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November 22, 2014

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Lowden still dealing with campaign debt from failed 2010 Senate bid

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Leila Navidi

Sue Lowden speaks during an interview at Santa Fe Mining Co. bar and restaurant in Las Vegas on Tuesday, October 1, 2013. Lowden is running for lieutenant governor.

Sue Lowden Announces Bid for Lt. Governor

Sue Lowden speaks during an interview at Santa Fe Mining Co. bar and restaurant in Las Vegas on Tuesday, October 1, 2013. Lowden is running for lieutenant governor. Launch slideshow »

Republican lieutenant governor candidate Sue Lowden says she’s made good on her debts from her 2010 race for Senate.

But her own campaign says this is not so.

The “Sue Lowden For U.S. Senate” campaign committee filed a report last week that shows she still has more than $500,000 in debts, contrary to her claims.

She told the Sun last month that she had paid the debt she owes to consultants and vendors who did work for her during her Senate campaign.

But that debt is still on the books and a good portion of it likely won’t be paid.

Two vendors have sued Lowden for hundreds of thousands of dollars of unpaid invoices; Lowden prevailed in one case and another is ongoing.

Thirteen other vendors who did campaign work for her will likely receive compensation for only some of the work they did, getting just a fraction of what they are owed, said Bob Beers, a Republican member of the Las Vegas City Council who is also Lowden’s treasurer for both her U.S. Senate campaign committee and campaign to win the lieutenant governor's race.

“A vendor would agree to accept, for example, 50 cents on the dollar,” Beers said.

Those payments haven’t been paid yet, according to an Oct. 28 Federal Election Commission filing.

Sharron Angle speaks to a group of Rick Santorum supporters at Santorum's campaign headquarters in Las Vegas, Feb. 4, 2012.

Sharron Angle speaks to a group of Rick Santorum supporters at Santorum's campaign headquarters in Las Vegas, Feb. 4, 2012.

Still, Lowden says that the vendors who did work for her 2010 U.S. Senate primary campaign against Republican Sharron Angle have been paid.

“Those vendors have already been paid,” she said.

The questions surrounding the unpaid bills come as Lowden is embarking on her bid for lieutenant governor.

She is raising money for the primary campaign against state Sen. Mark Hutchison, R-Las Vegas, and ultimately for the general election should she prevail in the primary.

The law makes the state and federal accounts separate entities and allows for the retirement of unpaid debts and new fundraising to occur at the same time. Candidates raising money for a state race can’t use it to pay federal campaign debts.

It’s unclear whether the specter of unpaid vendors will hurt Lowden.

Her campaign manager, Tom Letizia, said nobody has mentioned the Senate campaign debt to him.

“We’re not having any problem getting all the vendors that we need,” he said. “We have every capability that we can possibly need available to us.”

• • •

In some cases, vendors have been paid.

Scott Seidenstricker of Matley Properties in Reno said he negotiated a settlement with Beers to get a portion of the $12,269.44 that the campaign owed him.

But some of the vendors may never be paid.

The “termination” paperwork filed last week by Beers asks the FEC to close the Lowden committee’s account.

Although Lowden said her vendors would be paid, and Beers acknowledged that some settlements would likely result in partial payments, the 2010 campaign committee could be closed before that happens.

Asked how vendors owed money would get paid under such a scenario, Beers said “they don’t.”

Beers said that’s typical for a losing campaign committee to write off thousands of dollars in unpaid debts.

“I am comfortable suggesting that vendors who are veterans of the federal campaign process ... have frequently experienced the failure to collect the full amount that they’re owed on the unsuccessful conclusion of a federal campaign,” he said.

It’s true that losing campaigns do often default on their debts.

An article citing Lowden’s 2010 debts in the trade publication Campaigns & Elections even quotes political consultants advising other political consultants on “Tips For Getting Clients to Pay Up."

Winning candidates can host a “retire-the-debt fundraiser” that allow donors who contributed to their opponent or did not donate to any candidate to retroactively back the winner after the election, said a Nevada political consultant who’s unaffiliated with Lowden, Hutchison or any other candidate for lieutenant governor.

But losing candidates don’t have that option.

Lowden, however, isn’t the normal losing candidate. She’s independently wealthy.

When asked how she plans to address the unpaid vendors, she said Beers is negotiating all payments.

She also told the Sun that many candidates are in her same situation.

“While you’re doing this story, why don’t you take a look at other people who are running who also have campaign debt?” she said. “Other campaigns have debt who are running for office.”

But a Sun review of other losing candidates who ran for a federal office in Nevada during the past several years shows that most candidates have retired most of their debts.

U.S. Rep. Shelley Berkley, D-Nev., holds a news conference in the parking lot of Palo Verde High School before a rally for Republican vice presidential candidate Paul Ryan at the school, Aug. 14, 2012. Berkley is running for U.S. Senate against Sen. Dean Heller, R-Nev.

U.S. Rep. Shelley Berkley, D-Nev., holds a news conference in the parking lot of Palo Verde High School before a rally for Republican vice presidential candidate Paul Ryan at the school, Aug. 14, 2012. Berkley is running for U.S. Senate against Sen. Dean Heller, R-Nev.

Shelley Berkley, a Las Vegas Democrat who in 2012 tried to defeat Sen. Dean Heller, R-Nev., ended her campaign with $5,101 in debt.

Danny Tarkanian, a Republican who failed to get elected to Congress, had $0 in debts from his 2012 race against Democratic Rep. Steven Horsford.

Kate Marshall, a Democrat who ran for Congress in 2011, and John Oceguera, a Democrat who ran for Congress last year, also had $0 in debt.

Even if Lowden successfully contests the invoices from two vendors, the remaining, uncontested debt still amounts to more than $300,000.

The Oct. 28 filing indicates that many vendors have already conceded the fact that they may not be paid.

An entry for the Lukens Company of Virginia notes that the “current loan balance of $134,169 has been forgiven.”

A representative from the Lukens Company did not return a phone call from the Sun.

The vendors aren’t the only ones losing out from Lowden’s campaign.

Lowden also plans to forgo about $2 million she personally donated to her campaign in the form of a loan.

“It’ll probably never be paid back and end up being an unsettled loan,” Beers said.

Lowden called the whole story of her previous campaign’s debt a political attack from her opponents.

She said the situation will take care of itself when the courts decide what to do about the debt she is contesting and the Federal Election Commission decides what to do about the debt she is not.

“You don’t see them fining me or calling me,” Lowden said. “The FEC is fine with what I am doing. I am not doing anything wrong.”

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