Va. Democratic chair warns of major debt

Virginia Democratic Party Chairman and Richmond Mayor Dwight Jones has privately told party leaders that the organization is saddled with substantial debt, according to four of the officials who were told.

The news comes as a potential deal is in the works to sell the party’s headquarters in Richmond to make way for a baseball stadium that Jones wants.

Jones’s dual role in the deal — as leader of both the potential buyer (the city) and seller (the party) of the property — has raised questions for Democratic Party insiders. Some of them wondered what role the debt — which Jones pegged at $600,000, according to two party leaders — might be playing to drive the deal.

Party spokeswoman Ashley Bauman said the party has taken steps to prevent any conflict of interest stemming from the potential deal on the stadium site, which was first reported by the Richmond Times-Dispatch.

“We’ve created a firewall between the mayor and any discussions with the building,” Bauman said.


Richmond Mayor Dwight Jones, left, has told Democrats that the state party is saddled with substantial debt. (JOE MAHONEY/THE RICHMOND TIMES-DISPATCH)

Jones, who was elected party chairman in March, did not respond to requests for an interview. But city spokeswoman Tammy Hawley said any negotiations would be conducted by Richmond’s economic development authority and ratified by the City Council. The mayor is not a member of the council and would not get a vote.

“Hasn’t been, is not and will not be,” Hawley said when asked about Jones’s involvement in any negotiations.

Jones alerted members of the Democrats’ steering committee to the debt in a conference call in April, according to four people familiar with the conversation, who spoke on the condition of anonymity in order to discuss sensitive intra-party information.

Two of those people said Jones put the debt at $600,000. A third said only that the number was in the “six figures.” The fourth declined to disclose the amount Jones discussed.

Bauman declined to comment on the size of the organization’s debt or to confirm that it has debt. But she said if the party has debt, it stems from the hard-fought 2013 elections that went into overtime. There was a recount in the attorney general’s race and the need for several special elections to fill seats that opened up when their occupants were elected to new positions. One of the special elections also required a recount.

“Any debt the party has incurred is the result of . . . an unprecedented multimillion-dollar field effort that captured all three statewide offices for the first time in over 20 years and won two Senate special elections to maintain control of the Virginia Senate,” she said.

The drawn-out 2113 election cycle also took a toll on finances at the Republican Party of Virginia, which had $28,000 in its state account at the end of March and, at the end of April, $34,000 in its federal account.

Federal Election Commission reports show the Democratic Party with $118,00 in its federal account. The party’s most recent state report, filed March 31, shows it had about $60,000 in cash on hand in its state account. A $100,000 donation from Gov. Terry McAuliffe’s Common Good VA political action committee came in on the day of the filing deadline. Without it, the party would have been $40,000 in the red.

Not reflected in that $60,000 bottom line: more than $300,000 in outstanding debts owed to five private firms for legal, consulting research, event management and analytic services, according to the report filed with the State Board of Elections.

That debt still falls short of the $600,000 that Jones is said to have warned the steering committee about.

Bauman did not respond to questions about why debt figures on the party’s financial report did not appear to jibe with what party leaders say Jones told them.

Three of the Democrats familiar with the April conference call became more concerned about the debt last week, with news that the stadium site would include the party headquarters building. They wondered whether the debt might be somehow driving the deal. Could the deal be an effort to bail out the debt-ridden party, some wondered. Or were the party’s money woes pressuring it to unload the building?

Paul Goldman, a Richmond lawyer and former Democratic Party chairman, said he has talked to Democrats around the state who are uneasy about the potential deal.

“This is what Yogi Berra meant when he said, ‘This is too coincidental to be a coincidence,’ ” said Goldman, who has opposed the stadium plan because it would be built on the site of a notorious slave jail.

As mayor, Jones has pushed to build a $79 million baseball stadium in an area just east of downtown known as Shockoe Bottom. The stadium would replace the one currently used by the Flying Squirrels, a Minor League team. It would be surrounded by a privately developed hotel, grocery store and apartments.

The footprint for the stadium has shifted over time, but Hawley said the city has known since early this year that the party headquarters building might have to make way for the project.

“The footprint has changed. Different ownership interests have come up and gone away. All these things are very fluid,” she said.

The party purchased its three-story building for about $1.2 million in November 2008 and refinanced it last year. The building was still valued at that price when assessed for the refinancing, according to an internal party document obtained by The Washington Post.

Party officials have discussed selling the building for a least a year. The property, partially rented out to other office tenants, brings in about enough rental income to cover the $5,000-a-month mortgage payment. But it needs repairs, according to two party members. One recalled the party having to choose between fixing the leaking roof or paying the salaries of field organizers. (The party chose the field organizers.)

Laura Vozzella covers Virginia politics for The Washington Post.
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