Smith accused of leaving GOP short on cash

Smith accused of leaving GOP short on cash

July 16th, 2010 by Andy Sher in Politics

NASHVILLE - While 3rd Congressional District hopeful Robin Smith decries "out of control" spending at the federal level, some Republicans say a review indicates she left the party with a money shortfall when she stepped down as state GOP chairman.

A Republican State Executive Committee member said he examined the review and stated it showed the state Republican Party as of May 31, 2009 - Mrs. Smith's last official day at the party - had a bank overdraft of $19,090 on its unrestricted funds.

That was confirmed by two other Republicans. All spoke on condition their names not be used.

Smith campaign spokesman Mark Winslow on Thursday accused the campaign of rival 3rd District GOP candidate Chuck Fleischmann of peddling the story based on a "false allegation."

He said via e-mail that Mrs. Smith "is widely regarded as the most effective and successful chairman in Tennessee Republican Party history. Since leaving the chairmanship, she has run a positive, issues-oriented campaign focusing on the important challenges facing the nation."

Mr. Winslow, who served as Mrs. Smith's chief of staff when she was at the party, said "we've heard the rumors that Fleischmann and (adviser Chip) Saltsman have been shopping a story around ... based on a false allegation that Robin mismanaged the finances of the party while chairman."

A former state Republican Party chairman himself, Mr. Saltsman said Thursday that "facts are facts in this case."

"There's an audit that obviously exists, because every party chairman after their tenure has an audit of their party finances," he said. "The Smith campaign can dance around this all they want, but to be completely transparent and honest to the voters they ought to release the audit so we all know the facts."

Tennessee Republican Party Chris Devaney, who succeeded Mrs. Smith in July 2009, declined to discuss the matter.

"The policy of the state party is to remain neutral in a contested primary," he said. "Anything less would be unfair to all of the candidates in the race. It would also be inappropriate for me to comment on internal financial matters of the party."

He did say, however, that Mrs. Smith had "significant electorial success as chairman of the (state party) in 2008 - success we're going to build on this year."

While Mrs. Smith objected to assertions that the party was running a deficit during her term, publicly filed statements during the latter months of her tenure show the state GOP with low cash balances and high amounts of obligations in both the party's state and federal accounts.

The GOP's Tennessee Legislative Campaign Committee fund, which reports to the state, began its Jan. 1-June 30, 2009, period with a negative balance of $12,318.10, according to filings with the Tennessee Registry of Election Finance. It received $123,311.72 in receipts and spent $102,230.47.

That left it with a positive balance of $8,763.15, but the party also reported obligations still outstanding of $60,797.53 as of June 30, the month after Mrs. Smith departed from the state party.

At the federal level, the Tennessee Republican Party reported to the Federal Election Commission in May 2009 that the party began the month with $2,397 in cash on hand. The GOP had $50,389.92 in total receipts, some of which was shifted over from the state account. The party spent $56,191.57 in its federal account and had cash on hand of $3,404.01 on May 31.

In his e-mail, Smith spokesman Mr. Winslow cited a recently Federal Election Commission audit of the state party's finances during the 2005-06 election cycle, prior to Mrs. Smith coming aboard as chairman in August 2007.

The election commission said the state GOP understated receipts by $117,371 and disbursements by $77,948. Mr. Winslow said in his e-mail that the FEC's action "blows apart their story for the lie it is."

Mrs. Smith dealt with some of the FEC's preliminary findings by refunding $77,000 in money that was deposited incorrectly in the federal account from the 2005-06 period, he said. She did it "without taking out loans," he said.

According to Republicans, most of the refunded federal contributions legally found their way back to the party's state accounts, where they were supposed to have been deposited.

The bulk of that was a $50,000 contribution from the Republican Governors Association that originally was made to the state GOP's federal account. The money was returned on Feb. 3, 2009. The governors association then sent another $50,000 check to the party's Tennessee committee on Feb. 10, 2009, records show.

GOP Chairman Devaney, who was the state party's executive director during the 2005-06 election cycle, repeatedly declined to discuss the matter this week.