GOP Senate campaign heats up after report tying Budd to bankruptcy that hurt farmers

The race for the Republican nomination for a U.S. Senate seat in North Carolina heated up in recent days after a Washington Post story detailed how farmers lost millions of dollars in the bankruptcy of a company led in part by the family of Rep. Ted Budd.

Budd, whose candidacy won former president Donald Trump’s endorsement in June, has faced sharp criticism from his competitors after the story published on Tuesday. Both former Gov. Pat McCrory and former Rep. Mark Walker, who are also vying for the nomination, jumped at the chance to accuse Budd of being a “D.C. insider” who swindled farmers.

AgriBioTech, based in Henderson, Nev., was a “full-service seed company” specializing in forage and turfgrass that also researched and developed seed varieties and processing plants, according to a company news release.

Budd was not an officer of the company, but was a shareholder. His father, Richard Budd, took over as chief executive in 1999 and served as chairman of the board, according to federal securities filings.

Budd was also one of 11 people who signed a loan to AgriBioTech to try and save the faltering company less than a year before the company declared bankruptcy, his campaign acknowledged. AgriBioTech repaid the loan with interest, but more than 1,200 farmers in 39 states went unpaid for more than $50 million of products.

Following AgriBioTech’s bankruptcy filing in 2000, a lawsuit filed in Nevada claimed that Richard Budd transferred millions of dollars out of the company to his family, including Ted Budd, before paying back farmers for their products. In a settlement reached in 2005, the Budds agreed to pay about $6 million to the farmers without admitting wrongdoing, according to a report by the Las Vegas Sun at the time.

“I wish my efforts to save ABT had been successful, but they were not,” Richard Budd said in a statement provided by his son’s campaign. “I did my best, but in this case, my best was not enough to save the company.”

Congress responded by creating a $35 million no-interest loan fund to help the affected farmers.

In an interview this week with the Winston-Salem news channel WXII, Ted Budd said he “never had any involvement” with the company. His campaign spokesman, Jonathan Felts, said in a statement that farmers’ accusations of fraudulent transfers were “untrue allegations which is, sadly, a typical tactic in these sorts of lawsuits.”

“Ted’s got the Trump endorsement and has the momentum to win this race,” Felts said. “Some reporters suffer from Trump Derangement Syndrome and will say or do anything if they think it might hurt President Trump’s political popularity.”

McCrory, Walker’s response

All three of the leading Republican candidates have tried to paint themselves as outsiders in Washington, and both Walker and McCrory are using the Post’s story as a way to kick the legs off Budd’s efforts.

“Do we really need another Washington politician like this representing North Carolina in the United States Senate?” McCrory wrote on Twitter.

Walker wrote on Facebook that the report was “unsettling but confirms the Budd record: follow big money and you always find Ted Budd.”

“Unfortunately, this is not the end of the story, but the opening chapter of Budd putting money over principle,” Walker added. “You cannot expect to serve North Carolina in the U.S. Senate with this lack of judgment and refusal to answer questions.”

State of the campaigns

The U.S. Senate race in North Carolina will play a pivotal role in determining which party will control the chamber after the 2022 midterm elections. The primary is scheduled for March 8.

So far, Budd has cashed in on his Trump endorsement by raising $700,000 in the second quarter. He also loaned his own campaign $250,000, and came into the race with an extra $1.1 million in cash from his House races. McCrory raised $1.24 million in the second quarter, and Walker has raised more than $1.25 million since he declared his candidacy in December.

It is unclear what impact Budd’s connection to AgriBioTech will have on the race.

Jordan Shaw, a campaign advisor to McCrory, wrote on Twitter that Budd is “going to need a better answer” than denying connection to the company.