SCOTT MONEYHAM: Just What's a Lobbying Expense?
A few years ago, the North Carolina legislature decided that lobbyists and those who employ them must report lobbying expenses.
The state already had a requirement that lobbying expenses be reported, but a loophole made the rule largely toothless.
Looking at today's lobbying expense reports, filed with the secretary of state's office, you still won't find a pile of expenses filed by the hundreds of lobbyists registered in the state.
There are a couple of reasons for the zeros.
First, legislators approved a gift ban that prevents the kind of small group or one-on-one wining and dining that used to take place in Raleigh, when some lobbyists plied a few legislators with fancy steakhouse dinners.
The wining and dining isn't done. Legislative receptions, with shrimp and other finger food, are still allowed under certain circumstances, the biggest being that large groups or even the general public is invited.
So some of the lines on those reports aren't blank.
Another reason you won't find lots of companies employing lobbyists racking up six-figure expenses is because of interpretations by the State Ethics Commission about what exactly constitutes lobbying.
Last year, the commission ruled that companies don't necessarily have to report all of a lobbyist's salary. When a lobbyist has responsibilities other than trying to persuade legislators to vote for or against legislation to benefit their clients, then the percentage of their salaries that doesn't involve lobbying can be deducted.
The ruling makes sense in some instances.
For example, someone who heads up a trade association, representing companies in the same line of business, will typically do more than lobby.
But a more recent ruling by the State Ethics Commission could portend more reporting by companies that employ lobbyists.
The September ruling examined the question of whether a lobbyist's time spent developing legislative strategy, as opposed to directly lobbying or following the legislative process, should be considered a lobbying expense.
The commission came up with a "but-for" test to answer the question. But for the effort to lobby legislators, would these activities be taking place?
The answer seems obvious.
But the interpretation raises the possibility of another test that ought to be put to the firms employing lobbyists: But for the need for lobbying the North Carolina General Assembly, would you be employing a lobbyist?
If the answer is no, then shouldn't the entire lobbyist's salary be reported as a lobbying expense?
The answer isn't always no. As stated, some registered lobbyists do more than lobbying.
But when companies report just a fraction of the salaries of people who essentially live in the Legislative Building when the legislature is in session, the current rules and interpretations may not be sufficient.
A but-for test would seem to be in line for more than just the activities of lobbyists.
Scott Mooneyham writes for Capitol Press Association in Raleigh. Contact him at firstname.lastname@example.org.
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