Equality Arizona is back, but under a leader who allegedly doomed it.

For more than 30 years, Equality Arizona has existed as a local beacon of advocacy among queer Arizonans, a successful LGBTQ+ nonprofit that lobbied legislators, hosted star-studded events and held sway in lobbying circles and in Capitol hallways.

So, it came as a surprise last year, when without any public announcement Equality Arizona quietly lost all of its staff and was on the verge of completely folding and brought in another nonprofit leader to help close the business down.

There was no explanation to its abrupt end and no press coverage that the organization’s Interim Executive Director Jeanne Woodbury left her position.

But heading into the 2024 legislative session and a divisive election year coupled with a swarm of anti-LGBTQ+ bills and resolutions there was worry not enough queer voices, especially Equality Arizona leadership, would be at the Capitol.

Now, it’s back, but again under the leadership of Michael Soto, the same person who many say caused its original downfall.

Interviews with lobbyists at the state capitol, former board members, and former staff for the organization show that under Soto, the nonprofit and lobbying group saw immense success and grew from a team of volunteers to fully paid staff fundraising millions of dollars. But that success was followed by hundreds of thousands of dollars in alleged overspending that decimated the nonprofit’s assets. LOOKOUT has been given internal investigation documents that Equality Arizona’s board and lawyer reviewed, which include text and internal Slack messages, a formal grievance letter, and phone recordings that explained how Soto allegedly bled the organization of money, spent lavishly on out-of-state causes, took on a full time job in another state, and spent thousands of dollars on unauthorized expenses.

Soto denies any allegations that he improperly handled or spent funds, and dismissed claims that he was working two full time jobs. In an interview with LOOKOUT, Soto said the implications made in the letter to the board were proven false and that he was operating ethically and well within his parameters as CEO of the company. He also said he was fully transparent with his spending and employment with other organizations, and provided receipts and emails from lawyers and Equality Arizona’s accountant that showed he had no hand in the organization’s financial troubles.

But in September of 2022, after Equality Arizona’s board did an investigation based on the same documents LOOKOUT obtained, the board quietly eliminated Soto from his position as executive director while requiring employees and board members to sign non-disclosure agreements saying he resigned.

Now, along with taking back Equality Arizona as the president of the board and executive director in December, Soto is chief advocacy officer at ONE Community, a LGBTQ+ nonprofit that builds business relationships across political party lines.

His return to the organization has made some former Equality Arizona employees and LGBTQ+ advocates uncomfortable, leaving them to say that people should be made aware of what happens inside nonprofits and also be the ones to make decisions of who represents them at the Capitol.

A WHOLE OTHER JOB

When you meet Soto, you understand why he is so effective in his job as an advocate and LGBTQ+ leader. His presence easily fills a room. He's charming and speaks passionately on queer issues.

Mix that with his track record at Equality Arizona and it's easy to see why he was a leading contender for a job with the Greater Seattle Business Association, one of the nation's largest LGBTQ+ business alliances.

The organization sought out a new leader for almost a year after their former chief executive resigned from the position in 2020 and left the company without an official CEO.

That changed, though, in November of 2021. The GSBA announced Soto as its new president and CEO.

A seasoned professional who had worked with Arizona’s LGBTQ+ businesses, forged alliances among conservative and faith-based organizations, and secured hundreds of thousands of dollars in grant funding for equality campaigns, Soto was seen as a fierce advocate of queer causes and a worthy replacement.

“Soto was selected after an extensive nationwide search for the ideal candidate to grow and further develop GSBA’s mission to bring communities together through business while advocating for civil rights by supporting small businesses, promoting LGBTQ+ tourism, and investing in the next generation of leaders,” GSBA’s press release read.

Soto signed his contract on Dec. 13, according to GSBA, with the understanding that he would move to Seattle in January 2022 to work full-time.

“I am excited to call the Pacific Northwest my new home and am proud to work toward equality and inclusion in the Seattle area and beyond through GSBA,” said Soto in the same press release. “I’ve been dedicated to advocating for the Arizona LGBTQ+ community, having led a team of professionals to build its political power…I hope to help GSBA to create even more positive social impact and continue to support the ongoing success of this organization.”

The release noted that Soto was “most recently serving as the executive director for Equality Arizona.”

But Soto did not leave his position in Arizona. Instead, in the same month he signed the contract with GSBA, he also negotiated a bonus and backpay of more than $60,000 with Equality Arizona, according to the grievance letter filed with the organization's board.

It didn’t take long for people to notice: people at both organizations raised questions about Soto’s employment after noticing that he was missing certain days, or was seen in Phoenix when he should have been in Seattle.

At one point, when Equality Arizona rebranded its website in March 2022, Soto was still listed as the nonprofit’s executive director. He allegedly told staff at GSBA that he wasn’t sure why Equality Arizona wouldn’t remove him from the website, and assured them that he was no longer working as the organization’s executive director, according to the grievance letter and a recorded phone call with an Equality Arizona staff member and GSBA leader that was provided to the board.

At the same time, though, Soto was telling his staff in Arizona a different story. On at least three occasions, internal messages and recorded calls between Equality Arizona staff and Soto show that Soto said the job at GSBA was just a “contract,” and was not permanent.

That isn’t true, according to the GSBA.

“He was not on contract basis,” said a GSBA leader in a phone call that was used in the investigation by Equality Arizona. “He was a full time employee, employed as president and CEO of GSBA.”

On his official start date with the GSBA on Feb. 7, Soto claimed he was in an accident that broke his ankle, and couldn’t be there. In a phone conversation with a GSBA leader that was given to the board for review, they said Soto later claimed he also broke two ribs. That same day, though, he was seen working at the Arizona Capitol.

On multiple occasions, the grievance letter said staff at both Equality Arizona and GSBA confronted Soto on where he was employed.

In an emailed statement to LOOKOUT, Soto defended his job at GSBA and said that “having work outside of Equality Arizona was common practice for all staff and included working with other social justice nonprofit organizations in Arizona and outside of Arizona.”

When later asked about the GSBA leader who said Soto was hired as a full-time employee, he said he wouldn’t comment on any organization’s claims against him, just that they were false.

“I don't know what's happening with any of those folks and it's not my business,” he said. “I don't know what their motives are for saying what they're saying, but I'm not gonna comment on them.”

Former staff at Equality Arizona confirmed that contract work outside of the organization was common and not prohibited. However, those jobs were either part-time or short-term, they said. Screenshots reviewed by the board also showed that those outside contract gigs for staff typically went through an approval process to make sure there were no conflicts of interest.

Staff said in interviews that never happened with the GSBA job for Soto.

CONFLICTING STATEMENTS

Despite public statements from Soto saying he was excited to call the Pacific Northwest his “new home,” the permanent move to Seattle never happened.

Soto was initially expected to move to Seattle in January 2022, with a start date of February, according to a phone call with the GSBA leader. But during that time, he was still in Arizona working for Equality Arizona. He told leadership at GSBA that he had COVID-19 and was hospitalized, according to phone calls.

Screenshots from Slack messages and emails showed that Soto was very much still involved with work at Equality Arizona throughout January, and did not tell staff about his new job with GSBA.

It’s unclear if Soto was, indeed, hospitalized or had COVID-19. But an interview with a former staff member said they did not recollect Soto ever being ill at that time.

On his official start date with the GSBA on Feb. 7, Soto claimed he was in an accident that broke his ankle, and couldn’t be there. (In the phone conversation with the GSBA leader, they said he later claimed that he also broke two ribs.)

But while allegedly suffering from broken ribs and an ankle, Soto was seen, photographed, and quoted at the Arizona State Capitol promoting a nondiscrimination bill that he helped forge with the help of ONE Community and members of the House LGBTQ+ Caucus.

In a response to questions from LOOKOUT, Soto said that despite claims he openly told GSBA members about illnesses and accidents, he keeps his medical life private from staff.

“None of the individuals who are your sources have ever been involved in my life in a way that would give them substantive knowledge of my medical challenges or needs including in regard to illness, injury, or anything else… Like many people, I choose to be as private as possible in regard to my medical care and health,” Soto said.

“He pulled all our trans staff aside in a private meeting, and literally people were pitted against each other." - Statement from a GSBA leader in a recorded phone call.

While employed at both organizations, members at Equality Arizona and GSBA noticed there were issues with Soto, primarily not showing up to meetings, disappearing from phone calls, or saying he was out fundraising for one organization when he was actually meeting with people for the other nonprofit.

According to the grievance letter, in one instance Soto said he was in Seattle meeting with a prospective funder for Equality Arizona. In reality, GSBA officials said that he was working for them on the same day and going to multiple meetings.

In another occasion, the letter read, GSBA leaders raised alarm on Soto missing an important meeting. He said he was with funders. Instead, the letter alleged that he was in a meeting with Equality Arizona Board President Caitlin Breedlove.

Breedlove wouldn’t comment on the allegations raised in the letter, citing the non-disclosure agreement.

Pushback to Soto being hired at both companies was met with attempts at retaliation, according to the phone call with the GSBA leader. The person said a staff member who noticed the video at the Arizona State Capitol in February 2022 and then brought it to GSBA’s attention “had a target on their back,” and said Soto wanted them fired, but was unsuccessful.

Also, the letter sent to the board said that when Equality Arizona Deputy Director Nichole Cassidy confronted Soto about his employment with GSBA during a private phone call, he accused her of being transphobic and racist, and said she was “spinning out of control.”

The authors of the grievance letter, Cassidy and Woodbury (who at the time was Equality Arizona’s communications director), wouldn’t speak on record about Soto’s leadership. Both Cassidy and Woodbury signed NDA’s related to their time at the organization. (Woodbury currently works at Creosote Partners, where LOOKOUT board member Gaelle Esposito is a partner. LOOKOUT board members are not involved in editorial decisions.)

Soto also allegedly “pitted” GSBA staff against each other, according to the GSBA leader’s phone call.

“Half of our staff is trans,” they said. “And he put such a rift between the staff, he alienated the staff from each other. The first time was in Seattle, he pulled all our trans staff aside in a private meeting, and literally people were pitted against each other.”

“It was horrible,” they said.

FINANCIAL PROBLEMS

Soto calls himself a community organizer at heart, and his time in advocacy reflects that. According to a publicly available resume from 2017, he previously worked as a program manager at St. Joseph the Worker, and at Arizona Citizens for the Arts as its outreach and community developments manager. He even had a stint as communications fellow at Equality Arizona in 2008 — years before he was tapped to run the organization.

Soto started leading Equality Arizona in 2018, after serving on its board for almost three years. In 2020, he took over officially as its CEO.

It could have been his background in grant management, relationship building and advocating for LGBTQ+ people and the arts that made him a qualified candidate for the job at Equality Arizona, which at the time had been a major force in queer advocacy across the state, but made little money and had almost no staff.

The year Soto started, IRS Form 990 filings—tax documents charities are required to file and make publicly available every year—show that Equality Arizona’s 501(c)(3) arm brought in less than $80,000 a year, with only $17,187 in financial assets. Within his first year, revenue tripled to $240,421, and increased year over year until 2021 when the organization under his leadership brought in $314,905, and had net assets of more than $113,000.

“I want to be clear. That funding was explicitly there.” - Soto speaking on allegations that he misspent money.

Equality Arizona Foundation is registered as a 501(c)(3) charitable nonprofit, and a 501(c)(4) named Equality Arizona that can lobby on behalf of Arizonans.

But after taking his position at GSBA, tax forms showed that revenue for Equality Arizona’s 501(c)(3) arm only increased by $50,000, whereas spending almost doubled from $362,000 in 2021, to $601,272 in 2022. Most of that spending went to a federal initiative that focused on the U.S. Respect for Marriage Act, Soto said. But without more money coming in, the organization was spending money it didn’t have, staff members claimed in the letter.

At one point, an Equality Arizona staff member raised the alarm that they were worried about the company’s finances, according to a Slack message shared with the board. In response, Soto wrote that funding was coming and not to worry about budgeting.

Soto sat down with LOOKOUT and presented a spreadsheet showing that during 2022, he brought in more than $600,000 of grants that covered the costs of traveling to Washington, D.C. and working on federal initiatives.

“I want to be clear,” he said. “That funding was explicitly there.”

He didn’t provide a copy to LOOKOUT for review.

But by September 2022, when Woodbury took over as interim executive director, the organization was left without any reserves. Equality Arizona’s tax forms in 2022 showed that after Soto left, the nonprofit had negative financial assets totaling more than $124,000 for the 501(c)(3) arm.

Soto said he wasn’t with Equality Arizona when the 2022 tax forms were filed, and had no insight into why the organization’s 990 showed a deficiency in funds.

“I have no idea what happened with it,” he said. “That's not something I could comment on.”

He also said now that he’s back as president of the board for Equality Arizona, it would be a priority for him to understand what happened to the organization, financially, and re-evaluate the 2022 tax documents.

In the grievance letter, employees claimed that Soto had also linked the Equality Arizona business debit card to a personal Amazon account and made unauthorized purchases. Slack messages and internal documents showed that Soto was pressed to provide receipts totaling more than $11,000 in Amazon and other purchases for almost eight months. A message showed that in order to finish accounting for the quarter, some of the purchases were designated as “office supplies” without knowing what they were.

Soto provided a confirmation email from his lawyer and Equality Arizona’s accountant that detailed his Amazon purchases, refuting the claims in the letter. He said that he was consistent during his time as executive director in providing receipts, and wasn’t sure why the claims were made against him.

“All purchases made by me on behalf of Equality Arizona have been recorded and accounted for in accordance with the organization’s financial processes,” Soto said in his prepared statement. He said he confirmed with the organization's accountant on Jan. 23 this year that “the 2022 financial year would not have been able to be closed out if all expenses and purchases had not been properly accounted for by the organization.”

AN EXIT STRATEGY

After months of playing both sides in Seattle and Phoenix, Soto quietly left his position at GSBA.

In conversations with one staff member, he said he “fired” GSBA as a client in May 2022, adding that the organization was “fucked up,” according to a phone call provided to the board. News articles from Seattle Gay News needled Soto and said he must have not been able to handle the Pacific Northwest’s weather. The Puget Sound Business Journal only said that Soto would continue working on a national campaign for LGBTQ+ equality.

But the phone call with the GSBA leader said that he resigned in June 2022, a month later than when he told Equality Arizona staff. They said an internal investigation was done after Soto claimed the organization was “toxic,” and implied that members of GSBA had to sign an NDA.

Months later, Equality Arizona’s board received the grievance letter. It accused Soto of holding two positions secretly, not being present for many of Equality Arizona’s events or meetings, and showed concern over the organization’s financial problems during his time as CEO.

In August 2022, the board put Soto and Cassidy, the deputy director, on temporary leave and later decided to terminate Soto from his position at Equality Arizona. Cassidy resigned from her position at the same time, while Woodbury was appointed as interim executive director.

Members of the board and staff signed NDA’s that didn’t allow them to speak publicly on the subject for two years or while employed at the organization. The agreement said that Equality Arizona would “have its record reflect that Soto’s employment ended by resignation,” and that if media or organizations asked for an explanation, Equality Arizona would “only provide a copy” of a letter written by Breedlove, the board president. The letter explained Soto was leaving to continue federal work in LGBTQ+ matters.

Breedlove left in September 2022 right after Soto’s departure, and only confirmed in a phone call that Soto was removed from his position.

On Sept. 23, 2022, his final day at Equality Arizona, he was named Chief Advocacy Officer for ONE Community, the group he had worked with to push an anti-discrimination bill alongside other local campaigns for LGBTQ+ equality among business owners, where he remains in that role.

Angela Hughey, ONE Community’s executive director, wouldn’t respond to questions on the allegations leveled against Soto, but confirmed in an email that Soto’s position as chief advocacy officer was as a consultant.

When asked on his termination from Equality Arizona, Soto sent LOOKOUT the letter from Breedlove, as well as a signed letter from former board member Ritchie Taylor, who is now the spokesperson for the Arizona Attorney General, that praised his work as CEO.

Taylor also wouldn’t speak on record about Soto’s time or the investigation.

This all came to a head in the summer 2023, when Woodbury stepped away from Equality Arizona. Woodbury wouldn’t comment on why she left, but said in a text message that everything in the letter “is all true to the best of my recollection.”

Soon after, rumors abounded that the organization was defunct. And with no one leading it, Soto said he was approached and asked to be reinstated as Equality Arizona’s president. It’s unclear who on the board approached him. 

But people close to the matter said the board was facing financial liability with Equality Arizona’s debts, and wanted to exit from the company. Soto said that wasn’t true. 

“I've looked at all of the bank statements, there hasn't been a shortfall,” he said. “So that's where I was like, ‘What are you talking about?’... Like the records don't reflect that.” 

The Arizona Corporation Commission shows that as of Dec. 27, 2023, Soto was in charge, with all other board members removed from their positions. He wouldn’t comment about why board members left, only that some had finished their term.

Soto remains an influential figure in Arizona’s LGBTQ+ advocacy scene, and despite the allegations against him, he said he won’t dwell on them.  

“We live in a really difficult time,” he said. “I believe in an ethic of solidarity, and regardless of what these folks  what's happening for them in their lives, that's making this feel appropriate for them, make them feel like it's okay for them to make these kinds of allegations  I'm not going to say anything that would hurt them or be detrimental in any way. Because I have empathy for these folks, and they're part of my community.”

And taking back Equality Arizona as it exists currently, he finds himself in the same situation he did when first leading it in 2018. He said there’s an opportunity for the organization to approach advocacy through community organizing, outreach and building partnerships to dispel misinformation and get community members activated in local politics. 

“For me, that's still the point of Equality Arizona,” he said. “It's not a direct service provider, right? It doesn't do a whole lot of things. It works strategically to pass bills that increase the rights and make better the quality of life of LGBTQ people.”

But since the start of legislative session, with more anti-LGBTQ+ bills proposed than ever before, Soto has scarcely been seen advocating for the community at legislative hearings.

And there are some people that question if Soto is the right person to lead Equality Arizona.

Breedlove, the former board president, spoke generally that the people running local nonprofits—especially ones that represent marginalized communities—should consider more transparency and letting those they help have a say in who represents them. 

“It shouldn’t be up to a small number of people,” she said. “And if there are concerns from the community, they should be raised—so long as it’s proactive.”