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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, and can be found in 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.
It Is Time to Comply with SEC Rule 206(4)-5
The first of two compliance dates for Securities and Exchange Commission (SEC) Rule 206(4)-5, which had an effective date of September 13, 2010, passed on March 14, 2011.
The rule prohibits investment advisers from providing investment advisory services for compensation to a government entity within two years after a contribution to an official of that government entity is made, either by the investment adviser or by any covered associate of the investment adviser. This prohibition does not apply to contributions made by a covered associate to officials for whom the covered associate was entitled to vote at the time of the contributions if the contributions did not exceed $350 in the aggregate to any one official, per election. The prohibitions also do not apply to contributions made by a covered associate to officials for whom the covered associate was not entitled to vote at the time of the contributions if the contributions did not exceed $150 in the aggregate to any one official, per election.
An additional prohibition prevents an investment adviser from providing or agreeing to provide, directly or indirectly, payment to any person to solicit a government entity for investment advisory services unless that person is a regulated person or is an executive officer, general partner, managing member, or employee of the investment adviser. Nor may such advisers coordinate or solicit any person or political action committee to make a contribution to an official of a government entity to which the adviser is providing or seeking to provide investment advisory services or payment to a political party of a state or locality where the investment adviser is providing or seeking to provide investment advisory services to a government entity.
The rule has two important compliance dates. The March 14, 2011 date applied to investment advisers subject to the rule. The other compliance date, September 13, 2011, is when investment advisers will no longer be able to use third parties to solicit government business except in compliance with this rule. Additionally, advisers to registered investment pools have until the September 13 date to comply with this rule.
Summary of Changes UPDATE
CALIFORNIA: Directors of the California Public Employees' Retirement System (CalPERS) adopted several new ethics proposals. Among the proposals are rules to regulate fee payments to placement agents, who help funds gain access to CalPERS decision makers, and rules to ensure the same staff members who negotiate investment deals do not monitor their success. Additionally, the directors approved a requirement for investment partners to hold meetings in modest office settings instead of vacation resorts. The directors postponed making a decision on a proposal that would reduce or eliminate travel, gifts, and other accommodations provided to board members by outside investment firms. A decision was also postponed on a proposal that would impose a two-year "revolving door" ban on certain CalPERS employees. The directors postponed decisions on proposals to reduce or eliminate travel, gifts, and other accommodations outside investment firms provide board members, and to impose a two-year "revolving door" ban on certain CalPERS employees. These regulations are in line with legislation taking effect earlier this year requiring placement agents to register as lobbyists and regulating how the agents are paid.
CONNECTICUT: Governor Dannel P. Malloy has proposed reducing the number of budgeted state agencies from 87 to 57 in a move intended to increase efficiency and save the state money. Included in the reduction plan is a proposal to combine the Office of State Ethics, Elections Enforcement Commission, Contracting Standards Board, Freedom of Information Commission, and Judicial Review Council into a new agency to be named the Office of Governmental Accountability. While not detailing how these agencies would be capable of functioning as one or where any cost savings would be seen, Malloy did question in a press release why all these agencies are presently separate.
ORANGE COUNTY, CALIFORNIA: Starting July 1, those seeking to influence county government will be required to register with the Board of Supervisors. Under the new law, county lobbyists must register within 10 days of commencing lobbying activity and renew these registrations annually. The registration fee will be $75 for an initial registration and $50 for each annual renewal thereafter. The regulation does not apply to those lobbying on behalf of nonprofit organizations.
AKRON, OHIO: Candidates for mayor and city council will be allowed to accept larger donations for the first time in 12 years. On February 14, 2011, the Akron City Council passed legislation to increase the city’s contribution limits. Those running for mayor or an at-large council seat will be able to take contributions of $450, and ward candidates will be allowed to accept contributions of $200. The previous limits were $300 and $100, respectively. Under the language of a charter amendment passed by voters in November, city council will review and adjust the contributions limits every two years beginning in 2012.
VARIOUS: Several jurisdictions raised contribution limits based on changes in the cost of living index. Among them, the Federal Election Commission raised the amount an individual and certain PACs can contribute to a candidate from $2,400 to $2,500 and to a national party committee from $30,400 to $30,800. The previous biennial limit of $115,500 has been adjusted upward to $117,000, of which $46,200 may be contributed to candidates and $70,800 total to federal PACs and all other political party committees. In Ohio, the new limits, which will be in effect through February 24, 2013, feature very modest increases in each category. For instance, an individual may now donate $11,543.70 to a PAC, a statewide candidate, or state-level legislative candidate; the previous amount was $11,395.56. Maximum individual contributions to statewide parties increased from $34,186.68 to $34,631.11. New limits in Tennessee include a biennial aggregate limit of $113,700 on contributions to state and local candidates and PACs. Individuals may contribute no more than $44,800 to state and local candidates and no more than $68,900 to all PACs (including parties) during the two year cycle. Lobbyist gift limits have increased to $55 per event and lobbyist employers are limited to gifts with a cumulative value of $110 during a calendar year.
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: email@example.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.
Cash versus Accrual Method of Reporting
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