Liberals call for probe of deal between RNC and Michigan GOP

Alex Pappas Political Reporter
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Michigan liberals want a probe of the Michigan Republican party following [intlink id=”768594″ type=”post”]Wednesday’s report[/intlink] from The Daily Caller on a fundraising deal between the state party and the Republican National Committee that was allegedly intended to circumvent campaign finance laws and inflate the RNC’s 2009 fundraising numbers.

According to sources and FEC reports, the transfer of hundreds of thousands in funds between the two organizations was the result of a deal struck last year stipulating that if the Michigan Republican Party could raise what turned out to be half a million dollars for the RNC from its donors, the committee would immediately give the money back.

“It was a known secret that a deal had been struck on the topic,” a former RNC official confirmed to The Daily Caller.

Another former RNC official said he was shocked by the report and thinks if true the allegations could be the “straw that breaks the camel’s back” with regard to Steele’s tenure as RNC chairman. The official said it is not unusual for state parties to transfer unused contributions to other committees, but this type of direct appeal to donors to help them circumvent federal campaign finance limits is highly unusual and possibly illegal.

“If you’re asking for a state party to make a contribution [to the national committee] the expectation is that there’s some kind of contribution coming back [to the state party],” the second official said. “But what they did here is a little different in that they actually went to donors, who are the ones who actually have federal limits of giving $10,000 with the idea of circumventing the FEC law and the RNC serves as a conduit in order to do that. I mean that’s just devastating.”

Michigan Democratic Chairman Mark Brewer called the transfer of funds on Wednesday a “secret scheme [that] may be an illegal attempt to avoid federal contribution limits” while David Holtz, head of the liberal advocacy group Progress Michigan, called on state Attorney General Mike Cox and the Michigan State Police to launch an investigation.

“Individuals can give only $10,000 per year to the Michigan Republican Party but they can give $30,400 per year to the RNC,” Brewer said. “If those donations to the RNC were made with the agreement or understanding that they would be transferred to the Michigan Republican Party, the RNC, Michael Steele, the Michigan Republican Party and [state party chairman] Ron Weiser may have broken the law.”

“The big question is: Were these donors and the GOP in a confederacy to bypass federal limitations on campaign finance contributions?” asked Holtz, pointing out that Michigan has a $10,000 limit on the amount donors can give the state party for federal races. According to Holtz, the state has three contested federal races this fall, all congressional seats currently held by Democrats: Bart Stupak in the 1st District, Mark Schauer in the 7th and Gary Peters in the 9th.

“Michigan is going to be battleground state for Republicans and Democrats this fall, so it wouldn’t be shocking if big-time Republican donors in Michigan wanted to see more of their money channeled to those races,” Holtz said. “We’re asking for an investigation into whether that was a coordinated effort to answer the question of whether the law was broken or not.”

RNC spokesman Doug Heye declined to comment on the story when reached by The Daily Caller on Tuesday night, but a Michigan GOP spokeswoman denied any deal took place and any wrongdoing on the part of either organization. Michigan Republican Party chairman Ron Weiser and executive political director Matt Mason did not respond to requests for comment.

The allegations appear to be backed up by FEC reports. Fifteen donors from Michigan maxed out their donations to the committee on a single day —Dec. 31 — the last day of 2009 — giving $456,000 to the committee. During the next two months, $500,000 was disbursed back from the RNC’s coffers to those of the Michigan Republican Party, with $250,000 given in January and another $250,000 disbursed in February. No other state received close to that from the RNC during the time frame; Delaware was the next highest at $129,800 in cash and in-kind equipment.

Michigan state law allows individuals to donate an unlimited amount to political parties, though contributors who give to the party are subjected to federal campaign laws that restrict spending on federal races to $10,000 per year, per individual. Among the donors who maxed out on the final day of the year are Calvin College president Gaylen Byker, who is currently on sabbatical, Plastipak Packaging chairman William Young and his wife Vivienne.

Asked the motivation for the individual contributors to donate to the Michigan Party through the RNC, the official said by doing so, “They would be able to give more money to the Michigan state party than the federal limit of 10k.” Calls by The Daily Caller to the individual contributors were either not returned, or the donors refused to comment.

However Perrigo Chairman Michael Jandernoa of Grand Rapids, who with his wife contributed $68,000 to the RNC earlier in December, told the Free Press there were no conditions placed on the donation. Jandernoa said he runs all his political donations through a consultant to make sure they comply with federal regulations.

“I think the benefit to them was them getting guaranteed money,” the source said of the Michigan GOP, “and the benefit to the RNC was getting higher fundraising numbers.”

The source indicated Steele and Ken McKay, who resigned Monday as Steele’s chief of staff following [intlink id=”713040″ type=”post”]reports by The Daily Caller[/intlink] of money spent at a risqué night club, were behind the deal along with Michigan party chair Ron Weiser.