State GOP is almost broke

Treasurer's report shows $4,615 in cash and $50,500 in debt

August 11, 2007|By Andrew A. Green | Andrew A. Green,Sun reporter

The Maryland Republican Party, reeling from the loss of the governor's mansion, is nearly broke, according to a copy of its financial statement obtained by The Sun.

The state GOP treasurer's report from July 31 shows the party had $4,615 in cash and $50,500 in debt. Because of lackluster fundraising, the party operated at a $103,536 deficit in the first six months of the year.

A report from the party's accountants shows that funding from major donors has dried up, and that the party's major annual fundraising event, the Red, White and Blue Dinner, netted $15,572, less than 10 percent of the amount the party had been counting on.

The poor fundraising comes at a time when conservative and moderate wings of the party are fighting over whether the party should take sides in state Sen. Andrew P. Harris' primary challenge to Rep. Wayne T. Gilchrest, a stark contrast to the unity and strength that the party displayed during former Gov. Robert L. Ehrlich Jr.'s term.

"It's no secret that the Maryland Republican Party is having financial problems" in the wake of Ehrlich's loss, said state GOP Chairman Jim Pelura. "Why do big donors give a lot of money? It's for access. I'd be the first to admit that access is limited right now, but that will change. With every piece of lousy legislation that comes out of the General Assembly, our position will strengthen."

The state party hasn't had to abandon its prime office space just off Church Circle in Annapolis -- which rents for about $5,000 a month -- but it has eliminated staff positions, canceled or consolidated events and reduced party-building activities.

"The Republican Party of Maryland continues to experience difficulties in fundraising resulting in minimal cash available to pay our continuing expenses," the treasurer's report says.

The party had expected to raise enough in the first six months of the year to bolster its cash position by nearly $100,000, but instead, it has been forced to rely on a line of credit to meet its daily operating expenses. According to the treasurer's report, the party has had some unexpected success in telephone fundraising, but contributions from major donors have been off sharply.

Kevin Igoe, a Republican consultant, said the problem is exacerbated by a bad climate for Republicans nationally. The party's fundraising committees in other states are suffering, too, he said.

"To try to alleviate that, you have to absolutely, totally concentrate on fundraising and nothing but fundraising and try to build the party base, build the donor file over time," Igoe said. "It's not a problem you're going to solve overnight."

The Ehrlich fundraising team has not been heavily involved in helping solicit donations for the party. Richard E. Hug, who helped Ehrlich raise millions for his two gubernatorial campaigns and who was a major fundraiser for President Bush, said the party has not approached him.

"I know they've had some difficulty raising money, but no, they haven't," Hug said. "I haven't been involved."

Earlier situation

Hug said the party was in the same situation after Ellen R. Sauerbrey's two losing gubernatorial runs, and he said he's confident it will recover.

Ehrlich spokesman Henry Fawell said the former governor is aware of the party's fundraising woes, which he said are not surprising given the loss of the governor's mansion.

"The question is whether they use the Democrats' plan to raise taxes and their failure to control energy costs to their advantage, not just in terms of fundraising but also recruiting solid candidates for the future," Fawell said.

In the first weeks of Gov. Martin O'Malley's administration, the party was active in offering a critique of the new Democratic governor, but in recent months, even as talk of tax increases intensified, the news releases from the state GOP dropped off.

Republican insiders said there has been a resurgence in the past few months of an old debate between the conservative and moderate wings of the party.

When Ehrlich was governor, the moderate wing was firmly in control, but in the past few months, some dissent has surfaced around the 1st Congressional District primary between Harris and Gilchrest. Gilchrest is a moderate, and Harris is a conservative.

Republican insiders, who asked for anonymity while discussing intraparty issues because they are not authorized to speak about them, said Pelura advocated this spring for changes to state party rules and practices, including a shift that would allow it to make pre-primary endorsements and a move away from its policy of supporting incumbent Republicans.

Pelura said he is "not focused on any one aspect of the bylaws," which have not been voted on. He said Republican National Committee rules would limit the state party's ability to get involved in primaries.

Fears for party

But several Republicans said they feared the party is picking sides, and that it could cripple the Maryland GOP for years to come.

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