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House GOP campaign fund faces questions over missing money

Northern Michigan Republicans retain their seats after some significant challenges. PHOTO: Paul Martinez (Flickr)
Paul Maritinez
Northern Michigan Republicans retain their seats after some significant challenges. PHOTO: Paul Martinez (Flickr)

A campaign committee controlled by Republican leaders is facing fines and questions over how it lost track of many thousands of dollars during the last election.

 No campaign committee in Michigan was busier in the 2016 election cycle than the House Republican Campaign Committee. It was locked in a fierce battle with Democrats for control of the Michigan House of Representatives. With control of the governor’s office and the state Senate already in hand, Republicans were anxious to maintain their dominance in Lansing, while Democrats were fighting for a seat at the table.

“The House Republican Campaign Committee raised more money than any other committee in the 2015-2016 election cycle and it spent the second most and it was one of the two biggest players in what was the most expensive battle for control of the state House in Michigan history,” says Craig Mauger of the Michigan Campaign Finance Network, which partnered with Michigan Public Radio in this reporting project.

The investigation found the House Republican Campaign Committee lost track of more than $100,000 in its campaign fund. Both the Republican and Democratic campaign funds spent about $4 million dollars in the last election cycle.

There are often errors in campaign expense reports, but this one is big – the biggest in memory, according to the spokesman for the Michigan Bureau of Elections.

The problem went unreported for months until an attorney for the fund notified the state Bureau of Elections in late January about the discrepancy, according to communications revealed from a Freedom of Information Act request. The attorney, Eric Doster, said the fund had cleaned house, replaced key figures within the organization and the top Republican in the state House, Speaker Tom Leonard, ordered an audit.

Leonard would not speak on the record. But Stu Sandler, a political consultant for the House Republican Campaign Committee, said when the problem was discovered:

“We immediately hired an attorney. We hired an audit team. We notified the Secretary of State’s office. Once we finish the audit, we plan to work with the Secretary of State (which houses the Bureau of Elections) to ensure our campaign finance reports are filed accurately.”

Sandler stressed that whatever went wrong happened under the previous Republican leadership team led by then-House Speaker Kevin Cotter. A statement from Cotter says he’s working with the auditors.

So, what happened to that money? Where did that $100 thousand from donors and political action funds go? We don’t know yet.

Everyone’s waiting now for the House Republicans to finish the audit and file updated spending reports.

“Certainly, we’ll review them and take action as appropriate once we review the revised filings,” says Fred Woodhams, spokesman for Secretary of State Ruth Johnson and the state Bureau of Elections. He says no one in his shop can remember a bigger error of this type.        

It’s too early to tell if any laws were broken. But, at the very least, fines are likely because state law requires that all political expenditures are reported.

Craig Mauger of the Michigan Campaign Finance Network says spending reports give the public a glimpse into how campaigns are being run, and whether they’re being honest, ethical, and responsible with donor dollars.

He says, it’s true, the campaign committee reported the error, “but when the self-reporting happens months after the election wherein the problems happened, it inhibits the public’s ability to weigh how the money is influencing the races.”

Mauger says the public was denied a fuller picture of how the campaigns were handled, and who was paying to get their local representatives elected.

The next step is to see what the Republicans’ internal audit turns up, how the missing money was spent, and who gets blamed.

Rick Pluta is Senior Capitol Correspondent for the Michigan Public Radio Network. He has been covering Michigan’s Capitol, government, and politics since 1987. His journalism background includes stints with UPI, The Elizabeth (NJ) Daily Journal, The (Pontiac, MI) Oakland Press, and WJR. He is also a lifelong public radio listener.