Houston hedge-fund billionaire and former Enron trader John Arnold has become a surprisingly famous figure in Rhode Island politics since it emerged that he donated more than $100,000 to Engage Rhode Island, the advocacy group that helped Gina Raimondo pass the pension law. Her opponents have seized on Arnold’s ties to high finance and the ill-fated energy firm to cast doubt on EngageRI’s motivations.

But Arnold’s actual story is actually more interesting than that, according to the summer issue of WSJ.Money magazine.

Arnold, 39, closed his hedge fund last year and retired to begin giving away his $2.8-billion fortune, mainly through the Laura and John Arnold Foundation he and his wife founded:

Arnold and his wife, Laura, have a somewhat unique approach to giving. Most billionaires tend to write checks to good causes they’re part of, hospitals where they were treated or universities they attended. … Or there are donors who make sizable gifts to meet an obvious need in a community, such as hunger or education. But at a time when charitable giving in the U.S. is still down from its peak in 2007, the Arnolds want to try something new and somewhat grander. John says the goal is to make “transformational” changes to society.

The Arnolds want to see if they can use their money to solve some of the country’s biggest problems through data analysis and science, with an unsentimental focus on results and an aversion to feel-good projects — the success of which can’t be quantified. No topic is too ambitious: Along with obesity, the Arnolds plan to dig into criminal justice and pension reform, among others.

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By Ted Nesi

PROVIDENCE, R.I. (WPRI) – Engage Rhode Island’s fundraising slowed significantly in 2012 compared with the prior year, when the advocacy group provided crucial support for the pension law pushed through by Treasurer Gina Raimondo, WPRI.com has confirmed. Its union opponents said they spent $80,000 in 2011.

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Engage Rhode Island, the deep-pocketed advocacy group closely tied to Treasurer Gina Raimondo, released an unsigned three-page document [pdf] on Monday that makes the case for the legality of the 2011 pension law. Here’s the core of the argument:

If the Rhode Island Supreme Court affirms Judge Taft-Carter’s Decision, it will reverse its own precedent on the unmistakability doctrine, and create new constitutional law which will differ from federal court precedent and the precedent of the majority of state courts in this country. … If the judiciary can require a legislature to bind itself forever through one legislative act, which can never be revisited, the judiciary is thereby given too much power. Thus, it is important to hold from a separation of powers perspective that, unless the legislature’s intent to create contractual rights against the state is unmistakably clear, it should be free to amend its own legislation in the future.

Read the entire PDF here. For an alternative view, check out this from RWU Law’s Michael Yelnosky.

• Related: Mediation to continue in RI pension suit after judge gets update (Feb. 28)

Some of the secrecy surrounding Engage Rhode Island has been pierced.

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.

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Gina Raimondo is out of town, but her allies are still here to defend the pension law.

Engage Rhode Island, the deep-pocketed advocacy group that helped Raimondo pass the pension changes, issued a statement Wednesday afternoon criticizing Governor Chafee for talking with union leaders Tuesday about a potential settlement of their lawsuit challenging the law.

The unsigned statement said EngageRI is “concerned” by Chafee’s “apparent change of heart” on “a bill he signed into law just a year ago,” and is “saddened to hear of his desire to give away the retirement security of thousands of Rhode Islanders behind closed doors.”

EngageRI’s statement pushed back at the idea that unions weren’t given a chance to influence the process, and said it’s “unfortunate that Governor Chafee would want to subvert this open and public process by talking with union leadership behind closed doors.”

Raimondo released a statement shortly afterwards that, unlike EngageRI’s, only referenced the governor indirectly. “It is not the time for closed-door meetings. This is not a time for politics,” she said.

“If at some point the court asks the state to sit down to try and reach a settlement, we will do so in good faith,” Raimondo said. “In the meantime, Treasury will continue to work diligently to defend the important work done by the General Assembly.”

House Speaker Gordon Fox also weighed in against Chafee’s initiative. “It is not appropriate for me to negotiate legislation that was passed by the General Assembly and signed by the governor,” he said. “The time to negotiate was during the 30 hours of public hearings that were conducted by the legislature.”

In response, Chafee issued a statement of his own: “I have confidence in the state’s legal case. But a strong case does not guarantee a win.” The governor also said, “I have been disappointed that state leaders in a position to engage in reasonable discussions have chosen not to do so.”

Senate President M. Teresa Paiva Weed, the last of the four principals in the pension drama, opted to stay out of the fray on Wednesday. “She is going to decline comment at this point in time,” Senate spokesman Greg Pare told WPRI.com.

Full statements from all parties after the jump.

• Related: Barro: RI came closer than most but didn’t fix pension problem (Dec. 4)

This post has been updated.

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Engage Rhode Island’s leaders were serious about sticking around.

The deep-pocketed 501(c)4 advocacy group that helped pass last year’s pension overhaul sent out campaign fliers this month in three districts with closely contested Democratic primary races for General Assembly.

Two of the mailers attack incumbent Reps. Spencer Dickinson of South Kingstown and Rene Menard of Lincoln for voting against the law. Dickinson’s opponent is South Kingstown Councilwoman Kathleen Fogarty, who backed the law, and Menard’s is Cumberland Councilwoman Mia Ackerman, a staunch supporter of the changes whose website specifically links her candidacy with Treasurer Gina Raimondo’s policies.

(The two women use almost identical language on their respective campaign sites, telling voters they’ll work for “your interests” rather than “special interests.”)

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Engage Rhode Island, the deep-pocketed group that successfully pushed passage of the new pension law, raised $12,650 for its new political action committee and made no contributions during the first three months of this year.

EngageRI PAC had $14,069 on hand as of March 31, according to a report filed with the R.I. Board of Elections. The group donated $6,000 to the General Assembly’s top six Democrats last year and organizers have said it will provide support for legislators who voted for the pension overhaul.

EngageRI PAC’s first-quarter donors included Bernard Buonanno Jr., a senior partner at Riparian Partners, which was purchased last year by Oppenheimer & Co.; Ted Long, a lawyer and former top aide to U.S. Sen. Jack Reed; Terrence Murray, the former chairman of FleetBoston bank; and a number of others who supported Engage RI’s original 501(c)4.

• Related: EngageRI donates $1,000 each to top six in General Assembly (Feb. 1)

An earlier version of this post incorrectly said the EngageRI PAC donor is Bernard Buonanno III, a managing director at private-equity firm Nautic Partners; his father, Bernard Buonanno Jr., is the donor.

Treasurer Raimondo met with the Chicago Tribune’s editorial board recently, and it seems they came away impressed – so much so they want President Obama’s former chief of staff to create an “Engage Illinois” group modeled on Engage Rhode Island.

“Governor Quinn, Mayor Emanuel: Engage Illinois,” the Trib wrote in an editorial Friday. (That would be recently elected Chicago Mayor Rahm Emanuel, who was Obama’s right-hand man.) ”For our part, we will keep trying to help.”

Illinois’ pension system is the worst-funded in the country and a big source of angst in the Land of Lincoln. At a Tribune forum on Wednesday, “Emanuel raised, and Quinn discussed, the best idea of the night: that Illinois consider pension changes that the similarly Democratic state of Rhode Island adopted in November,” the editorialists said.

Here’s the lesson the Trib took from Raimondo’s work last year:

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Engage Rhode Island played a pivotal role in getting last November’s pension overhaul across the finish line, but it’s not clear whether the deep-pocketed advocacy group will put the same muscle behind the municipal-relief legislation Governor Chafee proposed last week.

“We appreciate Governor Chafee’s initiative on municipal pension reform,” Jon Duffy, a spokesman for EngageRI, told WPRI.com in a statement. “His experience as mayor of Warwick gives him a particularly deep understanding of the challenges faced by our cities and towns.”

However, Duffy stopped short of endorsing the far-reaching package the governor put forward on Thursday. EngageRI’s board members “look forward to reading his proposals and working with his administration to ensure that any pension reform measures proposed are comprehensive,” he said.

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By Ted Nesi

PROVIDENCE, R.I. (WPRI) - Engage Rhode Island, the deep-pocketed group that successfully pushed passage of the new pension law, donated $6,000 to the General Assembly’s top six Democrats late last year through its new political action committee.

EngageRI PAC contributed $1,000 each on Dec. 29 to the campaign war chests of House Speaker Gordon Fox, Senate President M. Teresa Paiva Weed, House Majority Leader Nick Mattiello, Senate Majority Leader Dominick Ruggerio and the two finance committee chairmen, Rep. Helio Melo and Sen. Dan DaPonte, according to campaign finance records reviewed by WPRI.com. The Providence Journal first reported the donations.

“EngageRI PAC gave to General Assembly leadership for their efforts and courage in the pension reform efforts leading to the passage of the Rhode Island Retirement Security Act of 2011,” Jon Duffy, EngageRI’s spokesman, told WPRI.com. The PAC is now “in a very active fundraising mode,” he said.

The six donations used up most of the $7,840 the EngageRI PAC raised in December from a group that included Duffy, Paul Choquette of Gilbane, Ed Cooney of Nortek, John Galvin of Collette Vacations and John Muggeridge of Fidelity Investments. The original 501(c)4 EngageRI has not said where it got its budget of more than $600,000.

EngageRI PAC did not make donations to Treasurer Gina Raimondo, the driving force behind the pension bill who inspired EngageRI, or Gov. Lincoln Chafee, who signed the bill into law. The group has said it will provide support for legislators who voted for the pension overhaul.

• Related: EngageRI forms PAC to fund pols; spent $617K for pension bill (Dec. 16)

The nonprofit Crossroads Rhode Island has suffered dearly for signing on with Engage Rhode Island, the deep-pocketed advocacy group that successfully pushed the pension bill. Sunday’s Projo reports donations to Crossroads are down more than 50% from last year and it is receiving angry letters from public employees.

Asked whether she’d still join EngageRI if she got the chance to do it all over, Crossroads chief Anne Nolan told the paper: “Honestly, I can’t answer that.”

What the Journal article doesn’t mention is that Crossroads has already disappeared from EngageRI’s website. The nonprofit is no longer listed among EngageRI’s coalition members on its home page, and Nolan herself has been deleted from EngageRI’s board of directors list.

Crossroads isn’t alone.

Another social services agency whose support for EngageRI drew a lot of attention – Family Service of Rhode Island – has also been removed from the coalition list, and the name of its CEO, Margaret Holland McDuff, has been deleted from the board, where she’d been listed as EngageRI’s co-chairperson. McDuff and Nortek executive Ed Cooney were the original driving forces behind EngageRI.

• Related: EngageRI forms PAC to fund pols; spent $617K for pension bill (Dec. 16)

By Ted Nesi

PROVIDENCE, R.I. (WPRI) - Engage Rhode Island, the deep-pocketed advocacy group that successfully pushed passage of the new pension law, spent more than $617,000 over two months to promote the legislation and has now formed a political action committee to support lawmakers who voted for it.

EngageRI shelled out $93,327 in November after spending $524,657 in October on two months’ worth of lobbying, advertising, campaign materials and other expenses in support of the pension bill, according to a lobbying report the organization filed Thursday with the secretary of state’s office.

On Nov. 17, the day the pension bill passed the House and Senate, Engage Rhode Island formed an offshoot organization called Engage RI PAC that will be able to support individual candidates. Engage Rhode Island, the original group, is organized as a 501(c)4 nonprofit and thus barred from advocating for individual politicians.

“We’ve said all along that we would support candidates that supported pension reform, and the PAC gives us the vehicle to do that in a direct way,” EngageRI spokesman Jon Duffy told WPRI.com.

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By Ted Nesi

PROVIDENCE, R.I. (WPRI) – Engage Rhode Island, the deep-pocketed new advocacy group pushing passage of the Raimondo-Chafee pension bill, spent nearly $525,000 to promote the legislation in the month of October alone.

EngageRI shelled out more than half a million dollars to pay for 31 days’ worth of lobbying, advertising, campaign materials and other expenses on behalf of the pension bill, according to a lobbying report the organization filed Tuesday with the secretary of state’s office.

The bulk of the spending – $348,819 – went to EngageRI’s public relations firm Duffy & Shanley, though in many cases that money was then spent by the firm to buy television, print and digital advertisements. (EngageRI has bought ads on WPRI 12 and WPRI.com.)

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