By SHARON THEIMER The Associated Press
Friday, January 30, 2004; 3:28 AM
WASHINGTON - Howard Dean's record campaign fund has dropped from $41 million to around $5 million, forcing him to cut costs as new front-runner John Kerry's fund-raising fortunes rise.
A source directly familiar with Dean's finances, who spoke on condition of anonymity, said Dean had about $5 million on hand after all bills were paid. A second source, a senior campaign official, confirmed that Dean's cash on hand had fallen to seven figures.
Contributions slowed dramatically in the hours after Dean replaced campaign manager Joe Trippi on Wednesday, but Dean supporters were heartened by a fund-raising pickup on Thursday. His Web site showed he was raising money at a clip of about $10,000 per hour, with more than $1 million in online donations since last Saturday.
When asked whether there would be layoffs as Dean looks to cut costs, a senior official said Dean was serious when he said the campaign would be leaner. The official said that rather than wholesale staff cuts, the campaign would reduce or shift staff as it makes decisions about which primary states to compete in.
Dean, whose Internet-fueled $41 million in fund raising last year was a Democratic record, is now withholding staff salaries and has decided against airing ads in any of the seven states voting next Tuesday.
Dean's belt-tightening came as Kerry raised more than $500,000 over the Internet in the two days since his New Hampshire victory Tuesday night.
Kerry's best day online before his Iowa victory last week brought in just $50,000 to $60,000, spokesman Michael Meehan said. In all, he has raised more than $1.6 million over the Internet since the Jan. 19 caucuses.
Kerry's flood of online donations arrives a little more than a month after he announced he had mortgaged his family's Boston home to secure a $6 million loan to keep his campaign afloat. He hasn't decided whether he will lend his campaign more money, Meehan said Thursday.
"Senator Kerry will make decisions about how he funds and executes his campaign on a daily basis," Meehan said, declining to say how much cash the campaign has on hand.
Kerry and Dean are the only two Democrats skipping public financing. Dean raised nearly double Kerry's cash total last year.
