"Our decision is that we will be moving the Hispanic Unity USA Party," Sanchez told reporters after taking a deep breath Friday. "We will be moving it to a different location. We will be having it on Tuesday night."
Party leaders responded by immediately restoring the speaking slot at next week's Democratic National Convention that they had taken from Sanchez on Thursday when she refused to move the fund-raiser.
While she said Friday she regretted the "discord and disagreement" within the party, she offered no apology for her original decision to schedule the event at the Playboy Mansion, famed for its scantily clad women. And she praised Playboy's Hugh Hefner and his daughter, Christie, for their efforts.
"This in no way reflects anything other than appreciation to the Hefners and to Playboy Enterprises," Sanchez told reporters outside her Garden Grove district office.
Democratic leaders feared that the event, though not sanctioned by the party, could undermine attempts to portray Gore and running mate Joseph Lieberman as pro-family, and could give Republicans an easy target in the fall campaigns.
The fund-raiser for Hispanic Unity's voter registration initiative will now be held at B.B. King's Blues Club in Universal City.
Gore said he supported the party's decision to distance itself from the event - and from Sanchez, a staunch supporter - despite his own acceptance of campaign money from Playboy.
Republicans are accusing the Gore campaign of hypocrisy, noting that Hefner and his daughter donated thousands of dollars last year. Jim Nicholson of the Republican National Committee said Thursday "They may not like talking about it, but they sure do enjoy that Playboy money."
"It's apples and oranges," Gore replied. He said the symbolism of Democrats' holding an event at the mansion, famed for its scantily clad women, doesn't compare with his acceptance of the checks.
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The Democratic Playboy Mansion fund-raiser
Party chairman Joe Andrew lauded Sanchez's decision to abandon the mansion as a "courageous act," but not all Democrats agreed.
The president pro tem of the California Senate faxed a letter to Andrew saying he would protest by giving $25,000 he was raising for the Democratic National Committee to Hispanic Unity instead.
"This isn't the Democratic Party I grew up with. ... It smacks more of fascism than the Democratic Part," said Sen. John Burton, D-San Francisco. "What are they going to do next, burn books?"
Andrew said freedom of speech was not the issue.
"We're not moralizing against Playboy. We're not moralizing against the Playboy Mansion. We're just saying it's an inappropriate place for a person with a title within the party to hold an event," he said.
Sanchez attained near-folk hero status in the Latino community and was embraced and elevated by the Democratic party after her surprise win over longtime Rep. Robert K. Dornan, a conservative Republican, in 1996.
Sanchez's Republican opponent in November's election, Gloria Matta Tuchman, wasted no time in jumping on the issue.
"She has embarrassed her party and embarrassed the people of the 46th congressional district," said Tuchman, a schoolteacher and 1998 candidate for state superintendent of public instruction.