Revisions to Lobbying Disclosure Act Guidance
Public Policy Development
The Clerk of the House has posted a notice regarding conditions for terminating the listing of an individual lobbyist on an organization's lobbying reports and has amended significantly its Lobbying Disclosure Act Guidance ("Guidance"). Some key aspects of the modifications are summarized below.
Obligation to File Reports by Persons Incorrectly Listed as Lobbyists
President Obama's recent pronouncements regulating interactions between his administration and those deemed lobbyists under the Lobby Disclosure Act, not to mention the new obligation to file individual LD-203 contribution reports, caused organizations to amend previous lobbying reports to remove the names of individuals incorrectly listed as lobbyists. Many who did so reasonably believed that the removed individuals were not obligated to file LD-203 reports. The Clerk of the House has concluded otherwise. The Clerk's June 5 notice states that amending a previous report does not absolve an incorrectly named individual from filing an LD-203 report. We confirmed with the Office of the Clerk that this notice is intended to have retroactive effect. The Clerk long has maintained that its Guidance does not have the force of law. Individuals seeking to comply with the Clerk's Guidance and who were identified (even incorrectly) as lobbyists in a 2008 or 2009 lobbying report now must file LD-203 reports for the semi-annual period(s) in which they were so identified.
Conditions Permitting Termination of a Lobbyist
The Clerk's June 5 notice states that an organization may terminate an individual as a lobbyist under the following conditions:
[O]nly when: (i) that individual's lobbying activities on behalf of that client did not constitute at the end of the current quarter, and are not reasonably expected in the upcoming quarter to constitute, 20 percent of the time that such employee is engaged in total activities for that client; or (ii) that individual did not in the current quarter and does not reasonably expect in the upcoming quarter to make more than one lobbying contact per quarter.
We understand that this language is not intended to affect the circumstances under which registration is required in the first instance. The notice merely provides an easier exit for individuals who intend to terminate their lobbying activity, but who are performing a minimal amount of lobbying while they wind down their efforts. Filers also are reminded that to terminate the listing of a lobbyist, a registrant must complete the LD-2's Line 23, which is used to signaled that an individual is no longer a lobbyist. The amended Guidance states that "[a]mending the LD-1 or LD-2 to erase a lobbyist listed on lines 10 or 18, respectively, is not a proper termination."
Conditions Requiring Registration
The Clerk's Guidance previously suggested that employment or retention to make one lobbying contact was sufficient to trigger the requirement to register. The Guidance has been harmonized and now states that registration is required when one is "employed or retained to make more than one lobbying contact on behalf of a client (and meets the 20% of time threshold)." (emphasis added)
Clarifications for Completing LD-203 Contribution Reports
Sole proprietors and small firms are reminded to file two contribution reports for each semi-annual period: one on behalf of the registrant and one on behalf of the listed lobbyist (even if the lobbyist and the registrant are one and the same).
Filers of LD-203 contribution reports are reminded not to disclose contributions to state or local candidates and committees that are not required to register with the Federal Election Commission.
A non-voting board member (e.g. honorary or ex-officio) does not control an organization for purposes of reporting payments to an entity established, financed, maintained, or controlled by a covered official. In addition, a charitable organization established by a person before that person became a covered official, where the covered official has had "no relationship to the organization after becoming a covered official," is not considered to have been established by a covered official. Finally, a covered official's de minimis contribution to charity does not equate to financing, maintaining, or controlling the charity.
Disclosure is not required for costs related to non-preferential sponsorship of a multi-candidate primary/general election debate.
In reporting the cost of an event to honor a covered official, a registrant must report direct costs (e.g., hotel rental, food, and flowers), but not indirect costs such as the registrant's staff salaries and office overhead. Costs related to separate vendors may be aggregated and reported as costs to "various vendors." The registrant should report separately, however, the cost of any item given to the covered official.
For more information, please contact the professional(s) listed below, or your regular Crowell & Moring contact.