January 25, 2007
It's largely about the money, or lack thereof

The most significant allegation that Republican insiders have raised against Diane Tebelius is that she's been a disaster at all aspects of the #1 task of managing money -- raising it, spending it wisely and accounting for it properly.

Eric broke the news in this post on Tebelius' failure last year to raise nearly the amount of money customarily expected of a state chairman.

The details are complicated, involving the arcana of campaign finance laws, but I'll try to resummarize and add some narrative highlights from folks who have tried to work with Tebelius on party finances

As Eric explained earlier, there are basically two kinds of party funds, imposed by both state and federal campaign finance laws -- "exempt", also known as "soft dollars", and "non-exempt", also known as "hard dollars". Hard dollars are subject to strict per-person and per-PAC limits. Certain activities, such as campaigning and get-out-the-vote (e.g. mailers, signs, phone banks) MUST be paid for with "hard dollars". "Soft dollars" are not subject to contribution limits, but may be used only for general party expenses and overhead (staff salaries, legal bills, etc.), not for campaigns. Because hard dollars are hardest to raise and are the exclusive source for campaign funding, they should be spent only on campaigns and GOTV, but NEVER on party overhead.

When Tebelius was elected chairman a year ago, the party had substantial debts from the election contest. (And the debt was larger than it could have been owing to Tebelius's outsized legal bill). Tebelius could and should have paid off the entire debt by raising soft dollars from corporate donors and major individual donors. But she didn't.

Those who've watched her in operation say she was completely unprepared and ill-suited to the task of raising money. She didn't have the stomach to make the hours of phone calls to ask for money as the job demands. She just didn't do it. Nor did she seem to know how to conduct herself with major donors. As a result, little money was raised.

To compound matters, insiders recount instances where she represented that funds would be used for one purpose, but then turned around and spent the money for a different purpose. As a result, she lost credibility and fewer major donors would be inclined to entrust her with large donations.

Having failed to raise enough soft dollars to pay for party overhead and retire the debt, Tebelius dipped into the "hard dollars" raised by other folks. This is entirely legal, but in the words of one observer "collossally stupid". As a result, the state party had less money to spend on GOTV activities.

Even worse, several folks told me, Tebelius directed office accounting staff to re-classify donations in the accounting system, making it appear that money raised by other people was raised by Tebelius herself. There is no allegation that this is illegal, but it would serve the purpose of representing to the executive board that she was more successful at raising money than she actually was.

Ultimately, the spending in the 2006 election was unimpressive. Tebelius did spend significant resources in the 8th Congressional District on GOTV to support Dave Reichert. But that's the only CD that benefitted from significant resources. Eric's post mentioned several Republican legislators who lost their races by narrow margins. All of these had at least part of their districts outside the 8th, and could have benefitted from state-funded GOTV. Toby Nixon and Jeff Possinger, for example, led their opponents in the portions of the 45th district inside the 8th, but lost in the 1st CD.

Posted by Stefan Sharkansky at January 25, 2007 01:25 PM | Email This
Comments
1. Stefan,

If your talking about the McGavick Campaign
when you speak of representing funds donated
to the state party by some of McGavick's bigger
contributers. The McGavick Campaign wanted her
to give that money to them. The money apparently
was given to the state party for that purpose.
That my friend would have been a violation
of federal election law. The money was given
to the state because these contributors were
max out on what they could give the McGavick
campaign directly.


If Diane initially told the McGavick campaign
she would give them the money that was stupid.
Ultimately she did the right thing in this
case.

Posted by: phil spackman on January 25, 2007 01:49 PM
2. It would seem, Phil, that it is the promise to spend funds, not the actual spending of those funds, that would be questionable.

Posted by: Ed the Head on January 25, 2007 02:01 PM
3. How come no mention of Dino Rossi telling the WSRP that he wouldn't run for governor if it didn't pay off the legal debts first? Given that, it's no surprise that Diane tapped into the hard money.

Still, that doesn't excuse her failure at raising soft money. It's ironic because when Diane was first elected, I was told that she would do a great job because she was tough as nails and would raise tons of cash.

Posted by: Larry on January 25, 2007 02:47 PM
4. Ed the Head


Did I not just say that it was stupid to
promise the money to the McGavick Campaign
in the first place?I guess I have to wonder
why there so upset Diane didn't violate the law?
That some pretty twisted thinking on their
part. But then look what it got them anyway.

Posted by: phil spackman on January 25, 2007 02:50 PM
5. And now it's to be Chris Vance? Wasn't he the guy responsible for getting McGavick to run? Will Washington Republicans never learn anything?

Posted by: sarkas on January 25, 2007 05:01 PM
6. STEFAN FOR CHAIRMAN! CONGRESS! PLEASE STEFAN, RUN FOR SOMETHING! your the only common sense voice in the party right now.

Posted by: SIMPLESALMON on January 25, 2007 05:08 PM
7. Phil - I know people on the McGavick Campaign. Diane didn't promise to GIVE them the money, and they didn't ask for it. McGavick's fundraisers raised the money in to the state party, and when the McGavick Campaign suggsted how it might best be used, Diane was simply dismissive. It takes some stones to act like it's your money when you had no hand in raising it. You're right that McGavick couldn't tell her how to spend the money, but to ignore the McGavick Campaign's suggestions was silly and petty.

Posted by: Beavis on January 25, 2007 06:12 PM
8. Beavis, after all these years you never learned did you? You can't point out the obvious to Butthead. So leave Spackman alone to wallow in his negativism.

Posted by: Whiskey Dick on January 25, 2007 06:17 PM
9. You guys are really missing the Correlation does not equal causation thing.

Undoubtedly, Diane had trouble raising funds, I mean, doners usually want to go with winners, and it was pretty clear that last year, Republicans weren't gonna be winners.

She raised a great deal of money for her own run for Congress, and clearly isn't incapable of it. She's clearly not 'incompetent' or 'clueless' or anything like that.

Unless you are nutty conspiracy theorist that is going to say that she purposefully didn't raise money because she wanted to wreck the party or something stupid like that, might it be possible that she didn't raise as much money because it was a very difficult year and nobody was going to get blood from turnips this year?

There's a price to pay for firing your Generals after every defeat, even if they were not responsible for them. Read up on the Peloponnesian war.

Posted by: Cliff on January 25, 2007 08:41 PM
10. Cliff,

The problem with Diane's fundraising is that her major donor fundraising was pathetic. Please see Stefan and Eric's previous posts. Everything they said is easily proved. I'm sure she didn't purposefully NOT raise money. I'm sure she means well. It's just that she's so unfocused that she didn't consider it to be a priority, or she just didn't physically have the ability to do it. In previous posts there have been several stories about her lack of leadership, focus, and even the possibility that she is bipolar or something.

This is not someone we want as our state party chair.

Posted by: Don Johnson on January 25, 2007 08:52 PM
11. "Toby Nixon and Jeff Possinger, for example, led their opponents in the portions of the 45th district inside the 8th, but lost in the 1st CD."

The 8th CD portions of the 45th LD (Duvall, Sammamish, Carnation, etc.) are significantly more Republican leaning than the 1st CD portions of the 45th LD (Kirkland).

In 2003, when I ran for King County Assessor, I also carried the 8th CD portion of the 45th LD and lost in the 1st CD portion of the 45th LD. And there was no GOP funded GOTV effort whatsoever in 2003 anywhere.

(This observation is certainly no defense of Diane Tebelius or any other horse that may be in the State GOP Chair.)

Posted by: Richard Pope on January 25, 2007 11:32 PM
12. The adage about not firing generals after losses does not apply here. From what Stefan and others have uncovered, especially pertaining to the recount legal fees, it doesn't appear electing Tebelius was the brightest thing for us to do in the beginning.

Think of it this way, voting against Diane is simply cutting our losses and moving on. Sure it was a bad year for Republicans--but beyond that, there were serious gaps in leadership at the top. Who remembers reading anything about the State Party in news reports? Who remembers seeing any money quotes from Diane in the papers?

Looking back, the WSRP was strangely AWOL in the last cycle. An unresponsive party chair can't last long in this state, or anywhere else for that matter.

Posted by: Patrick on January 25, 2007 11:54 PM
13. Richard Pope,

I had been hoping we would hear from you in this.

It is my understanding that the WSRP was in essence insolvent, with a long list of creditors, when Tebelius (both an attorney and an officer of the corporation which is the WSRP's legal entity) demanded payment of in excess of $100,000.

By so doing she would have known that she was demanding and getting preferential treatment to that accorded other creditors with preexisting claims.

Although other creditors received only partial payment much delayed, she appears to have received immediate and full payment.

I would be interested in your opinion of the her behavior in this matter. What it appropriate? Ethical? Lawful?

I would also be interested in the opinion of other attorneys reading this.

TV Fan

Posted by: TV Fan on January 26, 2007 12:02 AM
14. In the 2000 election, I donated the legal limit in a state race, and never heard anything back from the party during 2002, 2004 or 2006 except the same blanket mailings I'm sure every voter got.

My name and address were on the check. Does the GOP really not build a donors database, or did my info slip through the cracks?

Posted by: johnny on January 26, 2007 07:05 AM
15. Beavis,

Since your in the know about the money
McGavick's people raised for the state
party. Just exactly what were there suggestions
to Diane as to how the money should be used?


Don Johnson, I have been reading your postings
about Diane for over a week now.Its apparent
you don't like her at all. You continue to
make some pretty serious allegations about
her.Not once have you been willing back up
anything you have said with any substance
whatsoever. Making light of someone mental
stability just so you can help your friend
win a race is not a good idea.

If in fact Luke Esser put you up to saying
these things that should tell everyone
something about Luke's character. If he didn't
put you up to it then your not doing him any
favors continuing down this road.

Posted by: phil spackman on January 26, 2007 09:21 AM
16. RE: #15 Hey, Spack Man- You are quick to post: "Not once have you been willing to back up anything you have said with any substance whatsoever"

I've been waiting for almost 2 years for that "SECRET" stuff only you knew about as to Susan Hutchinson, blah,blah,blah.

Gimme substance, Man!!

Posted by: John425 on January 26, 2007 09:43 AM
17. John425,

Susan is not running for anything so please leave
her out of this.To answer your question though I have
said Susan is a conservative through and
through.As I said before she isn't running
and getting specific about anything
at this point serves no purpose.

Posted by: phil spackman on January 26, 2007 10:10 AM
18. Phil -

I think many appreciate your decision to refrain from comment if it "serves no purpose".

I would guess that many SP readers share the hope that you will let this fine principle be your guiding light in the future.

Perhaps it would help you get enough time away from the computer to get a real job, and move out of Mom's back bedroom.

Posted by: Phil Spellcheck on January 26, 2007 10:37 AM
19. Mr Spellcheck,

I don't know who you are but what gives you
the right to speak for everyone else? My mother
lives in the state of California. As far as a real
a job is concerned you don't know a thing about
me.


I will have you know that for the past 4 years
I have been at home taking care of our 5 year
old daughter.My wife is a senior project manager
for the largest property management firm in the
world. Now I have had some bad breaks from a
career standpoint over the past 5 years.
However I am just about to go back to school
to finish up my degree in broadcasting.

Its unfortunate people like yourself have
to take cheap shots at others you remind me
of some democrats. When they can't defend
who or what there talking about they resort
to character assassination.

Posted by: phil spackman on January 26, 2007 11:10 AM
20. Don,

Did you actually READ my post before responding? Your response may or may not be true, but they do not address my objection. My objection is simple: It was a bad year, all the money people knew it was going to be a bad year, a lot of big doners want to back winners, not losers, therefore, it seems very possible they were not going to raise a lot of money no matter what.

And this doesn't even take into account people that remain loyal to the GOP, but were angry about whatever issue they didn't think was delivered on, and thus didn't donate, or thought the money would be wasted this year, because no amount of money was going to fix the problem (i.e. what Toby Nixon said)

If you have a legitimate way to refute these things, great, but simply saying "Her major donar fundraising was pathetic," doesn't tell you anything.

Posted by: Cliff on January 27, 2007 10:59 AM
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