Posted on Thu, May. 08, 2008

Political career hasn't come easy

BRUCE LUNSFORD'S WEALTH YET TO ADD UP TO PUBLIC OFFICE

By Sarah Vos

SVOS@HERALD-LEADER.COM

Pablo Alcala

Bruce Lunsford worked the cash register at a campaign stop in Harrodsburg on April 30. He is running for the Democratic nomination for the U.S. Senate. Photo by Pablo Alcala | Staff

William Bruce Lunsford

Bruce Lunsford has lived the quintessential American dream. As a child, he went five years without indoor plumbing and set tobacco in his family's fields.

He worked his way through college and law school and found success in the business world. He's now a multimillionaire, with enough cash flow to dabble in Hollywood flicks, Thoroughbreds and politics.

It's the last that has proven most elusive for Lunsford, who has evolved from an outsider politician to establishment choice.

He has spent almost $14 million of his own money trying to capture Kentucky's governorship but never garnered more than 21 percent of Democratic primary votes.

In 2003, he pitched himself as an outsider, running television ads that portrayed Frankfort legislators as monkeys. He pulled out just before the primary, and then endorsed Republican Ernie Fletcher in the general election.

Lunsford spent much of the 2007 race trying to atone for that endorsement.

Now he's running for U.S. Senate, and, this time, he's the establishment choice, recruited by Democratic Gov. Steve Beshear and, Lunsford says, "very important people" in the U.S. Senate.

The Democratic Senatorial Campaign Committee has all but endorsed him. Unions who fought him before have lined up behind him.

The reason they give is simple: Lunsford has name recognition and enough money to fund a credible race against Senate Minority Leader Mitch McConnell.

"We took a pragmatic view of the situation," said Bill Londrigan, president of the Kentucky AFL-CIO.

Lunsford, 60, says he'll make a good senator for the same reasons that he's been a good business executive: He hires the right people, and he's persuasive.

But the argument has its dangers. It's also the venue where Lunsford has faced the most criticism.

In 1985, Lunsford started a health care business that focused on small hospitals. Vencor grew over the next 10 years into a Wall Street darling, a multimillion-dollar corporation with 60,000 employees in 46 states.

But in 1998, the company made headlines when it evicted Medicaid patients from nursing homes to make way for private-pay ones.

Lunsford, who has said he didn't know what staff were doing, apologized and flew to Florida, where the most publicized evictions were taking place. Eventually, the patients were invited to return, and the company paid a $270,000 fine.

A year later the company was forced to file for bankruptcy reorganization.

The campaign says that the Balanced Budget Act of 1997, which changed Medicare and Medicaid reimbursement rates, contributed to the troubles.

Vencor reorganized as two companies: Vencor, which took care of the patients, and Ventas, which owned the buildings. Vencor stock plummeted. Shareholders sued.

Lunsford's campaign is concerned enough about how this record is portrayed that staffers require reporters profiling the candidate to sit down for an hourlong primer on Lunsford's business history.

The campaign argues that Vencor, now Kindred Healthcare, is a success story. Four other health care companies filed for bankruptcy around the same time and never emerged from the process.

Vencor shareholders were given equal shares of Ventas, and, if they still owned them today, they would be rich. Ventas and Kindred stock have since recovered, and Ventas makes up much of Lunsford's personal fortune.

Lunsford won't say how much he's worth, but, according to his financial disclosure report, it's $33 million to $150 million.

He owns condos in Saratoga Springs, N.Y., Williams Island, Fla., Palm Springs, Phoenix, Chicago and two in Louisville. Three are investments, he said. The rest he uses personally.

Hart-Lunsford Pictures, the movie-production company Lunsford owns with Ed Hart, his business partner and campaign manager, sold its first two films at the Sundance Film Festival. This year, they had two films at Tribeca Film Festival, and they sold two others to distributors, Hart said.

Hart, who has known Lunsford since 1989, says they went into movies wanting a challenge.

That desire also pushed Lunsford into politics, Hart said. Lunsford first considered running for office more than 20 years ago.

At the time, he had just finished working for Gov. John Y. Brown, first as a legislative liaison and then as commerce secretary.

There was an open Congressional seat in Northern Kentucky, and Lunsford wanted to run.

But Lunsford said Brown and W.T. Young, a Lexington businessman, advised him to wait, to make his fortune before venturing into politics.

Hart says that Lunsford has learned a lot since he first ran for office in 2003.

"He's made that transition from the CEO, who is impatient, to the candidate, who listens and wants to learn from the people you're talking to," Hart said.

Greg Stumbo, the former attorney general who was Lunsford's running mate in 2007, said Lunsford has gotten better at retail politics.

In the 2007 race, Lunsford would go to an event and talk to the people he felt comfortable with. But he soon learned how to work a room, talking to everyone, Stumbo said.

Lunsford also has a better political sense, Stumbo said. "He's more in charge of the campaign now," he said.

But to be successful, Lunsford's campaign will need money.

McConnell is known as strong fund-raiser and an even better campaigner. Since he was re-elected in 2002, he's raised more than $12 million. He has approximately $7.7 million to spend.

According to his most recent finance report, Lunsford has raised $262,000. He's contributed more than $1 million of his own money, according to his campaign.

For him, winning the primary is just a step toward defeating McConnell.

"I don't need a primary victory," he said. "I don't need it for my personal ego or gratification. I'm in the race to win in November."

the race to face Mcconnell