At the end of the year the state party will eliminate what is called its county executive director program, which distributed about $260,000 a year among about a dozen counties to assist with fundraising activities and grass-roots organizing.
Its finances are so shaky, the state party faced the choice of ending the funding or possibly laying off workers from its staff, according to one official.
In an era of multimillion-dollar presidential campaigns, the amount at issue is relatively small. Indeed, some larger local GOP committees, like San Diego and Orange counties, expect to have enough funds available from their own accounts to fill the gap.
But others will face cutbacks at a time when candidates are trying to attract voters in a political environment defined by an unpopular Republican president and the Iraq war. An Associated Press-Ipsos poll last week found roughly one of three adults approve of President Bush's performance, about the same as his all-time low.
The cuts are "really going to hurt the party statewide, there's no doubt about that," said Jack Duncan, whose job with the Kern County GOP is financed in part with the state dollars.
"A lot of people think volunteers will step in and take care of a lot of these issues. That's stretching it, I think," Duncan added. "Someone is going to have to ... take care of the fundraising activity and do all those kinds of things. For some of the counties, that's going to be pretty tough."
According to state records, the California GOP was $1.7 million in debt at the end of October, the most recent figures available. Its federal committee was nearly $430,000 in the red, records show.
An e-mail sent by regional vice chairman Jon Fleischman to other party officials, which was obtained by AP, pointed to a shortage of cash.
"I don't know how to sugarcoat this," Fleischman wrote in the e-mail. The party "is going through a very fiscally challenging period."
Warned by the party's chief operating officer that state GOP layoffs could follow if the county funding was continued, "I was forced to vote to end a program that I believe is a good one, simply because we are faced with a situation of limited resources," Fleischman wrote. He later predicted finances would improve.
Contacted by phone, Fleischman declined comment on the e-mail.
State Chairman Ron Nehring did not respond to a phone call or e-mail. A statement issued by the party stressed that the funding for the program was expected to end on Dec. 31.
It did not mention its board voted last week not to continue the county dollars after than time. The board also defeated a motion to extend the dollars until February.
"This program was started three years ago and it was intended to have the executive directors develop the county grass-roots program, fundraising activities and develop community ties," the statement said. "The county executive directors are employees of the county central committee, not the state party."
In August major donors agreed to pay off a $3 million debt by February for the California GOP, left over from the 2006 campaign.
Party members say fundraising has been dampened by, among other reasons, Bush's immigration plan, which many conservatives have called a giveaway to illegal workers.
Nehring has had a bumpy tenure, with problems ranging from weak finances to staffing.
Asked Friday if Republican Gov. Arnold Schwarzenegger had confidence in Nehring's leadership, spokeswoman Julie Soderlund did not answer directly.
"The governor has a good working relationship with Ron," she said in an e-mail.