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13-Term Incumbent Faces Election-Year Barrage of Misconduct Charges

September 26, 1986

PROVIDENCE, R.I. (AP) _ An avalanche of allegations against Rep. Fernand J. St Germain has national Republican strategists drooling over the once-unthinkable prospect of ousting the powerful House Banking Committee chairman.

The Democratic incumbent is relying on his 26 years of service to the blue- collar voters of eastern Rhode Island while brushing aside accusations he has reaped huge financial gains from his banking panel post.

John A. Holmes Jr., who as chairman of the state GOP helped spearhead one of the biggest Republican surges in this Democrat-dominated state in 60 years, has gone on the attack with lots of help from national party leaders.

″The man reeks,″ said Holmes, 37, who left the party post to battle St Germain. ″He personifies the negativism of the word ‘politician.‴ The thrust of Holmes’ campaign has been to convince voters their congressman has abandoned them in favor of his wallet.

″How did Fred St Germain become a multimillionaire on a congressional salary?″ Holmes asked.

St Germain, 58, who has won re-election easily since first being sent to Washington in 1960, declined repeated requests for an interview, saying the campaign was not in full swing.

But with the national GOP making the race one of its top 10 targets, the 13-term incumbent has been forced into what is proving to be the fight of his political life.

The latest poll shows St Germain still with a comfortable 50 percent to 31 percent lead, but with Holmes making steady gains.

St Germain’s woes began last September with a Wall Street Journal story that the congressman amassed a personal fortune approaching $2.6 million with the help of people and institutions under the purview of his committee. St Germain has said his wealth was derived from legitimate investments that paid off.

The newspaper report sparked a probe by the House ethics committee, which continues.

Later, the congressman came under fire from Holmes for refusing to release his tax returns, and was attacked by a national bipartisan group for taking huge campaign donations from the banking industry.

Then, a California attorney alleged St. Germain took $35,000 from a Rhode Island developer in exchange for support of subsidized housing projects under the jurisdicion of his committee. The ethics probe was expanded and the Justice Department is investigating the bribe allegation.

St Germain denies any wrongdoing.

His campaign opponent, meanwhile, has enjoyed favorable exposure, bucking the odds to lead a GOP resurgence in Rhode Island. The party, just three years ago a laughingstock, now controls a majority of Rhode Island’s statewide offices, including governor and attorney general.

It was never a secret that Holmes coveted St Germain’s seat, and the congressman’s apparent vulnerability convinced Holmes the time had come to make his first run for office.

″I think for many of the 26 years he’s done a damn good job,″ said Holmes. ″But he has so totally lost the definition of what a public servant is all about. ... The $75,000 he gets as a member of Congress is nothing more than his meal ticket to go down to Washington and make his deals.″

The struggle has led to a number of firsts for the embattled Democrat: the hiring of a re-election campaign manager; the commissioning of a poll; and an early summer campaign start with television ads in June to counter negative publicity.

He has dug deep into a campaign warchest swollen to near the million-dollar mark during re-election cakewalks in years past.

This year St Germain has spent $121,000 on television, and is expected to spend at least that much on TV in the final six weeks.

Holmes said he would spend a maximum of $400,000, about half of that on television.

St Germain’s ads portray him as a constituent-minded lawmaker who has used his power to bring low-income housing, waste treatment plants and other benefits to the working-class district.

The latest Holmes ad, with the Capitol as a backdrop, has him telling voters: ″You’ll be reading about my legislation, not my scandals.″

St Germain, who has paid a lawyer at least $79,000 from campaign funds to monitor the ethics probe, has repeatedly predicted exoneration, leading Republicans to charge he has inside information on the committee’s secret dealings.

Republicans say those assertions were underscored when St Germain acknowledged he attended a June fund-raiser for Rep. George C. Wortley, a New York Republican who sits on both the ethics and banking panels. St Germain said he appeared as a courtesy to a friend, as he has for other Republican members of his committee.

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