Donelon won a full-term as commissioner in the October 20, 2007 jungle primary. He finished with 606,534 votes (51 percent) and defeated three opponents, the strongest of which was the Democrat James "Jim" Crowley, who polled 423,722 (36 percent). Two other Republican candidates held the remaining 13 percent of the vote.
Donelon was first elected to complete a 15-month unexpired term as insurance commissioner in a special election held on September 30, 2006. He polled 50.1 percent of the ballots cast in a low-turnout election. His 283,316 votes were 847 more than the tabulations of his two opponents combined. Republican state Senator James David Cain of Sabine Parish in western Louisiana, polled 222,414 (39 percent); S.B.A. Zaitoon of the Libertarian Party, received 60,094 votes (11 percent). There was no Democrat in the special election. Donelon ran strongest in urban areas; Cain, in the rural parishes and small towns.
Donelon became commissioner when Democrat J. Robert Wooley resigned to become a lobbyist for the high-powered law firm Adams and Reese in Baton Rouge. Wooley appointed Donelon as his first deputy in 2001, and under the Louisiana Constitution of 1974, Donelon automatically became temporary commissioner. Donelon is considered an expert in matters of insurance and risk management. Even his critics concede that he has one of the longest resumes in modern Louisiana politics.
Wooley said that he chose Donelon to be his chief deputy because of Donelon's impeccable reputation and his extensive knowledge of insurance. "Jim was the only guy I knew who could help me restore the credibility and integrity of an office embarrassed because the three previous insurance commissioners had gone to jail," Wooley said. "He is a consumer advocate who does the right thing for the right reasons, and he knows insurance inside and out. I believe he is the most qualified commissioner of insurance ever to assume the position," Wooley added.
In 1979, Donelon passed up a race to win reelection to the Jefferson Parish Council to make an unsuccessful race for Lieutenant Governor to his then fellow Democrat, Robert Louis "Bobby" Freeman of Plaquemine in Iberville Parish. Donelon was considered the "conservative" in that race to the "liberal" Freeman. Most of the supporters of David C. Treen, the winner of the gubernatorial election that year, are believed to have backed Donelon, and most of the backers of Democrat Louis J. Lambert went with Freeman.
Thereafter, Donelon narrowly failed in the spring of 1980, as a Republican convert in a bid for the United States House of Representatives from the Third Congressional District. He also lost a Republican campaign for the U.S. Senate in 1998. He lost to the Democrats Wilbert Joseph "Billy" Tauzin, II, and John B. Breaux, respectively, for the U.S. House and Senate. Former Congressman Tauzin switched to Republican affiliation in 1995. Both Tauzin and Breaux retired in January 2005.
Donelon also lost a race to a fellow Republican for a state judgeship in Jefferson Parish in the spring of 1999.
Donelon was born in New Orleans. He graduated from Jesuit High School, the University of New Orleans, and Loyola University School of Law. In 1986, he was the first recipient of the Homer L. Hitt Distinguished Alumnus of the Year award for the University of New Orleans. He is Roman Catholic.
He is married to the former Merilynn Boudreaux. They reside in Jefferson Parish and are the parents of four daughters and the grandparents of two granddaughters and one grandson. Donelon serves on the board of directors of Hope Haven Boys Home, Friends Alliance for the Mentally Ill, and the Blood Center for Southeast Louisiana. He is affiliated with the Sacred Heart Dad's Club, and the Council on Alcohol and Drug Abuse. The Alliance for Good Government honored Donelon as both "Outstanding Jefferson Parish Official" and "Legislator of Distinction."
Donelon retired after 33 years of service as State Judge Advocate for the Louisiana Army National Guard. He held the rank of colonel and received the prestigious Legion of Merit medal, among other citations.
On February 20, 1980, he switched to Republican affiliation to run for the Third Congressional District seat vacated when David Treen became governor. Treen urged the party to coalesce behind Donelon even though there were other longer-tenured Republicans who were interested in making the race. Donelon attracted three Democratic opponents in the special election. The strongest was state Representative Tauzin, then of Thibodaux in Lafourche Parish, who was the chairman of the House Natural Resources Committee. Also in the race was state Senator Anthony "Tony" Guarisco of Morgan City in St. Mary Parish, considered a "fiscal conservative" but a "social liberal", who was a strong proponent of the unratified Equal Rights Amendment. Robert "Bob" Namer, who criticized the other three candidates for excessive campaign spending, also ran as a Democrat, but he later switched to the GOP.
Tauzin filed with the Federal Election Commission a complaint which charged that Donelon's campaign donations were tainted. He cited Donelon's series of letters of credit with no interest required through the Jefferson Bank and Trust Company. Such loans violated federal election law, Tauzin noted. Donelon in turn claimed that the first Mrs. Tauzin obtained a $60,000 loan for her husband's campaign and criticized Tauzin for making "a friviolous charge . . . in the waning days of the campaign."
Former Governor Edwin Washington Edwards had initially told Donelon, who had been an Edwards aide prior to 1975, that Edwards would not become involved in the campaign. When Treen began to campaign for Donelon, Edwards endorsed Tauzin, a former floor leader for Edwards. Donelon entered the first round of balloting as a slight favorite in that he had won some 57 percent of the vote in the parishes which then comprised the Third District in the lieutenant governor's race against Bobby Freeman just seven months earlier. Guarisco, who was endorsed by the New Orleans Times-Pcayune, which had supported Treen for governor in 1979, said that he did not want the support of either Edwards or Treen because he was "independent of all that." Tauzin was also endorsed by Lieutenant Governor Freeman, Senator Russell B. Long and Congressman John Breaux, whom Donelon would oppose 18 years later in a Senate race.
Donelon led in the first balloting with 37,191 votes (45.1 percent), but he had peaked and could not sufficiently broaden his appeal into the special election runoff. Tauzin followed with 35,384 ballots (42.9 percent); Guarisco had 8,827 (10.7 percent), and Namer only 1,0670 (1.3 percent). Donelon won his own Jefferson Parish with 67.4 percent and eked out a bare 50.5 percent in often Republican-leaning Iberia Parish at the western end of the district. In the other French parishes, Donelon fared poorly, taking just 14.9 percent in Tauzin's home base of Lafourche, 33.5 percent in Terrebonne Parish (Houma), 27.3 percent in St. Mary Parish, 30.2 percent in the two St. Martin Parish precincts in the district, and 38.7 percent in St. Charles Parish. Some 60 percent of Donelon's vote came from Jefferson Parish.
The Republican National Committee joined the National Republican Congressional Committee to raise money nationwide for Donelon. RNC Chairman William "Bill" Brock of Tennessee and congressional chairman Congressman Guy Vander Jagt of Michigan, said that funds were need to purchase media and newspaper advertising to reach undecided voters and to conduct a massive "get-out-the-vote" drive. Brock and Vander Jagt said that the Louisiana special election was "an opportunity to hold this congressional seat. Donelon is an outstanding Republican and former Jefferson Parish president. His Democrat opponent [future Republican Tauzin] is pro-big labor and a big spender. Democrats and labor bosses will go all out with massive campaign blitz to win control of this district. Republican leaders in Louisiana join us in urgently requesting your immediate action to stop them . . . "
The Republican effort to elect Donelon to hold the Treen seat fell short. Tauzin prevailed with 62,108 votes (53.1 percent) to Donelon's 54,815 ballots (46.9 percent). Donelon's 2/3 majority in Jefferson Parish was insufficient to offset huge Tauzin majorities in Lafourche, St. Charles, St. Mary, St. Martin, and Terrebonne parishes. In Iberia Parish, the two split the vote, with Tauzin securing 50.1 percent. The turnout in the May 17 special election runoff was 116,923, compared to 82,462 in the April 19 first round of balloting. The greater participation occurred despite flooding that inundated much of south Louisiana the previous day. Donelon announced after his defeat that he would not challenge Tauzin for a full term later in the year. Tauzin became unbeatable in the district. Even when he switched parties, he was then untouchable by a Democratic opponent.
In a special election in 1982, Donelon won the seat vacated by the resignation of Representative Charles Grisbaum, Jr., a Republican. Grisbaum, who became a judge on the new Fifth Circuit Court of Appeal in Gretna, the seat of Jefferson Parish, had also run for Congress as a Democrat in 1974 against Republican Representative Treen. Grisbaum became a friend of Treen's during that campaign, and, in 1977, he switched parties while continuing his legislative service from Jefferson Parish. Grisbaum by 1980 was one of Treen's point men in the legislature.
Donelon, who followed in Grisbaum's path, also has ties to Treen. It was then newly-inaugurated Governor Treen in 1980, who proposed that Republicans unite behind Donelon for the special election to choose Treen's congressional successor.
Donelon was considered a "conservative" legislator. In 1996–1997, the Christian Coalition gave him an overall 80 percent rating for that legislative session.
After he won repeated legislative reelection in Jefferson Parish, Donelon became his party's "sacrificial lamb" in 1998 against popular Democratic Senator John Breaux of Crowley in Acadia Parish, who was seeking his third and, as it turned out, final term in the U.S. Senate. Donelon stepped up to run when other candidates deferred to the inevitablility of Breaux's reelection. The race was not close. Breaux won the jungle primary outright with 620,504 votes (64 percent). Donelon trailed with 306,616 (32 percent). The remaining 4 percent was shared by a half-dozen minor candidates.
Donelon held the legislative seat, District 98, for nineteen years until his resignation on June 30, 2001. As he took the position in the Department of Insurance, Donelon was succeeded by a fellow Republican, Thomas John "Tom" Capella.
Before he left the legislature, Donelon ran in a special judicial election on March 27, 1999. He was defeated by Republican Ronald D. Bodenheimer, who polled 8,981 votes (55 percent) to Donelon's 7,300 (45 percent). In that race Donelon had unsuccessfully used the slogan "Who Better to Interpret the Laws Than the Person Who Wrote Them." Thereafter, Bodenheimer (born 1953), a former prosecutor, went to prison on conviction of having conspired to plant the prescription painkiller OxyContin in the automobile of an FBI informant who frequently complained about drug trafficking and zoning violations at the judge's marina.
On June 5, 2006, then Commissioner Donelon issued Advisory Letter 06-04 to the approximately 100 companies with homeowners insurance policies in Louisiana. The letter requests their cooperation in extending from one to two years the prescriptive period for policyholders with Hurricane Katrina and/or Rita claims. In most cases, a Louisiana policyholder's right to file suit on a homeowners insurance claim is limited to twelve months.
"Given the unprecedented number of claims following Hurricanes Katrina and Rita, one year is simply not going to be enough time for many policyholders and insurance companies to work out a settlement that is in the best interest of both," Donelon said. He asked insurers to file with his department on or before August 1, the necessary paperwork to put the extension into effect.
Donelon conducted a month-long, statewide storm awareness tour: "As I talked to policyholders and insurance industry representatives throughout the state, I became certain that extending the prescriptive period is the right thing to do," Donelon said.
Wooley said that he had planned to resign prior to the hurricanes, "but when Katrina hit, we decided we had to try and get through at least the crisis part of it." Wooley said that he had accomplished most of his goals as commissioner prior to the hurricane, the most important of which was restoring the public image of the Department of Insurance.
Wooley joined the department in 1999 as then-Commissioner James H. "Jim" Brown’s chief deputy. In the fall of 2000, Brown, a Democrat, was convicted of lying to an FBI agent, and Wooley moved up to the commissioner's position. Wooley was the first commissioner to leave office without a streak of scandal. His predecessors went to prison. Brown served a six-month sentence in the facility in Oakdale in Allen Parish. Democrat Douglas D. "Doug" Green of Baton Rouge received 25 years for his part in the Champion Insurance scandal of the late 1980s. Sherman Bernard, who is also remembered for having opposed the Democratic nomination of Senator Russell Long in 1974, served time for taking bribes.
In the special election, Donelon faced a fellow Democrat-turned-Republican in state Senator James David Cain of tiny Dry Creek. Cain questioned Donelon's commitment to the Republican Party because of Donelon's acceptance of the staff appointment from the Democrat Wooley. Yet, Donelon has been a registered Republican for twenty years longer than has Cain. Cain's opponents say that he violated the old Ronald W. Reagan "Eleventh Commandment," which proclaims to GOP candidates: "Thou shall not speak ill of another Republican." Cain's state Senate term expires early in 2008.
Cain attempted to taint Donelon into a "guilt by association" with the legal problems that past Louisiana insurance commissioners have endured. Donelon fired back in two ways. The Internet bayoubuzz.com reported that Donelon courted local insurance agencies. He, like Wooley and Wooley’s former boss, Jim Brown, built a strong popularity with the industry's rank and file. Bayoubuzz.com also obtained a memo that seems to outline an aggressive strategy to appeal to frustrated homeowners still awaiting their benefits from Katrina and Rita damage. Donelon also pledged to continue Wooley's work at improving the image of the agency.
In his term as chairman of the Senate Insurance Committee, Cain criticized many of the policies of the Wooley administration, which Donelon has continued. Cain decried as "too little, too late" investigations by the Department of Insurance conducted against companies that tried to avoid reimbursing customers. He also attacked Donelon in the post-storm era, most notably over the continued operations of the Louisiana Citizens Property Insurance Corporation.