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January 21, 2015

Georgia Governor’s Re-Election Pays Off for Daughter-In-Law’s Company

By David Crockett

Nathan Deal

Georgia Gov. Nathan Deal’s re-election campaign was very good for the Deal family, and not just because the governor won.  A company owned by the governor’s daughter-in-law, Denise Deal, was paid $1.3 million by the campaign during the 2014 election cycle, including more than $608,000 in the final days of the re-election effort.  In addition, the Republican Governors Association (RGA), which spent more than $3.7 million on Gov. Deal’s behalf, paid Ms. Deal’s company a total of $144,000 in 2014.  In all, her company, the Sassafras Group, was paid more than $1.6 million by Georgia Republicans in the 2014 election.

The growth of Ms. Deal’s career as a fundraiser tracks her father-in-law’s ascent to the top of Georgia Republican politics.  As CREW pointed out in its 2013 Worst Governors report, Gov. Deal previously used his campaign accounts to pay another one of Ms. Deal’s companies, Southern Magnolia Capital.  The company was a mystery at first.  When Fox 5 Atlanta News reported on Nathan Deal for Governor’s payments to Southern Magnolia Capital in May 2011, the company had no working website and its publicly available business filings made no mention of Ms. Deal.  In all, Gov. Deal’s campaigns paid the firm more than $331,000 during and after his 2010 campaign for governor.  Real PAC, an advocacy group with close ties to the governor, also paid the company more than $107,000.  These payments from Gov. Deal’s campaign and his allies proved controversial, drawing both ethics complaints and poor news coverage.    

Despite Ms. Deal’s limited experience as a fundraiser prior to her work for Gov. Deal, her company quickly did big business with Georgia Republicans, receiving over $330,000 from candidates and committees.  On the federal level, congressmen from Gov. Deal’s old congressional districts and former House Speaker Newt Gingrich paid the firm more than $137,000 as well.  The RGA also paid Southern Magnolia Capital $51,300 in 2012.

In early 2013, Ms. Deal formed the Sassafras Group to fundraise for Gov. Deal’s 2014 re-election campaign.  According to Ms. Deal, creating the new firm was meant to allow her and her business partner at Southern Magnolia Capital to remain focused on their clients as their business grew.  Instead, the spinoff company appears to have completely replaced the original.  Months after Gov. Deal’s 2010 election, his campaign began making monthly payments to Southern Magnolia Capital for “Consulting-Office Management.”  In March 2013, the campaign stopped paying Southern Magnolia Capital, switching its consulting payments to the Sassafras Group.  Southern Magnolia Capital’s business beyond Gov. Deal eventually dried up as well.  The company has not received any payments from state or federal candidates since November 2013.  At some point between June and December 2013, the firm’s website disappeared. 

The Sassafras Group has also replaced Southern Magnolia Capital as a go-to fundraising firm for Republicans in Georgia.  Though Nathan Deal for Governor was the new firm’s first client, several Georgia Republicans followed suit.  Since 2013, 37 different candidates have hired the firm.  Outside of Gov. Deal, the Sassafras Group’s top clients include the Georgia Republican Party, the Republican campaign committees in the Georgia House and Senate, and the campaign committees of Speaker David Ralston (R) and Senate President Pro Tempore David Shafer (R).  When New Jersey Gov. Chris Christie visited the state in March 2014 for an RGA fundraiser with Gov. Deal, Ms. Deal and the Sassafras Group handled RSVPs.  Despite all this business, additional information about the Sassafras Group is hard to come by as the company does not even have a website.

With term limits preventing Gov. Deal from running for a third term in 2018, what the future holds for the Sassafras Group independent of its main benefactor is worth watching.  If Gov. Deal’s most recent campaign finance report is any indication, it doesn’t look like business is set to dry up soon.  In December 2014, a month after Gov. Deal was re-elected, Nathan Deal for Governor paid the Sassafras Group its regular monthly consulting payment of $2,500. 

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