EXCLUSIVE: Steele yields powers to foes in RNC

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By Ralph Z. Hallow

Capitulating to critics on the Republican National Committee, embattled Republican Party Chairman Michael S. Steele has signed a secret pact agreeing to controls and restraints on how he spends hundreds of millions of dollars in party funds and contracts, The Washington Times has learned.

The "good governance" agreement revives checks and balances Mr. Steele resisted implementing for RNC contracts, fees for legal work and other expenditures that were not renewed after the 2008 presidential nominating contest.

The agreement, proposed by several current and former RNC officials, goes further, making 33-year RNC veteran Jay Banning, who was fired by Mr. Steele along with his deputy last month, an on-call adviser to the RNC treasurer. Mr. Banning was seen as a trusted liaison to RNC members critical of Mr. Steele's tenure and financial management.

"I regard them - the Steele administration - bound by it," former Republican National Committee General Counsel David Norcross told The Times on Tuesday.

Mr. Norcross, RNC Treasurer Randy Pullen, chairman of the Arizona Republican Party, and former party budget chiefs Ron Kaufman and Alec Poitevint had fought with Mr. Steele over having the 168-member committee vote on restoring the "good governance" guidelines created in 2004 at a special May 20 meeting.

Trevor Francis, the RNC's new communications director, would not comment on the agreement that several of the dissident members said was reached.

"Everything was already in place," Mr. Francis said.

Under nearly constant fire from conservatives since his Jan. 30 election, Mr. Steele last Wednesday accused the resolution's proponents of a power grab "scheme." It looked like an impasse, with a showdown - and a possible no-confidence vote in Mr. Steele - coming at a special meeting called for May 20.

But closed-door negotiations between Mr. Steele and his representatives and Mr. Pullen and the dissident group reached an accord. It represents the first time in memory that rebel members of the Republican Party's national governing body have successfully taken on the party's historically powerful national chairman and his loyalists.

"We have a written agreement with them to accept and operate under terms of '04 Resolution; make Banning available to Pullen; keep [former RNC chief counsel Thomas J.] Josefiak on retainer and available to Pullen; keep Banning's assistant on the payroll and available to Pullen; and to negotiate on [competitive contract] bidding and [chief financial officer] language," Mr. Norcross wrote in an e-mail to another RNC member.

"We think we have the tools to hold them to it. They believe we have or could readily muster the votes to adopt something at the summer meeting," Mr. Norcross wrote.

The written agreement remains in effect until the scheduled July summer meeting of the full RNC, at which time the entire body is expected to vote on the resolution.

The funding fight intensified the open challenge to Mr. Steele's authority. Unhappy RNC conservatives secured the signatures needed to force the committee to convene next month's special meeting to vote on a resolution labeling Democrats as "socialists," despite the chairman's reservations about the political wisdom of the move.

Critics said the "socialist" resolution battle was a sign of Mr. Steele's rocky start as RNC chairman and his continuing struggle to assert control of the party's message since his election in January.