Trump's campaign spends $6 million with Trump companies

AP News
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Posted: Jun 21, 2016 6:44 PM
Trump's campaign spends $6 million with Trump companies

WASHINGTON (AP) — Donald Trump is one of the wealthiest people to ever run for president, but his campaign appears to be flat broke. What's more, fundraising reports show he's used about $6 million in campaign money to pay his own companies and family members.

The billionaire businessman's financial woes were enough to inspire the mocking Twitter hashtag "TrumpSoPoor" on Tuesday and, far more seriously, give already reluctant donors a fresh batch of reasons to withhold their money.

Trump's campaign expenses are hardly inspiring confidence among people whose money he's pursuing. The spending includes a $423,000 May payment to Mar-a-Lago, the private club in Florida that serves as his vacation home, and enough Trump-branded bottled water to fill a bathtub.

Democratic rival Hillary Clinton ribbed Trump on Tuesday, tweeting to followers: "What is Trump spending his meager campaign resources on? Why, himself, of course."

A presidential campaign is expensive — about $1 billion in recent years. That money pays for crucial candidate outreach, including costly television advertising and identifying, persuading and getting voters to the polls in November.

Trump began this month with $1.3 million in the bank, less campaign cash than many congressional candidates and even behind several of the Republican presidential candidates he defeated. The $3 million he collected in May donations is about one-tenth what Clinton raised.

Trump waves off criticism of his fundraising, saying he only began in earnest May 25 despite having become the presumptive nominee weeks earlier. He largely financed his successful primary bid through personal loans but now is leaning heavily on the Republican National Committee for help.

"To date, the campaign's fundraising has been incredible, and we continue to see a tremendous outpouring of support for Mr. Trump and money to the Republican Party," his campaign said in a statement Tuesday.

Both Trump and the party say he can write checks if donations don't pick up. But there are signs he is taking fundraising more seriously.

He made his first emailed pitch for donations on Tuesday, writing that he would match up to $2 million in contributions. "This is the first fundraising email I have ever sent on behalf of my campaign," Trump wrote. "That's right. THE FIRST ONE."

That more-engaged approach can't come too soon for Republican financiers.

"There's a lot of reluctance," said Spencer Zwick, who was Mitt Romney's chief fundraiser four years ago. "Some are saying the finance organization is highly disorganized."

Trump's defenders, including New York donor Anthony Scaramucci, say a major part of his appeal is that he's a "non-politician" who does things differently.

That extends to his propensity to mix business with politics.

Finance reports filed with the Federal Election Commission detail a campaign unafraid to co-mingle political and business endeavors in an unprecedented way.

Wealthy political candidates in the past, including New York Mayor Michael Bloomberg and presidential contender Steve Forbes both walled off their campaigns from the companies bearing their names.

Not so for Trump. Through the end of May, his campaign had plowed about $6 million back into Trump corporate products and services, a review of federal filings shows. That's nearly 10 percent of his expenditures.

There's nothing illegal about it. Regulations do require companies— even ones owned by the candidate— to charge fair-market value so as not to run afoul of a ban on corporate campaign contributions.

They also require some complicated record-keeping.

For instance, FEC reports show the campaign making about $400,000 in payments to Trump. But that's a campaign finance accounting quirk. What's actually happened is that Trump donated $400,000 in campaign office space and some salaries of company employees who have been working on his presidential bid.

Yet Trump's companies also charge his campaign for goods and services, putting him at risk of appearing to be a self-dealer. That's why Forbes and Bloomberg avoided the issue altogether, former aides said.

"You just never want to have to worry about any blurred lines with personal, corporate, in-kind and contributor money," said Bill Dal Col, who ran Forbes' unsuccessful 1996 and 2000 White House campaigns.

One more complication: The $46 million worth of loans Trump made to his campaign can be repaid with donor money, even though he insists he won't do that.

The situation has some donors spooked, said Charlie Spies, a Republican elections attorney who has worked with major contributors and was helping Trump opponent Jeb Bush.

"Why would donors give money when the first dollars go to help a billionaire buy products from his own company?" Spies asked.

The biggest payment to a Trump company is $4.6 million to TAG Air, the holding company of his airplanes.

His campaign headquarters is at Trump Tower in New York. The campaign has paid about $520,000 in rent and utilities to Trump Tower Commercial LLC and to Trump Corporation.

For events, he often uses his own properties. The campaign paid out $26,000 in January to rent a facility at Trump National Doral, his golf course in Miami. He'd held an event in the gold-accented ballroom there in late October. The campaign spent another $11,000 on Trump's hotel in Chicago.

Even refreshments have a Trump tie.

About $5,000 from the campaign went to Eric Trump Wine Manufacturing LLC, which offers Virginia wines bearing the bold letters of Trump.

Son Eric Trump also factors into another large Trump campaign expense.

The campaign has paid about $4.7 million for hats and T-shirts purchased from Ace Specialties. That company is owned by a board member of Eric Trump's charitable foundation.

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