Democrats face budget shortfall for convention

NEW YORK -- Facing a $15 million budget shortfall, organizers of the Democratic National Convention are cutting events while hoping Barack Obama's emergence as the likely presidential nominee will spur his vast army of donors to pony up.

The convention's host committee was expected to report on its financial position late Monday in Denver. The committee is under contract to the Democratic National Committee to raise $40.6 million of an overall convention budget of about $70 million. Several people knowledgeable about the committee's activities projected it would be about $15 million short of its goal.

The convention opens on Aug. 25, giving the committee just 10 weeks to come up with the money. Some faulted the slowing economy and the protracted Democratic primary as the two major reasons the city's host committee has struggled to raise the cash.

"It's a significant amount and a big concern," acknowledged Rick Ridder, a Denver-based Democratic strategist who has helped the city's convention efforts.

"Without a doubt, there was tentativeness on the part of a lot of major companies because they didn't know who the nominee was going to be," Ridder said. "And frankly, Denver is not a major corporate center. Many of the corporations who contributed to Boston (site of the party's 2004 convention) just haven't seen advantages to coming here."

Organizers have moved to cut a number of the cocktail parties and other events associated with the convention and are consolidating vendors to trim costs. Those efforts are likely to shave up to $3 million from the budget, they said.

A planned media walkthrough of the Pepsi Center was abruptly canceled last week, alerting political reporters across the country there was something amiss. People close to the party's convention committee said the event was scrapped in part to embarrass the host committee into stepping up its fundraising efforts.

Denver was awarded the convention in January 2007 despite lingering questions over whether the city would be able to pull together the necessary financing. At the time, DNC Chairman Howard Dean set those concerns aside, noting that Colorado and other states in the mountain West were becoming fertile electoral territory for Democrats.

With Obama now the party's standard-bearer, host committee members expressed optimism that their fundraising efforts would improve. But they also acknowledged they could use a boost from his campaign.

"There are discussions occurring. We could definitely use the help of the Obama campaign," said Steve Farber, a Denver lawyer and leading member of the host committee. "The fact that we have a candidate now does help."

Farber said that the convention fundraising had already ticked up since last week, after Hillary Rodham Clinton exited the race and Obama stepped out for the first time as the presumed nominee against Republican John McCain.

Since then, the Illinois senator has moved quickly to consolidate operations with the Democratic National Committee, and he named the campaign's political director, Matthew Nugen, to oversee convention operations. Nugen and others visited Denver last week to begin discussions on a range of matters, including fundraising.

The Obama campaign has broken all political fundraising records largely by mining the Internet for small contributions, collecting some $265 million. A fundraising pitch to those donors could vastly boost the convention's fundraising, several observers said.

But Chris Lopez, a spokesman for the host committee, insisted that the campaign would not be held responsible for making up any fundraising shortfall.

"Obama's great for the party, and there's a lot of love for him out there. But we can't depend on that," Lopez said. "We're under contract to raise the money and we expect we'll hit our target. It's not on the senator or his campaign, it's on us."

An Obama campaign spokesman, Bill Burton, referred all questions about the convention efforts to the host committee.

Then there's the issue of the Clintons, long the party's most powerful and influential leaders. Convention organizers said that with the former first lady out of the race, it remains to be seen how much the couple's loyal army of fundraisers and donors will help out with convention expenses.

The Clintons' close friend and top fundraiser, Terry McAuliffe raised millions for the party's conventions in both 2000 and 2004. He's helping to retire Hillary Clinton's campaign debt, which is estimated to be at least $30 million.

Two wealthy Bill Clinton associates, supermarket mogul Ron Burkle and Hollywood producer Steve Bing, have made six-figure contributions to past conventions but so far have held off doing so this year.