The Insider

Aid and Comfort
Since he began running for mayor, Rob Mosbacher hasn't been the least bit shy about trumpeting his chairmanship of the Greater Houston Area Chapter of the American Red Cross and his other philanthropic endeavors.

The multimillionaire oilman has routinely mentioned his work for the Red Cross in his handouts and mailings. But recently, by highlighting his volunteer service in a television commercial, Mosbacher appears to have violated the nonprofit relief agency's code of conduct, which bans the use or involvement of the Red Cross or its name in political campaigns.

It's always possible, of course, that Mosbacher was simply confused by the Red Cross's slogan, "Help Can't Wait," and presumed that it applied to his ambitions to hold elective office as well as to aid for disaster victims.

Earlier this year, The Insider has learned, Red Cross funds were used to pay for a ghostwritten op-ed piece on the agency's behalf that ran under Mosbacher's byline in the Houston Chronicle -- after he had launched his mayoral bid. More on that later, but first let's examine the aid and comfort old Mosbacher associates received from the Red Cross while the candidate was a board member and later chairman of the Houston branch.

Back in 1993, the local chapter hired longtime Mosbacher family retainer Herb Butrum for a $100,000 "major gifts development" study funded by the agency's national organization. Butrum has worked for years for Mosbacher Energy, the family-owned company of which Rob Mosbacher is president, and is currently being paid $7,500 a month as a consultant to Mosbacher's campaign. Mosbacher was on the Red Cross board at the time Butrum signed on for the study. He began his two-year run as chairman in 1995.

Butrum told The Insider he received "$60,000 or $70,000" for the study, and also performed similar work for a half-dozen other Red Cross chapters around the country. He acknowledged that Mosbacher recommended him for the local contract, but defended the assignment, which he described as an intensive two-year study of how the Red Cross could fill the vacuum created when the United Way withdrew as major funding source for the agency's efforts. Butrum says he also advised the local chapter on the purchase of new computers and sophisticated software to enhance its fundraising capabilities.

A person with inside knowledge of the Houston chapter's operation has a different take on Butrum's work: "The study, which uncovered such startling facts as the Red Cross was not in the in-crowd and that its own board members were ignorant of what it did, was considered nonsense and quickly forgotten."

The Mosbacher campaign did not respond to verbal and written requests from The Insider for a response to this story.

During his chairmanship, Mosbacher also approved the local chapter's hiring of Donna Rybiski as its marketing and communications director -- reportedly at a $70,000 salary, considerably above the $36,000$41,000 salary the chapter initially advertised for the position. Rybiski declined to divulge her annual pay to The Insider, saying it was not public information.

Rybiski is old friends with Mosbacher and his wife, Catherine, as Rybiski let it be known to other employees in the Houston office after her hiring. Her resume includes a stint as executive director of the Houston Committee for Private Sector Initiatives, a group sponsored by Tenneco that Mosbacher helped found in the early 1980s. It encourages corporate involvement in community self-help projects and has a distinctly Republican aura. (The same Mosbacher television commercial that promotes his Red Cross service also features Ann Kaufman, a former board member of Committee for Private Sector Initiatives, praising Mosbacher for his involvement with that group. Last week, the head of another nonprofit agency complained to the IRS that Kaufman's appearance in the commercial violates federal rules prohibiting nonprofits from endorsing candidates.)

Under Rybiski's direction, Mosbacher was afforded a generous amount of face-time in two newsletters of the local chapter that were issued after he began his campaign for mayor. The spring edition of the Good Neighbor News contained a front-page letter from the outgoing chairman entitled "Mosbacher Recalls Volunteer Rewards." Inside are photographs of Mosbacher gripping and grinning with American Red Cross President Elizabeth Dole and Councilwoman Martha Wong. Four photographs of the mayoral candidate with various dignitaries were shoehorned into the newsletter's summer edition, published after Mosbacher's tenure as chairman was over.

Rybiski, who displays a photo of herself, Mosbacher and President Reagan at her Red Cross office, was responsible for a $787 expenditure of the nonprofit's funds to pay corporate communications specialist Suzanne Thomas to ghostwrite the Chronicle op-ed page piece that ran under Mosbacher's byline on March 2, a week after Mosbacher conducted a fundraiser that netted more than a million bucks for his campaign. The 732-word piece was not overtly political -- it simply plumped the Red Cross's efforts -- but it definitely provided some free exposure for the fledgling candidate with the advertised "warm heart for Houston."

Thomas confirms she wrote the editorial that carried Mosbacher's byline and was paid out of local Red Cross funds. Her billing to the agency even included a handwritten thank-you note to Rybiski. "Donna, many thanks again for the business," wrote Thomas. "It is always most appreciated."

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