April 5, 2011 •
Ask the Experts – Cash versus Accrual Method of Reporting
Here is your chance to “Ask the Experts” at State and Federal Communications, Inc.
Q. If I receive an invoice from my contract lobbyist for services rendered during one reporting period, but I do not make payment on the invoice until the next reporting period, how do I know when to accurately report the payment?
A. You need to determine whether your particular state uses the cash or accrual method of disclosure.
The cash method is based on when money is actually transacted; in other words, when funds in point of fact change hands from client to contract lobbyist. In direct contrast to the cash method, the accrual method focuses on the obligation to pay as opposed to when funds actually change hands. Essentially, when you receive the invoice from your contract lobbyist, you are obligated to pay.
So which date do you use for reporting purposes? Is it the date you actually mail the check to the contract lobbyist, or the date you receive the invoice? These rarely, if ever, occur on the same date and therein lies the issue: what happens when these dates fall in different reporting periods?
Some states, such as Tennessee and Texas, specifically provide by statute or rule the method of disclosure that should be followed. When the law is silent, the most prudent thing to do is call the disclosure office for that particular jurisdiction and get an answer. Be sure to take the name and title of the person you spoke with and keep it in your records. You may often hear, “It doesn’t matter; report the expense however you choose.” This sounds great, but in reality is very frustrating. Whichever method you choose, be consistent. If you decide upon the cash method, document that and use it for all future reports.
When it comes to your contract lobbyists, be sure they are using the disclosure method required by law. This can be important in an audit when the state looks to see if your report aligns with the contract lobbyist’s report. If the method is optional, discuss with your contract lobbyist which method they intend to use and be consistent.
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.
(We are always 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.
March 15, 2011 •
Everything is Bigger in Texas – Except a Legislative Per Diem
Trigger for Reporting Lobbyist Expenditures Decreases in Texas
Effective March 17, 2011, the amount triggering detailed reporting for food, beverages, transportation, lodging, and entertainment will drop to $90.
The trigger is set by statute at 60% of the amount of the legislative per diem.
Due to the legislative per diem decreasing from $168 for the 2009 session to $150 for the 2011 session, the trigger has decreased from $100.80 to $90.
March 2, 2011 •
Ask the Experts – Nuances with the New Illinois Lobbying Disclosure Requirements
Here is your chance to “Ask the Experts” at State and Federal Communications, Inc.
Q: Now that Illinois has semi-monthly reporting, are there any changes to the contents of the report?
A: As of January 1, 2011, Illinois requires disclosure reports to be submitted on the fifth and 20th of each month. This new schedule began on January 20, 2011. The Secretary of State’s Office issued a 2011 Expenditure Report Filing Guide concerning how to disclose reportable activity on the Activity Detail Report. This guide contains some changes for client or lobbying entity reporting.
Individual expenditures made on behalf of covered officials must be itemized with expanded information. Lobbying entity reports must itemize for each individual expenditure or transaction:
- The name of the official for whose benefit each expenditure was made;
- The name of the client on whose behalf the expenditure was made;
- Whether the expenditure was made on behalf of a client;
- The total amount of the expenditure;
- A description of the expenditure;
- The vendor or purveyor to whom the expenditure was made;
- The address and location of the expenditure if the expenditure was for an intangible item such as lodging;
- The date on which the expenditure occurred; and
- The subject matter of the lobbying activity, if any.
As in previous years, the expenditure reports must also include reporting of lobbying activity that is unrelated to an itemized expenditure. This requirement is satisfied by identifying:
February 24, 2011 •
U.S. Supreme Court Rejects Appeal Challenging Washington’s Campaign Finance Disclosure Law
Ninth Circuit Court Decision Upheld
The U.S. Supreme Court rejected an appeal by Human Life of Washington challenging Washington’s campaign finance disclosure law. The Supreme Court let stand without comment a Ninth U.S. Circuit Court of Appeals ruling that upheld the state’s disclosure requirements for political committees, independent expenditures and political advertising.
Human Life of Washington challenged the requirements as a violation of its free-speech rights, as it sought to keep donors in a 2008 campaign opposing an assisted-suicide ballot measure confidential. The group argued that it was not required to register as a political-action committee and disclose donors because its advertisements did not specifically reference the ballot measure.
Photo of the U.S. Supreme Court by UpstateNYer on Wikipedia.
February 16, 2011 •
Ask the Experts – What Are the Rules Regarding a Lobbyist’s Personal Political Contributions?
Here is your chance to “Ask the Experts” at State and Federal Communications, Inc.
Q. As a registered lobbyist, am I allowed to make a personal political contribution to a general assembly member whom I might eventually lobby? Does it make a difference whether I am a constituent of the general assembly member? Is such a contribution reportable?
A. As is customary in the nature of government affairs work, the answer depends upon the state in which you are making the contribution. That means you need to check the rules and regulations on political contributions for each state before you make the contribution. Also, whether such contributions are permitted or reported depends upon the amount of the contribution.
Here are some relevant examples:
- Personal political contributions by a lobbyist are reportable in Iowa, Maryland, Massachusetts, and New Hampshire. In some instances, the reporting requirement extends to a member of the lobbyist’s immediate family also making a contribution.
- In Pennsylvania, a registered lobbyist making a personal political contribution must register and report in the same manner required of PACs.
- There is an absolute prohibition on personal political contributions by registered lobbyists in Connecticut and North Carolina.
- In South Carolina, lobbyists are prohibited from making contributions to a candidate or anyone acting on behalf of a candidate if the lobbyist engages in lobbying the public office or public body for which the candidate is seeking election.
- In California, lobbyists may not contribute to state candidates or officeholders, or their controlled committees, if registered to lobby the candidate or officeholder’s agency.
- In Alaska, a lobbyist may not make a contribution to a candidate for office in a district outside the lobbyist’s own voting district. This prohibition continues for one year after a lobbyist’s registration or renewed registration date. A lobbyist who contributes to a legislative candidate must file a report within 30 days after making the contribution.
Political contributions not otherwise prohibited by a registered lobbyist could nonetheless be prohibited based on the particular state’s pay-to-play laws. Also, always make sure there are no restrictions on making the contribution during the legislative session.
Finally, it bears repeating to check the laws in the particular state before you make the contribution.
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.
(We are always 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.
February 9, 2011 •
News about Oklahoma’s Ethics Rules for 2011
Final amendments released.
The state Ethics Commission has released its final promulgated amendments to the state’s ethics rules for 2011.
These amendments, available on the commission’s website, become law on July 1 if no action is taken by the state legislature.
One of the rules set forth this year will allow corporations to make independent expenditures and another will allow PACs to contribute to ballot measure committees.
Image of the Oklahoma flag by Denelson83 on Wikipedia.
January 26, 2011 •
Public Officials’ Post-Service Employment Options May Be Limited
The Idaho senate has passed two bills which would restrict public officials’ employment options after leaving office.
SB1037 would prohibit certain officials from working for a company receiving certain state contracts or grants for one year if the former official was involved in the award process.
SB1038, a “revolving door” law, would prohibit state officials or legislators from working as a lobbyist for one year after leaving office.
January 20, 2011 •
Ask the Experts – Disclosure of “All-Invited” Events
Here is your chance to “Ask the Experts” at State and Federal Communications, Inc.
Q. If my employer hosts a function to which all members of the state legislature are invited, must I disclose the name of each individual legislator attending, or can I merely reference the fact that all members were invited?
A. This is a very common occurrence for most lobbyists: to pay for events where all members of the legislature, or some other identifiable group, are invited. The reporting implications for such events range from simple aggregate disclosure to detailed reporting where the name of every legislator attending must be listed. The key to accurate reporting is to know how the state defines “all invited” and whether it takes into consideration any type of “sub-group.”
Here is a representative summary of the varied reporting requirements you might encounter with this type of event:
Arizona – All expenditures incurred by a principal or lobbyist for a special event for legislators – including parties, dinners, athletic events, entertainment, and other functions – to which all members of the legislature, either house of the legislature, or any committee of the legislature are invited must be reported. These expenditures do not have to be reported based on the cost per legislator. However, a description of the event, date and location of the event, number of persons invited, and total expenditures must be reported.
Arkansas – A “special event” is a planned activity to which a specific governmental body or identifiable group of public servants is invited. One of the unique aspects of Arkansas disclosure in this situation is that if the event has multiple co-hosts, the names of all other lobbyists sharing in the cost of the event must be reported.
Also in Arkansas, hospitality rooms may be reported as a “special event” provided the lobbyist invites specific governmental bodies or identifiable groups of public servants. When reporting hospitality room expenses, the lobbyist must itemize the date the hospitality room was open; the name of the event hosted; the exact amount paid by the lobbyist towards the total expenditure for the hospitality room; and the names of all other lobbyists sharing in the cost of the room.
Georgia – Aggregate expenditures on food, beverages, and registration at group events to which all members of an agency, including the legislature and its committees and subcommittees, are invited must be disclosed. Also, if an expenditure is made on behalf of a public official and is simultaneously incurred for an identifiable group of public officials, the individual identification of whom would be impractical, the name of the individual official need not be disclosed. A general description of the identifiable group will suffice.
Louisiana – For legislative lobbying, the following must be invited before invoking group disclosure: the entire legislature; either house; any standing committee; select committee; statutory committee; committee created by resolution of either house; subcommittee of any committee; recognized caucus; or any delegation thereof. Disclosure includes the name of the group invited; the amount, date, and location of the event.
For executive branch lobbying, group disclosure is when more than 25 executive branch officials are invited to a reception, social gathering, or other function. The name of the event, amount, date, and location must be reported.
Utah – In Utah, food or beverage expenditures must be reported if the aggregate daily expenditures benefitting the public official are greater than $25, unless the food or beverage is provided in connection with an event to which all of the members of the legislature, a standing committee, interim committee, legislative task force, or a party caucus are invited.
Washington – Washington does not provide for group reporting. Even if all members of the legislature, or all members of any sub-group within the legislature, are invited, every individual person must be listed by name if the expenditure exceeds $25 per occasion (which it usually does when group events are involved).
If two or more lobbyist employers share the expenses of a reception or other entertainment event, the lobbyist primarily responsible for organizing the event must disclose on his or her monthly L-2 report the names of the legislators (and members of their immediate families) attending the group event. Rather than duplicating this list of attendees, the L-2 reports filed by the lobbyists of the other employers sponsoring the event may make reference to the lobbyist’s report that contains these details.
We have not listed rules for all the states, only examples of some states. If you have a question on a state not listed here, please contact us directly at 330-761-9960.
We are always 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.
January 6, 2011 •
Ask The Experts – Beyond Registration, What Are the Requirements?
Here is your chance to “Ask the Experts” at State and Federal Communications, Inc.
Q. Once I complete my lobbyist registration, what other obligations do I have in my state?
A. Filing lobbyist and/or principal disclosure reports is the bare minimum requirement in many states. In addition, you may be required to obtain an ID badge. Some states require mandatory lobbyist training on a regular basis. Most often, this can be done online. To date, the states requiring this are: Alaska, California, Illinois, Louisiana, Maryland, Massachusetts, Tennessee, Utah, and West Virginia.
Many states have different gift law limitations for lobbyists. For example, in Texas lobbyists are permitted to give gifts of $500 or less, while public servants may accept non-cash item of less than $50 from non-lobbyists.
In addition to reporting requirements, states may require pre- or post-notification to officials when an expenditure has been made on his/her behalf which is disclosed on a lobbying report. In Illinois, a lobbyist who makes an expenditure on behalf of an official must inform him/her, in writing, at the time the expenditure.
We are always 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.
Amber Fish Linke is the Compliance Manager for State and Federal Communications, Inc.
December 23, 2010 •
Ask the Experts – Gift Reimbursement
Here is your chance to “Ask the Experts” at State and Federal Communications, Inc.
Q. If I provide a gift to a covered official exceeding the gift limit in that jurisdiction, can the covered official reimburse my employer for the difference?
A. This is a situation you never, ever want to be in, but sometimes it happens. Fortunately, most of the states allow for the covered official to reimburse the donor in order to rectify the situation.
One of the circumstances precluding reimbursement is when too much time has elapsed between providing the excessive gift and reimbursement by the official. If too much time has passed, the state considers the gift to have been “accepted” by the official, and reimbursement is not an option.
Also, even if the official reimburses the overage, sometimes the lobbyist, the official, or both must nonetheless report the total value of the gift. From a disclosure standpoint, this makes a precarious situation even more suspect.
Some examples of these rules include the following:
- In Connecticut, the gift limit is $10. The official may not partially reimburse a more expensive gift to bring the final cost to the lobbyist below $10, because the overall value of the item is still over $10 [Advisory Opinion 1997-15].
- In the state of Washington, an official’s name cannot be removed from a filed lobbying report, regardless of whether the official has fully reimbursed the lobbyist for the reported expenditure. In addition, an official cannot partially reimburse a lobbyist for an expense to bring the total cost below the $50 reporting threshold. Even if a partial reimbursement occurs, both the lobbyist and the official must report the full amount. The only way an expenditure exceeding the threshold does not have to be reported is if the official fully reimburses the lobbyist prior to the lobbyist filing the lobbying report disclosing the expenditure.
- In New York, public officials and employees may completely reimburse the donor of a gift if the reimbursement is not removed or remote in time in order to comply with the gift ban [Advisory Opinion No. 97-03]. If an item, entertainment, or other benefit is received and payment of its market value is made prior to or simultaneously with receipt, there is no gift [Advisory Opinion No. 97-03].
We are always 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.
December 1, 2010 •
Ask the Experts – Don’t Get Stuck in the Revolving Door!
Here is your chance to “Ask the Experts” at State and Federal Communications, Inc.
Q. Can I hire a federal, state, or local official who just left office to represent our interests before his or her former colleagues?
A. 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.
We are always 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.
November 9, 2010 •
Ask the Experts – 2011 Lobbying Registrations
Here is your chance to “Ask the Experts” at State and Federal Communications, Inc.
Q. I am registered in numerous states. What are some of the features I need to know regarding renewing my lobbyist registrations for 2011? Do all my registrations automatically expire at the end of the year? H-E-L-P!
A. These are all very good questions, as January 1, 2011 is quickly approaching. The expirations on December 31 of this year are particularly thorny because they include not only those states having annual expirations, but most biennial expirations occur at the end of an even-numbered year.
As the states begin their 2011 legislative sessions, here are some things to keep in mind:
Annual registrations: The majority of states have a registration term based on a calendar year. If registered in any of the following states, your registration will expire on December 31, 2010.
Alabama Mississippi Alaska Missouri Arkansas Nebraska District of Columbia New Hampshire Florida [legislative and executive] New Mexico Georgia North Carolina Idaho [legislative and executive] Ohio [executive] Illinois Oklahoma Indiana [legislative and executive] Rhode Island [legislative] Iowa [legislative] South Carolina Kansas Tennessee Louisiana [legislative and executive] Texas Massachusetts Biennial registrations: The trick to keeping track of your registration expiration for biennial states is knowing whether the biennium ends on December 31st of an even-numbered or odd-numbered year.
Those states with biennial registrations expiring on December 31, 2010, include:
California Pennsylvania Connecticut Utah Hawaii Vermont Montana Washington New York West Virginia Ohio [legislative] Wisconsin Legislative sessions: In some states, registrations expire at the end of the regular legislative session. These include Nevada [sessions are held in odd-numbered years] and South Dakota. In Iowa, executive branch lobbyist registration is valid until the next regular session of the general assembly.
Non-calendar years: In other states, registrations expire at the end of a year, but that year is defined as other than January 1 to December 31. These states have the following registration terms:
Colorado [July 1 to July 15 of the subsequent year] North Dakota [July 1 to June 30] Kentucky executive [August 1 to July 31] Virginia [May 1 to April 30] Maine [December 1 to November 30] Wyoming [May 1 to April 30] Maryland [November 1 to October 31] On-going registrations: Once you register in the following states, your registration is on-going until you affirmatively terminate. These include:
Delaware
Federal
Michigan
Minnesota
New Jersey [a fee is due annually on November 15]
Rhode Island executiveAnd then there is Arizona: Just to keep you on your toes, Arizona has a biennial registration where lobbyists renew during November of odd-numbered years, and employers renew during November of even-numbered years.
October 6, 2010 •
Ask the Experts – Charitable Contributions
Here is your chance to “Ask the Experts” at State and Federal Communications, Inc.
Q. As a registered lobbyist, I am often contacted by elected officials to make a corporate contribution to the officials’ charity of choice, foundation, or scholarship fund. Is this legal? Am I required to disclose these contributions on my lobbying reports?
A. This scenario happens more and more every day. Even though the official does not derive direct, political contributions for his or her campaign, such charitable contributions nonetheless result in positive exposure for the official, goodwill by the lobbyist, and beneficiaries that include the underprivileged, the sick, and the elderly. Furthermore, the monetary amount of corporate charitable donations can surpass the amount of permissible political contributions under campaign finance law.
Most states allow a lobbyist’s employer to make charitable contributions at the behest of an elected official and there are no reporting obligations. Some of the other jurisdictional requirements include:
FEDERAL: Pursuant to House and Senate Rules, charitable contributions made by a registered lobbyist at the behest or designation of a legislative member or employee are prohibited, unless the member or employee has designated the contribution to a charitable organization in lieu of an honorarium.
Please note, however, a charitable organization established by a person before that person became a covered official – and where that covered official has no relationship to the organization after becoming a covered official – is not considered to be established by a covered official.
NEW YORK: Charitable contributions made at the behest of a public official are not permitted.
NEW JERSEY and NEVADA: The charitable contribution is allowed but is not reportable as long as the contribution is not made in the official’s name.
CALIFORNIA: The contribution is permissible but must be reported by the official, not the lobbyist or the employer.
CONNECTICUT: The charitable contribution is permissible and is reported as a lobbying expenditure.
DELAWARE: The contribution is reported as a gift.
DISTRICT OF COLUMBIA: The contribution is reported as other.
WYOMING: The contribution is only reported if it exceeds $500.
UTAH: Charitable contributions given for a political purpose are reportable.
If clients who subscribe to our Executive Source Guide on Lobbying Laws™ have further questions about other jurisdictions, they can always check the particular jurisdiction in the online resources. Or, clients can call us if they have some special information need.
We are always 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.
September 20, 2010 •
Ask the Experts – Non-Lobbyist Employees
Here is your chance to “Ask the Experts” at State and Federal Communications, Inc.
Q. I am a registered lobbyist, and based on my time, compensation, and expenses, I have crossed the threshold prescribed by state law requiring registration. My company has employees whose contact with state legislators, executive officials, and employees meets the definition of lobbying, but they do not exceed the threshold requiring registration. Am I under any obligation to disclose their lobbying activities even though they are not registered? Is my employer?
A. This is a good example of something we advise our clients all the time: know your state! Here are examples of jurisdictions where you need to know the nuances of non-lobbyist reporting requirements.
CALIFORNIA: You are only required to register as a lobbyist if you spend at least one-third of your time lobbying in a calendar month. However, other employees at your company might need to report their pro-rata share of compensation if they spend 10 percent or more of their time lobbying in any one calendar month.
This includes time spent involved in grassroots activity, providing research services, and preparing materials to be used for lobbying. This information is disclosed on the lobbyist employer report Form 635 as “Other Payments to Influence Legislative or Administrative Action,” Part III, Section D. Luckily, clerical staff are never considered non-lobbyist employees.
NEW JERSEY: If you are a lobbyist, you must register if you spend more than 20 hours in a calendar year attempting to influence legislation, regulations, or governmental processes by communicating with a state official. Registered governmental affairs agents must disclose their operational costs, including compensation paid to support personnel, including legal, technical, and clerical staff. Now for the big exception. The compensation of an employee working less than 450 hours per calendar year in support of a governmental affairs agent is not reportable. (TIP: We advise you have support personnel track their time to ensure they do not exceed the 450-hour threshold.)
TEXAS: In this state, you are either a lobbyist or not – there is no in-between. In addition, individuals registered in Texas only report their own expenditures. Compensation is not reportable. Ever.
We are always 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.
State and Federal Communications, Inc. provides research and consulting services for government relations professionals on lobbying laws, procurement lobbying laws, political contribution laws in the United States and Canada. Learn more by visiting stateandfed.com.