Unresolved Obstacles Loom Ahead of Democratic Convention

Charlotte and the Democratic Party have serious political and logistical issues as convention nears.

Julian Castro

San Antonio Mayor Julian Castro has been chosen to deliver the keynote address at the Democratic National Convention on Sept. 4., 2012.

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With Charlotte's time in the national spotlight now a month away, the host city for the Democratic National Convention has yet to clear any of the glaring political or logistical hurdles it faces.

The effort remains millions of dollars short of its fundraising goal, without the full support of the core labor constituency, the full attention of its chief fundraiser, or ability to rely on corporate benefactors to fill the vacuum. To make matters worse, a number of optical and logistical issues threaten to diminish the enthusiasm and positive exposure the convention and its host city are designed to evoke.

Perhaps the biggest hurdle ahead of next month's convention is the effort's fundraising shortfall, says John Szmer, a political science professor at UNC-Charlotte. Because the convention committees don't disclose their finances ahead of time, it's unclear how much of the $37 million they've raised, but news outlets in North Carolina and Washington report the effort is anywhere from $17 to $27 million short.

"The convention's primary obstacle is money. They aren't meeting their fundraising goals," Szmer says. "They certainly aren't meeting their fundraising goals locally, through Charlotte area donors, as they planned."

The fundraising troubles begin with a stated ban on corporate contributions to the convention. In 2008, the effort benefitted from more than $60 million in outside contributions, federal election filings show. Most of that came from large donations and the convention's four dozen corporate sponsors, who were offered special perks for donating.

Labor unions were another key source of support in 2008, which will be of less help this year. Upset that the convention will take place in North Carolina, an anti-union right-to-work state, Big Labor planned their own rally ahead of the convention, and many unions have announced boycotts or reductions in financial support for the convention. Unions provided $8 million to the 2008 convention efforts, according to federal filings.

[Unions To Hold 'Shadow Convention' Prior to National Convention]

The corporate money ban provides nice optics, but it has proven both inconvenient and less than watertight. Two months before the ban was announced, organizers formed a nonprofit called New American City for "welcoming and hospitality events in the metropolitan area of Charlotte in connection with the 2012 Democratic National Convention." Crucially, it will not have to disclose its funders, though several corporations have admitted contributing.

The ban also doesn't include in-kind contributions, meaning rather than giving checks companies will provide gifts and services on their own dime. Two local corporations have been vital to the effort, despite Democrats' claims otherwise.

The nation's largest electrical utility, Duke Power, has provided the host committee office space rent-free and offered a $10 million line of credit should fundraising fall short. Its CEO, Jim Rogers, was tapped to be the convention's chief fundraiser. But because of complications surrounding Duke's acquisition of another large energy company, he has been unable to devote enough time to the convention and has been publicly blamed for some of the fundraising problems.

President Barack Obama will give his acceptance speech at the convention's largest venue, Bank of America Stadium. The bank, which received $45 million in the Wall Street bailout, will also handle the event's banking. The convention has already deposited $17 million in public funds, which comes from checking a box on tax returns, into its Bank of America account. Like Duke, Bank of America's influence has played a big part not only in pulling off the convention, but also attracting it to Charlotte in the first place. Both have contributed to New American City, the secretive convention nonprofit that keeps its donors anonymous. Bank of America's former chairman Hugh McColl is a state power player who, like Rogers, was instrumental in making Charlotte's case to the Democratic Party, Szmer says.