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Pro-Trump Super PAC Paying Executives a Fortune for Long Shot Challenges to Maxine Waters & Debbie Wasserman Schultz

Nearly a year after the election, Rebuilding America Now hasn’t conducted much political activity—but its top executives are still making bank.

Pro-Trump Super PAC Paying Executives A Fortune for Longshot Challenges to Maxine Waters & Debbie Wasserman Schultz

Photo Illustration by Lyne Lucien/The Daily Beast

A leading pro-Trump political group hasn’t done much this year but pay for four-figure meals, five-figure travel bills, and six-figure consulting fees. It’s finally gearing up to enter the midterm election fray, but its preliminary target list doesn’t portend a political juggernaut.

Rebuilding America Now has spent just over a million dollars since December, a relatively small sum next to the $22 million it put behind President Donald Trump’s 2016 candidacy. But little if any of the funds appear to be going toward direct political activity. Nearly nine of every 10 dollars of the group’s reported spending has gone either to two top executives or to sky-high travel costs and expensive meals.

The bulk of the money has landed in the pockets of the group’s top staff members, Federal Election Commission records indicate. RAN paid $385,000 in consulting fees to its managing director, former Trump campaign official Laurance Gay, during the first six months of 2016. Its mid-year FEC filing—the group’s only financial disclosure report this year—also shows two payments to Gay, both itemized as “travel,” for $44,499 and $48,805.

In an interview, Gay said the high-dollar expenses went toward laying the groundwork for its midterm election plans. “We certainly aren’t taking ourselves out to dinner,” Gay said. “We have had numerous meetings with potential givers, potential advisers, people who had helped us raise money.”

That activity, Gay said, will culminate in RAN’s official entry into some 2018 political races in the next few weeks. The group has settled on two immediate targets: former Democratic National Committee chairwoman Rep. Debbie Wasserman Schultz and California Democrat Rep. Maxine Waters.

RAN currently has no plans to get involved in any U.S. Senate race, though Gay said that could change depending on how much money it’s able to raise. Neither has it jumped into the handful of special election races that have drawn the involvement of other pro-Trump political groups. And unlike other super PACs supporting the president, RAN hasn’t disclosed any independent expenditures in support of Trump, who is already a declared candidate for re-election.

Waters and Wasserman Shultz will represent its first targets of the 2018 cycle, though Gay said the group is eyeing up to five House races at the moment. Both frequent GOP bogeymen, the two congressional Democrats nevertheless represent relatively minor targets for a group that boasted an eight-figure budget last year, the official backing of the Trump presidential campaign, high-dollar support from some of the GOP’s most prominent donors, and a staff with ties to leading Trump-world figures.

Waters has become a top Trump antagonist this year, and earned the scorn of the president’s political base. But she hasn’t won less than 70 percent of the vote in any re-election contest since she first won her congressional seat in 1990. Gay said RAN is eyeing support for Republican challenger Omar Navarro, who lost to Waters by 52 points last year—but has nevertheless earned the backing of some elements of Trump’s political base, for whom a Waters defeat would be a major prize. On Thursday, Navarro will attend a fundraiser at the Trump National Golf Club in Los Angeles featuring former Maricopa County Sheriff Joe Arpaio.

Wasserman Schultz might be a marginally less difficult RAN target—she won re-election in her Florida district last year by 16 points, and is facing challengers both Democratic and Republican this year—but neither she nor Waters is on the Republican Party’s list of 2018 targets, or perceived by political experts as likely 2018 battleground districts.

Gay anticipates the skepticism, and points out that few such experts predicted a Trump win—let alone his carrying electoral votes in Wisconsin, Michigan, and Pennsylvania. But Waters and Schultz, if not easy political targets, carry another potential benefit: They’re potent targets for Republican fundraising appeals, and RAN is spending a lot more money than it’s bringing in.

Led by Florida Gov. Rick Scott during the 2016 cycle, the group was a major independent expenditure player in the race. It even received an official endorsement from then-vice presidential candidate Mike Pence—“Supporting Rebuilding America Now is one of the best ways to stop Hillary Clinton and help elect Donald Trump our next president,” Pence said at a Trump fundraising event—notwithstanding laws barring campaigns from coordinating with super PACs supporting their candidates.

Two days before Pence’s endorsement, RAN had received its largest contribution of the cycle: a $3 million donation from Home Depot founder Bernie Marcus, who chipped in another $2 million two months later. The group also received $4 million from California real estate developer Geoff Palmer, $2 million from Arkansas businessman Ron Cameron, and $6 million from Linda McMahon, the professional wrestling tycoon now serving as Trump’s Small Business administrator.

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Despite that pedigree and impressive history of high-dollar supporters, RAN is currently running on financial fumes. It received just one contribution totaling $5,000 during the first six months of the year. The rest of its income has come from reimbursements from a 2016 media vendor, which has refunded more than $1.1 million to the group, boosting the more than $850,000 in cash on hand with which it began the year.

Much of that money has gone to RAN’s executives, despite its lack of apparent political activity. And according to Brendan Fischer, the director of federal and FEC reform projects for the Campaign Legal Center, that could be contributing to its financial state of affairs.

“Perhaps the only check on a super PAC paying excessive compensation to its executives is that they’ll burn bridges with donors,” Fischer said in an email. “Presumably donors who write big checks to super PACs want their money spent electing candidates, not to go directly into the pocket of the super PAC’s staff.”

Gay is a longtime business associate of some of Trump’s top former campaign aides. He was an associate of the lobbying firm run by Paul Manafort, the former Trump campaign chairman at the center of allegations that the Russian government attempted to tip the election in Trump’s favor. Gay also worked at a separate lobbying firm with Rick Gates, a Manafort deputy who worked on the campaign and for Trump’s inaugural committee.

Gay and former RAN political director Ken McKay, who previously ran Gov. Chris Christie’s presidential campaign, joined the group after departing the Trump campaign in June 2016, a move that elicited allegations of illegal super PAC coordination. CLC argued in a legal complaint last year that Gay and McKay had both violated the “cooling-off period” required before a former campaign operative can join a supportive super PAC, which both RAN and the campaign denied. Fischer said that complaint is still pending before the FEC.

Like Gay, McKay drew large sums from RAN before leaving in July for a top post at PhRMA, the drug industry lobbying group. RAN reported paying McKay $210,000 in consulting fees from January through June, and another $3,100 for travel.

The group also paid more than $100,000 to EdNexus Advisors, a lobbying and consulting firm run by the group’s finance director, Christina Culver, a former Education Department official under President George W. Bush. In August, EdNexus registered to lobby on behalf of the US-China Business Association, a trade group representing Chinese companies looking to do business in the U.S.

Last week, the group held a conference at the Trump International Hotel in Washington. It initially hoped Vice President Mike Pence would attend, though the VP’s office declined the invitation, Culver told The Daily Beast. But it did land meetings with Eric Branstad, a senior White House adviser at the Commerce Department, and Erin Walsh, assistant secretary of Commerce for Global Markets. It also arranged a speaking slot at the Trump hotel event for Rep. Ed Royce, chairman of the House Foreign Affairs Committee.

Culver referred questions about RAN, including her as the group’s chief fundraiser, to Gay.

Of the $1.05 million RAN has reported spending since the election, about $917,000 went to consulting fees for Gay, McKay, and Culver, travel expenses, or meals, FEC records show.

“There is travel involved and there are dinners involved,” Gay said of the business of professional politicking. “It’s expensive to do what we do.”