Tough times at HRC: the Human Rights Campaign--the nation's most prominent gay rights group--is battling not only antigay forces but also activists questioning its size and strategy.

On an unseasonably warm night in February, some of the East Coast's wealthiest gay men and lesbians gathered at the posh Waldorf-Astoria hotel in New York City. At $350 and up per plate, the dinner was a fund-raiser for the Human Rights Campaign; the program was to honor the drug company Pfizer and the New Jersey Lesbian and Gay Coalition and featured appearances by Mayor Michael Bloomberg, former Texas governor Ann Richards, and American Idol finalist Kimberley Locke. Susan Sarandon canceled at the last minute.

Amid the pomp, it was likely that the arriving HRC supporters failed to notice the 30 or so protesters whom eight policeman escorted away from the front of the Waldorf to a space across the street. One held a sign that summed up their argument: WHAT THE FUCK ARE YOU DOING WITH ALL OF THAT MONEY?

Ordinarily it would be easy to dismiss such a ragtag group of protesters, especially since HRC has been attracting criticism since its founding almost 25 years ago. But in this case, the man holding the sign is veteran activist Larry Kramer, cofounder of both Gay Men's Health Crisis and ACT UP and author of the just-published manifesto The Tragedy of Today's Gays. "This day and age, what is there to celebrate?" Kramer said from behind his placard. "Everyone's all dressed up and they're going to go in and feel good about themselves. What is there to feel good about?"

In an e-mail he added, "I do not know what place [HRC] has in the community. I do not know what it does. I do not think it would make one bit of difference if they disappeared tomorrow."

Kramer's concerns are shared by many gays and lesbians who want HRC to better explain its day-to-day work. In the five months since one of the most disastrous elections for gay and lesbian rights, many gay activists are turning their anger away from powerful antigay forces and toward HRC, if for no other reason than that it is the country's wealthiest gay rights group.

There is no uniformity of feeling about HRC, though there is no shortage of opinions either. State, local, and grassroots activists are split on the group's effectiveness. While some express gratitude and offer praise for HRC's support, others are questioning just how well the group is doing its job and voicing skepticism about its potential for producing legislative victories in 2005 with a White House and a Congress controlled by vocally antigay Republicans.

Several such activists declined to be quoted on the record, not wanting to incur HRC's wrath. As tiffs story went to press, in fact, one prominent state activist called The Advocate in a panic, having been telephoned by an HRC board member who didn't want any negative comments in the press. Others were more public with their frustrations.

Alan Van Capelle, executive director of New York group Empire State Pride Agenda, says, "People want to know what the largest LGBT organization in the country has delivered for them." Oklahoma activist Terry Gatewood accuses HRC of having been "AWOL" during his state's marriage right in 2004. "I understood they got spanked [in previous state ballot battles], and they were reassessing how much money they were going to put into these rights," Gatewood says. "We just got the total runaround."

"HRC has always had critics and probably always will, and we hope to address those criticisms in a direct, forthright manner," says HRC spokesman David Smith, who was the group's director of communications under former executive director Elizabeth Birch and has just returned to HRC after more than a year away from the organization. "HRC has broad appeal within our community and straight allies. That is evidenced by membership and strong support."

Claiming 600,000 members, HRC remains the country's most visible gay rights organization. Other activists and straight allies look to it to set the national agenda on the right for gay equality and view its victories and its defeats as bellwethers for the gay and lesbian rights movement. Maistream reporters use its resources in reference to all things gay. In 2004 alone, according to the group, HRC was quoted by the media more than 1,000 times. Its blue-and-yellow equal-sign logo has nearly overtaken the pink triangle as the de facto symbol of gay rights. The group's outreach booths can be found at gay pride parades even in the smallest towns, and its online store sells everything from Calvin Klein T-shirts ($38) to dog (fishes ($8.95) emblazoned with its logo.

With fund-raising projected at $30 million for 2005, HRC boasts 10 times the number of donors of each of the three next best-funded groups: the National Gay and Lesbian Task Force, the Gay and Lesbian Alliance Against Defamation, and Lambda Legal. Only when the budgets of those three groups are combined can they come close to the financial fortitude of HRC, whose wealth is reflected by its sleek six-story headquarters near Dupont Circle in Washington, D.C.

Yet for all its financial might, HRC has in recent months faced management shake-ups and image problems that have rattled the organization to its core. Immediately after the November election the group lost its president, Cheryl Jacques, a former Massachusetts state senator who held the job for less than a year. (A search is under way for a new executive director, but at press time no candidates had been named.) Both Jacques and HRC cited disagreements over management style, but the timing led many to speculate that the group was rethinking its strategy.

Such talk was bolstered in December when The New York Times reported that the group was considering supporting the privatization of Social Security, a wildly unpopular position among progressives. Today, HRC officials say it was a reporter's error--a comment taken out of context--and firmly state that the organization is in no way in favor of President George W. Bush's plan. But the perception was difficult to banish: A letter signed by 60 activist leaders strongly rejected "trading" gay rights for the inclusion of same-sex couples in a revamped Social Security, and radical queer groups are still sending out e-mails condemning HRC's supposed support for privatizing Social Security.

"Did we hit a bump? Yes. But it was not a train wreck," says Vic Basile, HRC's first president and a current board member. "This is an organization that has thrived for 25 years, and it will continue to thrive." Other HRC staffers dismiss criticism as jealousy from those who can't re-create the elixir that makes the group a massive fund-raising success. HRC, they suggest, is being made the scapegoat for political setbacks for which no single entity is responsible. It's a situation that seems to be snowballing nationwide, as activists in battleground states face new court cases, new ballot initiatives, and new legislation designed to institutionalize antigay discrimination.

HRC also takes the fall for the lack of concrete victories on the federal level. There is still no Employment Non-Discrimination Act, no hopeful news on "don't ask, don't tell," no gay-inclusive hate-crimes law, no hope for tax laws that shelter same-sex domestic partners from paying income tax on health benefits.

But HRC contends that progress in D.C. comes one lawmaker at a time and may not make headlines. "When I started working at HRC, on November 14, 1994, just after the Republican Party took over control of [Congress], we had a small target list of Republicans and Democrats," says Winnie Stachelberg, the group's political director. "It was difficult to get meetings. There was a complete lack of understanding of issues that were facing the gay and lesbian communities." With its seven full-time lobbyists, who logged approximately 400 Capitol Hill visits in 2004, HRC has doggedly worked to change the way Congress views gays and lesbians. "Now," Stachelberg says, "we go to the Hill and there is much greater awareness of gay and lesbian issues and the concerns and challenges" facing gay people, and "there is more support on the Hill for our legislation than passage of bills would suggest."

That progress has been predicated on supporting allies in both major parties--another strategy for which HRC has taken a lot of flak, particularly in its 1998 endorsement of conservative Republican U.S. senator Alfonse D'Amato of New York, who lost his reelection race to progressive, pro-gay Democrat Charles Schumer.

"We are always prepared to support members of Congress who are good on GLBT issues," Stachelberg says. "We will always place some weight on whether a person is an incumbent. If we ask [a Republican] to vote a certain way and they do, you come back and support them again, even if that means they are challenged by a Democrat."

George Bush's second term promises to test the alliances HRC has formed on Capitol Hill, which is now populated by more vocally antigay Republican legislators than ever and a Democratic Party leery of pushing pro-gay legislation. In response, HRC's congressional lobbying is downplaying marriage equality in favor of issues that may find support more easily among middle-of-the-road voters.

"It's really important to keep pushing the envelope," says Hilary Rosen, an interim codirector of HRC. "We are in the process right now of preparing with our congressional allies two packages. One is on law and families, [which addresses] family protection, Social Security survivor benefits, estate-tax equity, and other kinds of health care choices. [The other] is on workplace issues--things like ENDA and the taxability of health benefits and pension designations and those things that all Americans get because of being associated with their jobs."

While Rosen acknowledges that in the current Congress these proposals are unlikely to pass, she argues, "You can always advance if you define advancement the right way. That's why it's so important to [emphasize] things like benefits in the workplace and nondiscrimination or pension portability in places like Georgia or Ohio. It's that kind of incremental work that matters in people's lives."

Rosen also cites HRC's launch of a religion project to jump-start a conversation on values without ceding faith to the religious right. "John D'Emilio, a gay historian, had this line I always subscribe to: We are about creeping and leaping. Only these days I think we are kind of doing both," Rosen says. "Public opinion is still moving in our direction, it's not moving backwards."

HRC acknowledges that the most pressing battles for gay equality are happening in the states, not in Congress. In 2004 the group spent $1.7 million on statewide activism. But every time HRC gets involved in local politics, it must balance its offer of significant resources against the perception that it's trying to preempt local leaders--or worse, funnel money back to its D.C. headquarters. In 2000, Lorri L. Jean, then the executive director of the National Gay and Lesbian Task Force, told the National Journal that HRC "continually organize[s] in ways that don't promote coalition or collaboration."

"In the past HRC has had really strained relationships with state organizations," says Roey Thorpe, director of Basic Rights Oregon, which in November unsuccessfully fought a state constitutional amendment to outlaw same-sex marriage. "But in the past year I have seen an unprecedented level of collaboration."

HRC, she says, "not only helped in fighting the ballot measure [in Oregon], they funded an effort to keep the measure off the ballot. I had a whole project set up to challenge the signature gatherers. In the past [HRC] had only given us a $5,000 equality grant. This time they donated $40,000 to help keep the measure off the ballot, in addition to more than $300,000 for the campaign against it."

Sharon Semmens, board chair of Georgia Equality, which also battled an anti-gay marriage ballot measure in 2004 and lost, calls her experience with HRC "100% positive." Semmens elaborates, "HRC's role was very much in partnership with Georgia Equality."

"Our intentions are good," says HRC national field director Seth Kilbourn. "We want to be collaborative, we are not about taking credit; it's about trying to get the work done. We don't want directive capability, but we want the ability and infrastructure to be able to lobby effectively in Georgia or Washington. I hope that over time that sort of hard, bright line between state and national will begin to blur."

The collaboration works both ways, he notes: "I need Equality Georgia, Massachusetts Equality, Equality California to help us with federal work, to make sure they have relationships with federal representatives. I need to be able to turn to them to find a gay couple to go talk to representative so-and-so about our issues. I also want to help them communicate their messages. It benefits both of us."

Not all of HRC's work is in battling antigay initiatives and federal lobbying. The group's WorkNet project, which tracks companies with GLBT-friendly employment policies, has seen a steady increase in corporations' voluntary participation since its launch in the late 1990s. Its FamilyNet project provides gay- and lesbian-led families a working primer for navigating legal waters regarding parenting, partnership benefits, estate planning, and other areas.

HRC also devotes considerable resources to providing the media with a gay and lesbian perspective on news developments, chiefly through educational ad campaigns and televised public service announcements. But at a time when visibility is no longer an end unto itself, activists are watching the organization that helped bring mainstream attention to GLBT lives.

"It's not that visibility isn't central or important," says Suzanna Danuta Waiters, the author of All the Rage: The Story of Gay Visibility in America. She warns against concluding "that cultural visibility is synonymous with profound cultural shifts."

Craig Rimmerman, professor of political science at Hobart and William Smith Colleges, agrees. "I think in the short term, Visibility is a form of success, but that can't take the place of serious and important policy accomplishments that improve LGBT lives."

Lorri L. Jean, now chief executive officer of the Los Angeles Gay and Lesbian Community Center, says the Human Rights Campaign remains crucial to achieving those goals: "We need HRC. We need them to be at their best. We need them to be even better than they've been in the past."

HRS'S MISSION STATEMENT

As America's largest gay and lesbian organization, the Human Rights Campaign provides a national voice on gay and lesbian issues. The Human Rights Campaign effectively lobbies Congress; mobilizes grassroots action in diverse communities; invests strategically to elect a fair-minded Congress; and increases public understanding through innovative education and communication strategies.

HRC is a bipartisan organization that works to advance equality based on sexual orientation and gender expression and identity, to ensure that gay, lesbian, bisexual, and transgender Americans can be open, honest, and safe at home, at work, and in the community.

SHOW US THE MONEY

How does the Human Rights Campaign spend its donors' money? The answer isn't simple, because under tax laws, HRC is considered two organizations in one: a foundation arm, called a 501(c)(3), donations to which are tax-deductible, and a lobbying arm, called a 501(c)(4), donations to which are not tax-deductible. Most individual donations, HRC says, are funneled into the 501(c)(4).

The two divisions share resources, and expenses may be allocated disproportionately. For example, the lobbying arm, which accounts for 79% of HRC's total expenditures, reported more than $3 million spent in 2004 on "membership education and services"--including the group's magazine and other mailings--while the foundation wing reported spending just $85, total.

Fund-raising costs are divided close to proportionately. "The (c)(3) is large contributions, corporate contributions, and [money from] foundations, but the cost of fund-raising we try to allocate across the board," explains interim codirector Hilary Rosen. "We don't try to separate it out because donors think they are giving to HRC, whether to (c)(3) or (c)(4)."

The combined organization took in just over $27 million in 2004. According to HRC's annual report, 59% went to programs, including both lobbying and field advocacy and 501(c)(3) programs such as WorkNet, FamilyNet, and media campaigns; 26% to fund-raising; and 15% on overhead, which includes building upkeep and employee salaries.

But HRC also counts under "programming" the costs of running its retail stores located in Washington, D.C., and Provincetown, Mass., and of direct-mail campaigns whose appeals for donations are wrapped around news updates. Charity watchdogs often shift such merchandise and mailing costs into the fund-raising category. That may explain why Charity Navigator, a New Jersey-based watchdog group, says that in 2003 HRC's 501(c)(3), known as the Human Rights Campaign Foundation, spent 41% of its money on fund-raising and just 48% on programs, giving the group a zero rating for efficiency. Charity Navigator's overall rating for the HRC Foundation is three out of five stars.

An HRC spokesperson responds simply that Charity Navigator's numbers are "wrong."

Wildman is The Advocate's Washington correspondent. Additional reporting by John Caldwell and Ryan James Kim.