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A 'Campaign Nightmare': How Scott Walker Ended Up With $1 Million in Debt

Wisconsin Gov. Scott Walker raised $7.4 million for his short-lived presidential bid but spent his cash as quickly as it came in, leaving the campaign with a debt of at least $1 million once all the bills roll in, according to sources and a report filed with federal elections officials Thursday.

By Jason Stein, Daniel Bice and Mary Spicuzza

Wisconsin Gov. Scott Walker raised $7.4 million for his short-lived presidential bid but spent his cash as quickly as it came in, leaving the campaign with a debt of at least $1 million once all the bills roll in, according to sources and a report filed with federal elections officials Thursday.

As of the end of last month, the campaign had spent $6.4 million, with more unpaid bills still showing up. The campaign burned through about $90,000 a day without even running major broadcast ads, doing so months before the first votes are cast.

The full extent of the deficit may not be revealed until the campaign files its next report with the Federal Election Commission in January. Sources familiar with the campaign's situation said it will take many months to pay off the roughly $1 million debt and described it as a "campaign nightmare."

The figures provide perspective on the challenges and missteps that undid Walker and on a debt that could serve as a drag on his political prospects going forward. He dropped out of the race on Sept. 21, unable to sustain financially a candidacy that had soared early. He raised and spent money aggressively and then faced plummeting polling and donations.

Contributions to Walker's campaign peaked in July with $2.4 million, but dropped by 50 percent in August, the month when he was deemed to have given a tepid performance in the first GOP debate.

Donations dropped even further in September but spending stayed strong. The governor's campaign manager made more than $50,000 for 71 days of work, while Walker's sons Matt and Alex drew nearly $10,000 in salary between them over those 10 weeks.

The Republican governor spent over 86 percent of what he took in between July and September. By comparison, the presidential campaign of U.S. Sen. Marco Rubio of Florida, who raised a similar sum to Walker over the past three months, said he had a "burn rate" of 40 percent.

Other candidates such as former Florida Gov. Jeb Bush were also spending money quickly but had gotten into the race earlier, raised more in previous months and still have money left.

As of Sept. 30, Walker's federal account had $985,200 in it and his campaign had debts and obligations of $161,100, according to the filing. But his campaign wouldn't say how much more in incoming bills was left to pay.

The Wall Street Journal first reported on the looming campaign shortfall.

"While the outcome is obviously not what we had hoped for, the (fundraising) reflects strong grass-roots support for his vision of taking the power out of Washington and returning it to the people," campaign spokesman Tom Evenson said. "Too many Americans worry that our nation is heading in the wrong direction, but Governor Walker is hopeful the eventual Republican nominee will champion an optimistic conservative vision that both inspires and offers a clear choice in 2016."

A source said that there had also been financial challenges for Our American Revival, a so-called 527 group which served as Walker's presidential campaign in waiting during the first half of 2015. The extent of those is not yet clear _ an official for the group had no immediate comment Thursday and the group's most recent filing with federal tax officials covers only the period up until June 30.

In the first half of the year, Our American Revival raised $6.2 million and spent $5.1 million.

Rick Wiley, Walker's presidential campaign manager and the former head of Our American Revival, has pushed back criticism that he and the governor presided over an ill-advised spending spree for the campaign.

"We didn't have a spending problem. We had a revenue problem," Wiley said last month.

But reports show heavy spending, including at least $1.9 million in payroll to staffers, some of whom drew five-figure monthly salaries. That wouldn't necessarily include payments to potentially high-priced consultants.

Wiley himself was making about $16,250 per month, which would have totaled an annual salary of nearly $195,000 per year if the bid had continued. As it was, Wiley drew down $51,910 for his 71-day oversight of the unsuccessful effort.

Four other campaign employees did even better: the governor's political director, Matt Mason, pulled down $61,000 over those 10 weeks; Walker's communications director, Kirsten Kukowski, made $58,000; and Walker's treasurer, Kate Lind, was paid $57,700; and Jonathan Waclawski, an attorney for the campaign, was paid $57,600.

Walker's sons, Matt and Alex, who took the fall semester off of college to campaign with their father, each made about $1,540 per month in salary for a total of $9,652.

The campaign also spent more than $1.1 million for mail pieces sent directly to potential donors or voters.

The approximately $161,000 still owed by the campaign includes $10,500 owed to the Waukesha County Expo Center, where Walker's campaign kickoff event was held in July.

Other outstanding debts include $54,400 owed for facility rental and catering services to The Union League Club, a swanky social club in New York City, and $44,200 owed for "event staging" to MMA Events LLC in Maryland.

The campaign also still owes some companies for online advertising, including $42,200 owed to Exact Drive and $34,100 owed to Milwaukee-based Connectivist Media.

Walker raised more than a number of other Republicans, including Rubio, former Hewlett-Packard executive Carly Fiorina, New Jersey Gov. Chris Christie, and U.S. Sen. Rand Paul of Kentucky, according to totals reported for those candidates by media such as the New Yorker and Politico.

But Bush and former surgeon Ben Carson raised far more and GOP front-runner and real estate mogul Donald Trump is a billionaire, freeing him from the fundraising demands placed on other candidates.

Wisconsin donors led the way in contributions to Walker's presidential campaign with $1.1 million, followed by California backers with $522,000; $387,000 from Texas donors; $367,000 from contributors in Illinois; and $235,000 from New York supporters.

Last spring and early summer, Walker rode high among polls and pundits alike, allowing his allied political group, the super PAC Unintimidated, to raise nearly $20 million between April and June alone. But during that time the governor was not an announced candidate for the White House and could not raise money for his actual campaign under federal election rules.

The unlimited donations made to Unintimidated can't be used to pay any debts for Walker's presidential campaign.

For his part, Walker told conservative talk radio host Charlie Sykes Wednesday that he wouldn't focus on the mistakes, whether his own or those of his campaign staff.

"There were a lot of different factors, obviously different candidates, different situations, different staff. All of those things come. Instead of doing what a lot of candidates do and whine about this, that or whatever, for me I accept it for what it is," Walker told Sykes.

(Data analysis and reporting for this article were provided by Kevin Crowe and Patrick Marley of the Milwaukee Journal Sentinel.)

(c)2015 Milwaukee Journal Sentinel

Caroline Cournoyer is GOVERNING's senior web editor.
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