Gingrich Said Opting to Pay Fine Himself

WASHINGTON —  House Speaker Newt Gingrich (R-Ga.) has decided to use personal funds to pay the $300,000 fine assessed against him by his colleagues early this year for ethics violations and plans to take out a loan to pay it, Republican sources said Wednesday.

The speaker is expected to announce his decision today in a closed-door meeting of House Republicans and then in a public speech on the House floor.

The decision puts an end to months of debate and controversy--within Republican ranks and among close Gingrich advisors--about whether the speaker should avoid personal financial pain and pay the ethics penalty out of campaign funds or other money raised from outsiders. Although that would be legal, many Republicans had warned Gingrich that it would cause him huge political problems--perhaps even threaten his hold on the speakership--and that he should pay the fine out of his own pocket.

Wednesday night Gingrich spokeswoman Christina Martin would confirm only that he “has made a decision,” which will be announced today. But a source close to Gingrich said that the $300,000 would be paid “entirely from personal funds, which he is going to have to borrow.”

The source would not provide details about the terms of the loan, including such questions as how long Gingrich would take to repay it and what interest would be charged. But the source said that the speaker and his wife, Marianne, had concluded that “the most crisp, cold way to get [the ethics controversy] behind them and move ahead was to use this mechanism.”

The decision comes in the wake of a concerted effort by Gingrich to stem speculation that the damage caused by the ethics controversy--combined with questions about his commitment to the conservative agenda--had made him such a political liability to the GOP that he ultimately would lose the speakership. Gingrich has been buoyed by the public exposure of a trip to Asia in March, as well as a series of speeches and other recent appearances in which he has reaffirmed his conservative credentials.

As a result, Gingrich appears to be on the rebound. But his standing has been shadowed by the question of how he would pay the financial penalty that the House imposed when it reprimanded him in January after a two-year Ethics Committee investigation of his political affairs.

The House found that he had violated House rules by failing to ensure that he did not violate laws barring the use of tax-exempt contributions for political purposes and for presenting false information to the Ethics Committee. Gingrich agreed to pay the $300,000 as part of a negotiated settlement. The Ethics Committee said that it represented reimbursement for the additional costs of the investigation caused by the false information he provided.

Gingrich’s staff initially indicated that he would pay the fine out of campaign funds, but that suggestion generated considerable criticism. Even many Republicans said that the speaker needed to pay the money out of his own pocket if he wanted political rehabilitation.

“There has to be some personal sacrifice on his part,” Rep. Ray LaHood (R-Ill.) said Wednesday.

But Gingrich heard conflicting advice from other Republicans, who urged him to use political money to pay the fine because they feared that his use of personal funds would set a bad precedent. For lawmakers of lesser means, they argued, such a fine could impose crippling financial problems.

The argument against using personal funds also found a powerful advocate in Gingrich’s wife. Sources close to Gingrich said that she argued strenuously for using outside sources to pay the penalty.

One of the sources close to Gingrich said: “It was a joint decision, but early on, and even until the last few days, [the speaker’s wife] was resistant” to using personal funds to pay the fine.

Without a loan, Gingrich seemingly would have to stretch to settle the $300,000 fine in one payment. He receives a congressional salary of $171,500 a year. His most recent financial disclosure form said that he collected $471,348 in net book royalties in 1995, when his book, “To Renew America,” made the bestseller list for a few weeks.

His disclosure form, filed in May 1996, shows that he and his wife held assets valued between $302,000 and $857,000.

In late 1994--just after the Republicans won control of Congress and he became speaker--Gingrich had been within reach of a substantial fortune when he was offered a $4.5-million advance for his book by publisher Rupert Murdoch. But Gingrich backed away from the arrangement in the face of fierce criticism that he was cashing in on his newfound power.

Although his book sold well, it fell far short of the expectations that had spurred Murdoch’s offer.