Conservative "Outsiders" Have Inside Track in Legislative Session

His nickname around the Texas Capitol is “mucus.”

It’s a play on Michael Quinn Sullivan’s initials — MQS — but the moniker is fitting on at least two levels: It underscores how much of an irritant the conservative activist has become to politicians who dare buck his Tea Party orthodoxy. It also says something about Sullivan’s staying power in Republican-ruled Texas.

They can’t get rid of him.

“He’s had a tremendous influence on some of my colleagues,” said longtime state Sen. Rodney Ellis, D-Houston. “I’ve got to commend him. He’s whipped it up pretty successfully to make himself appear to be much more of a power than I think he really is in terms of delivering votes to or against somebody in an election.”

Sullivan is by no means the only conservative partisan in Austin. But the 6-foot-4 Eagle Scout has emerged as the most recognizable face of a new brand of grassroots activists, emboldened by the success of the Tea Party movement and not afraid to rock the boat. They have been loosely described — bitterly in many quarters — as “outside groups” that have driven so much of the budget-slashing agenda in the waning 2011 session of the Texas Legislature.

Sullivan presides over some of the most influential ones: Empower Texans and Texans for Fiscal Responsibility, the latter of which has spawned a political action committee that makes campaign donations, mostly to conservative Republicans. In 2009, the former paid Sullivan $100,000, about a quarter of its budget, IRS disclosures show. The two organizations operate together as a relatively seamless political advocacy outfit that generally blasts any politician (typically the “moderate” Republicans) who strays from the notion that the only solution to the state’s fiscal woes is spending cuts — the deeper the better.

The intellectual underpinning for them is the Texas Public Policy Foundation, the influential conservative think tank where Sullivan once served as spokesman and vice president. Modeled after the Heritage Foundation in Washington, the Texas foundation was created by Dr. James Leininger, who made a fortune in the medical-products industry and has been showering conservative Republicans with his largesse for decades.

Other conservative groups like Texans for Lawsuit Reform, which helped Tea Party enthusiasts make unexpectedly large gains after doling out nearly $7 million in the pivotal 2010 elections, are much bigger donors than any of the groups Sullivan has served.

But money isn’t his currency. He has gained influence by ranking lawmakers’ work in a highly watched (and feared) “scorecard” of votes. Sullivan, 41, holds the scorecard like an anvil over the heads of Texas legislators — getting the word out via email and social media, and personal visits to their districts. He gave more than 200 speeches in the 2010 election year, and he’s gearing up for a full schedule ahead of 2012. He’ll be endorsing staunch budget cutters, of course.

“Likewise, folks who didn’t perform as well, I’ll be in their districts, too, talking about their records and also seeing if there is receptivity to folks who might do a better job,” Sullivan said. In other words, he will be actively recruiting candidates.

His two groups and the policy foundation share an influential Midland donor and board member — oilman Tim Dunn, chairman and CEO of CrownQuest Operating. Dunn said he was “by far” the largest donor to Sullivan’s two nonprofit groups. The policy foundation, meanwhile, has a huge and diverse donor base, made up mostly of individuals, followed by support from other nonprofits and some donations from companies, disclosures by the groups indicate. The list of donors remains private, and officials declined to voluntarily release it.

What isn’t secret is that the groups are extremely close to Gov. Rick Perry. The longest-serving governor in the U.S. donated all of the proceeds of his Washington-bashing book, Fed Up!, to the policy foundation. And his former policy director, Brooke Rollins, is president and CEO of the group, which started in San Antonio in 1989 with one employee and a $100,000 budget. In 2010, it had 29 employees and $4.5 million in income, and it's about to move into new digs on Congress Avenue near the Capitol.

Sullivan, a former newspaper reporter, often heaps effusive praise on the governor. A recent “tele-town hall” Sullivan staged with Perry on the call-in line — which drew nearly 80,000 voters — had the feel of a pro-Perry infomercial. Sullivan also has a ubiquitous presence on YouTube, where he has posted videos claiming that Texans are "inherently better" than people from places like California and Michigan and criticizing the pilgrims’ colony at Plymouth Rock as a failed experiment in socialism.

But Sullivan doesn’t stray from criticizing the governor or any other Republican when he disagrees with them. (Sullivan has also criticized The Texas Tribune and other news media outlets as "liberal" and out of step with the views of average Texans.) He and Dunn launched Empower Texans and Texans for Fiscal Responsibility specifically in opposition to the business tax overhaul Perry championed as a school finance fix in 2006. Sullivan has also called spending on the governor's rental mansion excessive. And in Sullivan’s view, the governor’s cherished job-luring programs — the Texas Enterprise Fund and the Emerging Technology Fund — amount to “corporate welfare” that should be abolished.

Still, this year Perry, Sullivan’s groups and the policy foundation are all united in their demand that the Legislature make staggering spending cuts in education and health care programs without raising taxes or making a big raid on the Rainy Day Fund.

From the looks of it, they have won: The Legislature is on the verge of doing just that, whether it happens now or in a special session this summer. A tax increase was a nonstarter all along in the Republican-dominated Legislature. But keeping billions of dollars in the Rainy Day Fund at a time of major budgetary distress — an idea that rankled all the Democrats and, initially, many Republicans — can be directly attributed to the pressure these groups applied, proponents say.

“We’ve had a very consistent message, which has been no Rainy Day Fund, no tax increase, live within the available revenue,” said Arlene Wohlgemuth, director of the policy foundation and a former legislator known for her feisty conservatism. “I think when it became apparent that the budget was not going to use the Rainy Day Fund in the Senate, that was probably the high water mark of acknowledging the effectiveness of the outside groups. That was a signal that we made a difference.”

The way Wohlegemuth sees it, outsiders have always been agitating at the Capitol, but in the past, she said, they’ve pressed legislators to spend more, not less. In other words, move over teachers and health care providers: There’s a new powerhouse in town.

Things might have gone differently. The Senate Finance Committee, led by powerful state Sen. Steve Ogden, R-Bryan, voted in late April to spend more than $3 billion out of the Rainy Day Fund to make the 2012-13 budget a little less draconian. That prompted a furious response from Sullivan, who called the measure an “exercise in irresponsibility.”

It didn’t end there. Ogden, who had promised to fight hard to use the reserve account, complained that “outside groups” had wormed their way into Capitol corridors where only insiders once roamed.

“There’s so many outside groups who I think are basically hostile to the Senate, trying to influence senators’ votes,” Ogden told reporters on April 27. “One of the strengths of the Senate has always been that it was pretty hard to penetrate the club but these outside groups have done it. And it’s making it harder to pass a bill.”

Ogden's lament came just as Sullivan’s Texans for Fiscal Responsibility promised to negatively score any vote in favor of using Rainy Day Fund money for the next two-year budget (about $3 billion has been used to wipe out a deficit in the current budget). In early May, the Senate, using a parliamentary trick to overcome filibuster-like rules designed to protect the minority party, rammed through the bare-bones budget over objections from all 12 Democrats. The 19 Republicans, including Ogden, all fell in line behind a more austere budget — prompting liberal blogger Phillip Martin to joke on Twitter that the powerful senator had become “Michael Quinn Sullivan’s lapdog.”

Sullivan called the remark “silly” and said he feels no ill will toward Ogden. He noted that the very first politician who turned him into a sign-planting campaign volunteer, in 1990, was a young GOP candidate for state representative — named Steve Ogden.

“He’s not the first person to refer to the Senate as a club. He’s the first one to say it publicly,” Sullivan said. “It’s different now. I think it frustrates him.”

Sullivan hasn’t won everything, not even close. He wanted constitutional spending restraints, but the Legislature didn’t bite. He also famously opposed the continued reign of House Speaker Joe Straus, R-San Antonio, but Straus was easily re-elected to a second term as speaker in January. Sullivan still plans to negatively rate a pro-Straus vote on his hallowed legislative scorecard. He swears he doesn’t gloat when he wins — or brood when he doesn’t.

“I don’t mind losing,” he said. “What I do mind is not having a fight.”