Q. Do gift laws preventing registered lobbyists and employers from giving gifts to public officials, also prohibit gifts to the family members of public officials?

A. Generally, in states that feature a prohibition on lobbyists giving gifts to public officials or employees, the prohibition will extend to members of the public officials’ immediate family. However, immediate family is usually a defined term and will vary by jurisdiction.

For example, Alabama law prohibits lobbyists and employers of lobbyists from offering or providing a thing of value to a public employee, public official, or family member of a public employee or public official. The state defines a family member of a public employee as a spouse or dependent. A family member of a public official is defined as the spouse, dependent, adult child and his or her spouse, spouse’s parent, and siblings of spouse and their respective spouses.

In Kentucky, the General Assembly just passed House Bill 28, which extends the prohibition on gifts to family members of legislators or candidates. Effective July 14, 2014, registered legislative lobbyists will be prohibited from giving gifts to spouses or children of legislators or candidates for General Assembly.

In Pennsylvania, gifts are also prohibited to immediate family members of public officials, employees, or candidates for public office. They interpret immediate family members to include spouses, children, parents, and siblings.

However, not all states include family members in the gift prohibitions. Minnesota’s gift prohibition applies to public officials, employees of the Legislature, and local officials, but it does not extend to their family members.

Before giving a gift to a public official or employee, you should consult the jurisdiction’s ethics commission. Do not expect officials or their family members to know the applicable laws.

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.

Q. To streamline LDA tracking and reporting, our company includes 100 percent of our in-house lobbyists’ compensation as lobbying on our quarterly report.  Is this a reasonable approach?

A. The LDA does not contain any special tracking requirements for reporting expenditures.  Registrants employing in-house lobbyists are required to provide a “good faith estimate of the total expenses” of their lobbying activities.  With the “good faith” standard as the back drop, an organization should determine whether including 100 percent of their lobbyists’ compensation meets that standard.  Aside from the tax implications of including 100percent of compensation, typically, there is some time that is spent during the course of a quarter that is not defined as lobbying and varies from month to month depending on what issues are being addressed.  Therefore, providing a good faith estimate, in most cases, will require a registrant to implement some sort of tracking process to meet the standard.  In the event of an audit, the ability to demonstrate reasonable efforts to track and capture lobbying activity, and only lobbying activity, is an additional benefit.

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.

Q. I am currently a registered lobbyist who files reports on a monthly basis.  I incurred a permissible meal expenditure on a covered official at the end of last month.  However, I did not pay for the expenditure until I received my credit card bill this month.  What date should I use to report the expenditure?

A. A common question concerns what accounting method to use for the reporting of expenses. The accrual basis of accounting reports expenditures according to the time the benefit is given. The cash basis of accounting reports expenditures according to the time it is actually paid.

The exact accounting method used depends on the jurisdiction in question. Both Arizona and Michigan prefer the accrual method of accounting. An expenditure is reported when it occurs or is given, not when it is paid. Indiana provides for activity reports to be filed on a cash basis. South Carolina also follows this method requiring an expenditure to be reported at the time it is paid.

Some states do not have a set accounting method to be used when reporting expenditures or permit either method to be used. In California, an expenditure should be reported at the time the benefit is given; however, if it is reported when the money is paid, the actual date of the expenditure should be noted. Pennsylvania allows a registrant to use any reasonable methods of estimation and allocation. However, once a method of accounting is chosen, filers should be consistent in its use. The filer should also keep an internal record of the accounting method used in case there is an audit by the Pennsylvania Department of State. Texas law indicates an expenditure does not have to be reported until the amount is readily determinable. An expenditure made by a credit card may be reported either according to when the expenditure is made or when the bill is received.

After confirming an expenditure is permissible, you must include it on the proper report. Consult with your jurisdiction’s filing office to determine the accounting method used for the disclosure of expenditures.

 

You can directly submit questions for this feature, and we will select those most appropriate and answer them here. Send your questions to: experts@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.

Q. My company is planning to get more engaged on the local level. What are some things I need to consider?

A. There are many considerations for a company prior to engaging on the local level. To ensure you are in compliance while interacting with municipal officials, it is important to check whether the municipality has a lobbyist registration ordinance, gift rules, or a pay-to-play ordinance. These provisions, if present, will impact your ability to engage with municipal officials. Requiring lobbyists to register on the municipal level is a quickly emerging trend throughout the U.S. This trend is not just impacting individuals who engage in what is generally regarded as lobbying, but also affecting permitting, sales, and other business functions.

For example, in San Jose, California, lobbying includes attempting to influence the proposal, drafting, development, adoption, recommendation, or approval of any contract, permit, license, or hiring action. The proliferation of these types of provisions has made it such that applying for a building permit, attempting to contract with the state, or even attempting to influence the selection of a candidate to be hired may be considered lobbying depending on the jurisdiction and the circumstances. The broad application of lobbying ordinances in municipalities merits attention and consideration prior to engaging to ensure registration is completed if needed.

An additional consideration is whether your company belongs to any trade associations with a lobbying presence in the municipality. Trade associations can help facilitate introductions to key players. However, you must still pay attention to the lobbyist registration threshold. It is a common misconception that being in the presence of a registered lobbyist negates an individual’s registration requirement. This is very rarely the case and should not be relied upon as a general rule. For more information about local level lobbying, please visit our website, www.stateandfed.com.

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.

 

 

Q. I am a registered lobbyist and on occasion I use my personal funds to make political contributions, as does my spouse.  Are there states that prohibit such activity?

A. A lobbyist, simply by virtue of his or her profession, may be prohibited from making personal political contributions.

There are nine states that either prohibit or limit a registered lobbyist’s ability to contribute to state candidates. In most instances, a lobbyist’s ability to contribute to political parties and ballot measure committees remains intact.

Kentucky, North Carolina, and Tennessee impose an outright ban on lobbyists’ contributions. In Connecticut and Massachusetts, there isn’t an outright ban, but instead a monetary limit of $100 and $200, respectively. In Connecticut, the limitation extends to family members of lobbyists.

Perhaps the state most mired in “red tape” is Alaska. A lobbyist may not contribute 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 Lobbyist Report of Contributions to Legislative Candidates (Form 15-5A) within 30 days after making the contribution.

In some states, lobbyists may not contribute to state candidates or officeholders if registered to lobby the candidate’s or officeholder’s agency. Such is the case in California and South Carolina.

Finally, as a registered lobbyist you should be aware there are numerous states that impose a lobbyist ban during the legislative session. Be sure to review the relevant statutes, regulations, and guidelines.

 

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.

 

Q. When must direct corporate political contributions be disclosed?

A. At least 15 states require some sort of corporate contribution disclosure, whether it be on a campaign finance statement or lobbyist/employer disclosure report.

Campaign finance reports typically require an annual aggregate threshold be exceeded before a report is triggered.  For example, in Utah, direct corporate contributions must exceed $750 in the aggregate per calendar year before a report is required.  In Georgia, the threshold is $25,000.  In Nebraska, a corporation making more than $250 in direct corporate contributions must file a report within 10 days after the end of the calendar month in which the contribution is made.

Conversely, lobbying reports typically start at “dollar one.” In New Mexico, lobbyists are required to report all political contributions made by the employer, regardless of amount.  The same holds true in South Carolina and New Hampshire.

And then there’s California—a hybrid of both campaign finance and lobbying disclosure.  Direct corporate contributions must exceed $10,000 in the aggregate per calendar year before a campaign finance report is due.  However, until this threshold is exceeded, corporate political contributions must be disclosed on the lobbyist employer’s quarterly report.

As always, the best practice is to track all corporate political contributions in the event disclosure is required.   Likewise, you need to familiarize yourself with the reporting requirements in those jurisdictions where your company is making contributions.

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.

Q. Our company, a federal registrant, is a member of numerous outside organizations.  We join many of these organizations for reasons other than their lobbying/government relations activities.  Even so, some of the organizations allocate a percentage of dues toward lobbying activities.  If we are not actively engaged in supporting the organization’s lobbying efforts, do we still need to include the lobbying allocation in our good faith estimate of lobbying expenditures.

A. Yes. The disclosure requirement in this regard is not dependent on the rationale behind why a registrant joins any given membership organization.  The reporting mandate requires every registrant to track and ascertain what portion, if any, of all dues it pays is used for lobbying activities.  The registrant is then required to include those allocations in their total lobbying expenses reported.

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.

Here is your chance to “Ask the Experts” at State and Federal Communications, Inc.

Q. I am a registered lobbyist in multiple jurisdictions and my reports are timely filed. Do I have to complete a training course?

A. Depending on where you are registered, you may be subject to a state mandated training requirement. Requiring the completion of a lobbyist training course has been an emerging trend as states expand their ethics and disclosure provisions.

For example, in Utah, a lobbyist must complete training, and obtain a perfect score on the examination, before their lobbying license is issued. In Louisiana, a registered lobbyist must complete one hour of training by December 31 of each year. The state provides in-person training classes, as well as an online training course.

Some states, such as Maryland, require training on bi-annual basis. In New York, the lobbyist is only required to attend a training course once every three years.

Failure to complete the required training can result in penalties to the lobbyist. Louisiana imposes a personal liability requirement on the lobbyist. Failure to complete the mandatory training class may result in a fine of up to $10,000.

While training is mandatory in some states, other states have optional training opportunities available to lobbyists who want to enhance their understanding of the state’s ethics and disclosure provisions. Colorado and Georgia are two of the states currently offering optional training courses.

To obtain additional information about the jurisdictions where you are registered, please visit www.stateandfed.com. Our new website premiered on November 1, 2013.

(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.

Q. I am a registered lobbyist with a personal relationship with a state legislator.  I would like to give her a gift for a special occasion.  Is this permissible?

A. As a registered lobbyist, you should always be aware of the restrictions placed on you for providing things of value to a state official.  A number of jurisdictions have strict “no gift” laws in place.  Wisconsin prohibits a lobbyist from providing things of pecuniary value to a legislator with very limited exceptions.

A gift can be permissible based on the personal relationship between the lobbyist and the legislator.  Texas and Florida allow gifts between a registered lobbyist and a legislator if they are related to a certain degree.  Please note that jurisdictions can examine the circumstances of the gift such as the extent of the relationship between the lobbyist and the legislator.  The lack of a history of gift giving between the parties or evidence of a personal relationship may render the gift impermissible.  The federal “friendship” exception also does not apply to state and local jurisdictions.

A registered lobbyist may be allowed to give a gift based on the special occasion or reasoning behind it.  In Massachusetts, a lobbyist may give a legislator gifts on certain occasions of religious or personal significance.  Connecticut allows gifts for certain major life events.  Be sure to confirm if any occasions are excluded.  Massachusetts does not consider a birthday to be an occasion of personal significance!

A gift may not be prohibited even if you are a registered lobbyist.  Confirm whether an intended gift is permissible with your state’s ethics office.

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.

Q. I am a registered lobbyist in five jurisdictions and just moved into a new house.  Is there anything I need to do to stay in compliance?

A. It is easy to be overwhelmed by all of the tasks associated with a move.  However, it is important to notify the jurisdictions in which you are registered of your new address as soon as possible as this affects both your lobbyist registration and reports.

For example, in Florida, a lobbyist must amend his or her registration within 15 days of a change. Additionally, registration renewal must occur on forms distributed by the state directly to the address listed on the lobbyist registration on file.  Without amending the registration to include a current address, the lobbyist will not receive the registration renewal materials.

In some states, a lobbyist can face penalties for failure to amend a registration upon a change of address.  In Arizona, a registrant must notify the secretary of state within five business days after any change to the information in the registration statement. If the state determines a violation has occurred, and the lobbyist fails to comply with the request to amend the registration, a hearing will occur and the state may issue a fine of up to $1,000.

To avoid facing penalties, know the registrations provisions of your jurisdictions.  In most cases, the jurisdiction will require you to provide an updated address.  Whether this process requires a phone call or amendment to your existing registration will vary. When in doubt, contact the overseeing agency to clarify the requirements.

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.

Q. My company is involved in an event where a meal and other gifts may be provided to public officials.  How do I know if this is permissible?

A. You must consider a number of issues any time you want to provide a gift to a public official.  In addition to consulting your company’s policies, you should answer the following questions:

• Is it a gift?  States often have exceptions to the definition of gift.  Arizona does not consider an expenditure for food, beverage, travel, or lodging to be a gift under state law.  A number of states do not consider things of value provided on the basis of a personal relationship or items of de minimis value to be gifts.
• Who is the giver?  Lobbyists are often subject to more stringent gift restrictions than non-lobbyists.  Florida prohibits any gifts from lobbyists to state officials and employees with very few exceptions.  However, if you are not registered as a lobbyist, you are permitted to give any gift if it is not given to influence any official action.  California imposes different gift limits; the limit is $10 or less per month for lobbyists and $440 or less per year for non-lobbyists.  Additional restrictions could apply if your company is a state contractor.  Connecticut does allow limited gifts from lobbyists and non-lobbyists.  However, state contractors must certify no gifts were made under certain circumstances.
• Who is the recipient?  The permissibility of a gift can depend on the branch of government or the seniority of the official or employee.  Maryland legislators may only accept food and beverage from lobbyists in very limited circumstances.  Executive branch officials may accept food and beverage if they are in the presence of the lobbyist. Delaware only restricts cabinet secretaries, division directors, and the governor’s professional staff from accepting gifts from lobbyists.

If you are anything less than 100% sure a gift is permissible, consult the state’s ethics agency.  Do not ask the official or employee involved!  He or she may not be familiar with the nuances of the state’s gift law.

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.

Q. I have been asked to testify before a committee of the state legislature regarding a pending or potential bill. Is this considered lobbying activity?

A. As is usually the case, the answer will vary drastically depending on the state in question. In this specific situation, there are at least three variables to consider when evaluating this question:

1. Is testimony excluded from the definition of lobbying? In many states, providing information, participating in a meeting, or otherwise communicating at the request of a public official is specifically excluded from the definition of lobbying. This is true even if the information will potentially influence legislation, as long as the contact was initiated by the state. In these jurisdictions, a person may be asked to testify about a topic as an industry expert without being subject to lobbying laws. For instance, in Colorado, a person who is not otherwise registered as a lobbyist, but provides information at the request of public officials is not required to register and report. Iowa has a similar exception for people providing testimony or information at the request of a public official.

2. Is the communication before a public committee? Often, participation at a public meeting or proceeding or otherwise testifying on the public record is excluded from lobbying laws. Delaware’s exemption is a good example of a state allowing for testimony at a public hearing without lobbyist registration. Likewise, Connecticut has an exception from its definition of lobbyist for those who are not hired specifically to lobby and whose appearances are limited to public testimony.

3. Is there a pending bill before the legislature? Finally, it may be important to determine whether there is an actual bill pending before the legislative body in question, or if the putative lobbying communication is only regarding potential legislation. Certain states only regulate attempts to influence legislation that has already been introduced. North Dakota is a good example of this point. In order to be considered a lobbyist, a person must be attempting to influence a live bill. An individual does not need to register as a lobbyist for attempting to influence a potential bill.

There are very few concepts, rules, or guideless applicable to all states, and accordingly, situations like this must be examined on a case-by-case basis. For specific guidance, please contact a member of the State and Federal Communications compliance department.

(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.

Q. We’ve had some disagreement internally within our organization – please help. As a federal registrant employing in-house lobbyists, are we only required to report the time and expenses associated with our “registered” lobbyists.

A. It’s a good question. The answer to which often gets lost amongst the efforts to report lobbyists’ activities. Federal registrants are certainly required to make best efforts to track, capture, and report the lobbying activities and expenses of those employees who meet the 20% threshold standard (lobbyist employee). In addition, registrants are equally required to track, capture, and report expenditures associated with employees who do not meet the 20% threshold but still engage in lobbying activities during the course of the quarter (non-lobbyist employees.) The names of non-lobbyist employees are not included on the report and neither is information related to what issues they addressed or contacts they made. That said, the Secretary of the Senate and Clerk of the House have consistently advised that all employee time spent engaged in lobbying activities should be included when determining an organization’s lobbying expenses, even when the employee(s) does not meet the statutory definition of being a lobbyist. In line with the best efforts standard, then, it is important to have in place reasonable, demonstrable processes to capture both lobbyist and non-lobbyist activities.

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.

Q. I am an in-house employee; however, I am not a registered lobbyist in my responsible state. Although I engage in lobbying activities from time to time, I do not meet the state’s registration threshold. However, other people from my company are registered. Do I have to disclose my expenditure and/or compensation for lobbying activities on company reports?

A. In some jurisdictions, although you are not a registered lobbyist, you may be required to include your expenditure and/or compensation information on company lobbying disclosure reports. There are 27 states requiring some level of reporting for non-lobbyist employees, including Arkansas, California, Georgia, Illinois, Indiana, Massachusetts, Michigan, and Wisconsin.

Every state treats non-lobbyist reporting differently. For example, in California, you are only required to include your compensation and reimbursed expenditures on a quarterly employer report if you spend more than 10% or more of your compensated time in a calendar month engaging in lobbying activities. In states such as North Carolina, Illinois, or New Jersey, permissible expenditures on behalf of public officials must be reported by the employer or registered lobbyist.

In the above jurisdictions where your company has an active lobbying presence, monitoring potential reportable activity is incredibly important. Although your level of activity may not necessitate registration in a state, you must become familiar with the state’s non-lobbyist reporting requirements, and carefully track activity, which may include the following:

• Compensation for lobbying activity;
• Personal reimbursed expenditures for food, travel, or lodging in connection with lobbying activity;
• Expenditures on behalf of public officials or employees;
• Sponsorships for events where public officials or employees will be present and receive a benefit; and/or
• Subject matter lobbied, including agencies contacted.

In sum, as you are reviewing your potential lobbyist registration obligations for the new year, it is just as important to review your potential reporting obligations as a non-lobbyist employee in the jurisdictions where your level of activity does not require registration.

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.