contributed $7,000 in one day in 2004 to two state PACs, and he and his wife eventually contributed at least $43,000 to the PACs.
By 2006, Romney announced that he was considering a presidential bid.
Commonwealth PACs were established in New Hampshire and Alabama, and 2006 became the year for the largest amount of contributions to the PACs, especially in Michigan and Iowa. In a single week in 2006, former Bain executive Fraser Bullock and his wife gave $43,000 to four Commonwealth PACs.
Meg Whitman, a former Romney protege at Bain & Co. who ran unsuccessfully for California governor in 2010, contributed $96,500 to four PACS in two days in November 2006.
Bain executives either didn't return phone calls or wouldn't comment on the record.
The fundraising didn't stop at Bain's door. Businessmen who worked with Bain also gave thousands of dollars to the Commonwealth PACs, steadily increasing their donations as their businesses flourished.
For example, Thomas Stemberg received $3 million from Bain in 1986 to grow Staples Inc.
By 2006, when Staples had 1,700 stores, Stemberg and his wife contributed at least $39,000 to four Commonwealth PACs. Stemberg is now with Highland Capital, a company whose managing partner joined with a Bain managing partner to buy the Boston Celtics basketball team. Stemberg and his wife eventually contributed a total of at least $90,000 to the PACs.
In another instance, Peter Karmanos Jr., the executive chairman of Compuware Corp., a Detroit-based company that Bain considered acquiring but declined in 2007, contributed $246,500 in a two-week period in 2006 to four Commonwealth PACs. A month after one contribution landed at the Michigan PAC, Karmanos became a member of its steering committee. Scott Romney, Mitt Romney's brother, sits on the Compuware board of directors.
Last summer, Compuware bought a Bain-backed software company.
Compuware spokesman Bill McGraw said Karmanos "likes the fact that Romney compromises, and he was able, as a Republican, to pass things such as health care in the most liberal state in the union because he could work with Ted Kennedy and other Democrats."
The spokesman said Karmanos still supported Romney and was waiting to see what financial support the candidate would need.
Once Romney officially declared his candidacy in 2007, the PACs went dormant and more than 85 other contributors who listed Bain as their employer gave about $188,000 to Romney's official campaign.
Federal contribution limits were $2,300 per person, per election. After conceding a loss in 2008, Romney immediately geared up for another run. The Commonwealth PACs, separated from the campaign during election years, were reinvigorated and renamed Free and Strong America. Once again, donations flowed in.
In 2010, Edward Conard, a former managing director at Bain Capital who'd donated tens of thousands of dollars to the PACs from 2004 to 2006, contributed $100,000 in a single day to six Romney PACs.
Other donors with Bain connections also contributed. Two executives with Sun Capital, a Boca Raton, Fla., investment firm that Romney and Bain joined in company ventures, donated a combined $100,000 to six PACs in a two-week period in 2010.
The Romney campaign declined to comment on the Bain contributions and referred questions to the PACs. Representatives of the PACs didn't return calls.
Campaign officials have said in past media interviews that the Commonwealth PACs followed the "spirit and the letter" of election laws and the PACs were created to allow Romney to campaign for and contribute to other Republican candidates and present his ideas when he isn't running for president.
"The use of state committees and federal leadership PACs to lay the foundation of a presidential run by Romney and other candidates is troubling because it's an obvious tactic to evade the (contribution) limits applicable to candidates for federal offices," said Paul Ryan, an attorney for the Campaign Legal Center, a nonprofit group that works with campaign-finance issues.
Last year, Romney supporters created the super PAC called Restore Our Future. Through the end of January, it had spent $17.3 million, mainly on advertising blasting opponent Newt Gingrich. By law, the super PAC can't coordinate with Romney or his campaign. But the group provided another vehicle for current and former Bain executives to show their financial support.
Conard has contributed at least $1 million to Restore Our Future, a donation that was masked through a shell corporation before Conard stepped forward. Edgerley and his wife also contributed at least $1 million. Stephen Zide, a Bain managing director, contributed at least $250,000 and David Bullock, the son of Fraser Bullock, contributed at least $100,000.
Disclosure reports filed Jan. 31 show that three additional Bain executives and one spouse together contributed $750,000.
The same two Sun Capital executives who contributed to the state PACs, Rodger Krouse and Marc Leder, also contributed $125,000 each to Restore Our Future last June. Krouse, Leder and their wives also contributed a combined total of at least $19,000 to Romney's 2008 and 2012 campaigns.
A spokesman for the two Sun Capital executives declined to comment.
Stemberg contributed at least $10,000 to Restore Our Future, and he and his wife contributed the maximum $5,000 allowed last year to Romney's campaign. Stemberg didn't return calls requesting comment.
For thrifty Bain executives, there's still the traditional method of contributing directly to Romney's campaign. For this year, the limit is $2,500 per person, per election. Last year, more than 95 contributors who listed Bain as their employer donated a total of about $221,000.
A spokesman for Bain Capital declined to comment.
The company is politically astute enough not to put all of its contributions in one party basket, however. For years, Bain entities also have contributed to Democratic candidates at the state and federal level. But in the 2008 election, Bain entities contributed far more to Romney than they did to Barack Obama, and thus far have done the same in 2012.
Romney's Bain connections have drawn scrutiny, especially questions about the low tax rates that executives of private equity firms pay. Romney recently released his 2010 and 2011 tax returns, which showed that he'd paid a little less than 15 percent in taxes on his $42 million total income for the two years.
About $13 million was from "carried interest," or a share of profits to equity managers on Bain investments that's taxed at lower rates than ordinary earned income is. Among Bain's lobbying interests was legislation that would treat "carried interest" as taxable income.
Bain Capital was a member of the Private Equity Council, now the Private Equity Growth Capital Council, which in 2010 opposed legislation to change the tax treatment of carried interest.
(John Dunbar contributed to this report. The Center for Public Integrity is a nonprofit center for investigative journalism.)
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