The Iowa Republican Party, which raises more than $1 million through its presidential straw poll, could be rescued by former Sen. Fred Thompson (Tenn.), whose entrance into the nonbinding but potentially significant contest would more than replace the money the state GOP appeared to have lost when presidential frontrunners Rudy Giuliani and Sen. John McCain (Ariz.) announced last week that they would not participate.

A decision by Thompson to compete in the straw poll would be good news for Iowa’s Republican Congressional candidates, who rely on the party’s resources and infrastructure every election cycle. Thompson is expected to formally get into the presidential race shortly.

A well-placed Iowa Republican political operative said Friday that the Thompson campaign was in talks with state GOP officials about taking part in the straw poll, which is set for Aug. 11 on the campus of Iowa State University in Ames.

Thompson’s participation would generate sufficient ticket sales to ensure the state GOP meets revenue projections for the event and doesn’t experience a drop-off in its ability to bankroll voter turnout and influence Congressional and state legislative races next year.

“It’s highly likely that Thompson will participate in the straw poll,” the Iowa Republican operative said. “There are meetings going on as we speak.”

Thompson campaign spokesman Mark Corallo said in an e-mail Friday that the former Senator and recent “Law & Order” star remains undecided on whether to enter the straw poll.

The Iowa GOP depends on the straw poll, a quadrennial cash cow that often foreshadows the winner of the Republican presidential nominating caucuses, to raise somewhere north of $1 million for the party to use in funding ground-game operations throughout the state.

Mary Tiffany, a spokeswoman for the Iowa Republican Party, conceded that the absence of Sen. McCain (Ariz.) and former New York Mayor Giuliani — as well as some lower-tier candidates — is threatening to depress ticket sales and downgrade the amount of money raised by the event. But Tiffany confirmed that the state GOP is confident that Thompson’s participation would enable the event to match attendance estimates of anywhere from 30,000 to 50,000 people.

There was no straw poll held in 2004, as President Bush was unopposed in the GOP primary. But in 1999, the state-fair-style event sold 37,000 tickets while drawing 40,000 people.

“The big question mark is Fred Thompson,” Tiffany said. “If he announces [for president] and chooses to come, then there is virtually no” financial impact from the decisions by Giuliani and McCain not to participate.

David Kochel, an Iowa adviser to former Massachusetts Gov. Mitt Romney — who also is considered a frontrunner for the GOP presidential nomination and is committed to competing in the straw poll — said the money raised through the event is crucial to the state party.

Kochel, who served as executive director of the state GOP from 1995 to 1996, said the money raised from the straw poll in 1995 helped the Iowa GOP take over the state Senate in the 1996 elections. The party’s ability to play in Congressional races also is determined partly by how much money is raised via the straw poll, Kochel said.

“It’s huge,” he said, regarding the straw poll’s impact on the Iowa GOP’s operations.

The GOP took a beating in Iowa last year, but Hawkeye State Republicans say they are banking on a good haul from the straw poll to help them fund a comeback in 2008.

In 2006, Iowa Republicans lost the gubernatorial race and saw both chambers of the Legislature fall into Democratic control, with the 1st and 2nd Congressional districts also slipping to the Democrats. Additionally, Democratic registration has risen three cycles running, with Democrats now outnumbering registered Republicans in Iowa for the first time in 12 years.

Meanwhile, Sen. Tom Harkin (D-Iowa) appears well-positioned for re-election in 2008, with no high-profile Republican coming forward to challenge him thus far.

Tiffany said the state GOP would have a better idea of where it stands financially with the straw poll sometime in July, at which point the participant field should be set.

“We’d love it if [Thompson] came,” she said. “We hope he does come.”