Worst rollout of the year? Ohio candidate owes $1 million in back taxes

December 4, 2013

Democratic gubernatorial contender Ed FitzGerald, left, introduces Ohio Democratic Senate Minority Leader Eric Kearney as his running mate on Thursday, Nov. 21, 2013, in Cincinnati. (Al Behrman/AP)

“Historians and pundits always say that the first real decision a governor makes is the one of running mate,” Cuyahoga County Executive Ed FitzGerald, Ohio Democrats’ likely nominee for governor next year, wrote to supporters when he announced he had chosen state Sen. Eric Kearney (D) as his running mate.

FitzGerald may be starting to wish voters weren’t paying attention to his first gubernatorial decision.

That’s because, in the two weeks since joining the ticket, Kearney has been under almost constant barrage for owing back taxes to the Internal Revenue Service. And the campaign’s response to the revelations about their lieutenant governor nominee has been just about the opposite of good crisis communications.

Just 48 hours after FitzGerald unveiled his new running mate, the Cleveland Plain Dealer reported Kearney had received a tax lien for $73,559 in 2010. At the same time, his wife and business partner owed more than $144,000. Kearney blamed financial problems at the company the couple owned, which publishes several small newspapers, and on a former executive, since deceased.

Kearney led reporters to believe that was all he owed, and that the couple was paying the taxes off in $1,000 increments every month.

But a few days later, the Cincinnati Enquirer reported (Update: The Columbus Dispatch broke this part of the story. Sorry, Joe Vardon) more tax bills: The Kearneys’ company owed $683,000 in federal taxes, $105,000 in state taxes dating as far back as 1996, and the couple had personal tax liens adding up to $218,000, of which they still owed $84,000. A spokesman had to admit the campaign couldn’t say what portion of the back taxes had been paid; the campaign had to ask the IRS for documentation. The following day, court records unearthed by the Enquirer showed Kearney had agreed to repay $13,000 in outstanding credit card debt.

In total, the Enquirer and the Plain Dealer turned up about $1 million in property liens against Kearney, his wife and their company. The Columbus Dispatch and the Toledo Blade got in on the act, too.

Crisis communicators usually offer a simple prescription for a public official who has bad news to share: Get the information out quickly and completely, answer every possible question, and satisfy the media’s curiosity. Then move on.

It took the FitzGerald campaign about two weeks to get to that point. But even following the crisis communications textbook didn’t work: On Wednesday, on a conference call with reporters, Kearney said he would release an “unprecedented amount” of information about his finances. He began going through a spreadsheet detailing those finances — a spreadsheet reporters participating in the call had never received.

That didn’t endear the candidate to the reporters covering the campaign.

“Kearney is going through financial spreadsheets, but we don’t have them. Twitter is going nuts. No one has these spreadsheets,” tweeted the Enquirer’s Chrissie Thompson. “I’ve got a feeling that even if I had the spreadsheet in front of me, I’d be lost based on Eric Kearney’s explanations,” wrote David Skolnick, of the Youngstown Vindicator (The Dispatch had a pretty good time putting together all the irate tweets).

On the face of it, a FitzGerald-Kearney ticket would be well-balanced. FitzGerald is from Cleveland; Kearney is from Cincinnati. FitzGerald, who doesn’t work in Columbus, can call himself an outsider; Kearney, the state Senate Democratic leader, has relationships with legislators. And Kearney is African American; turning out big blocs of the Democratic base is going to be crucial for FitzGerald, who faces incumbent Gov. John Kasich (R) next year.

Danny Kanner, a spokesman for the Democratic Governors Association, made the case that the race will be more about Kasich’s record than anything Kearney has done. But the early storyline is a gift to the Republican incumbent’s campaign. The FitzGerald campaign insists it was aware of Kearney’s debts, but it’s pretty clear they didn’t have the whole picture.

If picking Kearney was FitzGerald’s first gubernatorial decision, he didn’t do a very good job with the vetting process.

Reid Wilson covers state politics and policy for the Washington Post's GovBeat blog. He's a former editor in chief of The Hotline, the premier tip sheet on campaigns and elections, and he's a complete political junkie.
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