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Republican Committee Makes Big Turnaround on Fund-Raising

Once teetering on the edge of bankruptcy and irrelevance, the Republican National Committee has raised more than $110 million over the past 15 months and retired more than half its debt, accumulating large cash reserves that could give Mitt Romney a critical boost later this spring as he intensifies his campaign against President Obama.

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With the divisive and drawn-out Republican primary season moving toward a close, the committee reported more money in the bank at the start of last month than the Democratic National Committee, which raised about $137 million during the same period but also spent far more.

Party officials said the Republican committee would report more than $30 million in cash on hand in filings due with the Federal Election Commission this month, including a $22 million “presidential trust” that would be available to Mr. Romney should he become the party’s nominee.

The committee’s unexpected turnaround is a case study in how Republicans are chipping away at Mr. Obama’s advantage in traditional fund-raising — and of the rapid evolution of old-fashioned party institutions in the post-Citizens United landscape of “super PACs” and the unlimited money they can raise and spend.

One role that the committee has filled in the past when the party was out of power — pounding the president with early television advertising — has been taken up by outside groups like American Crossroads, founded by Karl Rove. That has allowed the committee and its chairman, Reince Priebus, to focus on rebuilding the party’s network of large donors.

The committee’s major-donor fund-raising in 2011 exceeded that of 2003, officials said, the year when President George W. Bush was preparing to run for re-election. Its small-donor program routinely brings in more than the Democratic committee’s, though far less than Mr. Obama’s campaign.

The party has already begun preparing for joint fund-raising operations with Mr. Romney, who has secured pledges from some of his donors to write large checks to the Republican committee if he becomes the nominee.

“Reince’s job, as he says, is to spend 80 percent of his time on the telephone and the other 20 percent at state party dinners,” said Frank J. Donatelli, a former deputy chairman at the committee. “There was a donor strike of sorts at the end of 2010. What he has done is regain the confidence of those major donors.”

At a time when Mr. Romney and other candidates have struggled to raise money, the committee’s fund-raising success has allowed it to move quickly into a general election posture, even before the emergence of a nominee and the flood of money to the party that usually accompanies it. While the party has run some advertising against Mr. Obama — including commercials in six swing states attacking his health care overhaul and timed to last week’s Supreme Court hearings — it has used most of its money, and the freedom afforded by super PAC advertising against Mr. Obama, to focus on its strength: identifying and turning out Republican voters.

What a super Pac CAN'T do ...

“The R.N.C. is the only organization that can spend money directly on the ground game and organizing the states,” said Alfred Hoffman Jr., one of the country’s top Republican fund-raisers and a former finance chairman of the committee. “A super PAC can’t do that.”

The party has already opened campaign offices in Florida, North Carolina and Virginia, with up to a dozen more set to open during the coming weeks and designated staff members hired for Hispanic outreach in key states. Officials said the committee had already made more than a million voter contacts in Wisconsin, a presidential swing state where the recall effort against Gov. Scott Walker, a Republican, has energized the grass roots of both parties.

President Barack Obama
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President Barack Obama

The party has also revamped its voter database, known as Voter Vault, which was built during Mr. Bush’s tenure but fell into disrepair after he left office. The new system will allow what committee officials there call “nano-targeting,” collecting far more detailed demographic and consumer data on Republican voters than the earlier version.

“We will be the gold standard of Republican get-out-the-vote efforts,” Mr. Priebus said in a statement. “We are at least 90 days ahead of where the R.N.C. has ever been in history.”

After its brush with near-bankruptcy, the committee slashed spending to $84 million since the beginning of 2011, compared with the Democratic committee’s $122 million in the same period. Mr. Priebus and his team have cut travel budgets, pared the ranks of expensive consultants and spent relatively little on polling. At the same time, the Democrats have invested heavily in information technology, data collection and party-building, which they believe will put them ahead of Republicans come November.

And Mr. Obama’s campaign remains well ahead of Mr. Romney’s in fund-raising: Through the end of February, Mr. Obama’s campaign had raised $172.7 million and had $84.7 million in cash on hand, dwarfing the $75 million raised by Mr. Romney, who has been forced to spend heavily against his primary opponents.

As that primary battle has raged, Mr. Obama’s team has been building a state-of-the-art national campaign, reconnecting with the millions of donors and supporters who helped him to victory four years ago.

Yet the Republican committee’s strong cash numbers suggest that relatively weak fund-raising by Mr. Romney will quickly improve as the primaries wind down, diminishing Mr. Obama’s advantage. Some Republican officials estimate that one-half to two-thirds of the party’s regular major donors have not yet contributed to Mr. Romney — but are likely to if he clinches the nomination.

In the coming weeks, Mr. Romney is likely to begin holding joint fund-raisers with the Republican committee, events that will leverage the presence of the party’s nominee to bring in large checks to the party’s treasury. (Mr. Obama’s campaign has staged more than 100 such events since last spring, far more than Mr. Bush did during his own re-election campaign.)

Mitt Romney
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Mitt Romney

“The R.N.C. money is telling you that once it is no longer a choice among Republicans, but between the Republican nominee and the president, the party’s backers will come out to support the Republican nominee,” said Michael J. Malbin, the executive director of the Campaign Finance Institute, a research group..

To some extent, the committee has benefited from a nominating fight that has left many Republican donors wary. Some of the party’s top fund-raisers, like Mr. Hoffman, a Florida real estate developer, devoted themselves full-time to bundling checks for the committee last year rather than raising money for any of the Republican candidates.

Mr. Priebus also pledged to reserve large contributions for the presidential trust — rather than using them to pay down debt accumulated under his predecessor, Michael Steele — and persuaded donors that giving to the party was a better alternative during primary season than sitting on the sidelines.

Those efforts effectively channeled millions of dollars to the party that will be spent in an effort to beat Democrats rather than other Republicans.

“It hit a chord in a lot of people,” Mr. Hoffman said. “Put your money in the R.N.C., because you know it will help in 2012.”

—Derek Willis contributed reporting.

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