Proposed San Francisco Lobbying Reforms

Anonymous

Wed, 05/28/2014 - 10:54

City Related

San Francisco's board of supervisors will soon vote on a number of amendments to
its lobbying code (attached; see below). According to <a href="http://blog.sfgate.com/cityinsider/2014/05/27/chiu-lobbying-legislation…; target="”_blank”">an
article in yesterday's San Francisco Chronicle</a>, the amendments
are based on recommendations by local good government groups, which
have pointed out that loopholes in the current law allow many
lobbyists not to register. The amendments are sponsored by the
board's president, David Chiu. 
 
Independent Agencies 
It is a good thing that the amendments extend the definition of
"lobbyist" to those who lobby independent agencies, offices, and
bodies. The officials who work for or sit on these bodies are some
of the most lobbied officials, but they generally do not like to be
included in government ethic programs and, therefore, are often excluded from them. Here are some of the
agencies, offices, and bodies that are currently not covered, but
would be:<blockquote>

First Five Commission (grantmaker) 
Local Agency Formation Commission (special districts and contract
approvals) 
Housing Authority Commission 
Parking Authority 
Successor Agency to the former Redevelopment Agency of the City and
County of San Francisco 
Workforce Investment San Francisco Board (grants and tax credits) 
Zoning Administrator 
City Engineer</blockquote>

Inside and Contract Lobbyists 
The proposed amendments make two unusual distinctions between inside
and contract lobbyists. In a proposed exception to the definition of
"lobbyist" (#15) — for communications regarding contracts — inside
lobbyists who make such communications would not need to register,
but contract lobbyists who make such communications would have to
register. 
 
The definition of "lobbyist" would also be changed so that a
contract lobbyist who makes even one contact with an official would
have to register (now the threshold is payments of $3,000 in a
three-month period), while inside lobbyists would have to make five
contacts in one month before they would have to register. This is a
big difference, and an unusual one. There are other California
cities that differ in their thresholds for the two types of
lobbyist, but the reason is how the two types of lobbyist are paid (inside lobbyists are usually not paid separately for their lobbying). The other cities have a
monetary requirement for contract lobbyists and an hourly
requirement for inside lobbyists. 
 
It certainly wasn't good to have a
monetary threshold for inside lobbyists, but the proposed solution is also problematic, because it implies a
difference not in terms of payments, but in terms of contacts. The
contacts may in fact differ in substance (e.g., questions from an employee
vs. negotiations to change a payment plan from a contract
lobbyist), but they equally well may be exactly the same. I don't
think this difference exists, not in any important way. 
 
It is unnecessary for individual employees to register just
because they make a single contact. Why not instead require
the employer to register, and then each time a new
employee makes a contact, his or her name would be added via a simple
fillable PDF filed online? 
 
Nonprofits 
According to the proposed amendments, employees of nonprofits would
be exempted from registering as lobbyists, no matter how many
contacts they made. This appears to include nonprofits that are
seeking contracts, grants, or permits from the city. 
 
There is no
reason for this exception. Many nonprofits lobby to get large sums
of money from or through a local government (by "through," I am
referring to state or federal funds handed out at the local level).
Nonprofits' lobbyists are no different than other inside lobbyists,
and should be treated the same way. 
 
There is another proposed amendment that deals with a special
nonprofit-related issue: developers of "major projects" making
donations to nonprofits that then lobby on behalf of development
projects. Such donations over $5,000 in aggregate would have to be
disclosed. 
 
Oddly, others who make donations to nonprofits, for the purpose of
supporting, opposing, or changing development plans, do not have to
disclose them. 
 
This amendment feels like a solution to a particular problem San
Francisco has had. I found <a href="http://www.citireport.com/2013/05/the-chiu-herrera-reforms/" target="”_blank”">one 2013 article</a> that said developers have used
nonprofits to pass through money to political campaigns. 
 
Attorney Exception 
It was heartening to read that the amendments would end the exception for
attorneys. Attorneys often argue that, as lawyers, their activities
can only be regulated by the state bar and grievance system (they
also seek, and sometimes succeed in getting themselves exempted from
conflicts of interest provisions and enforcement). 
 
But the details are not as heartening. The exception was for
services that can "be performed only by an attorney, architect, or a
professional engineer" (this exception would remain for architects
and engineers). This exception requires an attorney to argue that
lobbying services can only be performed by an attorney (I assume the
argument would be that the lobbying concerns laws, and who else can
deal with them?). 
 
To mollify attorneys, a new provision would be added to the lobbying code, as follows:<blockquote>

Nothing in this Chapter is intended to regulate attorneys engaged in
the practice of law...</blockquote>

In other words, it's still not clear that attorneys can be regulated
with respect to lobbying. If it's not clear, that's exactly what
they will argue. 
 
In fact, in comments requested by the city board of supervisors
(included in the attached document, at the end), an attorney says, "This
provision clarifies that attorneys who are simply 'practicing law'
are not subject to the registration and reporting requirements of
the Lobbyists Ordinance." Since it is the bar that determines whether
an attorney is simply "practicing law," it is likely that the city ethics
commission is not going to require an attorney to register in anything but a clear-cut
case. So it will be up to attorneys to decide whether they are "lobbying" or not. 
 
Client and Employer Liability 
An excellent proposed change would make the client or employer of a
lobbyist jointly and severally liable for all violations of the
lobbying code committed on its behalf. This will make the true lobbyists allies of the ethics commission in making sure that lobbying laws are followed. 
 
Permit Consultants 
The amendments would create and regulate the activity of a new sort
of lobbyist, the "permit consultant." Here's the definition:<blockquote>

"Permit consultant" is any individual who receives or is promised
compensation to provide permit consulting services. This includes
any employee who receives compensation attributable to time spent on
permit consulting services. This does not include: 
(1) The licensed architect or engineer of record for construction
activity allowed or contemplated by the permit, or an employee of
the architect or engineer; 
(2) The contractor who will be responsible for all construction
activity associated with the requested permit; or 
(3) The employee of an organization with tax exempt status under 26
United States Code Section 501(c)(3) communicating on behalf of that
organization regarding the development of a project for that
organization. 
 
"Permit consulting services" means any contact with the Department
of Building Inspection, the Entertainment Commission. the Planning
Department, or the Department of Public Works to help a permit
applicant obtain a permit.</blockquote>

This seems like a valuable clarification of the law. But it would be
better if more details were provided regarding what is a "permit"
rather than regarding which departments are involved in permits.
After all, contacts regarding permits are already considered
"lobbying" under the lobbying code. This clarification might
actually limit who must register, if the list of departments is not
exhaustive and if there is disagreement about what is a "permit" and
what is, for example, a "license" or an "approval." Do these
departments only issue "permits"? Does no one else issue "permits"? 
 
In any event, there are officials in other departments, agencies,
boards, and commissions that have influence with respect to
"permits." Is a "permit consultant" who contacts a city supervisor a
"lobbyist," requiring separate disclosures? And if a "permit
consultant" makes less than five contacts with supervisors in a
month, may those contacts not be disclosed, even though the
individual is actively lobbying with respect to a permit, but as a "permit consultant"? 
 
It's a good idea to clarify the status of permit consultants and require them to disclose. But why separate them out like this?
Why not simply make them "lobbyists"? The only difference is that an
inside permit consultant would have to register due to only one
contact, like a contract lobbyist. But that gets back to the odd threshold for inside
lobbyists: five contacts a month. 
 
Requirement to Cooperate 
It's great to have a requirement on all city officials to cooperate and assist with any
investigation into violations of the lobbying code. It would be nice
if officials were also required to report possible violations. 
 
Former Officials 
The attorney who was asked by the board of supervisors to comment on the proposed
amendments made an interesting additional recommendation:<blockquote>

It is my understanding that former elected officers and department
heads routinely lobby City Hall, but do not register and file
reports because they claim that they are not being paid to lobby.
Because such individuals still have such a great influence on City
officials and employees, in the interest of transparency and
fairness, the law could be amended to include former elected
officers and department heads as volunteer lobbyists who are not
paid but who engage in contacts with City officials and employees
for the purpose of influencing local legislative or administrative
action.</blockquote>

Robert Wechsler 
Director of Research-Retired, City Ethics 
 
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