May 10, 2019 •

Federal Judge Rules South Dakota Initiated Measure 24 Unconstitutional

U.S. District Judge Charles Kornmann struck down a ban on out-of-state contributions to ballot question committees recently passed by voters. Kornmann found Initiated Measure 24 unconstitutional because it violates First Amendment rights to engage in political speech. Additionally, Kornmann said […]

U.S. District Judge Charles Kornmann struck down a ban on out-of-state contributions to ballot question committees recently passed by voters.

Kornmann found Initiated Measure 24 unconstitutional because it violates First Amendment rights to engage in political speech.

Additionally, Kornmann said the measure violates the Commerce Clause by interfering with the free flow of money between persons from another state and South Dakota committees.

The ruling is a permanent injunction that stops the planned implementation on July 1.

The state must now determine if it will appeal the decision to the U.S. Eighth Circuit Court of Appeals.

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June 7, 2018 •

Ask the Experts – Required California Political Contribution Reports

My employer makes corporate contributions in California.  We have not yet exceeded $10,000 in calendar year 2018.  The primary election and special elections are taking place, along with the general election in the fall.  If we decide to make contributions, […]

My employer makes corporate contributions in California.  We have not yet exceeded $10,000 in calendar year 2018.  The primary election and special elections are taking place, along with the general election in the fall.  If we decide to make contributions, when do we have a late contribution report due?

The California “Late Contribution Report” [Form 497], sometimes referred to as the “24-hour report” is due during the 90-day period preceding any election if all of the following criteria are met:

  • The contribution is $1,000 or more, or multiple contributions aggregating $1,000 or more, to a single candidate, ballot measure committee, or political party.  This includes non-monetary and in-kind contributions…Read the full article

For more information, be sure to check out the “Registration and Reports Required” section of the U.S. Political Contributions Compliance Laws online publication for California. Please feel free to contact us if you have any questions.

Click here to read ALL Ask the Experts articles in full

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April 4, 2018 •

New Tip Sheet: Restrictions on Political Contributions from Lobbyists

The 2018 elections are approaching quickly. Have you reviewed the restrictions on political contributions from your company’s lobbyists? It is important to know what restrictions are placed on lobbyists, such as when, how, or how much a lobbyist may contribute. […]

The 2018 elections are approaching quickly. Have you reviewed the restrictions on political contributions from your company’s lobbyists?

It is important to know what restrictions are placed on lobbyists, such as when, how, or how much a lobbyist may contribute.

Knowing state and federal restrictions will help your company remain compliant and could save you a lot of headaches.

State and Federal Communications is here to help you. Our newest Tip Sheet “Restrictions on Political Contributions from Lobbyists” will inform you on sessional restrictions, lobbyist contribution limits, and restrictions on activities beyond making direct contributions.

This new Tip Sheet will provide you with the key information to keep in mind as you continue your government affairs program.

Click here to get this FREE Tip Sheet today – and ensure you and your team can say “I Comply!”

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March 21, 2018 •

Utah Governor Signs Bill Expanding Ban on Contributions During Sessions

Gov. Gary Herbert signed House Bill 320 this week, putting it into effect immediately. The bill expands the existing prohibition on contributions to legislators during a legislative session to also cover contributions to the lieutenant governor, attorney general, state auditor, […]

Gov. Gary Herbert signed House Bill 320 this week, putting it into effect immediately.

The bill expands the existing prohibition on contributions to legislators during a legislative session to also cover contributions to the lieutenant governor, attorney general, state auditor, and state treasurer.

The prohibition extends to contributions to the personal campaign committees and political action committees (PACs) of the covered candidates. Previously, only contributions to legislators were banned during sessions.

Parties prohibited from contributing during session include persons, lobbyists, principals, and political committees.

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September 15, 2017 •

News You Can Use Digest – September 15, 2017

      National: How Anna Nicole Smith’s Billionaire In Laws Secretly Lobbied the Courts Bloomberg.com – Zachary Mider | Published: 9/13/2017 When the heirs of billionaire J. Howard Marshall II, famous for his May-December romance with Playboy centerfold Anna Nicole Smith, went […]

 

 

 

National:

How Anna Nicole Smith’s Billionaire In Laws Secretly Lobbied the Courts
Bloomberg.com – Zachary Mider | Published: 9/13/2017

When the heirs of billionaire J. Howard Marshall II, famous for his May-December romance with Playboy centerfold Anna Nicole Smith, went to court in a $75 million tax dispute, they got help from an unlikely ally: Barber-Scotia College, the nation’s first institution of higher learning for black women. Barber-Scotia’s name, along with those of four other historically black colleges and universities, was on a friend-of-the-court brief submitted to the U.S. Court of Appeals for the Fifth Circuit. The brief was part of a campaign by the Marshall family, orchestrated by a Washington, D.C. consulting firm, to influence two of the nation’s highest courts. The campaign shows how it is possible for well-funded litigants to stack the deck by generating phony friends of the court, or by paying advocates who present themselves as independent but are really lobbyists in disguise.

On Facebook and Twitter, a Hunt for Russia’s Meddling Hand
New York Times – Scott Shane | Published: 9/7/2017

The Russian information attack on the election did not stop with the hacking and leaking of Democratic emails. Far less splashy, and far more difficult to trace, was Russia’s experimentation on Facebook and Twitter, the American companies that essentially invented the tools of social media and, in this case, did not stop them from being turned into engines of deception and propaganda. An investigation reveals some of the mechanisms by which suspected Russian operators used Twitter and Facebook to spread anti-Hillary Clinton messages and promote the hacked material they had leaked. Given the powerful role of social media in political contests, understanding the Russian efforts will be crucial in preventing or blunting similar, or more sophisticated, attacks in upcoming elections.

Federal:

Russian Network RT Must Register as Foreign Agent in US
The Hill – Megan Wilson | Published: 9/12/2017

The company that runs the U.S. version of RT, the Russian state-owned outlet originally known as Russia Today, must register with the Justice Department as a foreign agent, signaling that all of their content would be labeled as propaganda from Moscow. Media organizations have been exempted from the Foreign Agents Registration Act, which is wide-ranging in its disclosure requirements and generally applies to political consultants and those working in lobbying or public relations. It would be a felony if RT is found to have willfully failed to register as a foreign agent, however.

From the States and Municipalities:

Colorado
Denver City Council Approves New Rules Requiring Reports of Dark-Money Spending in Elections
Denver Post – Jon Murray | Published: 9/11/2017

The Denver City Council approved a bill that will require the reporting of at least $1,000 in independent spending by individuals, companies, or other organizations to support candidates or ballot issues. Those independent expenditures include any activity aiming to aid or hurt a candidate, including “electioneering communications” such as mailers, broadcast ads, or other advertising. The initial report to the Denver Elections Division, disclosing all expenses and donors above $25, will be required within two days after cumulative spending reaches $1,000.

Illinois
Weighing Third Term, Emanuel Relies on Campaign Donors Who Get City Hall Benefits
Chicago Tribune – Jeff Coen and Bill Ruthhart | Published: 9/8/2017

As Chicago Mayor Rahm Emanuel ramps up his campaign fundraising toward a possible third term, he continues to rely on donors who have received City Hall benefits, ranging from contracts and zoning approvals to appointments and personal endorsements from the mayor. With the mayoral election still a year and a half away, Emanuel has collected $3.1 million in high-dollar contributions. And more than $2.1 million of it, nearly 70 percent, has come from 83 donors who have benefited from actions at City Hall.

Massachusetts
Pro-Charter School Group Pays State’s Largest Campaign Finance Penalty
Boston Globe – Michael Levenson | Published: 9/11/2017

A group that backed last year’s charter school ballot question in Massachusetts paid $426,466 as part of a campaign finance settlement. The payment by Families for Excellent Schools-Advocacy is the largest civil forfeiture in the history of the Office of Campaign and Political Finance. Investigators say the organization violated the law by raising money from individuals and then contributing that money, more than $15 million, to the Great Schools Massachusetts Ballot Question Committee in a manner intended to disguise the source of the money. The group agreed with the IRS to dissolve itself, and Families for Excellent Schools, its umbrella group, agreed not to fundraise or engage in any election-related activity in Massachusetts for four years.

Minnesota
Scott County Attorney Declines Charges in Dai Thao Bribery-Solicitation Case
St. Paul Pioneer Press – Frederick Melo | Published: 9/12/2017

St. Paul City Councilperson Dai Thao will not face criminal charges over an allegation he attempted to solicit a bribe. The Scott County attorney’s office declined to prosecute the claims made against Thao and his former campaign manager, Angela Marlow. The allegations stemmed from a meeting between Thao, lobbyist Sarah Clarke, and some of Clarke’s clients. Clarke said that Thao told the group during the meeting that he needs “resources to spread his message.” She said it seemed clear he was asking for a bribe.

New Mexico
New Campaign Spending Rules to Take Effect
Albuquerque Journal – Dan Boyd | Published: 9/8/2017

Nonprofit advocacy organizations that spend unlimited amount of money to influence elections in New Mexico will have to disclose the names of contributors under rules adopted by state elections officials. The new requirements are set to go into effect on October 10, in time for 2018 primary and general elections, for so-called dark money groups that spend at least $2,500 on a statewide election or ballot measure. New Mexico Secretary of State Maggie Toulouse Oliver said vague and confusing rules are being cleaned up and the changes will “help shine a light on the dark money that has been plaguing our state’s campaigns.”

New York
Firm Uses Loophole to Secretly Donate $60G to de Blasio Campaign, Lobbying Records Show
New York Daily News – James Fanelli | Published: 9/9/2017

Constantinople & Vallone has a reputation as a powerful lobbying firm that gets its clients access to New York City Hall, but what is not so well known is it has helped steer $60,900 in campaign donations to Mayor Bill de Blasio. A loophole in the city’s campaign finance law has allowed the firm to stay under the radar as a fundraiser for the mayor. The only way to know Constantinople & Vallone has raised so much money for de Blasio is through obscure filings with the city clerk’s lobbying bureau.

Oregon
Legislators Consolidate Power, Cash, in Partially Invisible Cycle of Giving to Each Other
Salem Statesman-Journal – Cooper Green | Published: 9/9/2017

If a candidate passes contributions to another candidate, or to a re-election fund for fellow party members, the public can no longer see the money’s original donor. These transactions are known as pass-throughs. Transactions between Oregon legislators, or between lawmakers and re-election funds, are commonplace and have been for decades. An analysis shows legislative officeholders and candidates have utilized this system of pass-throughs more than 2,800 times in the last three election cycles alone, transferring $18.7 million dollars between themselves. Based on the total amount contributed to legislators during that time, this means more than a quarter of all money involved in legislative campaigns has seen more than one lawmaker as it moves through the system.

Pennsylvania
Elect Them, Then Lobby Them: Two firms blur the worlds of policy and politics in Harrisburg
Philadelphia Inquirer – Angela Couloumbis and Liz Navratil | Published: 9/11/2017

For years, lobbying in Pennsylvania was a secretive business, and more recently attracted scrutiny from federal investigators. A decade-old law strengthened registration and reporting requirements for lobbyists and their clients, but the state still lags behind others in transparency and accountability, according to the National Conference of State Legislatures. Among Harrisburg’s high-powered partnerships, only two have well-established campaign arms that, for the last decade, have dominated the market on both electing and lobbying Republicans who drive public policy.

Tennessee
Lobbyists Courted Lawmakers with Free Food, Baseball Tickets at Conferences
The Tennessean – Joel Ebert | Published: 9/11/2017

Under state law, Tennessee lawmakers can accept gifts like dinner and sports tickets at out-of-state conferences, provided they are related to the conference itself. Lobbyists can even pay for events labeled “state night” for lawmakers. And little disclosure is required, unlike the rules in place for how lobbyists interact with lawmakers at the Capitol. The practice at out-of-state conferences is increasingly widespread, including at conferences this year in Boston and Denver, according to interviews with lobbyists, lawmakers, and legislative staff.

Virginia
Virginia Lawmakers Attend Fewest Lobbyist-Paid Entertainment Events Since McDonnell Case
The Virginian-Pilot – Will Houp | Published: 9/7/2017

Virginia lawmakers continue to shrink away from meals, galas, and other entertainment occasions paid for by lobbyists as they attended less than half such events in 2016 and 2017 as they did three years ago. Data from the Virginia Conflict of Interest and Ethics Advisory Council shows a stark difference in what delegates and senators felt comfortable accepting before and after the corruption charges against former Gov. Bob McDonnell. At the same time, several law changes related to lobbyist entertainment have muddied the water in terms of comparing year to year.

Washington
Seattle Mayor Ed Murray Resigns After Fifth Child Sex-Abuse Allegation
Seattle Times – Jim Brunner, Daniel Beekman, and Lewis Kamb | Published: 9/12/2017

Seattle Mayor Ed Murray, beset over the past five months by sex abuse allegations, resigned his office. His announcement came after The Seattle Times reported that a fifth man, one of his cousins, had accused Murray of molesting him decades ago. Though he has denied all the accusations against him, Murray had already decided not to seek re-election. City Council President Bruce Harrell will temporarily serve as mayor and will decide within five days whether to take on the role of acting mayor past the November 7 election. If he demurs, the council will pick another of its members to serve until the election results are certified.

 

State and Federal Communications produces a weekly summary of national news, offering more than 60 articles per week focused on ethics, lobbying, and campaign finance.

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September 11, 2017 •

Campaign Finance Riders in House Financial Services Appropriations Bill

Several provisions added last week to the House Financial Services appropriations bill would alter some federal campaign laws. The legislation would prevent some charitable 501(c)(3) organizations such as churches from losing their tax-exempt status for making contributions to candidates. The […]

Several provisions added last week to the House Financial Services appropriations bill would alter some federal campaign laws.

The legislation would prevent some charitable 501(c)(3) organizations such as churches from losing their tax-exempt status for making contributions to candidates. The bill would also allow corporations greater latitude in soliciting employees to contribute to political action committees.

The riders to the bill also include provisions prohibiting the IRS from enacting rules governing political activity and prohibiting the SEC from implementing rules requiring corporations to report to its shareholders a corporation’s political campaign activities.

A further change to campaign finance law in the appropriation bill would bar the use of funds to recommend or require any entity submitting an offer for a federal contract to disclose specified political contributions as a condition of submitting the offer.

The appropriations and other finance bills are expected to be debated this and next week in the House.

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September 8, 2017 •

News You Can Use Digest – September 8, 2017

      National: Software Glitch or Russian Hackers? Election Problems Draw Little Scrutiny New York Times – Nicole Pearlroth, Michael Wines, and Matthew Rosenberg | Published: 9/1/2017 After a presidential campaign scarred by Russian meddling, local, state, and federal agencies have conducted […]

 

 

 

National:

Software Glitch or Russian Hackers? Election Problems Draw Little Scrutiny
New York Times – Nicole Pearlroth, Michael Wines, and Matthew Rosenberg | Published: 9/1/2017

After a presidential campaign scarred by Russian meddling, local, state, and federal agencies have conducted little of the type of digital forensic investigation required to assess the impact, if any, on voting in at least 21 states whose election systems were targeted by Russian hackers. The assaults on the vast back-end election apparatus – voter-registration operations, state and local election databases, e-poll books, and other equipment – have received far less attention than other aspects of the Russian interference, such as the hacking of Democratic emails and spreading of false or damaging information about Hillary Clinton. Yet the hacking of electoral systems was more extensive than previously disclosed.

Statehouses, Not Congress, Hosting Biggest Political Money Fights
Center for Public Integrity – Ashley Balcerzak | Published: 8/31/2017

Lawmakers in at least 18 states have introduced legislation this year to change the amount of money people can give to politicians. Half of the bills aim to increase contribution limits in attempts to keep pace with the rising number of outside forces that can spend unlimited amounts of cash. The other half try to decrease the limits to blunt the amount of money in politics. Meanwhile, national coalitions have swarmed statehouses and city halls. They are targeting disclosure laws, pay-to-play and lobbying rules, and the role corporations, unions, and nonprofits may play in elections, in addition to fundraising limits.

Federal:

A Two-Decade Crusade by Conservative Charities Fueled Trump’s Exit from Paris Climate Accord
Washington Post – Robert O’Harrow Jr. | Published: 9/5/2017

The story behind the Cooler Heads Coalition – an umbrella group in the vanguard of efforts to cast doubt on the gravity of climate change and thwart government efforts to address it – illuminates the influential, little-known role that tax-exempt public charities play in modern campaigns to sway lawmakers and shape policy while claiming to be nonpartisan educational organizations. It also offers insight into the forces behind a decision by President Trump that infuriated scientists and environmentalists, mystified U.S. allies, and went against the advice of some major corporations.

Democrats Say ‘Citizens United’ Should Die. Here’s Why That Won’t Happen.
Center for Public Integrity – Sarah Kleiner | Published: 8/31/2017

Seizing on the specter of Russian election influence, Democrats have ramped up their quixotic effort to blunt Citizens United v. Federal Election Commission, which unleashed a torrent of special interest spending on U.S. elections. They have introduced two dozen bills related to money in politics. Some are aimed at increasing donor transparency, others are targeting massive contributions from special interests. A couple are intent on reforming the FEC. None have had a single formal hearing, much less an up-or-down vote in either the House or Senate.

Trump Gets Millions from Golf Members. CEOs and Lobbyists Get Access to President
USA Today – Brad Heath, Fredreka Schouten, Steve Reilly, Nick Pezenstadler, and Aamer Madhani | Published: 9/6/2017

Members of clubs that Donald Trump owns and has visited most often as president include at least 50 executives whose companies hold federal contracts and 21 lobbyists and trade group officials. Two-thirds played on one of the 58 days Trump was there. A USA Today shows that for the first time in U.S. history, wealthy people with interests before the government have a chance for close and confidential access to the president as a result of payments that enrich him personally. The arrangement is legal, and members said they did not use the clubs to discuss government business. Nonetheless, ethics experts questioned whether it is appropriate for a sitting president to collect money from lobbyists and others who spend their days trying to shape federal policy or win government business.

From the States and Municipalities:

California
SF’s Political Watchdog Agency Proposes Sweeping Reforms, Nonprofits Cry Foul
San Francisco Examiner – Joshua Sabitini | Published: 9/4/2017

The San Francisco Ethics Commission is taking on the notorious “pay-to-play” culture at City Hall with proposed sweeping reforms. But some of the provisions have drawn the ire of nonprofits that warn it will deal a significant blow to their fundraising. One provision being discussed in the reform package would prohibit city commissioners from helping to raise money for candidates. Many nonprofit leaders blasted a portion of the sweeping reforms that would restrict so-called behested payments, which are contributions made to groups or causes at the request of elected officials.

Colorado
Denver Proposal Aims to Force Disclosure of Independent Spending in Elections as ‘Dark Money’ Trickles Down
Denver Post – Jon Murray | Published: 9/4/2017

A Denver City Council proposal seeks to close transparency gaps that allow “dark money” to go unreported as long as the people behind it do not coordinate directly with a candidate’s campaign. The proposal would adopt the state definitions of “independent expenditure” and “electioneering communication.” The individual, company, or other group behind the independent spending would have to file public reports within two days after more than $1,000 is spent, including disclosing anyone who gives more than $25 to the effort. They also would have to make clear on any mailers, broadcast ads, or other advertising who paid for them and the independence from the candidate’s or issue’s official campaign. The proposal also would modify the city’s campaign finance ordinance in other ways.

Maryland
Facing Minor Fine, Hogan Campaign Lawyer Threatens Attorney General Frosh
Washington Post – Fenit Nirappil | Published: 8/31/2017

Maryland Gov. Larry Hogan’s re-election campaign could be hit with a $250 fine for a minor violation of state election law, an inconvenience that has erupted into a partisan brawl. Hogan’s campaign attorney, Dirk Haire, who also chairs the Maryland Republican Party, will ask the state prosecutor’s office to launch an official misconduct investigation if state Attorney General Brian Frosh does not act to block the fine, which was proposed by staffers at the Board of Elections in response to a complaint from Maryland Democratic Party Chairperson Kathleen Matthews. Haire is also threatening to file a complaint alleging Frosh’s campaign illegally charged children for ice cream at a fundraiser.

Missouri
Councilwoman Repays Lobbyist, Concerned over Gifting
St. Joseph News-Press – Brendan Welch | Published: 9/6/2017

St. Joseph City Council Member Joyce Starr presented a check to a local lobbyist during a council meeting to avoid taking what she considered to be an unethical gift. Starr said council members often go out in a group after meetings to HiHo Bar and Grill, and Kenneth Reeder, a local political activist and lobbyist, is usually in attendance. She said after the August 11 council meeting, she discovered Reeder was being repaid for purchasing them dinner and drinks, and was not comfortable with it. Starr said the check was only for four dollars, “but it’s just the principle of the thing.”

South Carolina
Rep. Jim Merrill Pleads Guilty to Misconduct, Agrees to Assist Investigators in Statehouse Corruption Probe
Charleston Post and Courier – Glenn Smith and Andrew Brown | Published: 9/1/2017

South Carolina Rep. Jim Merrill pleaded guilty to using his office for personal profit, resigned his seat in the Legislature, and was sentenced to one year of probation. The plea agreement requires him to cooperate with state investigators and the FBI as they continue to probe corruption at the statehouse. Merrill was accused of using his office and his consulting firm to garner more than $1 million from trade groups and companies at a time when he was both a lawmaker and a consultant. He failed to report money he received from companies and groups that lobby legislators, did not file reports of campaign-related spending from the House Republican Caucus, and overcharged for his work.

Texas
Court: Texas Can Enforce New Voter ID Law in November
Governing – Allie Morris | Published: 9/6/2017

A federal appeals court panel ruled Texas can use its revised voter ID measure for the upcoming November elections, the latest in a series of winding legal battles on whether the state has intentionally discriminated against black and Latino voters through its original law passed in 2011 In August, U.S. District Court Judge Nelva Gonzales Ramos threw out Senate Bill 5, which the state Legislature passed earlier this year and in some ways softened the previous requirements that Texans present one of seven forms of photo ID at the polls in order to cast a ballot. Ramos said the state’s new voter ID law failed to fix the intentional discrimination against minority voters found in a 2011 law. The stay suspends that order until the appeals court can hear the merits for and against the state’s appeal.

Texas
Fred Lewis Appointment Stirs Controversy
Austin Monitor – Jo Clifton | Published: 9/1/2017

Fred Lewis, an attorney who served as the main architect of Austin’s new lobbying ordinance, surprisingly became the center of a controversy when the city council appointed him to serve on the Charter Review Commission. Lewis worked for many months on an ordinance specifically aimed at preventing lobbyists from serving on city commissions.

West Virginia
Charge Dropped Against Reporter Who Questioned Tom Price
New York Times – Matt Stevens | Published: 9/6/2017

West Virginia prosecutors dropped charges against a reporter who was arrested after peppering U.S. Health and Human Services Secretary Tom Price with healthcare policy questions while following him down a hallway at the Capitol. Prosecutors said the reporter, Dan Heyman, broke no laws. Heyman was arrested and jailed for willful disruption of state government processes. The arrest drew condemnation from civil rights and journalists’ rights groups, who said Heyman was merely performing his constitutionally protected duties.

Wisconsin
Report: New Ethics Commission has conducted just 1 investigation, says compliance is up
Wisconsin State Journal – Mark Sommerhauser | Published: 9/3/2017

A new report shows Wisconsin’s Ethics Commission investigated just one alleged violation in its first year of operation. That is a far less active pace than its predecessor, the Government Accountability Board (GAB). Republican lawmakers and Gov. Scott Walker created the Ethics Commission, saying the GAB was too partisan. Much of the new commission’s workings are shrouded by law. Hidden from public view are complaints alleging violations of ethics, campaign finance, or lobbying laws, as well as deliberations by the commission on whether to investigate complaints.

 

State and Federal Communications produces a weekly summary of national news, offering more than 60 articles per week focused on ethics, lobbying, and campaign finance.

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September 6, 2017 •

Denver City Council to Consider Amending Campaign Finance Law

Denver City Council is attempting to close a loophole allowing campaign spending to go unreported if not coordinated directly with a candidate’s campaign. The measure would adopt the state definitions of independent expenditure and electioneering communication. It would also require […]

Denver City Council is attempting to close a loophole allowing campaign spending to go unreported if not coordinated directly with a candidate’s campaign.

The measure would adopt the state definitions of independent expenditure and electioneering communication. It would also require individuals or entities making independent expenditures to file a report within two days of spending more than $1,000, itemize all contributions received exceeding $25, and clearly identify the source of funding for any paid advertising.

If the bill passes, other changes to city campaign finance laws would include differentiation between issue committees and other political committees, as well as a requirement for quarterly reports in the calendar year before an election and additional reporting in the weeks leading up to an election.

Council has scheduled a final vote for Sept. 11.

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August 18, 2017 •

New FINRA Pay-to-Play Rules Effective August 20

On August 20, new pay-to-play regulations of the Financial Industry Regulatory Authority (FINRA) take effect. FINRA Rule 2030 restricts contributions made to an official of a government entity being provided investment advisory services or being engaged to provide investment advisory […]

On August 20, new pay-to-play regulations of the Financial Industry Regulatory Authority (FINRA) take effect. FINRA Rule 2030 restricts contributions made to an official of a government entity being provided investment advisory services or being engaged to provide investment advisory services by certain parties.

The rule applies to broker-dealers, placement agents, and covered associates acting on behalf of certain regulated investment advisors or soliciting a government entity to invest in certain pooled investment vehicles.

The restrictions also prohibit soliciting a political action committee to make contributions or doing anything indirectly that, if done directly, would result in a violation of the rules. Another rule effective on the same date is FINRA Rule 4580, which mandates certain record-keeping requirements concerning related contributions.

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August 4, 2017 •

News You Can Use Digest – August 4, 2017

      National: Need a Job? Bob Brady and the Art of the Political Buyout Philadelphia Inquirer – Andrew Seidman and Jeremy Roebuck | Published: 7/30/2017 Prosecutors’ allegations that U.S. Rep. Robert Brady’s 2012 campaign paid a challenger $90,000 to drop out […]

 

 

 

National:

Need a Job? Bob Brady and the Art of the Political Buyout
Philadelphia Inquirer – Andrew Seidman and Jeremy Roebuck | Published: 7/30/2017

Prosecutors’ allegations that U.S. Rep. Robert Brady’s 2012 campaign paid a challenger $90,000 to drop out of the race may seem like a particularly brazen power play. Such transactions may look like backroom dealing, but campaign finance experts agree the line between the simply unseemly and the outright illegal can be difficult to determine. “Rarely are these situations an explicit quid pro quo: ‘I’ll give you money so you’ll drop out,'” said Kenneth Gross, who heads the political law practice at Skadden, Arps, Slate, Meagher & Flom. “But there are many shades of gray. There are often agreements to help a candidate retire [campaign] debt.”

Federal:

Democrats Introduce Bill to Strengthen Foreign Agents Law
Bloomberg BNA – Kenneth Doyle | Published: 7/31/2017

A new Senate bill would increase the U.S. Justice Department’s authority to impose civil fines people who do not comply with the Foreign Agent Lobbying Transparency Enforcement Act, which requires individuals working on behalf of a foreign government or official to register with the Justice Department within 10 days of signing a contract. In addition to fines, the legislation from Senate Democrats would create even more requirements for foreign agents. The registration laws on foreign lobbying are routinely flouted, according to Justice Department Inspector General Michael Horowitz.

Jared Kushner Stepped Down from 266 ‘Corporate Positions.’ What Does That Mean?
Washington Post – Jena McGregor | Published: 8/1/2017

In Donald Trump’s White House, Jared Kushner has many jobs. The president’s son-in-law is a senior adviser to Trump, has been charged with leading the administration’s revamping of the federal bureaucracy, and has a foreign policy portfolio that includes Mexico and the Middle East. But counting up the titles he stepped down from leading up to Trump’s inauguration, and the number looked to some, at first glance, as even more eye-popping. In a recent story following the release of his financial disclosures, it was reported Kushner had “resigned from 266 corporate positions.” Some on social media were scratching their heads. How does one person hold more than 250 positions?

No Going Back: Anthony Scaramucci’s White House job could cost him $7.5 million
USA Today – Gregory Korte | Published: 8/3/2017

Anthony Scaramucci took no salary during his short tenure as White House communication director, yet his 10-day career detour could end up costing him more than $7.5 million. That is because the hedge fund founder left the White House before he could obtain a “certificate of divestiture” giving him the special tax treatment available to federal employees who give up assets in order to avoid conflicts-of-interest. Without that certificate, the sale of Scaramucci’s Skybridge Capital to a Chinese holding company will be taxed at the capital gains rate of 15 percent. According to Scaramucci’s financial disclosure report, his share of the sale is worth at least $50 million; other estimates put that number even higher.

Trump Loyalist Mixes Businesses and Access at ‘Advisory’ Firm
New York Times – Nicholas Confessore and Kenneth Vogel | Published: 8/1/2017

Corey Lewandowski, Donald Trump’s former campaign chairperson, left the K Street firm he helped to establish amid scrutiny over his clients and his access to the president. Lewandowski then started a new consulting business. Now, as he takes on an increasingly broad role as an unofficial White House adviser, he is building a roster of clients with major interests before the Trump administration. Lewandowski appears to be positioning his new firm as an “advisory” business, part of a growing cohort of Washington, D.C. influencers who advise companies on how to navigate the government but do not register as lobbyists or disclose their clients.

From the States and Municipalities:

California: Anaheim City Council Passes County’s Toughest Restrictions on Lobbying
Orange County Register – Joseph Pimentel | Published: 8/1/2017

The Anaheim City Council voted to approve a bill that requires paid lobbyists to register with the city and file quarterly reports, and prohibits the city from hiring people from lobbying firms. Anaheim elected officials and workers also will be barred from lobbying the city for two years after they leave their government jobs. The ordinance defines a lobbyist as anyone who receives $500 or more a month to communicate with city officials for the purpose of influencing legislative or administrative actions. The council needs to take a second vote on the ordinance, slated for August 15, before it goes into effect.

California: San Diego Boosts Qualifications for Ethics Commission Members
San Diego Union-Tribune – David Garrick | Published: 8/1/2017

The city council approved four changes that aim to boost the experience and expertise of San Diego Ethics Commission members. The council amended the commission’s rules to say “priority consideration” will be given to nominees familiar with campaign finance laws, government ethics, lobbying laws, and conflict-of-interest regulations. In addition, the council clarified that rules prohibiting commission members from seeking elective office in the city do not extend to seeking other offices, such as county supervisor or the state Legislature. In September, the council is scheduled to consider amending a rule that prohibits anyone who ran for office against a current member of the council from being appointed to the commission.

Colorado: Walker Stapleton Found a Way Around Governor’s Race Donation Limits – It’s Raising Money and Eyebrows
Denver Post – Mark Matthews | Published: 8/3/2017

The longer that state Treasurer Walker Stapleton waits before formally announcing his bid for governor of Colorado, the more he can help steer unlimited sums of money toward a super PAC-style group that is expected to provide his major funding during the campaign. It is a setup that watchdogs said could stretch the limits of the state’s election law, even as it projects Stapleton’s fundraising might. And it is another sign that the 2018 race to replace Gov. John Hickenlooper is likely to surpass spending records in Colorado’s gubernatorial elections.

Maryland: Marijuana Experts Scored Prospective Md. Pot Businesses. Some Had Ties to Them.
Washington Post – Fenit Nirappil and Aaron Gregg | Published: 7/30/2017

Several of the independent experts hired to review applications to open medical marijuana businesses in Maryland had ties to companies whose materials they reviewed. The Maryland Medical Cannabis Commission said it is investigating these potential conflicts of interest. The connections, which The Washington Post discovered after a public records request, raise new questions about how the state tried to avoid conflicts in setting up a legal marijuana industry where hundreds of businesses were competing intensely for a limited number of growing, processing, and selling licenses.

Missouri: Greitens Faces More ‘Dark Money’ Questions Over No-Bid Contract with Express Scripts
Kansas City Star – Jason Hancock | Published: 7/28/2017

When Missouri Gov. Eric Greitens issued an executive order creating a prescription drug monitoring program, he said his goal was to help combat the scourge of opioid addiction in the state. His critics quickly homed in on another detail: to start the program, Greitens’ administration was giving a no-bid contract  to Express Scripts, a St. Louis-based pharmacy benefits management company that donated an undisclosed amount of money to the governor’s inauguration. It has become a familiar accusation, one that has dogged Greitens throughout his nearly eight months in office – that secret campaign contributions could be influencing his actions. Critics say this is the unavoidable byproduct of the governor’s reliance on so-called dark money.

Missouri: Lobbyist Gifts Averaging $1,760 Per Missouri Lawmaker – Less Than Year Before
Kansas City Star – Jason Hancock and Kelsey Ryan | Published: 8/3/2017

Lobbyists reported giving Missouri lawmakers and their staff members $347,368 in gifts from during the first six months of this year, which is less than the same period in 2016. Lobbyist gifts have declined every year since 2013. Observers point to numerous factors contributing to the decline, from increased public scrutiny on the practice to a series of embarrassing legislative scandals two years ago. Regardless of the reason, reform advocates say the drop is a sign that the tide is turning and lobbyist gifts are increasingly seen as a potential political liability.

Pennsylvania: Firms to Pay $9M to Feds to Resolve LCB Payola Case
PennLive.com – Mike Miller | Published: 7/27/2017

Four suppliers of alcohol to the state-owned system of liquor stores agreed to pay about $9 million in penalties for providing gifts to Pennsylvania Liquor Control Board officials. The U.S. attorney’s office in Harrisburg said the vendors, in turn, will not be prosecuted. Southern Glazer’s Wine and Spirits of Pennsylvania will pay $5 million for giving cash, all-expenses paid trips, and tickets to shows and sporting events to board officials from 2000 to 2012. Breakthru Beverage Pennsylvania, formerly Capital Wine and Spirits, and White Rock Distilleries will pay $2 million each for giving away gift cards, tickets, meals, and entertainment to the officials. Pio Imports will pay $200,000 for handing out gift cards to officials.

 

State and Federal Communications produces a weekly summary of national news, offering more than 60 articles per week focused on ethics, lobbying, and campaign finance.

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June 9, 2017 •

Wisconsin Legislator to Introduce Campaign Finance Package

Wisconsin State Sen. Chris Larson is introducing eight bills aimed at amending state campaign finance laws. The bills would restore lower contribution limits, amend the definition of political action committee, require transparency in political communications, limit coordinated campaign expenditures, expand […]

Wisconsin State Sen. Chris Larson is introducing eight bills aimed at amending state campaign finance laws.

The bills would restore lower contribution limits, amend the definition of political action committee, require transparency in political communications, limit coordinated campaign expenditures, expand reporting requirements for committees receiving a contribution exceeding $100 from an individual, and prohibit corporations and labor unions from contributing to segregated funds established by political parties or legislative campaign committees.

Larson says the proposed changes reflect common sense and would not drastically overhaul the current campaign finance system.

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June 1, 2017 •

Canada Federal: Bill Introduce to Increase Transparency for Political Fundraisers

On May 31, legislation was introduced in the Federal Parliament of Canada to increase transparency concerning political fundraising events. House Government Bill C-50 requires a five-day advance notice of fundraisers where the admission price is $200 or more. A regulated […]

On May 31, legislation was introduced in the Federal Parliament of Canada to increase transparency concerning political fundraising events.

House Government Bill C-50 requires a five-day advance notice of fundraisers where the admission price is $200 or more. A regulated fundraising event does not include a convention, including leadership conventions, of a registered party or a leadership contestants’ debate. The bill requires political parties file itemized reports to Elections Canada within 30 days of a fundraiser, including information such as the attendants’ names and amounts contributed. If a regulated fundraising event is organized entirely by persons or entities other than a registered party, the person or entity must provide the attendants and donation information to the registered party in time for the registered party to make its report.

The bill’s regulations would not apply if a fundraiser takes place during the election period of a general election.

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May 9, 2017 •

Judge Rules Missouri Campaign Finance Provisions Unconstitutional

Parts of a campaign finance law approved by Missouri voters in November have been ruled unconstitutional. U.S. District Court Senior Judge Ortrie Smith issued a ruling Friday finding corporations and labor organizations must be permitted to make contributions to campaign […]

Parts of a campaign finance law approved by Missouri voters in November have been ruled unconstitutional.

U.S. District Court Senior Judge Ortrie Smith issued a ruling Friday finding corporations and labor organizations must be permitted to make contributions to campaign committees only supporting or opposing ballot measures, and political action committees must be able to receive contributions from other political action committees.

The court also ruled the ban on contributions to PACs by heavily regulated entities unconstitutional.

Finally, the ruling permanently enjoins the Missouri Ethics Commission from interpreting certain campaign finance provisions in any manner inconsistent with previously issued advisory opinions. Contribution limits will continue to apply only to contributions to candidates unless a contribution to a continuing committee or PAC is restricted or designated for a specific candidate.

The court stayed any injunctive relief ordered for 45 days to allow the state to review the ruling and to allow for an opportunity to appeal.

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May 8, 2017 •

US Spending Bill Has Campaign Finance Provisions

Among the amendments in the 2017 Consolidated Appropriations Act that passed into law on May 5 are two provisions affecting campaign financing. House Resolution 244 explicitly prohibits the Internal Revenue Service from making new rules concerning the political speech or […]

Among the amendments in the 2017 Consolidated Appropriations Act that passed into law on May 5 are two provisions affecting campaign financing.

House Resolution 244 explicitly prohibits the Internal Revenue Service from making new rules concerning the political speech or activity of 501(c)(4) organizations. The legislation also prohibits the Securities and Exchange Commission from finalizing, issuing, or implementing any rule, regulation, or order regarding the disclosure of political contributions, contributions to tax exempt organizations, or dues paid to trade associations.

The 708 page omnibus spending bill, passed by Congress on May 4 and signed by the president on May 5, funds the U.S. government through September 30.

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