Stefanson-Glover leadership fight leaves Manitoba PCs with $300K election-year hangover

Manitoba's Progressive Conservative Party has to replace $300,000 worth of political donations after using money it already raised to ease a lingering financial headache from its fractious 2021 leadership race.

The governing PCs face an additional election year fundraising burden after the central party used donations to pay for legal and audit costs following Heather Stefanson's narrow victory over Shelly Glover, party spokesperson Michele Halverson confirmed.

Slightly more than $300,000 was raised by PC constituency associations and transferred to the party, Halverson said in a statement.

"This effort started over a year ago with $300,000 raised by our constituencies," she said. "These funds, which were held by the party, have since been forgiven in support of our overall financial and organizational efforts."

Those overall efforts, Halverson confirmed, include the financial aftermath of the 2021 leadership race, which Stefanson won by a 363-vote margin on Oct. 30, 2021.

An effort by Glover to overturn that result in court was quashed by a judge seven weeks later, on Dec. 17, 2021.

According the Progressive Conservative Party's financial statements for 2021, nearly $280,000 worth of legal and audit bills contributed to an overall deficit of slightly more than $415,000.

Comments to constituency

Earlier this month, Stefanson told members of her Tuxedo constituency association that the lawsuit continues to affect the party's finances.

"We were unfortunately in a lawsuit which continues, and that is unfortunate, but it's the situation that we're in as a party," Stefanson said in an audio recording provided to CBC News by a Tuxedo PC association member.

"Of course, these lawsuits cost money, and so the central party asked constituencies to forgive the money that was owed back to the constituencies in order to help pay for that," Stefanson continued.

"So that was more than $300,000 that was owed out to the constituencies. We of course said we're fine with that; everyone did as well. All of my colleagues did. So I'm very proud of that, but [this is] a very difficult time."

The premier went on to say the PCs must move forward and focus on fundraising in advance of a provincial election slated for Oct. 3.

"We've got a lot of work to do and I think we can spend upwards of ... $55,000 in the constituency for the election campaign. We want to make sure that we've got those dollars in our in our bank," she said, referring to the Tuxedo constituency association's balance.

"So more work to do. But that's that's the reason why that is not higher than it should be."

The PC's use of donations to help pay for the leadership battle does not appear to be controversial within the party. Several donors contacted by CBC News said they had no concerns about the practice.

Keith Borkowsky, a 2021 PC donor based in Beausejour, Man., said he would have preferred to see the money spent on support for PC candidates this year.

"From my own perspective, I'm not thrilled the money was used for legal purposes that possibly could have been avoided," Borkowsky said in an interview from Brandon.

Royce Koop, a University of Manitoba political studies professor, said he believes the PCs will be able to secure enough new donations during an election year to replace the $300,000.

"I think this is probably something that the Tories can make up," Koop said in a statement.

There could be more costs related to the 2021 leadership contest. Glover and the PCs have yet to agree to costs related to the civil legal action, Glover said in a statement.

While the PCs ended 2021 with a deficit, both the NDP and Liberals posted surpluses for that year. All three of Manitoba's three largest political parties have yet to file their financial statements for 2022.

All three of these parties say they will not suffer any financial effects from a separate civil suit: Liberal leader Dougald Lamont's effort to convince a court Stefanson violated provincial conflict of interest rules.

Lamont said he is paying his legal bills out of pocket. Halverson said Stefanson is following suit.

The NDP are not taking part in the suit.