By Rachel Kapochunas, CQ Staff

After a major setback threatened to derail their efforts in October, Republicans are expressing confidence that enough signatures will be gathered by the end of this month to place an initiative on California’s June ballot allocating electoral votes by congressional district rather than the current winner-take-all system.

Democrats have labeled the measure a “power grab.”

Supporters had collected just over 400,000 signatures total as of last week, according to political consultant Dave Gilliard, who is the campaign manager for California Counts, the group spearheading the signature-gathering effort. He said about 100,000 signatures came from the previous group collecting signatures.

Gilliard said California Counts is aiming for 650,000 to 700,000 signatures by the end of November — substantially above the required 433,971 signatures.

Gilliard, who helped form a committee to recall California Democratic Gov. Gray Davis in 2003, said that any initiative group can typically expect one out of every four signatures obtained on the street to be thrown out as invalid. Therefore, California Counts is supplementing their signature-gathering on the street with direct mail, which Gilliard said has a validity rate over 90 percent, and an Internet campaign. He stated that the group collected between 4,000 and 5,000 petitions through the Internet as of last week.

“We’re on a good pace,” Gilliard said. “I think we’re going to make it, but it’s a challenge every day.”

One major challenge for Gilliard and his colleagues is that they just recently took ownership of the signature-gathering effort after the original group disbanded.

Democrats had filed a complaint with the Federal Election Commission (FEC) on Oct. 1 alleging that the campaign of Republican national frontrunner Rudy Giuliani violated federal campaign law by financing and controlling the original committee, Californians for Equal Representation. The group reported in September that the majority of their funding originated from a single donation of $175,000. News reports later revealed that Giuliani fundraiser Paul Singer was behind the donation.

Democrats harshly criticized the initiative because they view it as a Republican tactic to boost the Republican presidential nominee’s vote share in California. Presently, electoral votes in California are allocated in a winner-take-all system used by nearly every state. Maine and Nebraska allocate electoral votes by congressional district.

Under the proposed initiative, the statewide winner would get two electoral votes but the rest would be divided up on the basis of the number of districts that each candidate won. The state currently possesses 55 electoral votes, more than 10 percent of the total electoral votes at stake nationwide and 21 votes more than those held by the next largest state, Texas.

If electoral votes had been allocated by congressional district in 2004, President Bush would have received 22 of the state’s 55 electoral votes and in 2000, Bush would have received 19 of California’s 54 electoral votes under the initiative. Bush narrowly edged out Democrat Al Gore in 2000 by just 5 electoral votes.

Kevin Eckery, who served as spokesman for the now-defunct group Californians for Equal Representation, told CQ Politics that the donation from Singer was “entirely legal.” But, Eckery said, he and his colleague, attorney Thomas Hiltachk, walked away from the project because the Singer contribution “was being done in this awkward manner that made it look like we were somehow laundering funds — and we didn’t want any part of that.”

He also added that donations had not been rolling in at the desired rate.

The current committee, California Counts, has an estimated budget of $2 million. California Counts reported raising more than a quarter of that goal, $540,000, in their first week of operation, according to campaign finance reports filed with the Secretary of State.

Top donors include: the California Republican Party, which contributed $80,000; billionaire media mogul Jerrold Perenchio of Los Angeles, Silicon Valley venture capitalist Floyd Kvamme and Newport Beach, Calif., investor Duane R. Roberts, who each donated about $50,000; and California Republican Rep. Darrell Issa , who chipped in at least $50,000 and $9,700 from his campaign committee, according to the report filed.

Issa, a wealthy former businessman, provided nearly $2 million in 2003 to fund the successful effort to recall Gov. Davis.

Gilliard said Issa’s involvement lends their current effort “a huge amount of credibility” because people are aware of his success in the recall effort and Gilliard believes that voters understand Issa is “serious about seeing it through.” Gilliard added that donations are coming in from many sources and Issa is not expected to carry the fundraising burden.

In an interview with CQ Politics, Issa said he helped send out direct mail and e-mail requests to about 1.5 million California voters regarding the initiative but gave no estimate of how much money he is willing to provide. Issa did note that the recall election circumstances were “unusual” and that many donors are involved

Issa said that dividing electoral votes proportionally is particularly important for large states such as California because candidates will no longer write off a state’s voters because they had little chance to win there.

“It will be in place for generations that presidents will come to California and campaign, even if they’re not going to win the majority,” Issa said. “That means we’re going to have presidential candidates in California for something other than a fundraiser. And as a Californian, I think that makes for good government.”

Democrats continue efforts to block the initiative. A group called Californians for Fair Election Reform, organized by former Gore Press Secretary Chris Lehane, is spearheading an anti-initiative push that has been endorsed and funded by leading Democrats. The group got off to an early start two months ago airing radio ads with the message, “Dividing California’s electoral votes only hurts Californians.”

Lehane’s group filed the FEC complaint against the original initiative committee and said in an interview with CQ Politics that the establishment of a new committee has not changed what Lehane cites is a clear connection to the Giuliani campaign. This week, the group asked the Los Angeles city attorney to look into a report that a group supporting the initiative was offering food to homeless people in exchange for their signatures on the petitions.

“They may have made some type of effort to try to sanitize the group,” Lehane said. “But stepping back, it’s even dirtier than it was first time around.”

Lehane noted that a number of people donating to or involved in the initiative effort are connected to the Giuliani campaign, such as Ann Dunsmore, who reportedly left Giuliani’s campaign and is now working on the initiative’s fundraising.

Giuliani spokesman Jarrod Agen said the initiative is “completely independent” from the Giuliani campaign.

After California Counts submits signatures to county election officials and they report totals to the Secretary of State, the process of verifying the signatures will begin.

Emily Cadei contributed to this story.