Sword and Shield

For those who have heard me speak about lobbying and procurement lobbying, you know I believe someone at the company needs to be the adult. Government Affairs does not want oversight over Business Development or Account Managers, but it also wants to protect its relationships in the states.

That is where the Sword and Shield comes into play. It is important other departments in your organization are alerting you when plans are made to interact with officials. Most folks in business development have one goal in mind—bring in sales. In most instances, these folks never believe the activities undertaken are considered lobbying, where they might have to register and report activities. Our responsibility in Government Affairs is to make sure anyone delving into the states or municipalities is armed with the needed information about lobbying and gift laws.

As you are closing up the year and considering your battleground states for 2011, take a look at other departments and start the discussion. You will find your role expands—to the benefit of you and your organization. An actual sword and shield is not necessary…but you can imagine you are wearing them!

On behalf of State and Federal Communications, we wish you and yours a very happy holiday season.

Elizabeth Z. Bartz
President and CEO

Wealth of Information at www.lobbycomply.com

Want to interact with your fellow government affairs and procurement colleagues? Then jump into the State and Federal Communications, Inc. blog at www.lobbycomply.com.

Once there, you can join the exchange of ideas and view solutions to common challenges and problems. Also, State and Federal Communications continually adds content to the blog, including ‘hot topics,’ which are summaries of important news items you need to know about.

Join the conversation, and make use of this valuable information resource.

www.stateandfed.com

Legislation We Are Tracking

At any given time, more than 1,000 legislative bills, which can affect how you do business as a government affairs professional, are being discussed in federal, state, and local jurisdictions. These bills are summarized in the State and Federal Communications’ digital encyclopedias for lobbying laws, political contributions, and procurement lobbying; this information is located on the client portion of the State and Federal Communications website.

Summaries of major bills are also included in monthly e-mail updates sent to all clients. The chart below shows the number of bills we are tracking in regards to lobbying laws, political contributions, and procurement lobbying.

A Year of Big Changes to Illinois Lobbyist Laws

by Stephen Quinn, Esq.
Research Associate

 In the wake of seemingly constant political scandal, particularly involving the Governor’s office, the state of Illinois passed significant changes to its Lobbyist Registration Act.  The enhancements to the system are aimed toward improving transparency and easing the public’s fear of “back room” politics.  It is no coincidence that the lobbying law changes come at the same time the state is strengthening ethics rules in other arenas.  The state recently passed new disclosure requirements for contacts with procurement officials.  Additionally, Illinois’ campaign finance laws will feature contribution limits in 2011 and quarterly PAC reporting.   The improvements to the state’s lobbying regulations are part of an overall climate of increasing disclosure around the United States.  Several other states, including Utah and Georgia, have made similar changes in state lobbying law this year. 

The first change to the rules, which is already known by most people impacted by it, relates to the registration fee.  Illinois initially sought to increase this fee to $1,000 per lobbyist and per organization employing a lobbyist.  Thus, a company with two state-level lobbyists would have been charged $3,000 per year.   The ACLU sued for and was granted an injunction on this fee.  Essentially, the state agreed Illinois could not demonstrate the increase in cost was necessary to administer the Lobbyist Act.  Additionally, the ACLU had raised a First Amendment establishment clause argument because the bill granted exemptions to certain religious lobbying and thus “demonstrated a preference for religious speech over non-religious speech.”  Eventually, the state and the ACLU agreed to a fee of $300 and the suit was dropped.   Additionally, lobbyists are required to complete an online ethics training course within 30 days of registration.

Lobbyists will have to report more frequently in 2011 and beyond.  The lobbying dates used to be tied to whether the legislature was in session but are now semi-monthly, regardless.  In 2010, while the litigation on the Act was pending, reporting was done essentially as soon as the Secretary of State’s Index Department was able to receive them in the midst of the judicial and legislative melee.  Lobbyists filed a report on September 30 for the first half of 2010, and now must report second-half expenditures on January 15, 2011.  Starting in 2011, reports are due twice per month.  A report for the first 15 days is due on each 20^th, and a report covering the 16^th through the end of each month is due on the following 5^th.  While this is very cumbersome, it is at least consistent.  The smaller reporting periods should make the information to be reported very manageable.

One feature of Illinois’ lobbying seen in a few other states is the provision relating to notification of officials.  Previously, if an official were set to appear on a lobbyist’s report because that lobbyist made an expenditure on the official, the lobbyist was required to give the official notice of this fact 25 days before the report was due and again 30 days after the report was filed.  Under the new changes, the 30-day post-notification remains but the pre-notification is changed.  Now, lobbyists must give the official “contemporaneous written notification” of a reportable expenditure made on the official’s behalf.

Summary of Changes UPDATE
Note Recent Changes to Compliance Regulations

by John Cozine, Esq.
Research Manager 

FEDERAL: A lawsuit has been filed in the Federal District Court of the District of Columbia seeking to allow foreign citizens to make political contributions.  2 U.S.C. §441e and its implementing regulations prohibit political contributions and independent expenditures by foreign nationals living lawfully in the U.S.A. but without legal permanent residence.  In Bluman v. FEC, the two plaintiffs, a doctor in residency and a recent law school graduate, both citizens of other countries, are seeking to make political contributions in support of various candidates and political issues ranging from both ends of the political spectrum. They are specifically requesting the court declare section 441e and its implementing regulations unconstitutional as applied to foreign nationals lawfully residing and working in the United States. They have asked for a three-judge court decision, which may allow for a direct appeal to the United States Supreme Court.

MONTANA: District Judge Jeffrey Sherlock of Helena ruled the 1912 Corrupt Practices Act, which prohibited corporations from making independent political expenditures, unconstitutional.  Bozeman attorney Margot Barg argued on behalf of the plaintiffs, a gun rights organization and a local painting company, that corporations are entitled to make the same sort of free political speech as individuals, citing the U.S. Supreme Court decision in Citizens United v. Federal Election Commission. Judge Sherlock wrote that the Montana law, "insofar as it prevents corporations from making independent expenditures to support or oppose political candidates or political parties, is declared unconstitutional." Restrictions on corporate contributions to political candidates are not affected by the decision. Montana Attorney General Steve Bullock plans to appeal the district court’s ruling.

SOUTH CAROLINA: The State Ethics Commission will not appeal South Carolina Citizens for Life, Inc. v Krawcheck, a federal court decision finding South Carolina’s statutory definition of committee unconstitutional. The commission has already voluntarily announced it will not enforce provisions of the law concerning committees making independent expenditures. State Ethics Commission director Herb Hayden says groups can now both raise and spend unlimited amounts of money and likely will not have to report their donors. He and Senate Ethics Committee chairman Wes Hayes say a new law is needed to govern committee contribution limits.

HAWAII: A federal judge has granted the request of two men seeking to be able to contribute in excess of the state's limit of $1,000 to a noncandidate political action committee. U.S. District Judge Michael Seabright issued an order permitting the plaintiffs in the action to contribute $2,500 to the Aloha Family Alliance, a noncandidate political action committee which supports traditional marriage and opposes abortion and physician-assisted suicide, for the general election. Hawaii law limits contributions to a noncandidate committee to $1,000 per election, with the primary and general election counting as two separate elections. Neither plaintiff in this action had made a contribution during the primary election. Further, the written order does not allow others to exceed the $1,000 limit for the general election.

WASHINGTON: The 9th U.S. Circuit Court of Appeals stayed the decision in Family PAC v. McKenna, et al. which declared a Washington law limiting campaign contributions in the final weeks of ballot measure campaigns unconstitutional. U.S. District Judge Ronald Leighton ruled last month that the Washington limit is an unconstitutional infringement on political speech. The three-judge panel wrote "Washington and its voters have a significant interest in preventing the State's long-standing campaign finance laws from being upended by the courts so soon before the upcoming election." The court also considered that Family PAC had failed to identify any contributions greater than $5000 that it expected to receive in the event that the law would be overturned and appeared not to be participating in the upcoming general election, mitigating any harm that may come from the stay of the ruling.

ASK THE EXPERTS

State and Federal Communications’ Experts Answer Your Questions

Here is your chance to “Ask the Experts” at State and Federal Communications, Inc. You can directly submit questions for this feature, and we will select those most appropriate and answer them here. Send your questions to: marketing@stateandfed.com. (Of course, we have always been available to answer questions from clients that are specific to your needs, and we encourage you to continue to call or e-mail us with questions about your particular company or organization. As always, we will confidentially and directly provide answers or information you need.) Our replies to your questions are not legal advice. Instead, these replies represent our analysis of laws, rules, and regulations.

Question

Can I hire a federal, state, or local official who just left office to represent our interests before his or her former colleagues?

 

Answer 

While the answer depends on the jurisdiction, the trend is definitely to increase the restrictions on the ability of former elected officials and government employees to seek employment as lobbyists after leaving their government positions.

Most commonly, these restrictions take the form of a waiting period during which the former official is not permitted to influence actions over which he or she exerted some power or influence.  Ostensibly, the waiting period allows this power or influence to dissipate.  It also allows time for the specific issues the former official influenced to move through the system, under the theory that the former official’s influence will be lessened on issues he or she did not directly handle.

The revolving door restrictions placed upon officials in New Jersey are fairly typical.  In that state, former members of the legislature, the governor, and heads of principal departments of the executive branch are prohibited from registering as lobbyists for one year after leaving office.  Anyone knowingly or willfully violating the revolving door restrictions is subject to a penalty of up to $10,000 and can be barred from engaging in lobbying in the state for up to an additional five years.  The law assigns the Election Law Enforcement Commission the power to hold hearings regarding possible violations and assess the enumerated penalties if the violations are found to have occurred.

Most jurisdictions that have introduced ethics legislation in recent years have included revolving door provisions, as the Indiana General Assembly did this year with the passage of House Bill 1001.  Because of the increasing prevalence and importance of these laws, State and Federal Communications will be focusing on this issue and addressing it in our Executive Source on Lobbying Laws.

State and Federal Scrapbook

Plan to say hello at future events where State and Federal Communications will be attending and/or speaking regarding compliance issues.