Turnaround Tale

Annie's List jumps out of the red and into the blue

Kelly White (center) rebuilt Annie's List to become a major player in the 2006 legislative races. White has since resigned as executive director but continues to stay involved in the organization's growth. She's flanked here by deputy director Mel Abel and political director Robert Jones. The three hold displays of their winning candidates.
Kelly White (center) rebuilt Annie's List to become a major player in the 2006 legislative races. White has since resigned as executive director but continues to stay involved in the organization's growth. She's flanked here by deputy director Mel Abel and political director Robert Jones. The three hold displays of their winning candidates. (Photo By John Anderson)

It was after 11pm on election night, and some of the guests at the Stephen F. Austin Hotel were calling the front desk to complain about the ruckus coming from one of the rooms. A hotel employee was dispatched to the 12th floor to try to quell the noise. Stationed in the hallway outside the suite, the young man in the crisp uniform frowned each time the elevator doors popped open to deliver another set of revelers to Room 1210.

The arrival of a TV news camera crew was the last straw. Another hotel staffer, this one with more authority, asked the entire group to move the party to the downstairs ballroom, where Democrats were celebrating a wild night of state and national election victories.

The gathering upstairs was supposed to have been a small, private affair, where Valinda Bolton would hole up with campaign staff, friends, family, and political number crunchers to wait out the election returns. It was a long evening. As precinct reports trickled in for House District 47, Bolton and the Democratic Party looked to be on the verge of capturing the last Republican-held House district in Travis Co. That's when more people started showing up on the 12th floor, and the crowing grew louder. Oddly enough, most of the celebrants were stone-cold sober.

In the hallway and on the elevator ride downstairs to deliver her victory speech, Bolton, mindful of the scolding from the hotel hall monitor, spoke in an ecstatic whisper. "This campaign has just been an amazing experience," she said. "Other than marriage and motherhood, this has been the best thing I've ever done." Bolton attributed a large share of her win to Annie's List, a 3-year-old campaign PAC that supports Democratic women candidates in Legislative races. In the primary, Bolton ran against three opponents, including Jason Earle, who, as the son of popular District Attorney Ronnie Earle, had assembled an impressive war chest with the help of wealthy establishment Democrats. While it was clear to many that Bolton was the stronger of the two candidates, a lot of folks were squeamish about publicly backing Bolton, out of concern that their support would appear as a sign of disloyalty to the elder Earle, one of the most powerful members of Travis County's old guard.

Clearly, Jason Earle was getting in the way of Bolton's ability to raise some respectable money. When you can't raise the big money, people start to question your worth. That's when Annie's List, whose donors include some of the state's wealthiest and most well-connected women, stuck its neck out and endorsed Bolton. With that single gesture and a check, Bolton's fundraising efforts were no longer in doubt. Other donors started putting money into the collection plate, but Annie's List turned out to be Bolton's largest donor, investing a total of $80,000.

Bolton was one of three winners out of a slate of five women House candidates on whom Annie's List had focused most of its resources. Besides Bolton, the two other incoming freshmen to the 2007 Legislature – Paula Hightower Pierson of Dallas and Ellen Cohen of Houston – managed to trump heavily financed incumbent Republican Reps. Toby Goodman and Martha Wong, respectively.

Considering the red landscape of the state, the addition of three Democratic women to the House next year is a pretty remarkable achievement. Until the election, there were only 14 female D's in the 150-member House. And that includes two recent arrivals – Austin Rep. Donna Howard, who won a special election in February to replace Republican Todd Baxter, and Houston Rep. Ana Hernandez, elected in late December to succeed Joe Moreno, who died in a vehicle accident during the 2005 session. Annie's List supported both women.

The role of Annie's List in the election is only part of a larger story about a fledgling pro-women's PAC that started 2006 on the brink of ruin, underwent a swift and dramatic turnaround, and is now ending the year on a bittersweet note and a question mark. The group's surprising recovery and success at the polls was followed by the post-election resignation of executive director Kelly White. A confluence of personal events over the summer, including the death of her father, led to her decision to leave Annie's List after the election, she said.

"I didn't thoughtfully go out and seek this job," White said of her tenure with Annie's List. "I went into it because I cared a lot about it, and I had good friends who were in fact running for office. I really felt strongly that I could fix it, and I did." Leaving the group, she added, "was a really tough decision, but I just got some real clarity over the summer about this cycle in my career and my life. Annie's List is in a wonderful place right now. I would never have left if it had not been in good shape."

White, a gifted networker and fundraiser with a track record of building Austin SafePlace into a national model of advocacy against domestic violence, took the reins of Annie's List early this year, at a time when the group was in turmoil. The group's executive director, Sherry Boyles, had just left the organization amid questions concerning the PAC's expenditures in 2005, an off-election year. Financial records from that year show the PAC spent more than 80% of the $325,000 raised in contributions. Boyles' salary and management fees came to $81,400, and travel, restaurant, and catering costs added up to more than $50,000, according to records filed with the Texas Ethics Commission. (Boyles, a Dallas resident and the 2002 Democratic nominee for the Texas Railroad Commission, did not respond to e-mail requests seeking an interview for this story. Directory assistance in Dallas County shows no listing for Boyles.)

Donors were understandably angry that they had no idea how their money was being spent. With Boyles' departure, Austin attorney and major Annie's List donor Alice London stepped in to provide legal services (as an in-kind contribution), and the old board essentially agreed to fire itself and appoint a new board of three, which eventually expanded for wider representation. "The [former] board of directors had questioned Sherry's expenditures and requested her to reimburse the organization because they felt like she spent some money inappropriately," London said. "And the board, in order to regain the donors' confidence, felt like they needed to take some responsibility." The new board includes two local women, London and Rosie Mendoza, a CPA who took over the PAC's treasury and financial filings with the Texas Ethics Commission.

"We were under this cloud," London recalled of those first early weeks of uncertainty. "We didn't have any time to waste because we had these [special] elections coming up in February with Donna Howard and Katy Hubener, and then Valinda's primary in March."

White brought in two of her most trusted political allies – Robert Jones as political director and Mel Abel as deputy director. Both had worked with White on her unsuccessful bid for a House seat in 2004 (narrowly missing the same District 48 that Howard later captured). Jones also had worked at EMILY's List, the Washington-based national women's PAC upon which Annie's List is somewhat modeled. Jones had directed a training program there for a new generation of political operatives; he runs a similar program for Annie's List and sent this year's crop to work on each of the five campaigns the PAC targeted. (While EMILY stands for Early Money Is Like Yeast – it helps the dough rise – Annie's List honors Annie Blanton, who in 1918 became Texas' first woman elected to a statewide office, that of superintendent for public instruction.)

"Kelly came in at a critical time," London continued. "She made it very clear that there would be no room for compromise, that she was going to hold this group to a high ethical standard, or she wasn't going to get involved and wasn't going to put her credibility on the line." Once on the job, White immediately took control of the group's assets and infrastructure and put Abel in charge of getting the books and the database in order. New bylaws and operating procedures were put into place.

"We believed that if we didn't do something very quickly, we would lose the opportunity to make the group viable, and we'd be losing the chance to change history," London said. "I think that's what made the difference, that there was this compelling sense of urgency and the belief that this election year would be different."

There were also moments of doubt. "All of our candidates got outspent three to one, or four to one, and there was the question of whether our discipline and the concept of having a centralized organization to create efficiency could beat the high dollars on the other side," London said. "We all had these questions of whether it was going to work, and the sense that it had to work."

Jones likes to point out that Bolton refers to herself as the poster child of Annie's List. While Bolton had a strong campaign staff with consultant Glen Maxey and campaign manager Elizabeth Hartman, among others, Earle's high-profile name presented a serious threat – not just to Bolton but to the Democratic Party. It was widely believed that if Earle won the primary, he would not likely survive the general election against GOP hopeful Bill Welch. "Valinda is our big success story because this was a solid Republican seat that folks weren't really looking at until [former Rep.] Terry Keel announced he was resigning," Jones said. "We knew that she was the right candidate for that district, and we knew she'd be the one to get Republican women to cross over."

Before getting to that point, however, the old and new board members made some painful financial discoveries and subsequently reported them to the Texas Ethics Commission. According to the corrected filings, Boyles had made $22,600 in "personal and unauthorized expenses" that included clothing purchases of more than $1,220, monthly payments for TiVo, and movie tickets. Both Boyles and Annie's List paid fines, and financial records show that Boyles has since reimbursed the group the full $22,600.

It's possible the former board could have avoided the situation had it heeded early warning signs. Several original members of Annie's List resigned from its steering committee (since disbanded altogether) in 2004, and former state Rep. Ann Kitchen, who co-founded the group with Boyles in 2003, laid out her concerns in a letter to the board. She cited the insular nature of the board and the lack of an audit mechanism in the group's bylaws. "An annual audit of the books and records of the organization by an independent third party is a fundamental and prudent business practice for nonprofit corporations," she wrote, "particularly one handling over a quarter of a million dollars in contributions."

Today, Kitchen has only kind words to say about the group and White's ability to turn things around in time for the election. "My hope is that it will continue to evolve and will fulfill its potential to be a real catalyst at a grassroots level to motivate and organize women to support women candidates with their money," she said. "There's a huge potential for that."

With White's departure, the board is looking for a new executive director to continue building the group. The company line at Annie's List is that White had only intended to stay a year to get the group back on its feet and drum up the cash needed to reinvent it as not only a financier of women candidates but as a resource to help first-time candidates run effective campaigns. Still, some of White's friends outside the organization speculate that perhaps some sort of conflict with the board, or part of the board, may have prompted her decision to leave. White says she appreciates the loyalty of her friends but insists that her decision "is my issue, not the board's issue."

White's legacy continues with Jones and Abel already planning for the 2008 legislative races; they've kicked off the next round of training and recruitment workshops in cities around the state. Still, Annie's List supporters wonder how the group will survive without White at the helm. London believes that it will continue to thrive because women are energized by their newfound standing in both Texas and Washington.

"I'm going to hold on to the 2006 hypothesis – that when you raise money in smaller donations from lots of women statewide, it communicates broad-based support, not some agenda or special interest," London said. "That's the hypothesis I'll hold on to for 2008. Then we'll ask the question, did we really learn a lesson in 2006, or was this just a one-time deal?" end story

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Annie's ListDemocratic Party, Annie's List, Kelly White, Jason Earle, Valinda Bolton, Alice London, Sherry Boyles, Texas Legislature

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