Vern Buchanan
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| Vern Buchanan | |
| [[Image:|px|center|Vern Buchanan]] | |
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Florida's 13th district |
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term begins 2007 |
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| Political party: | |
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| Succeeding: | Katherine Harris |
| Religion: | Baptist |
| Born: | May 8, 1951 Sault Ste. Marie, Michigan |
| Spouse: | Sandy Buchanan |
Vernon "Vern" Buchanan (born May 8, 1951) is a Republican politician and an automobile dealer. Initial voting results had him leading Democratic opponent Christine Jennings, a banking executive, by less than 350 votes, although due to reports of irregularities with Sarasota County voting machines, a recount was ordered. On November 20, 2006, the Florida Department of State certified the results as Buchanan winning by 369 votes, following a court challenge by Jennings.
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[edit] Early life and education
Buchanan grew up in Michigan, the son of a factory foreman in a family of six children.[1] When he graduated from high school in 1969, he joined the Michigan Air National Guard, serving there for six years. Buchanan got a Bachelor's degreee in Business Administration from Cleary University, in Michigan, and a Masters in Business Administration from the University of Detroit.
[edit] Business career
After graduating with a BA, Buchanan went to work for Burroughs, a Detroit-based computer company. Next, in 1975, he became the Michigan distributor for a SMI, a firm that specialized in sales and marketing training materials.
[edit] American Speedy Printing
In May 1976, Buchanan convinced the owner of a Michigan printing company that he could help the business grow. The two founded American Speedy Printing, which grew through franchising to more than 730 stores in 44 states. In 1989, a subsidiary of Merrill Lynch made Buchanan a $15.4 million loan, guaranteed by his ownership in the company. In 1992, the company filed for bankruptcy, three days after Buchanan resigned; at the time, he owned all the company's stock. [1][2]
Buchanan and American Speedy were defendants in a string of lawsuits during the late 1980s and early 1990s by franchisees and master franchisees, who said they were not making the money that Buchanan had said they could expect. After the bankruptcy, he was accused by a creditors committee of taking excessive compensation and actions that resulted in overstated earnings for American Speedy. In a 1995 deposition, he said that he had no personal obligation to repay the loan from Merrill Lynch; a dispute with the Internal Revenue Service over taxes on the money Buchanan received from Merrill Lynch stretched through the 1990s.[2]
[edit] Florida businesses
In 1992, Buchanan bought a Honda and Acura dealership in Ocala, Florida. In late 1999, he bought two more dealerships. He continued to acquire dealerships after that, but in 2006 he sold five dealerships, plus his interest a clothing store and a spa, to concentrate on his House campaign, his spokesman said.[1]
Buchanan is currently worth more than $50 million. When he filed financial disclosure forms in the fall of 2005 as part of his bid for a seat in Congress, he had interests in more than 50 companies, including 25 auto dealerships, a charter jet business, offshore reinsurance companies and property in Florida and Michigan.[1] His dealership group had $756 million in sales in 2005.[2]
[edit] Off-shore reinsurance companies
Buchanan owns two reinsurance companies -- Jamat Reinsurance Co. and Buchanan Reinsurance Co., in Turks and Caicos, and part of the Bermuda reinsurance company Greater Atlantic Insurance Co. The three companies offer extended warranty policies to car buyers. Buchanan invests some of the proceeds from his reinsurance companies in real estate developments in the Bahamas.[3]
The Internal Revenue Service has stepped up efforts in recent years to investigate offshore reinsurance companies, and has urged Congress to change laws that help people benefit from these offshore tax havens. Through his campaign spokeswoman, Sally Tibbetts, he defended his record of paying taxes: "I have always paid my taxes and it is a substantial amount," Buchanan said in a written statement. "But I don't think anyone should pay more taxes than they owe." Tibbetts added that Buchanan's use of offshore reinsurance companies should not be considered unusual. "This is a widely accepted practice offered by hundreds of businesses and enjoyed by thousands of consumers," she said.[3]
[edit] Ritz-Carlton
In 1999, Buchanan was approached to help to finance a very large project -- the Ritz-Carlton condo-hotel development in Sarasota. But Buchanan was cut out of the Ritz deal, because the developers, Robert Buford and Kevin Daves, said he lied about his financial worth. Buchanan sued, and the parties settled in 2001.[4]
The settlement was unusual: Buchanan bought a penthouse apartment from a nephew of Buford's for $5 million; the nephew had purchased it the day before for $2.368 million. Buchanan owned the unit for slightly more than a year, until January 2003, and then sold it to another member of Buford's family for $6.35 million, using a deed dated a year earlier. The arrangement resulted in Buchanan paying about $260,000 less in federal taxes, because his profit of $1.35 million was taxed at 20% (capital gains) instead of 39.6% (regular income). Buford benefited because potential buyers checking property records would see that a penthouse had been sold to a wealthy car dealer for nearly $2 million more than any other condo in the building and then resold for a large profit a year later.[4]
In the year he owned the penthouse, Buchanan used it for scores of charity benefits. That also benefited the developers: they got to show the Ritz experience to hundreds of the richest people in Southwest Florida and beyond.[4]
[edit] Politics
[edit] Involvement prior to 2006 race for the U.S. House
Buchanan served as state finance chair for Senator Mel Martinez's successful 2004 campaign. He was also co-chair of the Republican National Finance Committee.
[edit] 2006 race for U.S. House of Representatives
Buchanan is running to replace incumbent Republican Katherine Harris in the 13th congressional district in Florida. Harris is the Republican nominee for the U.S. Senate. Buchanan will face Democrat Christine Jennings in the November general election. There are 216,000 registered Republicans and about 155,000 registered Democrats in the district.[5] The race is rated a toss-up.
Buchanan won the Republican primary with 32% of the vote, against four opponents. His closest challengers were Nancy Detert, with 25% of the vote, and Tramm Hudson, with 24%.
Buchanan has put $5.4 million of his own money into his campaign.[1] In October, Vice President Dick Cheney held a fundraising luncheon for Buchanan;[6]; later that month, President Bush held a fundraising reception for him.[7] Between the two events, Governor Jeb Bush, Senator Martinez, and Massachusetts Governor Mitt Romney came to the district to campaign for Buchanan.[8]
[edit] Other
Buchanan was chairman of the Greater Sarasota Chamber of Commerce and is now the chairman of the board of the Florida state chamber of commerce.[1] He is also a member of the board and the executive committee of United States Chamber of Commerce.[9] He and his wife Sandy and their two sons live in Sarasota.
[edit] Notes
- ^ a b c d e f Lauren Mayk, "Buchanan: Big deals led to big riches", Herald-Tribune, October 31, 2006
- ^ a b c Lauren Mayk, "A success story that's not so simple: Vern Buchanan's messy departure from American Speedy is a seldom-told tale", Herald Tribune, October 6, 2006
- ^ a b Michael Bragda, "Use of offshore companies helps Buchanan reduce his tax burden", Herald-Tribune, October 31, 2006
- ^ a b c Michael Braga, "Accountants, others question settlement between Buchanan, wealthy developer", Herald-Tribune, September 10, 2006
- ^ Jeremy Wallace, "President Pitches In at Buchanan Fundraiser: Bush touts GOP principles at Vern Buchanan event in Sarasota", The Ledger, October 25, 2006
- ^ "Vice President's Remarks at a Luncheon for Vern Buchanan for Congress ", press release, October 6, 2006
- ^ "Remarks by the President at Vern Buchanan for Congress Reception", press release, October 24, 2006
- ^ "GOP launches rescue mission in Florida race: Once-secure congressional seat now in jeopardy, polls say", Associated Press, October 20, 2006
- ^ Project VoteSmart bio, accessed November 1, 2006
