By Associated Press Writer
updated 4/5/2010 11:03:39 PM ET 2010-04-06T03:03:39

Amid unrelenting criticism of how the Republican National Committee has spent donors' dollars, Chairman Michael Steele on Monday accepted the resignation of his chief of staff and allowed one of his senior advisers to exit the inner workings of his political machine. The turnover hinted at future changes that some top Republicans hoped would include the chairman himself.

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RNC chief of staff Ken McKay became the highest-profile departure from the central committee after the revelation that the committee had picked up a nearly $2,000 tab at a sex-themed California night club. The incident proved embarrassing and a midlevel staffer was dismissed, a move that was not enough to assuage social conservatives urging a fundraising boycott.

Steele had insisted earlier Monday that he would not resign and defended his stewardship of party affairs. He dismissed criticism — some of it has centered on spending on flights, limousines and high-dollar hotels — as the talk of GOP figures uncomfortable with his "streetwise" managerial style.

Asked in a nationally broadcast interview if he would step down in the face of criticism of the party's financial management, Steele replied, "No." He said some people had been second-guessing him "since the day that I got the job."

That confidence was not extended to McKay. As the chief of staff, he ran day-to-day operations at RNC headquarters and was the top aide to a chairman who found few defenders.

McKay's resignation also prompted one of Steele's top advisers, Curt Anderson, to leave the committee's circle of consultants.

"Ken McKay's departure is a huge loss for the Republican Party. Ken steered the party through very successful elections last fall that have given us tremendous momentum. He's a great talent," Anderson said in a statement.

"Given our firm's commitments to campaigns all over the country, we have concluded it is best for us to step away from our advisory role at the RNC. We have high personal regard for the chairman and always have; we wish him well," he said.

Anderson may have seen his ties to Steele and the RNC as a liability for his business. Any of his clients could be tied to sex-themed clubs if Anderson remained linked with Steele.

Anderson helped recruit McKay to the RNC from the staff of Rhode Island Gov. Don Carcieri, where he previously served as his chief of staff and campaign manager. It wasn't clear if McKay, a well-respected operative, resigned voluntarily or was forced from his post, one of the most powerful in a party in the minority in both the House and the Senate.

Steele replaced McKay with Mike Leavitt, who joined the RNC as deputy chief of staff two months ago. He ran Steele's losing Senate campaign in 2006 and is close to the chairman. He also helped Virginia Gov. Bob McDonnell win election last year.

Steele has faced mounting criticism and pressure. Two top congressional Republicans said Sunday the RNC must be held accountable for the way it uses the money it raises in light of much-criticized Hollywood outing.

"This kind of thing has got to stop or they won't get any contributions," said Sen. Jon Kyl of Arizona, the No. 2 Republican in the Senate.

Kyl and Rep. Kevin McCarthy of California, who is leading the GOP effort to recruit candidates and elect House members, distanced themselves from Steele when discussing the committee's controversial spending.

Steele was not present at the Voyeur Hollywood West on Jan. 31 when a group of young Republicans ran a tab picked up by the RNC. After reporters noted the bill in a funding report, the RNC fired a staffer it blamed for the outing and said it would be reimbursed by a donor who had attended.

Asked on "Fox News Sunday" if Steele should step down, Kyl demurred but said, "The people that contribute to the committees, both Democrat and Republican, want to know that their money is well spent for the cause, and it needs to be that way."

Appearing Monday on ABC's "Good Morning America," Steele said he had a budget with $8 million left after the 2009 elections, contests which saw the GOP score victories in gubernatorial races in New Jersey and Virginia and in a special Senate race in Massachusetts.

"I hear our base out there," Steele said. "I hear the leadership, and we're taking steps to make sure that we're even more, how shall we say, fiscally conservative." But he also attributed his problem to "unnamed Republicans who don't like me."

Even as Steele and the national committee are being criticized for lavish spending habits, Steele has hired a special finance assistant who himself was fined by the District of Columbia three years ago for improperly spending money from a political action committee, according to published reports. The special assistant, Neil Alpert, will help with fundraising, The Washington Post reported Monday.

The Post, and a report Sunday by AOL's Politics Daily, said that in 2007, the District's Office of Campaign Finance found that Alpert improperly spent $37,670 on items not authorized by the D.C. Baseball PAC, which he chaired, or the D.C. Baseball Association, a nonprofit group the PAC created to raise money for youth programs. Alpert was asked to reimburse the groups, which were later dissolved after Major League Baseball authorized a Washington franchise. He was fined $4,000.

Copyright 2010 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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