Six months ago, Democratic National Committtee Chairman Tom Perez hired veteran Democratic operative Jess O'Connell to serve as CEO of the party organization. At that time, Dems were reeling from a top to bottom loss at the polls in 2016, including Hillary Clinton's devastating defeat at the hands of Donald Trump.

Here we are six months later, and while there has been some improvement in the party's fortunes with their victories in the Virginia and New Jersey governor races, the party still lags in fundraising and there is much unhappiness with how the DNC is divvying up cash to state and local parties.

Whether Perez felt the need to make a change is unclear. But for whatever reason, O'Connell is out as CEO.

NBC News:

O’Connell will leave the party stabilized, if not yet fully recovered, after wins last year in Virginia and Alabama, and her decision to leave is a personal one, a DNC official told NBC News, timed to cause minimal disruption ahead of November's midterm elections.

But O'Connell's departure comes just months after the DNC ousted its finance director following a period of weak fundraising, as well as a shakeup last year that reignited tensions with Sanders' allies. Still, the party has found itself subject to fewer negative headlines of late as fundraising started to improve and vacancies are filled.

The improvement in fundraising is entirely inadequate. The GOP has about $40 million more in the bank than Democrats at this point and Republicans find themselves in much better shape financially going into the big fundraising push for the mid terms. 

To underscore the Democrat's financial woes, state and local parties are begging the DNC to change the way the party distributes funds. They feel shortchanged as a result of big donors bypassing state parties after several massive failures during the last several election cycles. The bottom line: state and local Democrats have been decimated by losses at every level and both the national party and big donors are wary of pouring a lot of money into organizations that have yet to prove it would be well spent.

Politico:

Only a handful of the state chairs in attendance even spent time wooing the major party contributors who live in California — traditionally a prime source of cash — during their trips out west, fearing their efforts would be futile.

Much of their frustration is directed toward the Democratic National Committee, which recently started doling out nearly $1 million worth of competitive grants to a handful of states. While the first round of so-called State Party Innovation Fund grants were a welcome move, the state leaders who failed to score them were left to stew over their predicament.

That tension came to a head on Thursday, when Missouri chairman Stephen Webber stood up near the end of a report on the DNC grants to voice his objections. He complained that by publicly listing the 11 states who won the grants, the party had embarrassed those that didn’t, according to multiple Democrats who were in the room.

People back home will wonder what I did wrong, he told Ken Martin, the Minnesota chair who leads the ASDC, even though everyone involved in the application process says we did everything right.

In some states, leaders were under the impression they would be getting money and began planning how to invest it. Now have had to reorganize their budgets, said multiple Democrats.

It's no coincidence that O'Connell is departing as state and local parties express their frustration with the DNC's policies. Perez and national Democrats desperately need those state organizations to give the party the kind of boost that could put it over the top on election day. But they won't be much good if they're broke.

Before Perez puts his faith in another CEO, he should look at the way the party is organized. Those state organizations have less clout than their GOP counterrparts largely because the DNC has chosen to try and keep tighter control than Republicans. Reforms better come quickly if Democrats are to take advantage of what is shaping up to be a favorable electoral climate for them.