[Note from Jon:  Some of you may be reading this post because you were referred by an e-mail from my opponent for CRP office.  Needless to say, I could have disabled this link.  But what I said when I wrote this is still my opinion today.  I have run a positive campaign for this Party office, never once attacking my opponent (let alone on character issues).  It is my hope, since she has "referred" you to this website, that you will take some time while you are here to check it out.  The FlashReport is a place where we compile news and views on California politics.  We have over twenty top notch writers for the site (all Republican) and it has been a lot of fun to put together.  I think you will enjoy it.  I look forward to seeing you at convention this weekend, and am happy to discuss any matters with you that you would like.  I love the GOP, and have spent decades working hard to elect Republicans to office because I am passionate about our principles!  Jon]

Yesterday, California Republican Party Chairman Duf Sundheim sent out an e-mail , presumably to CRP Members, where he addressed the issue of the CRP’s debt, and specifically assured Party Members that there was a plan in place to retire this debt in the next few months.
 
Based on what I have heard, the CRP ended the election with somewhere between $4.5 and $5 million in debt — $3 million being a loan taken out and the rest being various expenditures in the final weeks of the campaign that, when the dust cleared, exceeded what was in the bank.
 
To be honest, my primary concern here is not the debt itself.  It is actually fairly common for political parties and campaign committees to incur debt — albeit this is a very large one.  I am more concerned about the process.  Specifically, how we got into debt.  Questions in my mind include who authorized the debt, and who knew we were spending funds beyond what was readily available to pay the bills.
 
For example, a big piece of this debt is what I have heard is a $3 million dollar loan that was taken out by the CRP, that will not be paid back before the term of Chairman Sundheim is over.  The Bylaws of the Party are quite specific that this level of indebtedness may not be authorized by the Chairman, or even the Board of Directors.  Because of past experiences where the Party has been left with debt, specific provisions were placed in the Bylaws that would prohibit massive debt without authorization of at least the Party’s 100 member Executive Committee, or a vote of the fuller 1600 member full Central Committee.  This provision was seemingly ignored, despite strong provisions (which I helped author over a decade ago) that makes CRP Board Members personally liable for unauthorized debt of this magnitude.  Apparently that did not serve as enough deterrence.
 
That said, at least this $3 million note was actually planned for by elected CRP leaders — the Chairman supported it, and it was part of a plan with ‘buy in’ from the Governor, legislative leaders, and it is my understanding that the Board of Directors voted to approve it (which they could do for a short-term loan under the bylaws, but as I said, they could not authorize beyond the end of the Chairman’s term, which ends one week from tomorrow). 
 
There are safeguards in the bylaws, specifically designed to make sure that our elected officers are making key decisions, such as the Board of Directors deciding whether to authorize $1.5 to $2 million in expenditures knowing that there were not funds available to pay them right away (which, to my knowledge, did not occur) or the Executive Committee authorizing a $3 million loan, in advance as is required under the bylaws (which I know did not take place).
 
Concerning the $1.5 – $2 million of debt that is not in the loan, I do not know how approval of these expenditures occurred.  Maybe the Chairman and or the Chief Operating Officer knew about them, and approved them.  But I am fairly certain that the Party’s Board of Directors was not consulted about going into debt (beyond the loan).
 
Again, I am not saying that taking on the debt, or spending more money in the final weeks of the campaign than we actually had in the bank, were necessarily poor decisions.  But what I am saying is that the decisions were not made by the people who have the responsibility, under the Bylaws, to make them.  And that is very disturbing.

[I extend an invitation to any member of the CRP Board of Directors or Staff to either comment below, or send me their thoughts on this matter which I will post to this blog.] 

This entry was posted on Saturday, February 3rd, 2007 at 12:00 am and is filed under Blog Posts.