Lobbying Ethics and Reporting Rules

Lobbying Ethics and Reporting Rules For Federal Lobbying v

Contents • What constitutes lobbying activity? • LDA Reporting Requirements • Campaign Finance Rules • “Revolving Door” Rules

Lobbying Activity • What constitutes lobbying activity? • Two or more lobbying contacts • Communicates with those contacts to influence decision-making on a federal issue • 20% of individual’s time is lobbying over a three-month period • Covered employees for lobbying contacts include: • Members of Congress • Employees of Congress • POTUS, VPOTUS • Executive Office of the President • SES I-V • Schedule C Employees • Military O-7 or above

Lobbying Activity • Federal issues include: • Legislative proposals • Rules • Regulations • Nominations • Executive Orders • Programs • Policies • Contracts • Grants • Loans • Permits • Licenses • Covered activity includes both: • Direct contact with covered officials AND • planning, research, background work, coordination with or for lobbying activities

Lobbying Activity Gift Rules – General Principles • Never offer anything of value to government official connected with performance in official role • Bribery, rewards, gratuities are illegal. • Officials may not “solicit” gifts. • Lobbyists are independently liable for violations.

Lobbying Activity Gift Rules - Political Appointees • Includes full-time non-career appointees, non-career SES and Schedule C employees • Prohibited from accepting gifts from any registered lobbyists (independent of activity related to agency), includes: • Lobbying firms • Firms employing in-house lobbyists • Non-lobbyist employees of registered lobbyists or organizations • DOES NOT include organizations that retain outside lobbyists or lobbying firms, but do not file their own LDA registration

Lobbying Activity Gift Rules - Political Appointees (cont.) • Exceptions: • Modest food/refreshments other than as part of meal • Items of little intrinsic value, solely for presentation • Gifts based on personal relationship • Gifts to POTUS or VPOTUS

Lobbying Activity Gift Rules - Other Executive Branch Employees • NO GIFTS unless an exception applies • Prohibited sources include any persons who… • Seek official action by employee’s agency • Conducts or seeks business with agency • Conducts activities regulated by agency • Hold interests substantially affected by performance of employee’s official duties

Lobbying Activity Gift Rules - Other Executive Branch Employees (cont.) • Exceptions: • Gifts of $20 or less per source per occasion, no more than $50 per year total per individual • Modest food and refreshments other than as part of a meal • Gifts based on personal relationship • Speaking engagements • Widely attended gathering • Employee must first obtain agency determination that attendance is in interests of agency • Diversity of views represented, or range of persons interested in specific matter are present • Free attendance for employee is allowable if >100 people expected and market value is <$335 • Items of little intrinsic value, solely for presentation

Lobbying Activity Congress Gift Rules: Travel Restrictions • Lobbyists are prohibited from: • Planning, organizing, requesting, or arranging a trip for a Member or staff • Follow up with Members or staff after invite is sent • Accompany Members or staff on trip • If travel is paid for by entity that employs/retains lobbyists, may last only one day and one night, with exceptions for universities in the House and 501c(3)s in the Senate • Paperwork Requirements: • Private sponsor must submit certification forms to Members/staff invited on trip • Staff must then submit paperwork to Ethics Committee of appropriate chamber, at least 15 days prior to travel for House and 30 days for Senate

Lobbying Activity Congress Gift Rules: Non-Travel Gifts • $0 limit (includes in-kind) for registered lobbyists or entities that employ/retain registered lobbyists • Source of gift is the organization with which the paying individual is affiliated: • Any entity other than client that contributes in excess of $5000 to registrant’s lobbying activities per quarter • Actively participates in planning, supervision, or control of lobbying • Associations/coalitions are the source, not individual members of association. Should disclose members during registration.

Lobbying Activity Congress Gift Rules: Non-Travel Gifts (cont.) • Covered Exceptions • Personal friendship • Historical relationship? • Gift giver offering similar gifts to others? • Gift submitted for reimbursement or as a business expense? • Relative of covered official • Immediate family (includes step or half siblings and in-laws) • First cousins, (great) aunt/uncle, niece/nephew • Grandparents, grandchildren (including those of spouse) • Receptions with food other than as part of meal • Cannot be 1-on-1 • Standing up not sitting down • Courtesy food at meetings (e.g. coffee, juice, donuts, bagels)

Lobbying Activity Congress Gift Rules: Non-Travel Gifts (cont.) • Covered Exceptions (cont.) • Widely Attended Events • Related to official duties • Over 25 non-Congressional attendees • Open to industry/profession, with invitation from sponsor • Free attendance for official includes waiver of conference fee, local transportation, sit-down meal costs • Charitable Fundraising • Unsolicited invitation from fundraiser organizer • True charitable purpose • Reimbursement for travel by charity acceptable for event • Site Visits (House Only) • Food and refreshments offered by site management only if on business’s premises, in a group setting with employees of site, part of official travel, NOT at Washington-area office of lobbying/law firm • Local transportation acceptable if not within 35-mile radius of district office or Washington DC

Lobbying Activity Congress Gift Rules: Non-Travel Gifts (cont.) • Covered Exceptions (cont.) • Constituent Events (Senate Only) • Free attendance in home state, only if: • Cost of meal <$50 • Event sponsored by constituent • >4 constituents attend • Speaking role relevant to official position • No lobbyists attend • Personal Hospitality • Meal/lodging for non-business purpose • In residence owned by host • Cannot discuss pending legislation • Hospitality cannot be provided by individual lobbyist • Items of little intrinsic value, must be <$10 in actual value

Lobbying Activity Congress Gift Rules: Non-Travel Gifts (cont.) • Covered Exceptions (cont.) • Government Expenses • Paid for by federal, state, or local government • Secured by government under a government contract • Training • Free, and “in the interest of” House or Senate • Food/refreshments permitted if an integral part of training • Senate: >24 staff and participation of >1 Senate office • No private subsidies of official activity • Others: • Bona fide awards and prizes • Gifts based on spouse or outside activities • Honorary degrees • Widely available benefits • Home state products • Political campaign contributions • ANY EXEMPTED GIFT OVER $250 MUST BE APPROVED IN ADVANCE BY ETHICS COMMITTEE (H OR S)

LDA Reporting Requirements • Everything is electronic. See the House Clerk website for further details. • For LDA Reporting Requirements, it is a crime to knowingly and willfully: • Falsify, conceal or cover up a material fact via trick/scheme/device • Make any materially false, fictitious or fraudulent statement or representation, OR • Make or use any false writing or documents knowing it to contain the above. • See §15 of the LDA for specific instructions for entities required to report lobbying expenditures under §6033(b)(8) or §162(e) of the IRC

LDA Reporting Requirements Registration Requirements • Firms file separate registration for each client • Not for <$3,000 clients during a quarterly period • Not for pro bono clients • Companies employing in-house lobbyists file a single registration, but not if expenses <$11,500 on lobbying per quarter • Required within 45 days of any lobbying activity

LDA Reporting Requirements Registration Requirements (cont.) • Information required during registration: • Client and information on client • % ownership in client by a foreign entity that • Holds 20% equitable ownership in client or any affiliate of client • Directly or indirectly, in whole or major part, plans, supervises, controls, directs, finances, or subsidizes the activities of the client or affiliate • OR is an affiliate of either the client or an organization affiliated with the client and has a direct interest in outcome of lobbying • General subject of lobbying activity • Employees involved in lobbying • Any employee who has served as a covered Executive or Legislative Branch official within the last 20 years

LDA Reporting Requirements Quarterly Filings • Must disclose: • specific issues/legislation • Agencies or house of Congress contacted per client • Employees who acted as lobbyists for client • Foreign entities involved • Total income, rounded to nearest $10,000 per client (separate rules for contingency fees) • Any previous service as a covered official of a lobbyist new to client • If a previously registered client has transitioned to pro bono, must continue registering quarterly.

LDA Reporting Requirements Semiannual Filings • Form LD-203 must be completed semiannually (Jan./Jul. 30th) by BOTH firms and lobbyists. • Must disclose: • Political committees established or controlled by firm • Political contributions >$200 to federal candidates, leadership PACs, parties • Payments made to events honoring covered officials • Payments to entities in recognition of covered officials • Contributions to entities controlled by covered or designated officials • Contributions to conferences, retreats, meetings held by covered officials or on their behalf • Certification that the firm (and each lobbyist) has read and is familiar with Congressional gift and travel rules, AND has not provided, requested, or directed a gift (incl. travel) to a Member or staff with knowledge that the gift would violate those rules.

LDA Reporting Requirements Termination Reports • Lobbyist Termination • If a registrant reasonably expects an individual to meet definition of lobbyist in next quarterly period, lobbyist should remain “active” • If not, then registrant can remove that lobbyist using line 23 of Form LD-2 • Client Termination • Registrant may terminate registration for a particular client when it is no longer employed/retained AND anticipates no further lobbying activities on client’s behalf • Companies employing in-house counsel may terminate registration when in-house lobbying has ceased and is not expected to resume • Form LD-2, check the “Termination Report” box and supply: • Date of termination • Lobbying income/expenses in the period up to and including that date

Campaign Finance Rules Generic Rules to Follow • Work with private campaign staff, not public official’s legislative (or executive branch) employees • Schedule fundraising (and give support) without regard to the legislative calendar, or personal legislative requests. • Invite a broad audience to any event, and avoid any special access to the Member on policy or legislative matters. • 501c(3) Non-Profits CANNOT CONTRIBUTE

Campaign Finance Rules 2012 Contribution Limits • Total Biennial Limit - $117,000 Overall • $46,200 to candidates • $70,800 to all PACs and party committees • $46,200 to local PACs and party committees • Specific Yearly Limits • $2500 per election to each candidate • $30,800 per year to national parties • $10,000 per year to state, district, and local party committees • $5000 per year to any other PAC

Campaign Finance Rules Groups without Contribution Limits • Super PACs • Required to register and report with FEC • Only authorized to make independent expenditures not authorized by candidate • Can solicit unlimited contributions from individuals, political committees, corporations, and unions • May not make direct monetary or in-kind contributions to federal candidates or committees • 527 Groups

Campaign Finance Rules Corporate Contribution Rules • Corporations cannot: • Make direct contributions to federal candidates and/or committees • “Facilitate” donations by employees • Reimburse employees for contributions • Direct employees to participate in fundraising • Punish employees for declining to participate in fundraising

Campaign Finance Rules Corporate Contribution Rules (cont.) • Any resources used for political fundraising/activity must be paid for in advance, including employee time, membership lists, office space, catering • Citizens United v. FEC • Corporations and unions may make unlimited independent expenditures on television and radio advertising affecting federal elections • Does not change direct contribution restriction

Campaign Finance Rules Bundled Contribution Rules • Refers to contributions forward or credited by a lobbyist, registrant, or lobbyist/registrant PAC. • DOES NOT include personal contributions of these parties. • Disclosure Requirements • Candidates, leadership PACs, and party committees must disclose bundled contributions from these parties. • Threshold for disclosure is when aggregate bundled contributions exceed $16,200, calculated over quarterly period.

“Revolving Door” Rules Negotiating Future Employment Rules • Executive Branch • May incur restrictions on current duties while still in government, if seeking private employment • Recusal Test: must have direct and predictable effect on financial interests of future employer • Applies when a government worker has “begun seeking employment”, including unsolicited communications • Continues until all possibilities of employment are rejected and discussion ended, or two months post-unsolicited communication • Special rules for procurement officials.

“Revolving Door” Rules Negotiating Future Employment Rules (cont.) • Senate • Senators are prohibited from negotiating jobs involving lobbying activities until after successor’s election • Exception: Senators must give the Secretary of the Senate notice within three business days of negotiating jobs which do not involve lobbying activities • Senate employees earning at least 75% of Senator’s salary must notify the Senate Ethics Committee within three business days of negotiating private sector employment • “Negotiations” occur only after offer has been made and Senator/staff is considering accepting. • Recusal requirements for all

“Revolving Door” Rules Negotiating Future Employment Rules (cont.) • House • Members are prohibited from negotiating private jobs until after successor’s election, unless Member gives notice to House Ethics Committee within three business days of negotiation • House employees earning at least 75% of Member’s salary must notify the House Ethics Committee within three business days of negotiations • Negotiations occur when there is “active interest on both sides in reaching an agreement” • Recusal requirements for all

“Revolving Door” Rules Restrictions on Post-Employment Activities • Executive Branch Rules • Obama-Specific Rule: • Any presidential appointee is forbidden from acting as a registered lobbyist under the LDA for the duration of the entire Obama administration. • Lifetime Ban on “Switching Sides” • Applies to every former executive branch employee • Forbidden from representing a private party before or against the federal government in relation to a “particular matter” involving “specific parties”, • IF that employee had worked on the same matter involving those parties “personally and substantially for the government previously. • Viewed as a very specific exclusionary rule, and does not refer to broad policymaking authority.

“Revolving Door” Rules Restrictions on Post-Employment Activities (cont.) • Executive Branch Rules (cont.) • Two-Year Ban on “Switching Sides” • Refers to the same types of employment as the lifetime ban • BUT extends to matters merely under the “official responsibility” of the federal official while employed by government. • Does not therefore require “personal and substantial” involvement in specific matters.

“Revolving Door” Rules Restrictions on Post-Employment Activities (cont.) • Executive Branch Rules (cont.) • “Senior Official” Cooling Off Period • Length: One year post-employment • Prohibited Activity: Advocacy contacts, appearances, or communications with “intent to influence” • Prohibited Content: “any matter” within jurisdiction of former agency/office, when attempting to influence • Prohibited Contacts: Individuals in former agency/office • “Senior Officials” include: • SES, paid greater than 86.5% of basic rate of pay for SES II • Military officers at O-7 or above • Certain White House staff

“Revolving Door” Rules Restrictions on Post-Employment Activities (cont.) • Executive Branch Rules (cont.) • “VERY Senior Official” Cooling Off Period • Length: TWO years post-employment • Prohibited Activity: representations or advocacy contacts • Prohibited Content: “ANY matter” • Prohibited Contacts: ANY employees/officials of former agency, AND SES I-V in any department or agency of executive branch. • “Very Senior Officials” include: • SES Level I • Employees of the Executive Office of the President • Certain White House employees compensated at SES II • Special Rules for Procurement Officials

“Revolving Door” Rules Restrictions on Post-Employment Activities (cont.) • Legislative Branch • Senate Rules • All former Senators are restricted from lobbying anyone in Congress or any employee of a legislative office for two years after leaving Senate • Staff earning 75% or more of a Senator’s salary (and employed for sixty or more days) are prohibited from lobbying any Senate employee/Senator for one year post-employment • All staff are prohibited from lobbying the office in which they previously were employed • Only communications with an intent to influence are barred

“Revolving Door” Rules Restrictions on Post-Employment Activities (cont.) • Legislative Branch (cont.) • House Rules • Former Members are prohibited from lobbying any Member/employee of Congress for one year after leaving • Legislative Office Staff earning 75% or more of that Member’s salary (and employed for sixty or more days) are prohibited from lobbying the legislative office in which they worked for one year • Legislative Committee Staff covered by same provisions are prohibited for one year from lobbying any Member of employee of former committee, or any Member who served on committee within previous year before leaving • Legislative Leadership Staff covered by same provisions are prohibited from lobbying anyone in that leadership office • Only communications with an intent to influence are barred

“Revolving Door” Rules Restrictions on Post-Employment Activities (cont.) • Joint Legislative and Executive Rules • Representations in Treaty or Trade Negotiations • Refers to former government officials/employees who… • Had personal and substantial participation in ongoing trade or treaty negotiations on behalf of the US, within last year of public employment • Had access to certain non-public information (not subject to FOIA disclosure) • Prohibited from representing, aiding or advising anyone on the basis of such non-public information concerning US trade or treaty negotiations, for one-year after leaving government • Representing Foreign Governments • Applies to: • Members of Congress and Senior Legislative Staff (75% earnings of Member) • Senior and Very Senior Executive Staff • Prohibits: • One year post-employment • Representing a foreign entity before any officers/employee of any department or agency of the US with intent to influence that official/employee in his/her official duties • Aiding or Advising a foreign entity with intent to influence a decision of any officer or employee of any department or agency of the US • Lifetime ban for US Trade Representative and his/her Deputy

Lobbying Ethics and Reporting Rules