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Baker's Fundraising in Different Light
Loans Boosted Johnson Challenger's Total, Documents Show

By Rosalind S. Helderman
Washington Post Staff Writer
Wednesday, December 13, 2006

In the days before the September Democratic primary, Prince George's county executive candidate Rushern L. Baker III announced that he had raised $1.2 million and touted the figure as a sign of his campaign's viability.

Recently released documents, however, show that almost half of the money came from loans, rather than contributions, including more than $300,000 from a single entity, Southern Management Corp. The Fairfax County-based company operates 11,000 apartment units in Prince George's County and has feuded with County Executive Jack B. Johnson (D), who was seeking reelection against Baker.

Baker also lent $196,000 to his campaign, which came within 5 percentage points of winning.

The figures make the campaign appear less successful at attracting broad financial backing than supporters had suggested.

Yesterday, Baker said it was tough to persuade wary donors to give to a campaign against a well-entrenched incumbent. He said he was comfortable with the amount of money he borrowed to run his campaign and said it was not misleading to trumpet fundraising numbers that included hefty loans.

"It meant we were able to spend whatever was there," he said. "It wasn't like this was money that couldn't go to commercials. We raised the money."

According to Baker's finance reports, he received three loans from an entity called the Renters Finance Corp. between July 2005 and Sept. 8, 2006 -- a few days before the Sept. 12 vote. Baker's campaign manager and Southern Management's chief executive confirmed yesterday that the Silver Spring-based finance group is an arm of the apartment complex company.

Maryland law limits the amount corporations can donate to political campaigns to $4,000 in each election cycle. But there is no limit on the amount a company can lend a campaign. The law requires that candidates pay back loans during the next political campaign cycle, in this case, by 2010. Baker is required to repay all loans, except for what he lent himself, meaning he will owe about $375,000.

Baker said that he is not done in politics and that he is confident he will be able to raise the money to repay Southern Management and other lenders. "Our history has been that if you find people willing to invest that much in you, you'll find that they're willing to help next time around," he said.

Last year, Johnson held a news conference to announce that he had compiled a list of 22 apartment complexes responsible for more than 19,000 calls to 911. He said apartment owners had failed to provide adequate security. This year, he proposed county legislation that would require managers to file security plans to protect residents. Johnson has said he plans to push the bill again.

Owners questioned the statistics and said Johnson was looking for a scapegoat to blame for crime.

David Hillman, Southern Management's chief executive, said yesterday that Johnson's decision to target apartments played a role in his decision to support Baker. But he also said he believed that Johnson, who was elected in 2002, was managing the county poorly and that Baker would do a better job.

"We did what we thought he needed, and I'd do it again in a minute," Hillman said. "What we have now is not what the county deserves to have."

When Baker launched his campaign in January, Johnson had close to $1 million for the campaign, and Baker was given little chance by political observers of defeating him.

In the days before the vote, Baker used fundraising figures as evidence that he had a shot at defeating Johnson, even though county residents had not turned out an incumbent executive in a generation.

Yesterday, Johnson's chief of staff, Michael D. Herman, said the latest campaign finance figures bolstered Johnson's contention that Baker was essentially being underwritten by apartment owners, "many of whom were going to be within the scope of new regulations requiring increased safety on their property in the county."

"Mr. Johnson said they were heavily financing his campaign," Herman said. "Now it's obvious."

Staff researcher Meg Smith contributed to this report.

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