St. Louis Alderman Scott Ogilvie recently introduced legislation to limit campaign contributions to local candidates.

Board Bill No. 53 prohibits candidates from accepting contributions exceeding $10,000 per city election from any person, entity, or committee. The amount would increase in April in each odd numbered year to coincide with any increase in the consumer price index.

Ogilvie’s proposal also defines election periods for the purposes of contribution limits, creates a Municipal Officials and Officers Ethics Commission, makes contributions from minors age 16 or younger attributable to parents or guardians, and sets penalties for violations of the bill.

If passed, the ordinance would be effective April 6, 2017.

Photo of the Gateway Arch in St. Louis by Daniel Schwen in Wikimedia Commons.

Bernalillo County Commissioner Debbie O’Malley is requesting the county attorney investigate donations to the political action committee (PAC) New Mexicans for New Mexico, which is supporting County Commission candidates Steven Michael Quezada and Robert Chavez.

There is a $1,000 cap for contributions from people doing business with Bernalillo County, but disclosure reports reveal owners of businesses with city contracts donating to the PAC in amounts exceeding the limit.

The matter has been referred to the county’s ethics commission for further investigation.

On May 17, three separate bills regarding lobbyists and political donors were introduced in the General Assembly.

If all three bills pass, political committees would be required to report a contributor’s occupation and employment information (Senate Bill 224), lobbyists would be required to disclose the source and amount of received payments (Senate Bill 225), and lobbyists would be required to pay a registration fee or face certain penalties (House Bill 385).

On May 17, U.S. District Judge Charles Lovell ruled the current statutory campaign finance contribution limits in Montana unconstitutional. “Defendants have not proven that the campaign contribution limits … further the important state interest of combating quid pro quo corruption or its appearance,” Lovell wrote in the court’s order.

Montana Commissioner of Political Practices Jonathan Motl said the ruling reinstates the contribution limits in place before the statute was enacted. Those contribution limits have been adjusted for inflation and are now $1,990 for governor and lieutenant governor; $990 for other statewide offices; $530 for District Court judge, Public Service Commission, and state Senate; and $330 for all other elected offices, including the state House. The limits are per candidate per election.

Attorney Matthew Monforton said the court’s ruling should mean there are no caps on contributions from any source” and will consider additional litigation if Motl doesn’t lift all limits, according to the Independent Record.

The statute struck down by Lovell in Lair v. Motl was enacted by an initiative vote in 1994.

On April 14, the Federal Election Commission (FEC) considered a motion to open a rule-making concerning whether to require entities accepting political contributions from corporations to verify those corporations are associations of United States citizens who are eligible to contribute. Commissioner Ellen L. Weintraub had previously submitted the motion contending there is “no framework in place to assist entities accepting political contributions or making independent expenditures and electioneering communications in complying with existing law.” Federal law prohibits foreign nationals from making political contributions and expenditures. Federal contractors are also prohibited from making certain political contributions and expenditures.

The commission also discussed a motion for rule-making regarding political funding from foreign nationals. The motion asks the commission to make a regulation requiring those making independent expenditures to certify no resources owned or controlled by foreign nations were used. The FEC has tentatively scheduled to meet at the FEC headquarters on June 23 to discuss corporations and foreign money.

On March 31, the Federal Election Commission may consider a motion to open a rule-making concerning whether to require entities accepting political contributions from corporations to verify those corporations are associations of United States citizens who are eligible to contribute.

On March 24, Commissioner Ellen L. Weintraub submitted the motion contending there is “no framework in place to assist entities accepting political contributions or making independent expenditures and electioneering communications in complying with existing law.” Federal law prohibits foreign nationals from making political contributions and expenditures. Federal contractors are also prohibited from making certain political contributions and expenditures.

Weintraub is further requesting the commission direct the Office of General Counsel to draft a rule-making document requiring those making independent expenditures and electioneering communications certify resources used are not owned or controlled by foreign nationals.

A new bill introduced in the Georgia Senate seeks to prevent campaign contributions from companies and executives doing business with the state. Senate Bill 394, introduced by Senate Judiciary Chairman Josh McKoon, prohibits contributions from business entities and affiliated persons who have contracts with the state exceeding $50,000 in the aggregate to any candidate for the office responsible for awarding such contracts.

Just last year, DeKalb County CEO, Burrell Ellis, was found guilty of threatening to end a contract with a state vendor if it did not make a $2,500 campaign contribution.

McKoon introduced the bill after noting Georgia is lagging behind the rest of the country, and federal law, on such legislation. The bill currently only affects statewide offices, but McKoon stated he is open to making the law more robust.

Photo of Georgia State Senator Joshua McKoon courtesy of the Georgia Senate website.

The Joint Commission on Public Ethics has released an advisory opinion addressing whether an elected official can solicit and accept campaign contributions or other forms of support for his campaign from a subject of the official’s enforcement powers. In the opinion, JCOPE determined an elected official running for election may not directly solicit or accept monetary or in-kind campaign contributions from any person or entity which is the active subject of an ongoing exercise of enforcement powers of the elected official or the office of the elected official.

Additionally, other, non-monetary forms of political support will be determined on a case-by-case basis as to whether a conflict of interest exists. The public official would be required to recuse himself from an exercise of enforcement powers against a party from whom he accepted a contribution in the prior 12 months.

Political contributions from federal lobbyists and political action committee (PACs) are now being accepted by the Democratic National Committee (DNC). A self-imposed ban on receiving contributions from lobbyists and PACs began in 2008 during the presidential campaign. Lobbyists and PAC representatives are still prohibited from attending events featuring the president or vice-president or their spouses, according to The Hill.

Mark Paustenbach, deputy communications director for the DNC, explained the change to The Washington Post by saying, “The DNC’s recent change in guidelines will ensure that we continue to have the resources and infrastructure in place to best support whoever emerges as our eventual nominee.” Last year it was announced the DNC would accept contributions from lobbyists and PACs for its party conventions.

Cleveland City Council President Kevin Kelley wants to raise the limits on political contributions in order to offer challengers a fair fight against incumbent candidates with established war chests. Individual and PAC contributions to mayoral candidates would be capped at $10,000 per calendar year. The current city ordinance permits just $1,000 from individuals and $2,000 from PACs. The proposed legislation would also increase contribution limits for council candidates up to $1,500 from individuals and $3,000 from PACs.

Critics argue the proposal would allow special interests to buy influence at City Hall. Kelley, however, believes $10,000 is not enough money to make a mayor feel beholden to a donor. Considering most Ohio cities have no campaign contribution limits, Kelley suggests a higher limit is still better than no limit at all.

The legislation will be discussed at the Finance Committee meeting on Wednesday, January 27, and will likely be up for passage the same night.

Photo of Cleveland City Hall by Stu Spivack on Wikimedia Commons.

Q. What are the key components for a successful government affairs compliance program?

A. We collaborate closely with our clients to create comprehensive and effective compliance programs. During this process, our clients often request guidance on best internal practices and procedures. Certainly, there is no one-size-fits-all approach—a successful compliance program will adapt seamlessly into the fabric of the corporate structure, making every program unique. Notwithstanding, here are five common components for successful government affairs compliance programs:

1. Centralized Oversight: Great compliance programs have a strong organizational structure with oversight and review vested in one dedicated team of government affairs professionals. All requests for corporate contributions, gifts, and events should be approved by the central team. There should be   one employer signatory for all state and local filings—one person who is responsible for oversight and who can attest to the accuracy of registrations and reports. This person typically has oversight of internal team activity, which affords an opportunity for a big picture overview of state and local responsibilities. The responsibility for all company reports should stay within the company—contract lobbyists typically should not be responsible for filing a company’s employer reports. Often, non-lobbyist employee activity, corporate contributions, and/or in-house corporate expenses need to be disclosed on employer reports. Contract lobbyists are not always privy to the necessary reporting information. We recommend working closely with your contract lobbyists to identify necessary reporting information (percentage of retainer dedicated to lobbying efforts, subject matter, etc.) and reviewing draft disclosure reports against company invoices to ensure accuracy in reporting.

2. Recurring Training Opportunities & Assessments: Providing adequate training opportunities for your team is necessary to ensure compliance. Ideally, this should be done on an annual basis, and completion should be required and documented. State and local requirements change quickly, as do team members. This is especially true for sales and procurement executives. We recommend a general training session or refresher course and individual follow-up to assess registration and/or reporting needs.

3. Broad Outreach Across Lines of Business and Departments: Contact with state and local government officials is usually not isolated to only the government affairs team—it can happen anywhere in your corporation, from the executive level to sales. A strong compliance program allows you to reach across lines of business and departments to ensure anyone engaging officials on behalf of your company is staying compliant with relevant rules and restrictions.

4. Clear Policies for Employee Engagement: Can you identify clear internal gift and contribution policies? Your compliance program should utilize and strengthen your existing gift, ethics, and corporate contribution policies. Ensure these policies are specific. For example, what employee activity triggers the policy? What activities are prohibited? What activities require pre-approval by your team? A well-structured compliance program will disseminate these policies companywide, and include a clear roadmap for employee compliance.

5. Open Door Policies and Procedures: In sum, you must make it easy to comply. If it’s too difficult to access information or request approval, your employees simply won’t do it. Is there an intranet, form, or a ticket system you can utilize to ensure your employees can easily access guidance? What resources do you provide to your employees?   Is there a company contact employees can reach to discuss questions or concerns? Further, there must be a fast turn-around time for questions and guidance. The longer something sits in a queue, the higher the risk for noncompliance.

In 2016, it will be more important than ever to keep a close watch on your compliance program.  Having a solid program in place will help when questions arise from the media, stockholders, and activists.

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.

State and Federal Communications, Inc. announces Jennifer Jaketic as a new compliance assistant.

She assists in the company’s Corporate Contribution Compliance department, also known as C³, which monitors the rules associated with corporations making political contributions.

“I like obliging by the rules and the ethical considerations of campaign finance,” Jaketic added. ”I enjoy working with numbers and the compliance aspect of it, which is why my position at State and Federal is such a valuable experience.”

“We started vetting contributions for our clients in 2008 and it is a piece of business which has grown. Nola Werren, Esq. from our staff has the experience needed with Jennifer to keep the work in progress for our clients,” said President and CEO Elizabeth Bartz.

Jaketic has more than 12 years of experience in campaign finance. Immediately following graduation from George Washington University with a bachelor’s in political science, Jaketic worked for the Federal Election Commission in its Reports and Analysis division, where she reviewed campaign finance reports of Political Action Committees. Jaketic is currently pursuing a master’s degree in accounting at Cleveland State University.

Lobbying 

“K Street Eyes Late-Year Rebound” by Megan Wilson for The Hill

Campaign Finance

“Divided D.C. Council Takes Aim at Mayor Bowser’s Super PAC” by Aaron Davis for Washington Post

Missouri: “Ten Missouri Megadonors Drive Largest Political Contributions” by Jason Hancock for Kansas City Star

Ethics

California: “Does Orange County Need an Ethics Commission? Voters to Decide in June” by Meghann Cuniff for Orange County Register

“Report Traces Jeb Bush’s Ties to Companies That Had Business with Florida” by Matt Flegenheimer and Steve Eder for New York Times

Wisconsin “Lawmakers Approve Bill Ending John Doe Probes of Political Crimes” by Patrick Marley and Jason Stein for Milwaukee Journal Sentinel

Elections

“Biden’s Decision Boosts Clinton and Sets Up a Two-Way Race With Sanders” by Paul Kane and Karen Tumulty for Washington Post

Legislative Issues

“Paul Ryan Tells House Republicans He’s Willing to Run, If Conditions Are Met” by Mike DeBonis and Robert Costa for Washington Post

Q. I recently became a registered lobbyist in my company’s home state.  I am also very active politically.  Are there any restrictions on my political contributions now that I am a registered lobbyist?

A. An individual’s status as a registered lobbyist can place additional restrictions and requirements on him or her related to his or her political contributions. Some jurisdictions place strict restrictions on a lobbyist’s ability to make contributions.  South Carolina prohibits registered lobbyists 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.  California has a similar prohibition, providing lobbyists may not contribute to a state candidate or officeholder, or their controlled committees, if registered to lobby the governmental agency for which the candidate seeks election or to which the officeholder belongs.  Other jurisdictions limit the amount a registered lobbyist can contribute compared to a nonregistered individual.  Registered legislative and executive agents in Massachusetts may contribute no more than $200 in the aggregate to any one candidate and such candidate’s committee during a calendar year.

A number of jurisdictions require reporting of lobbyist contributions.  Pennsylvania has extensive registration and reporting requirements for lobbyists who make personal political contributions, requiring them to register with the state before making a personal contribution and to file reports on the same schedule as a PAC.  Maryland’s reporting requirements are not as extensive, requiring certain political contributions to be disclosed on the lobbyist’s activity report.

When an individual becomes a registered lobbyist, he or she must review the applicable rules on his or her political contributions.  If unsure as to the requirements, please be sure to review our website at www.stateandfed.com for up-to-date information.

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.