Ethics Reporter: Lobbyists spent record amount during 2014 General Assembly


Special to NKy Tribune

 

A record-breaking total of $18.4 million was spent on lobbying the Kentucky General Assembly in 2014, a 3.2 percent increase over the previous spending mark of $17.8 million, set in 2012, and a 34 percent increase in the 10 years since $12.1 million was spent in 2004.
 

In the largest spending category, $16.8 million was spent last year by employers compensating lobbyists, a 5.7 percent increase over 2012, the previous even-numbered year with a 60-day legislative session.
 

With about 660 businesses and organizations lobbying in 2014, the top five spenders accounted for over $1 million of spending, and the 12 top-spending employers spent more than $2 million, or more than 11 percent of the year’s total.
 

As in four of the previous five years, the leading spender on legislative lobbying in 2014 was Altria Client Services and its affiliates, including Philip Morris USA and U.S. Smokeless Tobacco, which spent $323,097, including paying $234,000 to five lobbyists. Altria’s spending increased 14 percent from the $279,009 the company spent on lobbying in 2012.
 

Other leading spenders for the year were: Kentucky Chamber of Commerce, which spent $291,158, including $281,958 to six lobbyists; Kentucky Hospital Association, which spent $183,919; AT&T ($169,006); Kentucky Medical Association ($164,362); Anheuser-Busch Companies ($160,064); Kentucky Justice Association ($155,551); Kentucky Farm Bureau Federation ($133,174); Community Ventures Corp. ($127,855); and Buffalo Trace Distillery ($120,000).
 

The rest of 2014’s top 20 lobbying spenders are: Hewlett-Packard ($120,000); Molina Healthcare ($120,000); Churchill Downs ($118,479); Kentucky League of Cities ($117,742); Anthem, Inc. ($111,250); Home Builders Association of Kentucky ($109,854); Norton Healthcare ($107,712); United Parcel Service ($107,341); EQT Corporation ($106,006); and Century Aluminum of Kentucky ($104,020).
 

For a complete list of lobbying spending by all businesses and organizations, and compensation paid to each of the 600 plus lobbyists, see the website of the Legislative Ethics Commission.
 

Commission issues advisory on advertising, lobbyist co-hosting
 

At its January meeting, the Legislative Ethics Commission answered two questions that have arisen with respect to changes in the Code of Legislative Ethics made in 2014.
 

The first question relates to the change to KRS 6.821(4)5.a., which now requires an employer of a legislative agent to report on its updated registration statement:
 

“[t]he cost of advertising which appears during a session of the General Assembly, and which supports or opposes legislation, if the cost is paid by an employer [of a legislative agent] or a person or organization affiliated with an employer.”
 

The specific question is whether the employer of a legislative agent is under a duty to report the cost of advertising expended by a person or organization affiliated with the employer, if the employer has not requested the affiliated person or organization to do the advertising, and the employer does not pay for the advertising or reimburses the affiliate for the advertising costs.
 

It appears that the intent of this statutory provision is that an employer report the costs of advertising which it pays for, or which is made by an affiliate at the employer’s direction or request. If the employer directs or asks an affiliate to do the kind of advertising described in the statute and the affiliate complies, the employer should report the cost of such advertising.
 

If the employer reimburses the affiliate, either directly or indirectly, for the costs of such advertising, even if it were not done at the direction or request of the employer, the employer should also report the amount thus reimbursed as advertising costs.
 

The second question involves whether a change to KRS 6.811(5) which states that a legislative agent (lobbyist) “shall not directly solicit, control, or deliver a campaign contribution for a candidate or legislator” precludes a legislative lobbyist from serving as a host or co-host of a fundraising event for the campaign of a candidate for the General Assembly or a legislator.
 

In OLEC 07-01, it was held that a lobbyist could serve as a co-sponsor or co-host of a fundraising event for the campaign of a legislator seeking election to a state office. That opinion was based, in part, on prior opinions (OLEC 95-8 and 95-14) which held that a lobbyist could solicit a campaign contribution for a member of the General Assembly.
 

Because the statute now prohibits a lobbyist from directly soliciting a campaign contribution for a legislative candidate or a legislator, and one who acts as the host or co-host of such an event is engaging in the solicitation of funds for a campaign, it is no longer proper for a lobbyist to act in such a capacity.
 
 

Ethics Reporter is a publication of the Kentucky Legislative Ethics Commission. It is reprinted with permission.
  


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