HomeMy WebLinkAbout00-1501 HeinelElmer W. Heinel
E. W. Heinel Consultants
1588 Morgan Lane
Wayne, PA 19087
Dear Mr. Heinel:
ADVICE OF COUNSEL
October 27, 2000
00 -1501
Re: Lobbying, Principal, Lobbyist, Administrative Action; Nominations /Appointments;
Statements of Policy; Guidelines; Legislative Action; Direct or Immediate Benefit to
Client.
This responds to your letter of September 25, 2000, by which you requested advice
from the State Ethics Commission.
Issue: Whether the following activities on behalf of clients would constitute "lobbying"
so as to require registration and reporting under the Lobbying Disclosure Act: (1) getting a
client appointed to a particular position as an officer or employee of the Commonwealth of
Pennsylvania; (2) involvement in bond underwriting positions in agency bond issues, money
management involving State funds, or debt collection through the Department of Revenue or
Attorney General's office; or (3) efforts to influence legislative action where the benefit to the
client would not be immediate or direct.
Facts: You seek an advisory from the State Ethics Commission as to whether
various activities which you perform on behalf of your clients would constitute lobbying under
the Lobbying Disclosure Act, 65 Pa.C.S. §1301 et seq.
You state that most of your activities involve getting a client appointed to a particular
position. It is your view that such activities would not constitute lobbying under the Lobbying
Disclosure Act.
Some of your activities for clients pertain to bond underwriting positions in agency
bond issues; money management involving State funds; and debt collection through the
Department of Revenue or Attorney General's office. You state your view that these activities
would not require registration under the Lobbying Disclosure Act.
Your activities sometimes involve legislation. You state that generally, the type of
legislation that you work on can only benefit your client at a local level, and then only after
your client competes with other firms for a new business opportunity that is created by the
legislation. You state that the benefit to your client from such legislation is neither immediate
nor direct.
Based upon the above, you ask whether your activities would constitute "lobbying"
under the Lobbying Disclosure Act, such that you should continue to register under the Act.
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October 27, 2000
Page 2
Discussion: It is initially noted that pursuant to Section 1308(c) of the Lobbying Disclosure
Act ( "Act "), 65 Pa.C.S. §1308(c), in conjunction with Sections 7(10) and 7(11) of the Ethics
Act, 65 P.S. § §1107(10), (11), advisories are issued to the requestor based upon the facts
which the requestor has submitted. The Commission does not engage in an independent
investigation of the facts, nor does it speculate as to facts which have not been submitted, in
issuing advisories. It is the burden of the requestor to truthfully disclose all of the material
facts relevant to the inquiry. An advisory only affords a defense to the extent the requestor
has truthfully disclosed all of the material facts.
The following definitions and substantive provisions of the Act are pertinent to your
request.
Section 1303 of the Act defines "lobbying" as follows:
"Lobbying." An effort to influence legislative action or
administrative action. The term includes:
(1) providing any gift, entertainment, meal, transportation or
lodging to a State official or employee for the purpose of
advancing the interest of the lobbyist or principal; and
(2) direct or indirect communication.
65 Pa.C.S. §1303.
The key terms "legislative action," "administrative action," "direct communication," and
"indirect communication" that are within the definition of "lobbying" are themselves defined as
follows:
"Legislative action." An action taken by a State official or
employee involving the preparation, research, drafting,
introduction, consideration, modification, amendment, approval,
passage, enactment, tabling, postponement, defeat or rejection of
legislation; legislative motions; overriding or sustaining a veto by
the Governor; or confirmation of appointments by the Governor or
of appointments to public boards or commissions by a member of
the General Assembly.
"Administrative action." Any of the following:
(1) An agency's:
(i) proposal, consideration, promulgation or rescission of
a regulation;
(ii) development or modification of a guideline or a
statement of policy; or
(iii) approval or rejection of a regulation.
(2) The review, revision, approval or disapproval of a
regulation under the act of June 25, 1982 (P.L.633,
No.181), known as the Regulatory Review Act.
(3) The Governor's approval or veto of legislation.
(4) The nomination or appointment of an individual as an
officer or employee of the Commonwealth.
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(5) The proposal, consideration, promulgation or rescission of
an executive order.
"Direct communication." An effort, whether written, oral or by
any other medium, made by a lobbyist or principal, directed to a
State official or employee, the purpose or foreseeable effect of
which is to influence legislative action or administrative action.
"Indirect communication." An effort, whether written, oral or
by any other medium, to encourage others, including the general
public, to take action, the purpose or foreseeable effect of which
is to directly influence legislative action or administrative action.
The term includes letter- writing campaigns, mailings, telephone
banks, print and electronic media advertising, billboards,
publications and educational campaigns on public issues. The
term does not include regularly published periodic newsletters
primarily designed for and distributed to members of a bona fide
association or charitable or fraternal nonprofit corporation.
65 Pa.C.S. §1303.
The terms "principal" and "lobbyist" are defined in the statute as follows:
"Principal." Any individual, firm, association, corporation,
partnership, business trust or business entity:
(1) on whose behalf a lobbyist influences or attempts to
influence an administrative action or a legislative action; or
(2) that engages in lobbying on the principal's own behalf.
"Lobbyist." Any individual, firm, association, corporation,
partnership, business trust or business entity that engages in
lobbying on behalf of a principal for economic consideration.
The term includes an attorney who engages in lobbying.
Id.
Section 1306 of the Act provides, in pertinent part, as follows:
§1306. Exemption from registration and reporting
The following individuals and activities shall be exempt from
registration under section 1304 (relating to registration) and reporting
under section 1305 (relating to reporting):
(3) Any of the following:
(ii) An individual whose compensation for lobbying,
from all principals represented, does not exceed
$2,500 in the aggregate during any reporting
period.
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* * *
(iv) A principal whose total expenses for lobbying
purposes do not exceed $2500 during any
reporting period.
65 Pa.C.S. § §1306 (3)(ii), (iv).
The above provisions of the Act shall now be applied to your inquiry. You ask whether
your activities in certain areas would constitute "lobbying" so as to require registration and
reporting under the Lobbying Disclosure Act.
The first area which you have presented for review pertains to efforts to get your
clients appointed to particular positions. While you have not expressly so stated, it is
assumed that such positions are as officers or employees of the Commonwealth of
Pennsylvania, since the Lobbying Disclosure Act applies to regulate activities at the State
level of government. See, McGee, Opinion 99 -1022. You are advised that such activities
would clearly constitute lobbying under the Act. By definition, "lobbying" includes efforts to
influence "administrative action." 65 Pa.C.S. §1303. By definition, "administrative action"
includes "[t]he nomination or appointment of an individual as an officer or employee of the
Commonwealth." Id. Therefore, activities related to getting your clients appointed as officers
or employees of the Commonwealth of Pennsylvania would constitute "lobbying" as defined
by the Act.
The second area consists of activities related to bond underwriting positions in agency
bond issues, money management involving State funds, or debt collection through the
Department of Revenue or Attorney General's office. Based upon the very limited description
which you have presented, you are advised that such activities would not constitute lobbying
under the Act conditioned upon the assumptions that they would not include any efforts to
influence legislative action as defined by the Act or administrative action as to agency
regulations, statements of policy, guidelines, or Executive Orders.
The third area of your activities involves efforts to influence legislation. You state that
in such matters, the benefit to your client would neither be immediate nor direct. You are
advised that efforts to influence legislative action constitute "lobbying" under the Act
regardless of whether there is any perceived benefit, let alone whether any such benefit is
immediate or direct.
When a client engages you /your firm to perform services which constitute lobbying as
defined by the Act, your client is a "principal" and you and your firm are "lobbyists." Absent
exemption under Section 1306 of the Act, principals and lobbyists are subject to the
registration and reporting requirements of the Act.
As for continued registration under the Act, you are advised as follows.
Pursuant to Section 1304(c) of the Act, each lobbyist must file a separate registration
statement for each principal represented. 65 Pa.C.S. §1304(c)(2). Where lobbying is being
done through a firm, both the firm and the individual lobbyist(s) must register. Sweet, Opinion
99 -1024. However, each registrant pays only one $100 filing fee in any registration period.
51 Pa. Code §33.1(a)(2).
Absent exemption under Section 1306 of the Act, the deadline for registering as a
lobbyist would be within 10 days of being hired by the principal. 65 Pa.C.S. §1304(a).
Assuming that no exemption would apply, you would be required to register as a lobbyist for
each principal represented within 10 days of being hired by the principal. See, Powell, supra;
65 Pa.C.S. §1306.
Your firm would also be required to register as a lobbyist for each principal
represented within 10 days of being hired by the principal. There is no threshold exemption
for lobbyists that are entities. Gibboney, Opinion No. 99 -1005; Powell, Opinion No. 99 -1008;
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October 27, 2000
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Flaherty, Opinion No. 99 -1010.
It is parenthetically noted that a principal is subject to the registration and reporting
requirements of the Act if its total expenses for lobbying exceed $2500 in any reporting period
(quarter). Cook, Opinion 99 -1001. The principal would have 10 days to register once the
$2500 threshold would be exceeded. Dierkers, Opinion 00 -1004.
The propriety of the proposed conduct has only been addressed under the Act and
derivatively the Ethics Act to the extent applicable; the applicability of any other statute, code,
ordinance, regulation or other code of conduct has not been considered in that they do not
involve an interpretation of the Act.
Conclusion: When a client engages you /your firm to perform services which
constitute lobbying as defined by the Act, your client is a "principal" and you and your firm are
"lobbyists." Absent exemption under Section 1306 of the Act, principals and lobbyists are
subject to the registration and reporting requirements of the Act.
Activities related to getting clients appointed as officers or employees of the
Commonwealth of Pennsylvania would constitute "lobbying" as defined by the Act. Activities
related to bond underwriting positions in agency bond issues, money management involving
State funds, or debt collection through the Department of Revenue or Attorney General's
office would not constitute lobbying under the Act conditioned upon the assumptions that they
would not include efforts to influence legislative action as defined by the Act or administrative
action as to agency regulations, statements of policy, guidelines, or Executive Orders. Efforts
to influence legislative action constitute "lobbying" under the Act regardless of whether there
is any perceived benefit.
Each lobbyist must file a separate registration statement for each principal
represented. 65 Pa.C.S. §1304(c)(2). Where lobbying is being done through a firm, both the
firm and the individual lobbyist(s) must register. Each registrant pays only one $100 filing fee
in any registration period. 51 Pa. Code §33.1(a)(2).
Absent exemption under Section 1306 of the Act, the deadline for registering as a
lobbyist would be within 10 days of being hired by the principal. 65 Pa.C.S. §1304(a). There
is no threshold exemption for lobbyists that are entities.
Pursuant to Section 1308 of the Act, a requestor who truthfully discloses all material
facts in a request for an advisory and who acts in good faith based upon a written advice or
opinion of the Commission issued to the requestor shall not be held liable for a violation of
the Act.
This advice is a public record and will be made available as such.
Finally, if you disagree with this Advice or if you have any reason to
challenge same, you may appeal the Advice to the full Commission. A personal
appearance before the Commission will be scheduled and a formal Opinion will
be issued by the Commission.
Any such appeal must be in writing and must be actually received at the
Commission within thirty (30) days of the date of this Advice pursuant to 51 Pa.
Code §13.2(h). The appeal may be received at the Commission by hand delivery,
United States mail, delivery service, or by FAX transmission (717- 787 - 0806).
Failure to file such an appeal at the Commission within thirty (30) days may
result in the dismissal of the appeal.
Sincerely,
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October 27, 2000
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Vincent J. Dopko
Chief Counsel