A Question of Ethics

More Light is Shed on Requirements for Lobbying Registration

June 29, 2009

Q: As the president of a small local lobbying firm, I read with interest your last column about how it has recently become easier for lobbyists to terminate their registration. We are looking into whether any of our lobbyists can take advantage of the ruling you discussed allowing lobbyists to end their registration if they limit their government contacts to one per quarter for each client.

My question, however, concerns the other criterion for registration. As I understand it, lobbyists can terminate registration if they spend less than 20 percent of their time on “lobbying activities.” We are unsure whether this limit applies to each of our employee’s total amount of work or on a client-by-client basis. Some of our employees spend less than 20 percent of their total time on “lobbying activities.” Does this mean they don’t need to register at all?

A: Thank you for your question. If the response to my previous column is any indication, there are quite a few lobbyists out there who are considering terminating their registration. This trend would not be surprising, given the increasing number of legal restrictions that apply to registered lobbyists but not to anyone else.

Before turning to your question, I need to make one important clarification, which has just occurred and will directly affect your plans. Under recently amended guidance, it is no longer the case that lobbyists can avoid registration merely by limiting their government contacts to one per quarter for each client.

To review, the Lobbying Disclosure Act requires you to remain registered as a lobbyist so long as you meet both of two criteria. The act’s first criterion is that you are “employed or retained by a client for financial or other compensation for services that include more than one lobbying contact.” Until recently, it was not clear what the applicable time period is for this limit of one lobbying contact. For example, what if you had two contacts for a client but they were several years apart?

The Secretary of the Senate and the Clerk of the House, who are each responsible for administering the registration process, have recently had a lot to say about this ambiguity. First, shortly before my last column, they issued guidance stating that the one-contact limit applies on a quarterly basis. Under that guidance, lobbyists could terminate their registration for a client if they did not have more than one lobbying contact in the previous quarter for that client and did not reasonably expect to have more than one in the upcoming quarter.

This guidance caused quite a stir in the legal community, as some political lawyers thought it conflicted with the very language of the Lobbying Disclosure Act. The guidance would have allowed lobbyists to avoid registration by strategically timing their lobbying contacts for each client so only one fell in each quarter of the year. The Secretary of Senate and Clerk of the House subsequently reconsidered the guidance and have now issued what they called a “clarification,” but what is in fact altogether new guidance.

This new guidance states that lobbyists may terminate their registration under the first criterion if they do not “reasonably expect to make further lobbying contacts.”

Your question, however, concerns not the first but the second criterion. As to this, the act states that you need not register for a given client if lobbying activities constitute less than 20 percent of your time. Under the act, “lobbying activities” means “lobbying contacts and efforts in support of such contacts, including preparation and planning activities, research and other background work that is intended, at the time it is performed, for use in contacts, and coordination with the lobbying activities of others.”

You have asked whether the 20 percent limit applies to your employees on a per-client basis or across all of the activities of each employee. If it were to apply across all of an employee’s activities, each employee would not need to register unless 20 percent or more of all of the time that the employee works for your firm is devoted toward lobbying activities. If, on the other hand, it were to apply on a per-client basis, each employee would need to register for any client for whom 20 percent or more of the time the employee devotes toward that one client consists of lobbying activities.

On this issue, the guidance is actually quite clear. As with the one-contact limit, the 20 percent threshold applies on a client-by-client basis. The guidance states that an individual must remain registered for a given client if lobbying activities “constitute at least 20 percent of the individual’s time in services for that client over any three-month period.” The guidance even bolds the word “that” to drive home the point.

As you well know, keeping track of whether your employees exceed the 20 percent limit for each of your firm’s clients requires good record-keeping. In an ideal world, your employees would record all of the time that they spend for each client, and someone would take care to distinguish between time spent on lobbying activities and all other time. This might be a pain in the neck. But, as I am sure you know, it would be a much bigger pain to be found to have violated the Lobbying Disclosure Act.

© Copyright 2009, Roll Call Inc. Reprinted with permission. Widely regarded as the leading publication for Congressional news and information, Roll Call has been the newspaper of Capitol Hill since 1955. For more information, visit www.rollcall.com.


A Question of Ethics

When May Lobbyists Terminate Their Registration?

June 16, 2009

Q: In the lobbying firm where I work, we are growing increasingly anxious about the litany of rules that we face as registered lobbyists. One of the questions we have discussed is whether we all need to go through the formal registration process. The thought is that if we have some employees who might not be required to register, perhaps at least they could be freed from all of the rules and obligations that apply to registered lobbyists. But we are unsure of the termination requirements. Once registered, when may lobbyists terminate their registration?

A: Ever since the Lobbying Disclosure Act of 1995 created the lobbying registration system, the list of reasons someone would not want to register has continued to grow. For example, in 2007 the Honest Leadership and Open Government Act greatly expanded lobbyists’ disclosure obligations and also made it illegal for lobbyists to violate the Congressional gift and travel rules. More recently, President Barack Obama imposed additional restrictions on registered lobbyists, prohibiting them from joining his administration and limiting the contacts they may have with executive branch officials.

All of these restrictions have one thing in common. They only apply to registered lobbyists. The question on the minds of registered lobbyists like you, then, is: Is there any way I can terminate my registration and free myself of these legal risks?

It is a timely question as there is recent cause for hope. Guidance published just last week appears to relax the criteria governing when lobbyists must register and when they may terminate their registration. But, before getting to that guidance, let’s quickly review the criteria requiring registration.

Lobbyists must register four times per year—once in each quarter—for each client where the registration criteria are met for that quarter. Thus, a lobbyist has no choice but to be a “registered lobbyist” unless there is no client during a given quarter for whom the lobbyist meets the registration criteria. Conversely, a lobbyist may terminate his or her registration altogether only if, in a given quarter, the criteria are no longer met for any client.

There are two basic registration criteria, both of which must be met for registration to be required. First, of the total time that the lobbyist works for the client, at least 20 percent must be spent on “lobbying activities.” The definition of the term “lobbying activities” can be quite complicated and goes well beyond merely communicating with a government official on a client’s behalf. You should consider seeking further guidance for specific applications. Generally, however, an activity probably qualifies as a lobbying activity if its purpose is to support ongoing or future lobbying communications with government officials. This criterion applies on a quarterly basis to both the previous quarter as well as the upcoming one. The criterion is met either if the lobbyist exceeded the 20 percent mark in the previous quarter or if he reasonably expects to exceed the mark in the upcoming quarter.

The second registration criterion is that the lobbyist makes more than one “lobbying contact” on behalf of the client. Again, this term is not easily defined, so you should study the rules for specific applications. Broadly though, a lobbying contact is a communication with a legislative or executive branch official regarding official government actions such as the formulation of federal legislation, regulations and policies. While there is a long list of exceptions, the upshot is that most communications whose purpose is to influence officials regarding an official matter will qualify.

Until recently, there had been some uncertainty about the period of time during which the “one contact” limit applies. This is where the recent guidance comes in. Last week, the Clerk of the House and the Secretary of the Senate published guidance that appears to remove the uncertainty. It states that a lobbyist may terminate registration if he “did not in the current quarter and does not reasonably expect in the upcoming quarter to make more than one lobbying contact per quarter.”

For lobbyists who make many lobbying contacts per quarter on behalf of each client, this guidance is of little significance. However, for lobbyists who limit (or could afford to limit) their lobbying contacts on behalf of each client to just one per quarter, this guidance appears to allow a way out of registration and all the legal risks that come with it. Simply put: If you are a registered lobbyist and you have no client for whom you make more than one lobbying contact per quarter, you may be able to terminate your registration altogether.

But don’t rush off to terminate quite yet, because there may be a catch. Just as soon as this escape route has been opened, it may be closed off. Rumors abound that, as early as this week, the Clerk of the House and the Secretary of the Senate may revise the guidance regarding the “one contact” limit and adopt a more stringent standard. This is significant because the Clerk and the Secretary are responsible for administering the lobbying registration system.

Lobbyists considering terminating their registration would be wise to keep their eyes open. While open, the Clerk’s lobbying disclosure Web site would be a good place to look: lobbyingdisclosure.house.gov.

© Copyright 2009, Roll Call Inc. Reprinted with permission. Widely regarded as the leading publication for Congressional news and information, Roll Call has been the newspaper of Capitol Hill since 1955. For more information, visit www.rollcall.com.


A Question of Ethics

May a Member Use a Staffer as a Personal Assistant?

June 2, 2009

Q: I am a staffer for a freshman Member of the House with a question about filling out our boss’ staff. We have one more position to fill, and our Member would like to hire someone who has served as his personal assistant for the past eight years. Over the years, the personal assistant has done a little bit of everything for the Member, including scheduling, driving, laundry — even baby-sitting his children. Our chief of staff has concerns about whether someone on the House payroll can perform duties like these. May the Member hire his longtime assistant to perform these duties as a House staffer?

A: There are several different sources of restrictions on the uses of House staff. These include the House Rules, the House Members’ Handbook, the House Committee Handbook and federal statutes. Rather than parsing the language of each, for our purposes let’s just focus on their gist.

The House Ethics Manual provides a good synthesis of the many restrictions. It begins with the general principles that Congressional employees “are paid United States Treasury funds to perform public duties” and that “appropriated funds are to be used solely for the purposes for which they are appropriated.” In the case of staffers, the funds used to pay their salaries should be used only for legislative and representative duties, working on committee business, and other Congressional functions. “Employees may not be compensated from public funds to perform … personal … activities on behalf of [a] Member, the employee, or anyone else.” Members must certify that the compensation their staffers receive complies with these rules.

In short, staffers may perform “official and representational duties” but may not perform personal duties for Members as part of their work responsibilities. The difficulty lies in discerning the difference.

Unfortunately, none of the sources of restrictions on the uses of House staff include clear guidance regarding the distinction between official and personal duties. No House rule or federal statute even defines the “official and representational duties” that staffers may perform. This means that discerning the difference between official and personal duties must largely be done on a case-by-case basis.

What makes this gray area particularly troubling is that personal use of House staff can in some cases subject Members to criminal liability. Four times in the past, a Member has faced criminal charges for using staff for personal services. Charges have included embezzlement of government funds, fraud and false certifications regarding staffers’ compensation. Prosecutors have essentially alleged that Members who use staffers for personal services are stealing official funds.

But, just as these cases warn of the risks of using staffers for personal services, they also illustrate the difficulty in discerning the difference between personal and official services. For example, in 1995, a federal appeals court reviewed the conviction of Rep. Dan Rostenkowski (D-Ill.) for, among other things, using staff for personal services. In an opinion that was more candid than it was clarifying, the court said that it was “not so sure” that the rules provide a standard for distinguishing between official and personal services. This, the court said, is because “the line between ‘official work’ and ‘personal services’ is not so clear.”

The court’s analysis of the specific allegations regarding Rostenkowski’s staff further reveals how difficult it is to tell “personal” from “official.” The court concluded that a staffer who performed bookkeeping duties for a company Rostenkowski owned was plainly doing personal services for him in violation of the law. On the other hand, the court concluded that the following services might qualify as official work: mounting souvenirs on plaques, picking up Rostenkowski’s laundry and driving his family around. This is because such services might, in some circumstances, aid a Congressman in performing his official duties. The court cited the Members’ Handbook for the general proposition that the House vests Members with discretion to fix the terms and conditions of employment of staff.

Yet, you should take only so much comfort in the court’s conclusion with respect to these services. Just because a federal court in 1995 said that certain services might qualify as official services does not mean that today’s House Committee on Standards of Official Conduct would agree. Ultimately, the only way to know whether the ethics committee would consider a given service to be personal or official is to ask.

So, while I may have my own views regarding what should count as official work and what should count as personal, I am afraid that those views will not be of much use here. Rather, the ambiguous line between personal and official services means that the safest course for your Member would be to seek an advisory opinion from the House ethics committee. Specifically, he can submit a list of all of the duties that he wishes his assistant to perform, and he can request that the committee opine as to the propriety of each one. In the meantime, if his children need a baby sitter, I’d suggest he look somewhere other than his House staff.

© Copyright 2009, Roll Call Inc. Reprinted with permission. Widely regarded as the leading publication for Congressional news and information, Roll Call has been the newspaper of Capitol Hill since 1955. For more information, visit www.rollcall.com.