State elections officials have told the financially strapped Maryland Republican Party that it must repay $77,500 that Michael S. Steele, now the national GOP chairman, transferred to it in an apparent violation of campaign finance laws.
The state party faces a deadline in two weeks to resolve several alleged violations. If it remains unsettled, the matter ultimately could be referred to state prosecutors for possible charges.
The Maryland State Board of Elections found that money transferred from Steele's state campaign account, used to pay debts of the Republican State Central Committee, exceeded the legal limit, according to letters obtained by The Baltimore Sun. The violations turned up during a routine audit of political committees.
The board gave Steele, who served one term as the state's lieutenant governor, and the central committee 30 days from June 23, the date of the correspondence, to make the reimbursements and amend campaign finance reports dating back to 2002.
Most of the amount to be reimbursed stems from legal fees the central committee incurred during a redistricting fight several years ago. Steele, who was the state committee's chairman at the time, sued to have a Democratic-crafted redistricting plan thrown out by the Maryland Court of Appeals in 2002.
The debt went unpaid until 2007, when Steele's campaign account paid Baker and Hostetler LLP, the law firm that handled the case, $75,000 and classified it as an in-kind contribution to the state central committee.
The elections board directive adds to the problems, including outstanding debts and a recent spate of infighting, that have beset the Maryland GOP. It also comes in the wake of allegations that surfaced earlier this year regarding Steele's mishandling of campaign funds. Those accusations were made by Steele's former finance committee chairman for his unsuccessful U.S. Senate run in 2006, Alan B. Fabian, who was convicted of fraud unrelated to his political work.
Robert B. Ostrom, the central committee's attorney, said he planned to send a response to elections officials but declined to omment further.
"We're just waiting to see how it's resolved," said James Pelura, chairman of the state party, who also wouldn't discuss the issue. "It's an ongoing situation. There are negotiations back and forth."
Steele's attorney, Kerri L. Ruttenberg, declined to comment. Steele was traveling yesterday and could not be reached. A Republican National Committee spokesman referred questions to Steele's political campaign associates.
