SACRAMENTO, CA - After criticizing Democrats for years about overspending, the California Republican Party finds itself in terrible financial shape just three months before the November election.
Layoffs at party headquarters and the inability to fund candidates illustrate what federal and state campaign finance records are expected show, that the state GOP is in debt $543,000.
"We've managed our finances as well as we could, given the situation," California Republican Party spokesperson Mark Standriff said.
Critics within the party are outraged over what some call a "financial meltdown." That's on top of dwindling voter registration and poor outreach efforts to lure Latinos.
The GOP also spent $2.3 million challenging the new political district lines drawn for Senate races.
Party leaders point out they've made progress in erasing a $4.5 million debt from five years ago and SuperPACs can help candidates financially.
"Because of the fiscal responsibility we've been showing all along the way, we're going to end up the year in a position where we reduce all of our debt to zero and move forward to 2013 with a surprising number of successes," Standriff said.
Aaron McLear worked for Republican Gov. Arnold Schwarzenegger, who tried to get his party to move towards the center, but was pushed out by party members with a more Conservative agenda.
"Gov. Schwarzenegger talked about losing at the box office, that's what they would call it in Hollywood. That was about five years ago, and they didn't take his advice," Republican Strategist Aaron McLear said. "They said they would rather be right than win. Well, that's what happened."
McLear also said with the stronger leadership, the GOP can turn things around especially with Democrats in the middle of their own scandal involving the parks department hoarding millions of dollars.
"I think the pieces are there to make it a viable party," McLear said. "They just need to focus on fiscal issue, not those social issues that divide people."
By Nannette Miranda