Democrats seek clarity on gala

The Massachusetts Democratic Party demanded yesterday that Governor Mitt Romney and the state GOP explain whether corporate funds raised at a gala honoring the governor last summer were illegally used to compensate his chief political consultant, Michael Murphy, and Murphy's firm, DC Navigators.

Democratic chairman Philip W. Johnston said it is ''of critical importance" that the financial arrangements for the event, which was held during the Republican convention last August, be made public. A Globe story yesterday raised questions over the fact that after the event, Romney's political consultants billed the corporate sponsors $105,000 to pay for ''additional catering."

''Either Governor Romney or the state Republican Party should tell the public where the money went, and whether these corporate funds were illegally used to compensate Michael Murphy for political work," Johnston said in a letter to GOP state chairman Darrell Crate.

Corporate donations to political candidates' campaigns are not permitted under Massachusetts campaign finance law.

Murphy's firm sought checks from the three major sponsors of the event, Fidelity Investments, Massachusetts Mutual, and Liberty Mutual. In February, the consulting firm received a total of $53,000 from Fidelity and Liberty Mutual.

The Globe reported yesterday that, despite claims by Murphy's firm and the event's party planning company that the expected 1,500-person guest list swelled by nearly 70 percent, driving up costs for food and drink, the catering company's saleswoman said the party was charged for only 1,500 people.

That raised questions about where the money collected from the corporate sponsors for ''additional catering" went.

The party was held on the USS Intrepid, an aircraft carrier museum berthed on the Hudson River. The final cost was $395,000 -- $136,000 above the initial budget, according to Murphy's firm and Hession & Associates, the party planning firm.

Romney yesterday declined to address questions over the finances of the event, which was designed to showcase him as a national candidate.

His director of communications, Eric Fehrnstrom, said the governor accepts the accounting by Hession & Associates. He said Romney would not respond to Johnston's demands for an explanation.

Murphy yesterday dismissed Johnston's demands. ''Phil Johnston's allegation is completely untrue," Murphy said.

The political consultant also denounced the Globe story as ''silly and misleading."

Johnston said he was concerned because some of the money for the event was sent from the corporate sponsors directly to Murphy's consulting firm, and suggested that may constitute an illegal corporate donation to the adviser to do political work for Romney and the state Republican Party.

Murphy's firm had been receiving an $11,000 monthly retainer from the state Republican Party from January 2003 to December 2004. Republican State Committee chairman Darrell Crate said yesterday that the party stopped paying Murphy's firm in January of this year to save cash in anticipation of the 2006 election. That was just a month after Murphy's firm sent out the request seeking checks from the corporations.

Crate said the party would pay Murphy on an ad hoc basis this year. He dismissed any suggestion that the corporate funds were used to pay for Murphy's political work.

''The election cycle was over," Crate said. ''In an off year, we are trying to save some of our cash. We want to have our coffers full when we come up to the elections in '06."

However, during the previous off-election year, 2003, Murphy's firm received its regular retainer. Asked to explain, Crate said, ''I was the new chairman, learning how this all comes together."

Murphy said yesterday that the money his firm received from corporate sponsors of the Romney gala has been passed on to event vendors who put on the party. However, a partner at his firm, Trent Wisecup, told the Globe last week that the money was still in the accounts of DC Navigators.