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Profile of Bruce Lunsford: a real rags-to-riches tale

FRANKFORT — The boy in a black-and-white photo sits on a rickety tractor, wearing a cap and a grin on a farm with no indoor plumbing.

The campaign material of William Bruce Lunsford gives a big nod to Horatio Alger Jr., who wrote about how poor boys can attain the American dream of wealth and success through hard work, grit and concern for others.

From such humble beginnings, the material says, Lunsford grew up to be an entrepreneur, business leader and health care executive.

It touts that he helped bring 50,000 jobs to Kentucky as state commerce secretary and expanded a business from three employees to more than 60,000 and that he now longs to use his skills as a U.S. senator from his native Kentucky.

Alger would have been proud.

In his third bid for public office in five years, the multimillionaire Lunsford, 60, is citing his business acumen in his quest to oust Republican Mitch McConnell after 24 years in the Senate.

McConnell is attacking Lunsford's business record.

"Throughout his entire career, Bruce Lunsford has demonstrated a commitment to one major principle — himself," said Justin Brasell, McConnell's campaign manager.

"Whether it is his endless attempts to put his own name in lights or his questionable business ventures, they all begin and end with Bruce putting himself before anyone else," Brasell said.

One ad claimed Lunsford "got rich the Wall Street way — taking care of himself, first," and accused a health care company connected to Lunsford of "mistreating our veterans while Bruce profited."

Another tried to portray Lunsford as being out of touch with most Kentuckians, dubbing him a member of the "Jet Set Club" with homes in six cities.

Lunsford said he is proud of his work and is glad he has been financially successful.

But Lunsford has struggled with transferring his success onto the campaign trail. He lost bids for governor in 2003 and 2007, while spending $14 million of his own money.

Recent polls, however, show he is in a tight race with McConnell.

"I'm a better candidate this year than in the other two races," Lunsford said. "My skin is still not as thick as it should be, but I've learned not to get mad more than a minute or two at my opponent.

"I've learned to stay focused. I know McConnell is going to do desperate things to keep his job. I'm running a campaign to win and he's running a campaign not to lose."

Former Gov. John Y. Brown Jr., who tapped Lunsford in 1980 at age 32 to be Kentucky's first commerce secretary, thinks Kentucky voters realize that campaign attacks on Lunsford's business record are "unfair."

"I've watched Bruce Lunsford's business career from the very beginning, and it has been exemplary," said Brown, who Lunsford said is a close campaign adviser.

"In my opinion, Bruce is the most successful businessman in Kentucky in the last quarter century," Brown said. "You don't build such businesses as he has without ethics and integrity."

Lunsford's father, the late Amos Lunsford, was a union shop steward for General Electric in Cincinnati.

When Lunsford was 8, his parents borrowed money to buy a farm in Kenton County.

"My dad was a farmer who always bought land, getting up to 150 to 160 acres. He said land would always be there in good times or bad."

At Simon Kenton High School, Lunsford was an all-conference basketball player and a starter on the baseball team. Lunsford dreamed of playing basketball at the University of Kentucky. But he knew that his size e_SEmD 5-foot-8 — made that only a dream.

At UK, Lunsford, whose nickname was "Zippy," was an intramural adviser and member of Pi Kappa Alpha fraternity. He graduated in 1969.

After working for a Cincinnati accounting firm and becoming a certified public accountant, Lunsford graduated in the top 10 percent of his class in 1974 from the Salmon P. Chase College of Law.

Lunsford made his first dip into politics by becoming the Northern Kentucky representative of Brown's campaign for governor in 1978.

When Brown won the primary election, Lunsford became treasurer of the state Democratic Party.

Upon winning the gener al election, Brown named Lunsford deputy development secretary and then legislative liaison. In 1980, Lunsford was named commerce secretary.

Lunsford put into practice Brown's campaign pledge to run Kentucky like a business.

"Bruce did an outstanding job," Brown said. "He was involved in negotiations to set up UPS in Louisville and Delta in Northern Kentucky and established a Kentucky office in Japan."

A year after the Brown administration ended in 1983, Lunsford and two partners formed a health care company in Louisville.

By 1997, Vencor was a Fortune 500 company with more than 60,000 employees. It had more than 360 hospitals and nursing centers and provided services to 2,900 facilities.

The business encountered major problems in 1998.

Lunsford said he had to reorganize Vencor and file for bankruptcy protection when the federal government changed Medicare and Medicaid reimbursement rates.

Another major problem arose in 1998 when some of Vencor's nursing homes turned away Medicaid patients to provide space for private-pay patients. Democrat Ben Chandler highlighted that situation in his successful 2003 run for the Democratic nomination for governor.

Lunsford dropped out of the race and endorsed Republican Ernie Fletcher over Chandler. He later said that was a mistake.

Lunsford claimed he did not know that poor patients — fewer than 100, according to his staff — were being turned away. He apologized and said the evictions were not directed by him. The company paid a $270,000 fine.

The Department of Justice also accused Vencor of defrauding the federal government of $1.3 billion. The company paid about $130 million to settle the dispute but admitted no fault.

The Lunsford campaign says Vencor, along with many of the top long-term care companies, had complicated billing issues with federal regulators and the disputed billings "were settled for pennies on the dollar."

Lunsford resigned as chief executive officer of Ventas, a successor company, in 1999 but remained as chairman until he decided to run for governor in January 2003.

On the campaign trail this fall, Lunsford sometimes notes that McConnell's wife, U.S. Department of Labor Secretary Elaine Chao, was on Vencor's board of directors from 1997 until 2001.

McConnell has been more critical of Valor Healthcare, a Miami-based veterans' health care company associated with Lunsford that some patients claim provides shoddy care. Lunsford was chief executive officer and chairman of Valor and remains a director.

The candidates have traded TV ads about the company. Lunsford says Valor provides "quality health care" to 57,000 veterans and accuses McConnell of tricking a veteran into bad-mouthing the company.

The McConnell campaign also has released mailings that say Lunsford owns a $1.5 million condo in Miami; four condos in Saratoga Springs, N.Y., worth $1.75 million; a condo in Chicago; a $1.85 million residence in Scottsdale, Ariz.; a $2 million house in Palm Desert, Calif.; and a residence in Louisville.

Lunsford acknowledged that he owns property in those cities but said he is a lifelong Kentucky resident. "I spent more time in Henderson, Ky., last year than in Chicago," he said.

Lunsford also said McConnell should know better than to make residency an issue, since he lives in Washington.

A former member of Churchill Downs' board of directors, Lunsford is a Thoroughbred owner and breeder.

Other investments include Louisville's Kentucky Kingdom and Kentucky Speedway.

He also has invested in the motion picture industry. Several films co-produced by Hart-Lunsford Pictures have won national awards.

His Lunsford Capital LLC has invested in more than a dozen small businesses.

Lunsford said he does not enjoy "being in the muck and mire" of a race against McCon nell, but he thinks McConnell is vulnerable because of the economy.

To support his contention, he offers a story about a group of men he recently met at a pool hall in Lawrenceburg:

"I had a beer with everybody and we talked about what's going on in this country. When I got ready to go, everybody said they would vote for me except for one guy. He stood up and said he would not. It got quiet, and he said he would and could not vote for me because he was a convicted felon.

"But he quickly added that he has a big family."

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