GOP's Steele has debt from '98 campaign

Ehrlich's running mate owes sister $25,000

July 03, 2002|By David Nitkin | David Nitkin,SUN STAFF

As he embarks on a bid to become lieutenant governor, state Republican Party Chairman Michael S. Steele must resolve outstanding financial obligations from a previous run for office.

Time is running out for Steele to repay a $25,000 loan that helped finance his unsuccessful campaign for state comptroller in 1998. A report that is supposed to show the status of the loan is eight months' overdue.

State law requires loans to campaign committees to be repaid by the end of the next four-year election cycle. In Steele's case, that means he must repay money borrowed in 1998 from his sister, Monica Turner Tyson, by the end of December.

In an interview yesterday, Steele said efforts to raise funds to retire the debt during the past three years have been unsuccessful. "It's tough to raise money when you're not running for office," he said.

If a loan is not repaid in four years, it is considered a campaign contribution, which in Steele's case would exceed the $4,000 donation limit under state law. Similarly, below-mar- ket-rate interest also is considered a campaign donation.

Steele said he could not recall the exact interest rate on the loan, but called it a "nominal amount."

According to documents, the Friends of Michael Steele campaign did not file an annual report detailing contributions, expenses and obligations that was due Nov. 8. The report was still outstanding yesterday, and elections officials said the campaign would be fined $250 - the maximum allowed by law.

The most recent report, filed in November 2000, listed the $25,000 loan and $9,236 in unspecified bills, for a total debt of $34,236. Steele said yesterday that he believed only the loan remained unpaid.

He said his campaign treasurer neglected to file the report because he was traveling when the deadline passed and did not complete the paperwork when he returned.

"I just found out [Monday] he had not finished that filing," Steele said. "It was just an oversight."

He said he had planned to hold fund-raisers after this year's election but was accelerating the schedule now that he has a more visible role on the GOP gubernatorial ticket headed by Rep. Robert L. Ehrlich Jr.

"I think I'll do a campaign letter to friends and ask them to help," Steele said. "I don't want to give my opponents anything more to go after me than I absolutely have to."

Paul E. Schurick, an aide to Ehrlich, said the congressman knew about the loan before asking Steele to join his ticket and was not troubled by it.

"The one thing we know is that this issue will be resolved by the end of the year," Schurick said. "That's what the law requires, and that is what will be done."

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