WASHINGTON — The Republican Party chairman in the Virgin Islands, who is at the center of a heated dispute over seating delegates to the GOP national convention, has close ties to a political operative working to score delegates for Ted Cruz.
John Canegata, the chairman of the Virgin Islands Republican Party, signed a contract to provide a commission to Cruz operative Saul Anuzis on money he helped raise for a federal political committee called Virgin Islands Republican Party or VIGOP. The committee’s activities have drawn public rebukes from other top party officials in the islands, and it has spent little of its money directly supporting candidates or engaging in party-building in the territory.
Instead, almost all of the $1.6 million VIGOP had collected through the end of February for the 2016 election was plowed back into operating expenses. Big sums went to direct-mail and list-management firms in the Washington area — more than 2,000 miles away from the islands, Federal Election Commission records show.
The feud over that fundraising arrangement now threatens to spill over into the presidential election. This cluster of Caribbean islands finds itself in the national spotlight as the GOP hurtles toward a potential contested convention in July. The three remaining Republican contenders are scrambling for control of every possible convention delegate, including the nine the territory will send to Cleveland this summer.
The delegate chase is getting more aggressive each day because there’s a good chance that the convention could open without GOP front-runner Donald Trump locking up the 1,237 delegates needed to clinch the nomination. If so, delegates who arrive at the convention “unbound” could either help push Trump above the threshold he needs or force successive rounds of voting until someone hits 1,237 mark.
Canegata said his relationship with Anuzis, whom he calls “a very close friend," has nothing to do with advancing Cruz’s presidential ambitions. “We started this fundraising way before he became a Cruz surrogate,” he told USA TODAY.
Anuzis did not respond to interview requests. Cruz spokesman Brian Phillips said Anuzis stepped "aside from his relationship" with the Virgin Islands fundraising committee in January because of his role in the Cruz campaign.
New clout
Although Virgin Islands residents cannot vote in a presidential election, local Republican Party officials this year could have significant pull in picking the GOP nominee. Canegata and two other party officials from the islands automatically go to the convention as delegates unbound to any candidate. Six others, who are also uncommitted to any candidate, were selected by the roughly 300 Republicans who participated in the territory’s March 10 caucuses.
To the surprise of many locals, the top vote-getter was John Yob, a Michigan political strategist who relocated to the islands last year. Yob’s wife, Erica, and a third newcomer who also has ties to Yob also secured slots. Yob’s father, Chuck, is a supporter of Ohio Gov. John Kasich’s presidential bid, and both Yobs have feuded with Anuzis.
Canegata has refused to certify the slate chosen on March 10, citing a party rule requiring delegates accept their positions in writing. Instead, he has picked the six alternates.
On Thursday, the Canegata-approved slate appointed a Cruz delegate, Robert Max Schanfarber, to serve as the territory’s male representative to the convention’s rules committee, now suddenly more powerful because it will write the rules that govern how balloting will play out in a floor fight. The 112-member committee includes one woman and one man from each of the 50 states and six territories that play a role in the nomination process.
On Monday, however, the competing, uncommitted Virgin Islands slate announced its committee assignments in Cleveland and appointed John Yob to the rules committee. The battle over who are the Virgin Islands’ rightful delegates could last until the convention itself.
Anuzis, a former chairman of the Michigan Republican Party who twice ran for national party chairman, has been an important player in Cruz’s aggressive strategy to court delegates around the country, including the USA's territorial outposts. Last fall, Anuzis and Cruz’s father, Rafael, spent time together in the Virgin Islands, urging local powerbrokers to back the Texas senator.
“Whether you’re getting Texas, Michigan and Ohio or the Virgin Islands, Puerto Rico and American Samoa, each has an equal voice when it comes to nominating candidates to put them on the ballot at the convention,” Anuzis told Politico last October, previewing Cruz's drive to expand the delegate map.
Fundraising fight
The territory’s delegate saga — already the topic of national political news and bemused cable news chatter — is not the first bitter standoff between the party's chairman and other top party officials in the islands.
VIGOP’s operations have been the subject of furious debate among local party officials after a 2014 New York Times story raised questions about the fundraising activity of a little-known political committee.
VIGOP's treasurer, Virginia-based Scott B. Mackenzie, works for several political action committees that previously have drawn scrutiny for their fundraising practices. Last year, former Virginia attorney general Ken Cuccinelli won a settlement from a Mackenzie-affiliated PAC after Cuccinelli filed a federal lawsuit, charging that the group used his campaign to operate a “national fundraising scam.” Another PAC connected to MacKenzie, Patriots for Trump, shut down this year after the billionaire disavowed it.
More than $900,000 of the money VIGOP had spent through the end of February went to a direct-mail company called Forth Right and several firms that share its address in downtown Washington. Forth Right was formerly known as Base Connect, a firm for which MacKenzie has worked as a campaign-finance consultant, according to federal election regulators.
In an interview, Mackenzie defended the Virgin Islands committee’s heavy spending on direct-mail firms and other vendors. “You’ve got to build a donor base in order to spend in politics," he said.
Canegata, first elected party chairman in 2012, said he authorized the committee to give the tiny Virgin Islands a bigger voice in federal politics. The money, he said, is being used to build “good bridges with good candidates at the national level.”
In the 2014 midterm elections, VIGOP raised nearly $1.2 million and reported spending $83,500 — or about 7% of what it collected — to help federal and state candidates. Canegata said the committee was proud to support a slew of black and Latino Republicans that year. He said he was “not concerned at all” about Mackenzie’s past with other political action committees. “I’m satisfied,” he said. “It’s working out for us.”
Canegata's fundraising work has run into sharp resistance from other local party officials, however. St. Croix lawyer Warren “Bruce” Cole, who is treasurer of the Republican Party’s territorial committee and one of the uncommitted delegates selected at the March caucuses , is among the party officials who have raised a public fuss about the VIGOP and its fundraising practices.
He was part of a group last year that issued a report opposing the political fundraising committee. Cole also refuses to accept any money from VIGOP in local party's bank account, which he controls. “I believe the funds are not legitimately solicited,” Cole told USA TODAY.
A written agreement between Canegata and Anuzis, disclosed publicly as part of a local party review of the committee, shows his firm earning a 25% fundraising commission — a deal the panel members called “imprudent” because it provides the commission on any funds raised outside the territory “without regard to actual work performed with respect to such fundraising.”
VIGOP has paid Anuzis' firm, Coast to Coast Strategies, less than $6,000 since the committee began operating in December 2013, according to FEC reports. His only payment this year: a $1,300 reimbursement in February for a computer. Canegata said Anuzis has delayed accepting the 25% commission to which he is “entitled” until there’s support for the fundraising operation from a majority of the islands’ GOP territorial committee.
Canegata dismissed the criticism from other party members as sour grapes from people he displaced.The committee remains active. In just the first two months of this year, it collected another $317,000 in contributions.
"I will never regret our relationship with Saul," Canegata said. "It's put us on the map in terms of fundraising."
