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 E-News from State and Federal Communications, Inc.

January 2013

Random Acts of Audit

If you are registered as a state lobbyist, there is a good chance you have received notification for the state to conduct an audit on your lobbying reports. California, Indiana, Pennsylvania, New York, West Virginia are just a few states with random acts of audit.

But, are you ready for an IRS audit of your federal reports?

According to State and Federal Communications friend and client, Ken Gross from Skadden Arps, about 75 percent of the filings to the US Secretary of the Senate are filed using the LDA method, as opposed to the IRS method. That’s fine in practice, but your organization’s IRS filings need to show everything but lobbying activities.

When we are speaking with clients and audiences we emphasize the importance of keeping track of time, not only for your lobbying reports, but for your company’s filing with the IRS since the time devoted for lobbying is not deductible. It is impossible for anyone to spend 100% of time on lobbying because there are other administrative things people have to do, meetings to attend, and conferences to attend.

It is important companies keep two sets of books.

No, this is not The Producers where Matthew Broderick has two books—one to show the government and one not to show the government. It allows your organization to file its LD2 report without having to disclose lobbying expenditures for state and grassroots activities and still have the information to include in the IRS filings.

Take the opportunity to ask the accounting department if they are keeping track of time two different ways to insure your LD2 reports are accurate and, more important, when the IRS is a’knocking you can rest assured your reports are A-OK.

Until next month, I wish you all a Merry Christmas and Happy New Year.

Elizabeth Z. Bartz
President and CEO

The 2013 Guidebooks are on their way.

New York Adopts Independent Expenditure Rules

by Shamus Williams, Esq.

The New York State Board of Elections officially adopted rules concerning the disclosure of independent expenditures. The essence of the rule will force people who make independent expenditures to disclose funding and amounts spent by treating them as a political committee. Therefore, they will have to register as an independent expenditure committee and, for those elections in which they support or oppose a candidate, file reports before and after the election. The committee will also be responsible for filing periodic reports on January 15 and July 15 of each year.

Independent expenditures are defined by the state as expenditures made in support of or opposition to a candidate, expressly advocating for the election or defeat of a candidate, and made in complete independence from the candidate. Expressly advocate is defined as communicating with specific words calling for the election or defeat of a candidate, such as "vote," "oppose," "support," "defeat," "elect," or "reject."

Using these definitions, groups can avoid registering and reporting as an independent expenditure committee if they avoid using the special buzz words that would make their advertisements expressly advocating. The board of elections has said these rules are not completely new, but rather have been adopted to shed light on the rules and to ensure that people understand exactly what is expected when making independent expenditures. The rules have already taken effect and committees making these expenditures will next have to file a report on January 15, 2013.

Summary of Changes UPDATE
Note Recent Changes to Compliance Regulations

by John Cozine, Esq.
Research Manager

MASSACHUSETTS: Lobbyists using a LinkedIn online discussion group are not prohibited from soliciting contributions for candidates from the group. The Office of Campaign and Political Finance (OCPF) issued an opinion, AO-12-03, detailing when a lobbyist can solicit contributions on LinkedIn without being considered a regulated intermediary or conduit bundling contributions. The OCPF considers the use of social media, such as LinkedIn, as a "personal service” that is generally exempt from campaign finance limitations or disclosure requirements. Asking members of a lobbyist’s LinkedIn group to contribute directly to candidates does not involve “arranging” for the making of contributions the opinion holds. However, a lobbyist could be regulated if contributions are either delivered by the regulated intermediary to a particular candidate or such candidate's authorized committee or agent, or made in a manner that identifies in writing the person who arranged the making of the contributions. The restrictions for bundling apply only if at least one of the bundled contributions is more than $156. The OCPF also opined that persons who are not lobbyists may use LinkedIn or similar sites to solicit contributions for candidates, with certain restrictions for public employees.

WASHINGTON: An old lawsuit has been resurrected that could leave Washington’s public disclosure law involving grassroots lobbying in jeopardy. Two groups, Conservative Enthusiasts and Many Cultures, One Message, sued the Washington Public Disclosure Commission in 2010 claiming their free speech rights were violated by the law requiring grassroots campaigns to register and report with the state. The case was dismissed by a magistrate for lack of standing. However, last week, a three judge panel of the Ninth Circuit Court heard the appeal on the dismissal and will soon be making a decision on the law in question. At issue in the case will be whether the law is unconstitutionally vague. The law defines lobbying, among other things, as attempting to influence the passage of legislation. Included in the definition of legislation is “any other matter that may be the subject of action” by the legislature. It is this language that is the nature of the lawsuit. The two groups claim that the language is overly vague and includes “an endless possibility of matters.” Now, it is up to the appellate court to decide whether the case will go back to the trial court for a hearing on the merits and whether the dismissal will be upheld.

NEBRASKA: The clerk of the legislature's office is implementing voluntary electronic filing for lobbyist registration and reporting for the 2013 legislative session. Paper filings will be accepted through 2014, and mandatory electronic filing will be implemented January 1, 2015.

TALLAHASSEE, FLORIDA: The Tallahassee City Commission has approved the volunteers appointed to the newly-created ethics advisory panel. The panel will spend six months reviewing the city's policies on ethics, financial disclosure, and transparency to determine whether to keep the current policies or adopt new ones. The meetings will be publicly noticed, and the panel has already invited several outside experts to give feedback.

GEORGIA: The Board of Commissioners of the Georgia Government Transparency and Campaign Finance Commission issued an order for lobbyists with unpaid fines, fees, and unfiled reports. The commission will deny lobbyist renewal for 2013 to individuals registered with outstanding fees for previous registrations, supplemental registrations, or identification cards. The commission will also deny lobbyist renewal to individuals with unpaid fines or unfiled reports previously due. The order went into effect on December 16, 2012.

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.

  Total bills Number of Jurisdictions Passed Died Carried over
to 2013
Lobbying Laws 252 43 19 144 0
Political Contributions 450 46 43 218 0
Procurement Lobbying 277 42 35 147 1


W  E  B  S  I  T  E     T  I  P

Quick Reference Information

Subscribers to the Executive Guide on Political Contributions have access to a feature known as Election Cycles. Why is this important? In many jurisdictions contributions are capped during each election cycle. As a result, it is crucial to know how long the election cycle lasts so you don’t exceed the contribution limits and so you know when you may make additional contributions. Election cycles will be listed for every elective office covered by that jurisdiction’s campaign finance laws. Of course not every jurisdiction defines election cycle or relies on an election cycle to regulate the timing of contributions. Where there is no definition of election cycle, the listed election cycle will run from the date of the last election for that office to the date of the next election for that office.


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: (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.


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?


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.   

January's Expert - Myra Cottrill, Esq.

Wealth of Information at

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

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.

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


State and Federal Scrapbook

Linda Bird Johnson Robb with Elizabeth Bartz at the opening reception discussing Elizabeth's work with Chuck Robb's senatorial campaign in Virginia. Luci Baines Johnson with Elizabeth Bartz at the
State Dinner reception.
State and Federal Communications, Inc. President and CEO, Elizabeth Z. Bartz and Executive Director, I.T. Ren Koozer attended the State Dinner at the LBJ Museum and Library in Austin, Texas. Joining the State and Federal Communications, Inc. table included friends and colleagues - [front row] Jacqueline Clark - Ash Grove Cement Company, Beth Loudy - SGAC, Katrina Iserman - Sunovion Pharmaceuticals Inc., Elizabeth Bartz,
[back row] Christopher Badgley - Daiichi Sankyo, Inc,
Crislyn Lumia -SGAC, and Ren Koozer.


James Warner, Esq., Compliance Associate from State and Federal Communications, Inc. [far left] presented
with the American League of Lobbyists certificate.
Christopher Coleman from America's Natural Gas Alliance
with Elizabeth Bartz, at the NCSL Fall Forum in
Washington, D.C.
This holiday season we worked with Summit County Children Services and its Emancipating Youth Program to help outfit apartments for children who reach adult age and will no longer receive services from the agency.  This program helps each one get some things they need to start running their own home.
After presenting Elizabeth with gifts from the staff, we stopped to take a group photo during our very relaxing holiday party.

Local artist, Kari Fry, provided caricatures of the staff.
Our own Alexis Pope enjoyed Kari's caricature of her.
Each employee went home with a pizza from Luigi's and a Temo's chocolate Christmas tree.


See Us in Person


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


January 29-30, 2013

GOVERNING Magazine -
Outlook 2013: The Power of States and Localities

Washington, D.C.

February 5-8, 2013

2013 National Grassroots Conference
Key West, Florida

February 22-25, 2013

NGA Winter Meeting
Washington, D.C.


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The Mission of State and Federal Communications is
to make sure that your organization can say, "I Comply."

We are the leading authority and exclusive information source
on legislation and regulations surrounding campaign finance
and political contributions; state, federal, and municipal lobbying; and procurement lobbying.

Contact us to learn how conveniently our services will allow you to say "I Comply" for your compliance activities.