Budget issues bolster need for lobbyists

November 22nd, 2010 by Autumn

With every item on the federal budget slated for re-examination in light of the current concerns over tearing away at the budget deficit, corporate, state, and association interests are finding their issues increasingly at risk.  From Social Security and Medicare to defense authorizations and energy investments, nothing is safe from the budgetary chopping block.

Agriculture, transportation and healthcare are expected to be big topics of contention, and as such, companies in those industries in particular will increase Hill activity in the coming months as the 2011 budget is authorized and decisions are made regarding bills with long-term implications.

This is great news for lobbyists.  Government relations activity should see a sharp increase, as organizations scramble to educate incoming Congressmen who, on the heels of their campaign momentum, will be eager to slash spending, and vie for their programs to remain untouched.  AARP, the National Home Builders Association, the Commercial Spaceflight Federation, and the American Petroleum Institute, among others, have already made efforts to increase their efforts on Capitol Hill.

Budget cuts could prove to be a lobbyists' best friend

Though seemingly, the Republican vow to eliminate earmarks could be a death sentence for lobbyists who previously hit it big with earmarks, Roll Call reports that some lobbyists see this as merely an opportunity for members of their profession.  Grassroots social media efforts will need to be beefed up, and lobbyists may find themselves spending a lot of time educating on the need for certain programs, in an effort to curb the enthusiasm of freshman Senators and Representatives to take a cleaver to the budget.

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Industry Moves and Changes

November 22nd, 2010 by Autumn

David Tilstone has been named president of the National Tooling and Machining Association.

Scott Kamins, deputy chief of staff and director of government affairs at the Republican National Committee, has been named a director at the Prime Policy Group.

Charles Salem, chief of staff to Sen. Evan Bayh (D-Ind.), is joining Microsoft as managing director for public policy.

George Lowe, who spent four years serving as chief of staff to former Sen. Ted Stevens (R-Alaska), has joined Brown Rudnick’s Washington office as a partner. Lowe will work as a lobbyist in Brown Rudnick’s government law and strategies group


Weekly News Round-Up

November 19th, 2010 by Autumn

In this, the week of ethical trial decisions, proceedings did not fare well for the defendants.

  • The trial of Kevin Ring, the only Abramoff associate to try his luck in court, came to an end Monday, when a jury found him guilty of five felony counts of corruption.  Ring took eleven congressional aides and Bush administration officials down with him, along with nine others.  
  • Tom DeLay, the former Speaker of the House charged with money laundering and conspiracy, did not take the stand in his own defense before his attorney rested his case.  Though the case is largely circumstantial, several witness testimonies have implicated DeLay as having been involved in, or at minimum knowledgeable about, the transactions.  Closing arguments are scheduled for Monday.
  • Rep. Charles Rangle (D-NY) was found guilty of 11 charges, including improperly soliciting lobbying funds and failing to disclose income and assets.
  • Though facing investigation, and not actually on trial, conservative backers of American Principles in Action received negative press for not disclosing funds spent on Latino outreach this past election.  Citizens for Responsibility and Ethics in Washington is concerned that the group may have exploited the Citizens United decision beyond the Court’s initial intent.

Bundles of FUNds Compliance Q&A

November 18th, 2010 by Autumn

The changing environment of campaign finance regulations means lots of fun for lobbyists trying to do their job effectively.  Actually, what it really means is a pain in the rear.  Luckily, we here at LobbyBlog are combing through the laws on your behalf.  If you are a lobbyist, you need to know the basic rules about bundling contributions.

Who is covered by the bundling rule?

A: Any lobbyist registered under the LDA and any PAC that is “established or controlled” by a lobbyist so registered is subject to the bundling restrictions.

What qualifies as “bundling”?

Contributions that are either “forwarded” — delivered or transmitted, either electronically or physically– or “received and credited” — received directly from a contributor, but credited to a specific lobbyist–are treated as “bundled.”  It is worth noting that some campaigns now forbid lobbyists from “forwarding” any contributions because reporting these bundled funds has become too much of a hassle.

What is reportable?

Aggregate contributions of $16,000 or more during a single reporting period meet the trigger for report.  However, all reporting committees must file semi-annually as well as quarterly to ensure that any contributions of $16,000  in aggregate funds is disclosed to the FEC, even if the contributions are not made in the same quarter.

Tuesday Ethics Tip: Nonprofit Lobbying Edition

November 16th, 2010 by James

First of all: are nonprofits allowed to lobby? The answer is very clearly “yes,” although there are some restrictions.

The LDA (as amended by HLOGA) states that in addition to reporting all lobbying expenditures on their Form 990, nonprofits may also be required to register with Congress and report their activities, but only if they meet these two thresholds:

  • You have an employee who is a “lobbyist,”* defined as someone who spends 20% or more of his/her time engaged in lobbying activities and the same employee makes one or more lobbying contact in the same quarter
  • Your total federal lobbying expenses are expected to exceed $11,500 during a quarter

Q:  How should our 501 (c)(3) organization report board members’ contributions when we file?

A: While 501(c)(3) organizations cannot make political contributions, they can be involved in certain lobbying activities. A board member of a 501 (c)(3) can participate in these activities.  This would not make them lobbyists, unless there is something else that would trigger a need to register as a lobbyist. If a federally registered lobbyist is a member of the board of a 501 (c)(3) organization and participates in that organization’s event, in the capacity of board member, at which a congressman or senator is honored, that does not need to be disclosed.

Q: Can a 501(c)(3) non-profit organization sponsor travel for members of congress or congressional staffers?

A: Yes, although there are specific guidelines on the amount of time that is appropriate, and the rules differ for Senate and House members.

Q: Can a non-profit make a choice between the lobbying definition used by the LDA and the one used by the IRC?


A:  Yes, Congress allows organizations that have to track their lobbying expenditures in accordance with the tax code to use that format with their LDA reporting. You may therefore choose whether you want to just maintain one system for tracking and reporting lobbying expenditures and whether you want to do both. There are pros and cons for both types of filing.

Q: When I decide to use one definition (LDA v. IRC) over the other one, is that decision binding in the future, or can it be changed on a year-to-year basis?


A: It is not binding and you can change it.  It would be cumbersome to change it back and forth and back and forth, because you would be changing a lot of what you are tracking. But it is a choice that each organization has to make. If you decide to change, you simply notify the proper people on your LD-2.

Today’s post borrowed heavily from this one! (Thanks, Madiha!)

Weekly Lobbying News Round-up

November 12th, 2010 by Autumn

This week was full of developments, in the wake of several ethic investigations and a massive effort on K Street to prepare for the new Congress.  Among the top stories we followed:

  • Congresswoman in deep “Waters” over contributions – Rep. Maxine Waters (D-Calif.) has recently been accused of penning legislation in favor of a firm whose lobbying arm paid her husband $15,000 in consulting fees. Waters was already knee-deep in an ethics scandal regarding her attempts to steer money into her husband’s bank.
  • Jurors in the Kevin Ring ethics trial are having difficulty deciding whether or not Ring violated lobbying laws, specifically whether or not he intended corruption.  The judge in the case has assisted with definitions, instructing jurors to further deliberations.
  • Legislators in New Jersey are discussing whether or not lobbyists should be eligible for pension plans and health insurance.  The State Assembly is set to vote on a bill to deny these benefits later this month, citing a new belief that lobbyists are not “genuine state employees.” With jurisdictions nationwide looking to cut spending, there is speculation as to whether or not this could become a national trend.
  • Monday, Lobbyists testified in the ongoing money laundering trial of former Rep. Tom DeLay.  Lobbyists for Bacardi and Reliant Energy admitted to $70,000 in donations to DeLay during his 2002 election campaign, but his lawyer claims these donations were simply “politics as usual.

Campaign Finance in 2010

November 11th, 2010 by Autumn

This election saw record campaign spending from outside groups.  What changed to enable such astonishing third-party contributions?

  • Citizens United – for the first time in over 60 years, unions and corporations were permitted to spend treasury funds on ads calling for the election or defeat of certain candidates.  Prior to the ruling, these organizations were only permitted to advertise around particular issues, not in favor or opposition to particular candidates.  Corporate executives can donate business funds to nonprofits to advertise on behalf of the corporation anonymously — without anyone ever knowing where the money originated — providing incentive for CEOs reluctant to have a company openly endorse candidates in the past.
  • New FEC interpretation – The FEC has not required as much disclosure about advertising as it has in previous years, releasing a rule revision requiring only funds specifically donated for advertisements be disclosed.  This made it possible for contributors to avoid disclosure by simply not specifying where their money should be spent.   Half of the commissioners narrowed the margin for disclosure requirements even more, allowing funds to be designated for advertising and still avoid disclosure, as long as the contributors didn’t specify for which ad the money would be spent.  This drastically decreases the donation disclosure.
  • Super-PACs and the Speechnow aftermath – Citizens United opened the door for unlimited spending, which may have been the Pandora’s Box that led to the verdict in Speechnow.org v. FEC. Thanks to the D.C. Circuit Court of Appeals (and the U.S. Supreme Court who later refused to hear the case to overturn the verdict), groups can now identify as “independent expenditure committees,” allowing unlimited contributions from unlimited sources, though they must register as PACs.

To recap: thanks to two anti-regulatory court rulings, now groups can receive unlimited contributions fro

m unlimited sources, then spend in unlimited amounts with fewer restrictions, as long as they continue to register with the FEC.  The changing of the guard in the Capitol when the newly-elected Congressmen are seated should afford more changes, and less regulation, thanks to small-government favoring Republicans. Stay tuned!

Are you prepared for a GAO audit?

November 10th, 2010 by Brittany

Preparing for a GAO Audit of Lobbying Disclosure Reports
What you need to know
December 9, 2010 | 2:00-3:30 pm EST

Have you aligned your activities with HLOGA? Don’t let the new year find you unprepared. The GAO has now gone through several audit cycles. With leeway for unintentional failure to disclose expired, flawed disclosure and information monitoring will now trigger enforcement actions – and severe civil and criminal penalties.

Keeping your political activities, yourself, and your firm in compliance with the law takes vigilance. Find out what you can do now to protect yourself and prepare.

Register for Preparing for a GAO Audit of your Lobbying Disclosure Filings. This information-packed audioconference arms you with specific “do it now” guidance for making sure your records, contributions, gifts, practices and reporting will stand up under the harshest regulatory scrutiny. From checklists to real-world advice, you’ll come away with a solid action plan you can implement by December 31st, allowing you to breathe easy as you make all of the required filings.

Tuesday Ethics Tip: Grassroots Edition

November 9th, 2010 by James

Tap the power of your roots!

When the grassroots get all fired up, watch out! Most lobbyists would like to tap the power of grassroots advocates – but do you know what exactly qualifies as “grassroots”? And how do you report those activities on your LDA forms?

The official definition of grassroots lobbying is the Internal Revenue Code (IRC) definition: “a call to action to the public or segment of the public asking them to contact a designated official, state, federal, local on a specific item government action, specific legislation, or a nomination, etc.”

What activities are considered “grassroots”?

Grassroots lobbying is: “communications to the general public that refer to and reflect a view on the merits of a specific legislative proposal and a ‘call to action’ directly or indirectly encouraging legislative contact.” So, for example, if you’re XYZ Association, and you ask your members to write Representative Smith on H.R. 1234, that is grassroots lobbying.

Reporting grassroots lobbying

There are two different ways to report – you must make a designation.  If you are filing under the Lobbying Disclosure Act (LDA) definitions, grassroots lobbying is not disclosed on your forms. Under the Internal Revenue Code (IRC) definition of lobbying the expenses of grassroots lobbying are combined with the total reportable expenditures.  The key thing to remember is that whichever method you chose, you must use it consistently in your filing. Note also that registrants reporting lobbying income (i.e. lobbying firms, including lobbyists acting as sole proprietors) must use the LDA definition and reporting structure. Registrants reporting lobbying expenditures may elect to use the IRC or LDA.

Resources

Amy Showalter, at the Showalter Group, writes an excellent blog on keeping your advocates motivated and engaged.

Another great speaker on advocacy and citizen participation is Stephanie Vance, at Advocacy Associates.

Industry Moves and Changes

November 8th, 2010 by Autumn

Stephen Jacobs has joined the National Association of Manufacturers as senior director for international business policy. He was previously a deputy assistant secretary at the Commerce Department

David Weiss, a senior policy advisor at DLA Piper, is steping down to become president and CEO of CHF International, a development and humanitarian aid organization.

Coutney Geduldig, chief financial counsel to Sen. Bob Corker (R-Tenn.), is departing to be the managing director, head of federal government relations and chief counsel for Financial Services Forum.

Michael Quaranta, who until recently served as chief of staff to Rep. Michael Castle (R-Del.), has joined the Podesta Group as a partner.

Mary Streett, of Mayer Brown, has been named the Vice President of government affairs for Exelon Corporation.

Boehner most “lobby-friendly” in 112th Congress

November 8th, 2010 by Autumn

Proponents (and dissenters) of building new domestic oil refineries, small government, and “winning the global war on terror” should take note: the newly-elected Speaker of the House, whose platform is built around these issues, has been named “one of the most lobby-friendly politicians in Washington.”

The New York Times reports that Boehner has proposed “teaming up” with lobbyists to impact key legislation in the House.  Aides suggest Boehner’s lobbying alliances “reflect the pro-business, antiregulatory philosophy that he has espoused for more than three decades, dating back to when Mr. Boehner, the son of a tavern owner, ran a small plastics company in Ohio,” according to the same story.

Some insiders suggest that K Streeters may be able to find new careers as Hill staffers with the recent Republican power surge. Boehner, for one, is expected to continue to “lean on his industry allies” in his new role as Speaker of the House.  Indeed, Republicans are generally friendlier towards the lobbying profession, and the 112th Congress is expected to bring more opportunities, on and off the Hill, to government relations personnel.

Boehner is also “leading the charge” – along with Rep. Eric Cantor (R-Va) and the National Republican Congressional Committee – to fill chief of staff and other top positions with experienced personnel, including lobbyists, Politico reports.  Top Republicans are leery of relying on “newbies” to be expert Congressmen, or to select the best staffs for the job, and are compiling lists of individuals they deem more qualified to assist the freshman senators and representatives.

Supreme Court upholds PAC disclosure requirements

November 8th, 2010 by Autumn

In what many are calling a follow-up to the Citizens United ruling, and a blow to campaign finance reform, the Supreme Court declined to hear arguments in the Speechnow.org vs. FEC case last week.  Many are suggesting this broadens the reach of Citizens United and allows for increases freedom of speech in the electoral process.

The decision allows for unlimited donations to “independent expenditure groups” such as Speechnow.org, and challenges FEC regulation of campaign donations.  While unlimited donations allows for greater spending on campaigns, it also maintained disclosure requirements, noting that continued registration and disclosure will be required.

Under the ruling, Speechnow and similar groups must register as a PAC and disclose contributions.  As a result, over 50 such groups popped up around the country ahead of the mid-term elections, and this election cycle saw record spending. Watchdog group opensecrets.org noted that “significant investments from outside groups helped elect more than 200 federal candidates.”

Though both Democrats and Republicans received outside donations, it was Republicans who saw the greatest benefits of organizations’ ability to receive unlimited donations, and in turn, spend in unlimited proportions.  

Tech Companies Should Bolster Lobbying Budgets

November 8th, 2010 by Autumn

Apple and facebook, both notoriously absent in Washington affairs, have been named as companies who should consider taking up an interest in Capitol Hill proceedings.  Some worry that the companies’ lack of formal lobbying efforts may lead to unfavorable regulations being imposed.

Politico reports that Facebook executives believe that usage of the social media network by politicians speaks for itself.  “We don’t have to spend money, because our users are tremendously happy with our product,” Tim Sparapani, director of public policy told the publication. Sparapani is one of two individuals registered to lobby on facebook’s behalf.  Still, patron satisfaction has not spared facebook from being touted as an example of need for increased privacy regulation.

Fears have also begun to surface about scrutiny Apple may face over antitrust regulation.  Increased popularity of iTunes and the iPhone have opened the door for increased attention from lawmakers and those investigating anti-poaching and antitrust regulations.  To this point, Apple has managed to corner only a small piece of the technological market, and as such, only employs lobbyists on patent, tax, and trade regulation.

The Washington Post reports that the company should consider taking a more active role in studying legislation, noting the fates of companies like Microsoft and Google, each of which has faced FTC probes in recent years, and warns that if it doesn’t step up its lobbying efforts, it will spend more money trying to fight regulation than moving forward with its agenda.

Weekly Round-Up: Corrupt Politicians Election Edition

November 5th, 2010 by Autumn

Citizens for Responsibility and Ethics in Washington has identified four Congressmen-elects as “Most Corrupted Members of Congress.”

  • Roy Blunt, the newly-elected Republican Senator from Missouri, accepted over $217,000 in campaign donations from Philip Morris/Altria, where his then-girlfriend Abigail Perlman was working as a lobbyist.  Just before leaving his wife to marry Perlman, Blunt tried to pass a provision to help the company (at the expense of its competitors) in a Homeland Security bill.  He also used his weight to add earmarks to benefit one of his sons in legislation, and secure campaign donations when his second son ran for governor of Missouri, CREW reports.  As if that weren’t enough, He is also accused of being in cahoots with Jack Abramoff.
  • Timothy Griffin (R-Ark.) will take seat in the House of Representatives during the 112th Congress.  CREW accuses him of “Republican vote caging efforts, a legally questionable direct mail campaign to disenfranchise poor, minority, and military voters” during the 2004 presidential election.  He was also appointed U.S. Attorney in Arkansas under a provision of the PATRIOT Act that did not require his appointment to be confirmed by the Senate.  He resigned less than six months later after the House Judiciary Committee began an investigation into appointment and the surrounding politics.
  • Florida voters are sending Marco Rubio (R) to the Senate despite his current implication in a federal criminal investigation into his misuse of state party funds, and admitting to double-billing for personal expenses.  He provided Florida International University with $29m as he prepared to accept a part-time teaching position with the university once he left office.  Sen.-elect Rubio has been caught time and again misappropriating funds and passing legislation benefiting his biggest donors, yet has managed to make it to the U.S. Senate.
  • Allen West (R-Fl.) is a Floridian transport into the House of Representatives.  West formerly served in Iraq as an Army Lt. Col. , until he was “stripped of his command and forced to resign” for excessive interrogation techniques, though interrogations were not part of his job, CREW reports.  Mr. West’s service record let him off with a slap on the wrist, though a military tribunal found him worthy of court marshal.

Lobbying with Tax Dollars

November 5th, 2010 by Autumn

In reaction to the controversy of National Public Radio’s dismissal of Juan Williams for his comments on Fox News, many prominent politicians have alleged that NPR lacks objectivity and should no longer receive federal money.

Taking it one step further, an article in the Washington Examiner points out that NPR uses its public money and donations to lobby Congress for further appropriations and that its lobbying spending rose sharply during the beginning of the Great Recession.

A variety of taxpayer-funded organizations and institutions have federal lobbyists or are clients of lobbying firms.  Examples include:

Finally, most federal agencies have congressional affairs departments to help steer the executive branch’s agenda through Congress.  And since federal employees are already part of the government, they do not have to report their interactions with members of Congress as private lobbyists would.