— December 13, 2011
Cynthia Lummis first won election to the Wyoming House of Representatives in 1979. She was just 24 years old at the time, making her the youngest woman in Equality State history to serve in the legislature.
Since then, the Republican from Cheyenne has spent 24 years in elected office, climbing the political rungs through both chambers of the Wyoming Legislature to the state treasurer’s office, and then to the halls of U.S. Congress.
Though it is not widely known, Lummis’ rise in politics has been matched by her ascent as a businesswoman. While working as a lawyer and elected official in Cheyenne, she quietly built her personal wealth through a number of real estate ventures she pursued with her husband and law partner Alvin Wiederspahn, who has been a board member of several banks.
Even before Lummis began her political career, her family was known in Cheyenne for owning the Arp and Hammond Hardware Company, along with several large ranch properties southeast of town.
But election to the U.S. House in 2008 shed more light on Lummis’ personal finances, showing that the self-described rancher and small business owner may be one of the richest lawmakers in the Capitol.
In 2007-2008, Rep. Lummis’ financial disclosure forms reported a net worth between $20 million and $75 million, landing her spot No. 15 on RollCall.com’s list of the 50 wealthiest members in both houses of Congress.
Those numbers may make her net worth appear to be larger than it actually is, because the form used by Congress allows lawmakers to report their wealth within broad ranges; if an asset is over $1 million, there are only four boxes to check: $1-5 million, $5-25 million, $25-50 million, and over $50 million. (Click here to learn more.)
Lummis’ more recent disclosure forms have reported lower values, putting her total net worth for 2010 between $5.5 million and $24 million. Still, that ranks her as the 29th richest member of the U.S. House.
On paper, Lummis’ reported wealth dwarfs that of her fellow Wyoming members of Congress: Senators Mike Enzi and John Barrasso, both Republicans. According to financial disclosure statements filed with the Clerks of the House and Senate in 2010, Barrasso’s net worth is between $2,713,015 and $8,747,000, and Enzi’s is between $440,067 to $1,878,000. The Center for Responsive Politics ranked them as the 34th and 66th wealthiest senators, respectively.
Sen. Enzi’s biggest asset may be the three-story Washington D.C. home he bought in 1997 for $360,000, and which D.C. tax authorities valued at $874,000 in 2008.
The bulk of Sen. Barrasso’s money is his portfolio of Vanguard investment funds, valued between $2 million to $7.25 million in 2010. He earned a salary of $306,000 for his last year of work at Casper Orthopedic Associates in 2007.
If Lummis’ median estimated wealth of $14.75 million is accurate, she could be easily counted among the wealthiest 1 percent of all Americans who have more than $9 million in assets.
Lummis wrote about moving cows in Platte County during a weekend home from Washington in a recent press release. But it would be a mistake to cast her as an ordinary ranch woman. Her career trajectory and her financial balance sheet reveal an ambitious, intelligent woman from a wealthy family who gained political clout through her work on key state issues like tax revenue and the management of billions in state money.
Wealth in Property
Most of Lummis’ wealth is locked up in her shares of Arp and Hammond Company, Lummis Livestock Company, and Old Horse Pasture Inc. In 2007, she reported these three large family land companies to be worth between $5 million to $25 million each, which attracted the attention of Rollcall.com and other news outlets.
Lummis revised the values of the companies in her 2009 disclosure form,putting them between $1 million and $5 million, which dropped her out of the top 20 rankings of the wealthiest members of Congress.
While the exact value of these companies is unknown, the real estate footprint is part of the public record. Records from the Laramie County Assessor’s office show that Lummis is part or full owner of over 14,000 acres in Laramie County assessed at $2,735,244 in 2011.
Lummis Livestock paid a distribution ranging from $48,000 to $50,000 to Cynthia Lummis from 2007-2009, but paid nothing in 2010. One parcel owned by Lummis Livestock contains a gravel pit that could be generating income.
With her husband Wiederspahn, a Cheyenne Lawyer and former board member of Rocky Mountain Bank and First National Bank of Wyoming, Rep. Lummis owns the Colony Building and the Carey Block in downtown Cheyenne, along with a warehouse at 1112 Dunn Street. Those three properties were assessed at $1,114,100 in 2011.
Wiederspahn also owns Equipoise Corporation, a real estate and historic preservation development firm valued between $1 million to $5 million. Through Equipoise Corporation, Wiederspahn owns a three-story apartment building with 11 bathrooms at 912 Country Club Avenue in Cheyenne, plus a lot at 410 Randall Avenue. The latter property was to be the site of The Irwin, a luxury condo building that has not yet been built. Those properties are valued at $618,253 in 2011.
Equipoise also owns an 80-acre parcel at the foot of the Wyoming Range in Lincoln County, near the Star Valley community of Etna.
County tax assessment records show Wiederspahn and Lummis own 1,600 acres of ranchland in Platte County, located on Cooney Hills Road west of Wheatland near the Laramie Range. They own another 1,200 acres in Albany County.
Wiederspahn and Lummis’ primary residence is on Bent Avenue in Cheyenne, valued at $314,277 in 2010. Lummis also owns a condo on New York Avenue in Washington, D.C. valued at about $501,440 according to tax assessment records.
Lummis’ assets and those of her husband have not grown extravagantly since her election to Congress, though she did manage to pay off two ranch mortgages between 2008 and 2009 valued between $1.1 million and $5.25 million.
In 2010, Lummis reported between $115,000 and $250,000 in real estate income from the Colony Building, the Carey Block, and the warehouse at 1112 Dunn. Though not reported in the disclosure statement, she also earned a yearly salary of $174,000 as a member of Congress.
State Treasurer 1999-2007
Lummis’ power may have reached a peak during her years as state treasurer, when she was responsible for the investment and diversification of the massive windfall Wyoming saw during the natural gas boom.
During her two terms as state treasurer from 1999 to 2007, the state had received over $6 billion in revenue. Lummis oversaw the growth of the state’s investments from $3.5 billion to $8.6 billion, and led the conversion from mostly fixed income funds to a diversified portfolio.
As one of the five members of the State Land and Investment Board, she championed a strategy to put 50 percent of state investment funds into equities. Up to that point, the fiscally conservative state had kept most of its investments in fixed-income bonds.
During the course of Lummis’ term she helped choose fund managers like Cheyenne Capital Fund, which invested $257 million in state money, and State Street Global Advisors, which invested $952 million by December 2006.
Lummis’ treasurer’s report for 2006 shows other large investments were made through Fisher Investments and Capital Guardian Trust, which managed $350 million each. Western Asset Management and Lehman each managed over $330 million in fixed income funds. Friess Associates and GAMCO (Gabelli) each managed over $180 million in equities. Subsequently, donors connected to Lehman, Friess, and GAMCO all gave money to Lummis’ congressional campaign.
The array of new investments created a modernized growth portfolio that many hoped would help equalize the boom and bust cycles of mineral revenue that wreak havoc on the state’s budget. As Lummis said in her closing treasurer’s report for 2006, “Perhaps no State Treasurer will have as unique an opportunity as I to effect such significant change on Wyoming’s investment portfolios using modern institutional portfolio theory.”
She later wrote a chapter called “Combating the mineral curse: the case of Wyoming” in the book Sovereign Wealth Management for the World Bank. The publisher, Central Banking Publications, flew Lummis on a one-night all-expenses paid trip to London, according to her 2010 financial disclosure form.
In Lummis’ 2008 run for Congress against Democrat Gary Trauner, her campaign materials touted her role in the state’s $4 billion investment growth that occurred during her two terms as treasurer. Gov. Dave Freudenthal told the Casper Star Tribune that the energy boom, not Lummis, should be credited for the growth.
Whether or not the credit can be given to Lummis, it’s clear that the state’s portfolio has been growing in the right direction overall. As of June 30, 2011, Wyoming’s investments had a market value of $14.4 billion.
The increased exposure to growth also brought increased risk, and there have been some setbacks. In 2009 the state portfolio declined in value from $11.5 billion to $10.9 billion, an unrealized loss of $600 million on paper.
Even so, the portfolio is up nearly $6 billion since Lummis left the state treasurer’s office. That growth has been good for Wyoming, but it has also been good for the fund managers. For example, Cheyenne Capital Fund initially collected a yearly management fee of $1.9 million when it was chosen to manage state funds in 2003. Cheyenne Capital Fund founder John Fitzgerald said the company’s formula for calculating management fees is complicated, but usually comes out to about 1.55 percent annually, which is in line with the industry average. His fund charged the state a $2.9 million fee in 2010.
Business and Politics
Over the course of her career Lummis has been involved in many major transactions and policy initiatives, and several of her efforts have resulted in criticism.
In particular, Lummis’ connections to royalty in kind have drawn media scrutiny. As reported by WyoFile, Lummis voted in 2005 to commit Wyoming’s 50 percent interest in mineral royalties from federal lands to the royalty in kind program in the Department of the Interior, an experiment that ended in controversy after a lack of oversight by the Minerals Management Service caused the government to lose hundreds of millions in royalties.
The accounting problems arose during the Clinton years, but were left uncorrected during Bush’s tenure when Wyoming’s Rejane “Johnnie” Burton was director of the federal Minerals Management Service. Burton resigned from that job in 2007, before reports of major corruption in of the service’s Lakewood, Colo. offices surfaced in September of 2008.
After the Lakewood scandal broke, Lummis hired Burton as a field representative in her Cheyenne office in January of 2009. Lummis had a long association with Burton, who served in the state legislature and chaired the Wyoming Department of Revenue from 1995-2002.
In June 2010 Lummis’ Democratic challenger David Wendt criticized her continued employment of the controversial former Minerals Management service director. Burton then defended her record in a July 2010 article in the Casper Star Tribune, saying the press had crucified her. She said that she had initiated an investigation of the Lakewood office in 2006, and that the royalty in kind program had made money for the government.
Lummis paid Burton a yearly salary of $50,000 for her work in Cheyenne in 2009 and 2010, but that was reduced to a salary of $19,000 for January to September 2011. As of this writing, Burton continues to work in Lummis’ Cheyenne office.
Lummis also attracted media scrutiny in June 2011 when the Associated Press reported that several fund managers hired by Lummis during her tenure as state treasurer had gone on to contribute to her congressional campaigns in 2008 and 2010.
As shown below, this was not illegal, and may have been a case of political fundraising as usual.
The Associated Press article noted that donors to Lummis for Congress included John Fitzgerald of Cheyenne Capital Fund and several of his associates. Contributions from the Fitzgerald family amounted to $15,800 from 2008-2010.
As treasurer and member of the State Loan and Investment Board, Lummis had made several moves that benefited Cheyenne Capital. She voted for an investment of $125 million in state money with Fitzgerald’s fund in 2003, and then voted to invest another $100 million with the company in 2004.
In both cases she argued that Cheyenne Capital was the best manager, and subsequently the fund has had an internal rate of return of over 12 percent. (See Cheyenne Capital Fund – Private Equity Commitments and Investments for more information on the fund’s performance.)
Gov. Freudenthal voted against investing with the fund both times, but the measures passed anyway.
Then in 2006, Lummis signed a confidentiality agreement with Cheyenne Capital Group, which sealed their records to the public to protect industry secrets. That agreement was overturned earlier this year by a Freedom of Information Act request made by the Associated Press.
Lummis originally met Fitzgerald in the late 1980s through her husband’s banking interests. Fitzgerald was a lawyer for Kirkland and Ellis when he represented a consortium of equity firms that was headquartered in Cheyenne. Wiederspahn was a board member of Rocky Mountain Bank at that time, and worked with the consortium as it looked for assets to purchase.
In an interview with WyoFile, Fitzgerald said he may have met Lummis once through Wiederspahn at that time, but that he didn’t do any business with her until years later when she called him as state treasurer looking for equity funds to invest in.
While she was treasurer, Fitzgerald invested state money allotted to Cheyenne Capital Fund with several other private equity managers. After Lummis left the treasurer’s office, many of those managers donated to her 2008 congressional campaign, including Paul and Paula Balser of Ironwood Partners in New York ($8,100 from 2008-2011), James Gordon of Edgewater Funds in Chicago ($2,300 in 2008), and J. Martin of Platte River Ventures in Denver ($2,300 in 2008).
According to watchdog groups, managers of Wyoming’s larger investment funds also donated to Lummis, including the Jackson-based Foster Friess family of Friess Associates ($9,200 in 2008), Mario Gabelli of GAMCO ($3,300 in 2008 and 2009), and Theodore Roosevelt IV of Lehman Brothers and Barclays Capital ($3,157 in 2008 and 2009). In most cases, Lummis was only one among dozens of candidates that these fund managers contributed to at regular intervals.
Since Lummis left the state treasurer’s office in 2007, she had no authority to invest additional funds with the managers or change their compensation. Of the fund managers who made donations to her congressional campaigns after 2008, none of them donated to her campaigns for state treasurer in 1998 or 2002.
Contributions from all managers with ties to Cheyenne Capital totaled over $31,000, a small amount compared to the $1,530,454 total she raised for 2008.
Other sectors represented a much larger portion of her funding. For example, Lummis received over $177,000 from political action committees (PACs) and individuals connected with the energy and natural resources sector.
Aside from the stir caused by the fund manager donations, Lummis has had run-of-the-mill donors for a Wyoming candidate. In her fundraising efforts for her 2010 race she raised over $780,000. More than $279,000 of that came from individuals, while another $412,000 came from PACs.
Lummis held three fundraisers at the Capitol Hill Club in Washington. The events took place on March 11, June 17, and September 28, and helped net major contributions from oil industry and sugar industry PACs.
Notable donors who gave the individual limit of $2,400 included John Fitzgerald, manager of Cheyenne Capital Fund and Seneca Equity Partners; Diemer, Henry, David, and Susan True, all members of the Casper oil family; Jim and Mari Martin, Casper oil investors; Cheyenne businessman Tim Hu; Robert Model of Cody; and R. and Carol Holding of the Sinclair oil company.
Several of these individuals have a long history of supporting Lummis. In her 1992 race for Wyoming Senate, Lummis received contributions from Holding, Hu, and True.
PAC contributions for 1992 included Exxon, Arco, Texaco, Marathon, Burlington Northern, Chevron, Conoco, and many other interests.
Her list of campaign contributors for the 2002 treasurer race read like a who’s who of Wyoming Republican politics: Alan Simpson, Diemer True, Tom Stroock, Eli Bebout, Robert Peck, Judy Catchpole, Ray Hunkins, Cliff Hansen, Jim Geringer, and many others.
A Regular Wyoming Politician
Unlike Sen. Enzi, Cynthia Lummis does not appear to use her political connections or campaign funds to directly enrich her family.
As reported by WyoFile in September, Sen. Enzi’s campaign paid $70,910 to his son’s wife Danielle Enzi for her work as campaign manager from July 2010 to July 2011. Watchdog groups and some members of Congress frown on the practice of elected officials paying their relatives with campaign funds or otherwise, which can turn running for election into a way to build up family wealth. A Department of Energy stimulus grant paid Sen. Enzi’s son Brad $128,000 in consulting fees for his work on carbon storage study related to the slow-moving Two Elk power plant project.
Campaign disbursement reports show that Rep. Lummis pays Wiederspahn $900 quarterly to rent an office space in the First National Bank of Wyoming Building at 2015 Central Avenue in Cheyenne, plus reimbursements like $300 for office expenses, and occasional large ticket items such as $1,000 spent on postage. Total rent and reimbursements paid to Wiederspahn were $10,592 for 2009 and 2010, according to the Center for Responsive Politics.
Lummis’ daughter Annaliese Wiederspahn served as deputy campaign manager for her 2008 House race, before taking on the role of campaign manager in 2010.
Lummis for Congress paid Ms. Wiederspahn no salary for her managerial work, though she received $14,603 in reimbursements for mileage and expenses in 2009-2010. Lummis’ campaign expenditure reports can be found here.
Lummis for Congress also spent $161,876 on a loan repayment to Cynthia Lummis for money she loaned to her own campaign in 2010, plus $15,000 to Lummis for an unspecified expense in 2009.
Alvin Wiederspahn’s wealth seems to be largely independent of his wife’s political activities. In 2003, he partnered with Mick McMurry of Casper and Robert Jensen of Cheyenne in restoring the historic Plains Hotel in downtown Cheyenne.
McMurry was a major early player in the discovery of the Jonah natural gas field near Pinedale, and Jensen was Chief Operating Officer of the Wyoming Business Council at the time.
Wiederspahn also served on the board of directors of the First National Bank of Wyoming. The company is based in Laramie, but has branches in Cheyenne and Fort Collins.
In 2004, Lummis and Wiederspahn purchased shares of First Capital West Bankshares, the holding company of First National Bank of Wyoming. The president of the corporation is Timothy Borden, a banker and small-engine foundry owner from Steamboat Springs, Colorado.
Rep. Lummis’ financial disclosure statements indicate that the debt to Timothy Borden is held by Lummis’ spouse, Alvin Wiederspahn. From 2009 to 2010 the amount owed to Borden dropped from a range between $500,000 and $1 million to between $250,000 and $500,000. So even amid the global economic downturn, Lummis and Wiederspahn have maintained their ability to pay down debts.
Despite WyoFile’s repeated attempts to reach Rep. Lummis’ offices for comment on this article, neither she nor her staff offered a response.
However, Tammy Hooper, Chairman of the Wyoming Republican Party, provided a statement on Lummis’ investment record as state treasurer: “We’re appreciative of her efforts and always have been. (Cynthia Lummis had) an intuitive ability to invest Wyoming’s money well when she was treasurer, to the benefit of the state and the citizens of Wyoming.”
Hooper noted that Lummis’ fiscal experience of balancing the state budget on a yearly basis has informed her current work in Washington: “She’s carrying that forward to how the government is spending the money, and where it’s spending its money, and she’s trying to tackle the deficit spending.”
While Lummis has a much higher net worth than the average Wyoming voter, Hooper said that distinction is irrelevant to how the representative does her job.
“I don’t think that her personal wealth determines or impacts her decision making to do what’s best for the country and for the people she represents in Wyoming. You’re elected to do the job, which is to represent the people,” Hooper said.
This story is part of an occasional WyoFile series about the finances, records and political work of Wyoming’s congressional delegation. Read the previous installment: Rising From the Right: Barrasso’s climb in senate follows increasingly conservative course
Gregory Nickerson is a University of Wyoming-trained historian and writer from Big Horn. He has worked on documentary films in Nicaragua, Yellowstone, and Philadelphia, and held jobs as a museum curator and hunting guide.
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