The Illinois House of Representatives adjourned its two-year legislative session sine die on Wednesday, December 3.

Some state business will be left until Republican Gov.-elect Bruce Rauner and a new General Assembly take office in January. It is possible, however, for outgoing Gov. Pat Quinn to call a special session to force a vote on legislation increasing the minimum wage before he leaves office.

The Senate did not formally adjourn and will sit in session on January 13.

Photo of the Illinois Capitol Building by Daniel Schwen on Wikimedia Commons.

National:

An Upbeat End to a Turbulent Year for Conservative State Legislature Group
Washington Post – Tom Hamburger | Published: 12/3/2014

Early in 2014, ALEC lost some of its most esteemed corporate partners – including Google, Microsoft, Yahoo, and Facebook – who decided not to renew their memberships following complaints that the organization questioned climate science. But then came Election Day in November, which delivered massive gains for state lawmakers backed by the group and left a record number of state legislative chambers in Republican hands. Thus ALEC is ending the year with upticks in the number of corporate members and in interest from legislators.

How Do Countries Rank on Corruption?
Los Angeles Times – Alexandra Zavis | Published: 12/2/2014

A report from Transparency International shows how levels of corruption vary around the world. The group ranked 175 countries on factors such as the prevalence of bribery, how countries prosecute corruption, and how governments respond to their population’s needs, such as guaranteeing basic human rights. North American and European countries were relatively less corrupt than countries in South America, Central Africa, and Asia. Somalia and North Korea ranked as the most corrupt countries in the world. Denmark and New Zealand were the least corrupt. The U.S. came in 17th place.

Federal:

15 Places in DC Where Lobbyists Talk Turkey
The Hill – Megan Wilson | Published: 11/28/2014

There are more than 11,000 lobbyists in Washington, D.C. and an ever-growing assortment of places for wining and dining, from the smoke-filled rooms for which the city is famous to trendy cocktail lounges and four-star restaurants. There are some venues, however, that have emerged as staples for K Street business. While each of the roughly two-dozen lobbyists that responded to The Hill’s inquiry for their favorite places to dine, drink, and do business, Washington boasts 15 places where lobbyists are almost definitely expected to be found.

Federal Judge Tosses out FEC Donor Disclosure Rule, Calling it Too Narrow
Washington Post – Matea Gold | Published: 11/25/2014

A federal judge again tossed out an FEC rule that allowed nonprofit organizations running so-called issue ads to keep their donors secret, in a setback for groups such as the U.S. Chamber of Commerce and Crossroads GPS. U.S. District Court Judge Amy Berman Jackson said the rule is “arbitrary, capricious, and contrary to law.” The case hinges on a 2007-era regulation stating organizations that run issue ads close to Election Day only have to reveal donors who give for the explicit purpose of financing those spots. Under the rule, few groups running such ads have reported their contributors.

Know Before You Go: An ethics overview for Capitol Hill holiday parties
Roll Call – Kate Ackley | Published: 12/1/2014

The same congressional ethics regulations that ban lobbyists from treating lawmakers and staff to most lunches, dinners, or other gifts also govern the December social circuit in Washington. The “reception exemption” is the top carve out to the rules that most K Street party planners employ. “If it looks like a reception, then it’s OK; members and staff are allowed to attend a reception that’s purely social and a holiday celebration,” said William Minor, a lawyer at DLA Piper who specializes in ethics and lobbying laws. But beware anything that looks like a meal, or even opulent tiny bites such as caviar or truffles.

From the States and Municipalities:

California – L.A. Voters Won’t Be Offered Cash Prizes in March City Election
Los Angeles Times – David Zahniser | Published: 12/2/2014

The idea of luring Los Angeles voters to the polls with cash prizes will not be used during next year’s March or May elections. The city Ethics Commission had suggested holding a lottery to improve voter turnout, which was 23 percent for last year’s mayoral run-off. Voters would be eligible for prizes of $25,000 or $50,000. Opponents said that was bribery and would do little to make sure voters were well-informed on issues and candidates.

Florida – Former Attorney General’s Contact with Pam Bondi’s Office Raises Questions
Miami Herald – Michael Van Sickler (Tampa Bay Times) | Published: 12/1/2014

Bill McCollum is not just Pam Bondi’s predecessor as Florida attorney general; he also leads the Republican State Leadership Committee, which has championed Bondi’s advancement. During the 19 months that McCollum served as vice chairperson of the group, it contributed $650,000 to Bondi’s re-election campaign, more than 10 percent of what she raised, and chipped in another $16,000 in gifts so she could attend conferences with other Republican attorneys general. Now specializing in public policy and regulation at Dentons, an international law firm, McCollum contacted Bondi’s office on behalf of his clients, but did not register himself or list his clients with the state, which is a requirement for anyone who lobbies the executive branch.

Maryland – New Maryland Rules Would Curb Some Uses of Campaign Funds
Baltimore Sun – Michael Dresser | Published: 11/29/2014

New rules proposed by the State Board of Elections would bar candidates in Maryland from using their campaign funds to pay for such things as foreign travel, tuition, or mounting a legal defense to charges unrelated to the campaign. In addition to the prohibition on some uses of campaign funds, the board is proposing explicit rules on what actions violate the state’s longtime ban on legislators and statewide elected officials raising money during the legislative session. Among the practices banned is one in which officials send out a notice during the 90-day session to “save the date,” code in political circles for announcing a fundraiser.

Missouri – Missouri Lawmakers Face Renewed Calls to Change Loose Ethics Laws
Kansas City Star – Jason Hancock | Published: 11/26/2014

Some Missouri lawmakers say support is building to tighten state ethics laws that are among the loosest in the nation, but they warn that any reform probably would not include campaign contribution limits. The state allows legislators to accept unlimited gifts from lobbyists, collect political donations of any size, and lets lawmakers become lobbyists the moment they leave office. For years, some lawmakers have sought to change that, and each time those efforts have run into a wall of legislative opposition. Some think the 2015 legislative session could be different, with several longtime opponents of ethics reform out of office and legislative leaders voicing support for tackling the issue.

North Carolina – Redrawn Political Lines Create Sparse Choice for Voters
Ashville Citizen-Times – Mark Barrett | Published: 12/2/2014

Results of this year’s general election have once again fueled concerns about North Carolina’s redistricting process, one in which the General Assembly draws lines for U.S. House and legislative districts once a decade. Exactly half of all 120 state Houses races in November featured only one candidate. In the Senate, 19 of 50 races had just the one candidate. Only 30 to 40 of the remaining seats in the two chambers were truly “in play,” meaning either candidate had a realistic chance of winning, according to experts. Critics say the lack of competition means officeholders cater to the extreme wings of their parties, the party in power gets a disproportionate share of the seats, and voters are less likely to take an interest in public affairs.

Virginia – Ethics Commission Recommends More Caps on Free Meals, Trips for Virginia Lawmakers
The Tribune – Alan Suderman (Associated Press) | Published: 12/1/2014

A panel examining Virginia’s ethics laws recommending that state lawmakers not be able accept meals, trips, and entertainment worth more than $250 from lobbyists and others. The Commission on Integrity and Public Confidence in State Government included the recommendation in an interim report submitted to Gov. Terry McAuliffe. The commission had outlined its recommendations at a meeting in November, but now it has formally presented them to McAuliffe. The governor is expected to use the report to form the basis of ethics legislation he will propose for the General Assembly session that begins in January.

Washington – Ethics Panel Eyes Lawmakers’ Meals
The Columbian; Staff –   | Published: 12/2/2014

The Legislative Ethics Board has limited the number of free meals that Washington lawmakers could accept to 12 meals a year, and legislators currently have to report meals costing more than $50. At a recent meeting, the board approved a motion requesting that lawmakers publicly report free meals, no matter the dollar value. The Legislature must approve the reporting requirement.

West Virginia – Report Suggests Davis Conflict in Nursing Home Case
Charleston Gazette – Kate White | Published: 12/2/2014

An ABC News report said an attorney helped raise thousands of dollars for West Virginia Supreme Court Justice Robin Davis’ 2012 re-election campaign and later purchased a private jet from Davis’ husband for more than $1 million. The attorney, Michael Fuller, would later argue a high-profile nursing home case in front of Davis. Although the justices reduced a $90 million verdict against a nursing home to about $40 million, Fuller’s law firm received more than $17 million. Davis has said she is against changing the rules justices use to determine whether they should step down from certain cases.

State and Federal Communications produces a weekly summary of national news, offering more than 80 articles per week focused on ethics, lobbying, and campaign finance.

Today, the U.S. House of Representatives Committee on Ethics released a reminder for its members and staff about the propriety of accepting holiday gifts.

Holiday Guidance on the Gift Rule, an eight-page memorandum on House Rule 25, points out some of the restrictions, including reminders on how to handle certain types of situations such as attending a holiday reception at a lobbying firm.

In such a situation, attendance is allowed as long as “the food and refreshments are of ‘nominal value’ and offered ‘other than as part of a meal.’”

Should a representative or staff member be offered a gift card or certificate, the memorandum reminds them these items are considered the same as cash; therefore, they cannot be accepted under any gift exception. The communication also reminds members and staff how they must handle unacceptable gifts, how to seek written committee approval in some circumstances, and which financial disclosure requirements may be necessary.

In a seasonal flair, the memorandum ends with a whimsical poem entitled The House Gift Rule: A Rhyme for the Holidays. The poem includes stanzas such as the following:

Gifts worth less than 50 dollars really aren’t scary,

Unless there’s a lobbyist, you can make merry.

But beware! This exception requires you to know

That the donor’s permitted before pulling that bow.

Receptions are gifts but are permitted if they,

Aren’t a meal, regardless if served from a tray.

The exception requires that food value be nominal,

So no caviar, no matter, whether phenomenal.

Lobbying

“Ethics Panel Eyes Lawmakers’ Meals” in The Columbian

Campaign Finance

“New Study Finds Companies’ Campaign Donations Linked to Lower Tax Rates” by Debbie Freeman for Arizona State University

“Ethics Panel Seeks Change in Law to Stop Candidates from Paying Self from PAC” by Naomi Schalit (Maine Center for Public Interest Reporting) for Lewiston Sun Journal

“Election Ads Were About Issues, Says ‘Carolina Rising’ Chief” by Carrie Levine for Center for Public Integrity

Ethics

“Alcorn County Pays Ex-Lawmaker Thousands for Jail Work” by Emily Wagster Pettus for Hattiesburg Daily American

“Report Suggests Davis Conflict in Nursing Home Case” by Kate White for Charleston Gazette

Elections

“How to Handle a Broken Campaign Promise” by Nathan Gonzales for Roll Call

“L.A. Voters Won’t Be Offered Cash Prizes in March City Election” by David Zahniser for Los Angeles Times

Legislative Issues

“New Leader, New Rules for SC House” by Cassie Cope for The State

“State Lawmakers Poised for Pay Bump” by David Saleh-Rauf for San Antonio Express-News

Secretary of State Brian Kemp has called a special election to fill the seat in House District 120. The special election is set for January 6, 2015, and a runoff will be held on February 3, if necessary.

The newly re-elected Rep. Mickey Channell announced he will not fill the seat when the new term begins on January 12, 2015.

Virginia House Speaker William Howell announced a special election will be held on January 6 to fill the open seat for District 34. Barbara Comstock is vacating the seat following her victorious campaign for Virginia’s 10th Congressional District.

The Democratic candidate is likely to be Kathleen Murphy while the Republicans will select a candidate this weekend.

The 34th District covers parts of Fairfax and Loudoun counties.

City Council is preparing to hold a final vote on the Oakland Government Ethics Act after voters overwhelmingly approved a measure to strengthen the city’s Public Ethics Commission (PEC). Measure CC, a charter amendment, gives the PEC authority to enforce the city’s lobbying laws and to levy fines in excess of $1,000 for violations.

The Oakland Government Ethics Act compliments the charter amendment by providing a new set of ethics rules including a revolving-door provision and a new lower annual gift limit of $250. Gifts from persons who do business or seek to do business with the city would further be limited to $50 annually.

The council is scheduled to hold a final vote on the legislation on December 9, 2014.

This week we visit the state of Colorado and its capitol building.

Located in the “Mile High City” of Denver, the capitol building was constructed in the 1890’s, and almost two decades later a 24 karat gold plated dome was added in commemoration of Colorado’s gold rush days.

The building’s exterior is composed of Colorado white granite, while its interior contains two rare types of marble: rose and mauve. In fact, the marble was so rare that its known supply was completely used up in the construction of the capitol, a process that took six years to complete. In fact, the building itself was composed with the nation’s capitol in mind.

The interior is composed of brass and stained glass with the dome towering 180 feet above. Inside you’ll find beautifully painted portraits of each U.S. president from Washington to Clinton. On the first floor are the offices of the Governor and Lt. Governor.

The capitol also serves as the center for legislation, housing the House and Senate Chambers, as well as the Legislative Hearing Room, which was formerly the state Supreme Court Chambers. The House of Representatives Gallery and the Senate Gallery are magnificently decorated with beautiful stained glass pieces as well as embedded brass, its luxurious features complemented with comfortable theater seating.

Thank you once again for joining us this week during our exploration of and education on the wonderful state of Colorado’s capitol. You can take a virtual tour of the Colorado Capitol, or arrange for an actual tour here.

Don’t forget to join us as we take on yet another statehouse!

Photo of the Colorado State Capitol by Greg O’Beirne on Wikimedia Commons.

Lobbying

“Know Before You Go: An ethics overview for Capitol Hill holiday parties” by Kate Ackley for Roll Call

Campaign Finance

“Supervisors Will Give Controversial FPPC Monitoring Plan another Try” by Norberto Santana, Jr. for Kitsap Sun

“Federal Appeals Court Upholds Braddock’s Sentence” by Hugh McQuaid for CTNewsJunkie.com

“Hogan Won with Public Money, but Replenishing the Fund is Uncertain” by John Wagner for Washington Post

“Federal Judge Tosses out FEC Donor Disclosure Rule, Calling it Too Narrow” by Matea Gold for Washington Post

Ethics

Florida: “Broward’s Sharief to Admit Guilt, Accept $3,000 Fine in Ethics Case” by Brittany Wallman for South Florida Sun Sentinel

Indiana: “Legislative Ethics Reformers Walk Fine Line” by Dan Carden for Northwest Indiana Times

Missouri: “Missouri Lawmakers Face Renewed Calls to Change Loose Ethics Laws” by Jason Hancock for Kansas City Star

New Jersey: “Port Authority Employees with Political Ties Still on Job” by Martin Braun for Bloomberg News

Ohio: “Amer Ahmad Sentenced to 15 Years in Prison for Corruption Plot” by Jeremy Pelzer for Cleveland Plain Dealer

Q. For federal income tax purposes, our organization has been using the aggregate amounts reported on our quarterly LD-2 lobbying activity report as our nondeductible lobbying expenses.  Can the expenditures we compile for LDA reporting be used interchangeably for tax purposes?

A. In a word: maybe – It depends on the method of LDA reporting you’ve opted to follow.  If you file your LD-2 report using the IRC definitions (method C), then the number you compile and report on your LD-2 can be used interchangeably for tax purposes.  However, if you compile and report your quarterly lobbying expenditures using LDA definitions (method A), the results will not accurately reflect nondeductible lobbying expenses as defined by the IRS.  Because the definition of “lobbying” differs between the LDA and the IRC, the two compilation methods will produce very different results.  If you use LDA definitions to compile your quarterly LD-2, your organization must employ a second process by which to determine your nondeductible lobbying expenses for tax purposes.  A lobbying registrant can determine each year which method they will use to compile the LD-2 report.  Once a method has been selected, a registrant must use that method for all four quarterly reports during that year.

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.

Here is our December-January calendar. If you are attending any of the coming events, please stop by and say hello!

December 3   Ohio Society Holiday Party; Washington, DC

December 6-10   COGEL, Pittsburgh, Pennsylvania

December 9-12   NCSL Fall Forum, Washington, DC

January 8-11   NCSL Executive Committee Meeting, New Orleans, Louisiana

January 9-11   Women In Government Annual Meeting, St. Petersburg Beach, Florida

January 11-16   Public Affairs Institute, Laguna Beach, California

Gov. Terry Branstad has called a special election for state Senate District 12. The special election is scheduled for December 30, 2014.

The election will fill the vacancy left by Joni Ernst, who resigned from the state senate after being elected to the U.S. Senate in November 2014. Ernst’s former senate district includes Fremont, Mills, Montgomery, Page, Ringgold, and Taylor counties.

On November 27, the third session of the 40th parliament of the British Columbia Legislative Assembly adjourned for the year. The Legislature did not pass Bill M202, the Election Finance Amendment Act. It would have restricted political contributions to donations made by individual residents of the province and eliminated corporate, union, and out-of-province donations.

Photo of the main block of the British Columbia Parliament Buildings by Ryan Bushby on Wikimedia Commons.