74% of lobbyist spending on Kansas lawmakers unaccounted for
05/04/2013 6:01 PM
08/08/2014 10:16 AM
Lobbyists seeking to influence state laws have spent $380,000 feeding, entertaining and giving gifts to legislators in the first three months of this year.
But you will never know how three-fourths of that money was spent because the state disclosure law doesn’t require it.
Records obtained from the Kansas Governmental Ethics Commission show that more than 74 percent of lobbyist spending, almost $285,000, was reported as “unitemized” on state forms, meaning that it can’t be linked to any particular lawmaker or event.
In addition, the records show that 15 of the state’s top lobbying firms sometimes listed themselves as their own clients, further muddying an already unclear picture of who’s paying to influence lawmakers to do what.
And when lobbyists take lawmakers to a basketball game or concert, they don’t have to disclose who was playing, where they went or even the date of the event.
Legislative leaders defend the current disclosure law and their constant contact with lobbyists, who they say play a crucial role in the legislative process by bringing outside expertise to the lawmakers.
“The wonderful thing is it’s all recorded and it’s open to the public and nothing can be given to a legislator without that being documented,” said Susan Wagle, R-Wichita and president of the state Senate. “I think we have excellent ethics standards. I mean, we do need communication with interested parties, all people, when we pass a bill, and I’m just glad that the lobbyists report.”
One group that studied government transparency found Kansas lobbying disclosures to be far from excellent.
Kansas earned an overall grade of C for government ethics but an F for lobbying disclosure in a recent national study of state ethics laws.
“There was a real lack of specificity there that makes it very difficult to know what’s going on,” said Gordon Witkin, a managing editor of the State Integrity Investigation, a joint venture of three nonprofit, public-interest groups – the Center for Public Integrity, Global Integrity and Public Radio International.
Among neighboring states, Nebraska got the highest grade for lobbying disclosure, a B-plus. Colorado got a C, Missouri got a D-minus and Oklahoma matched Kansas with an F.
The investigation was especially critical of Kansas law for not requiring clients who hire lobbyists to disclose how much they pay them, a key feature in Nebraska’s high score.
In addition, the researchers downgraded Kansas for loopholes that allow lobbyists to list the bulk of their expenditures as unitemized.
“There seems to be a lot going on that wasn’t fully disclosed in Kansas,” Witkin said.
Carol Williams, executive director of the Kansas Governmental Ethics Commission, said some states require more transparency in reporting.
That includes disclosure of how much businesses are paying their lobbyists and how much businesses and lobbyists pay lawyers to write position papers or other costs related to influencing lawmakers.
“Without that, you don’t have the full picture of lobbying,” Williams said.
Meanwhile, some states also require that lobbyists file updates to show which bills they are lobbying for or against. Kansas requires only a generalization, such as “on behalf of teachers,” which doesn’t give the public much insight into the lobbying activity.
Until 2000, Kansas didn’t require lobbyists to break their spending on lawmakers into categories – they just tallied how much they spent overall. Now the state requires lobbyists to categorize spending for meals, recreation, entertainment and gifts.
“We have made progress over the years,” Williams said.
In Kansas, anyone who is paid or appointed to influence lawmakers or spends more than $100 on lobbying activities must register with the state as a lobbyist and pay a registration fee.
The Secretary of State maintains a database of all registered lobbyists.
The state’s ethics rules allow lawmakers to accept as much food and drink as they’d like. But they can only accept up to $40 a year in gifts, $40 in recreation and a maximum of $100 of entertainment from any one special interest group.
Lawmakers have resisted attempts to change the law to allow lobbyists to invite specific legislative committees out for dinners without giving an itemized account of who went or how the money was spent.
This summer, the ethics commission plans to begin random audits of lobbyists’ reports, which it hasn’t done in recent years. But the commission probably won’t be able to fill one of its vacant auditor positions because of budget cuts driven by the income tax cuts signed into law last year.
Williams said her office will still have the same authority to audit, but fewer people to do it.
“The more auditors you have, the more audits you can do,” she said.
Scotch and pedicures
One thing the records do show is that lobbying is a big business at the Kansas Statehouse.
Every day when the House or Senate is in session, a crowd of lobbyists lines the hallways outside the chambers to speak with legislators, while more lobbyists occupy seats in the public galleries inside.
Lobbyists take up almost all the seats at legislative committee meetings, and late in the day they hover by the stairway that leads to the legislators’ underground parking garage, hoping to catch a lawmaker or two going by.
But those casual encounters at the Capitol are just the starting point.
Lawmakers attended 112 recreational and entertainment events with lobbyists, mostly University of Kansas and Kansas State University basketball games.
Lobbyists aren’t required to list the dates that they treated lawmakers to free tickets, so it could not be determined how many of the games were regular-season and how many were NCAA Tournament play.
Twenty legislators went bowling with lobbyists and let them pick up the tab.
Lawmakers also received a total of about 180 gifts, including 158 personalized portfolios worth about $20 each to carry notebooks and papers courtesy of financial services firm Security Benefit Corp., eight state-seal plaques from various special interests, three “spa services” sponsored by the state Medical Association and three pedicures courtesy of the Kansas Bankers Association.
By far, the biggest lobbying perk was food and drink.
Most days that the Legislature meets, lawmakers can get a free lunch and dinner from one special interest group or another.
On many days, a buffet or deli box lunch is provided for all 165 lawmakers in a hallway just off the Capitol Rotunda. Other days, the lunches are spread out among various delegation, caucus and coalition meetings, where any legislator can attend and eat.
And almost every evening, some interest group sponsors a reception, banquet or meeting for groups of lawmakers, again with food and drink provided. One lobbyist listed “Scotch & cigars” for 10 lawmakers as a food and beverage expense.
That setup is one reason why so many lobbying expenses are unitemized on the state reporting forms.
Lobbyists aren’t required to disclose anything but the total cost of an event if they invite all the members of the Legislature, the whole House or Senate, or the entire Republican or Democratic caucus from either chamber.
That’s a big exception to disclosure that helped drag down Kansas’ score in the State Integrity Investigation, Witkin said.
In addition, Witkin questioned the practice of allowing lobbyists to list their own firms as clients. Fifteen lobbying shops did that a total of 295 times, representing more than $10,000 in spending, the records show.
Witkin said lobbyists might occasionally represent themselves on a bill, especially if it affects the rules of lobbying.
“It seems unusual that lobbyists are lobbying that often on their own behalf,” he said. “It would at least raise suspicion about not wanting to disclose who the real client might be.”
But Williams, the director of the ethics commission, and some lobbyists say not all of their activity is tied to a particular issue or client – sometimes they’re just sharing information or making small talk over a lobbyist-funded meal.
Scott Schneider of Schneider Public Strategies, one of many contract lobbyists at the Capitol, said some spending accommodates relationship-building with lawmakers that doesn’t involve their clients’ issues or advocacy-related specific bills.
“When I do spend a dollar, I feel I need to report it somewhere,” he said. “So I report it on behalf of myself.”
The result of lobbying
One example of lobbying muscle this session was over House Bill 2201, written primarily by AT&T, a perennial Capitol powerhouse with 11 registered lobbyists.
The bill allows telecommunications companies to shut down landline service to difficult-to-serve rural customers, allows companies to quit serving poor customers receiving Lifeline subsidies, shrinks the Kansas Universal Service Fund and pares back the authority of the Kansas Corporation Commission to regulate fraud, billing issues and quality of service.
With the cooperation of the other major phone companies in the state, AT&T wrote the bill and got the House Utilities Committee to enter it as a committee-sponsored bill.
It cleared the House on its first vote 118-1. In the Senate Utilities Committee, a staff-written amendment to maintain some KCC consumer-protection oversight was replaced with a much weaker amendment written by AT&T.
AT&T and the other phone company lobbyists had been provided with advance copies of the proposed amendments — although they weren’t given to the Citizens’ Utility Ratepayer Board, the state agency representing customers, according to David Springe, CURB’s chief consumer counsel.
The amended bill sailed through the Senate and a second vote in the House, and has since been signed into law by Gov. Sam Brownback.
Lawmakers openly acknowledged AT&T’s role in writing and amending the bill and hailed the other telecommunications companies for agreeing with it and not making legislators “choose between friends,” as a Republican bill brief put it.
“The telecommunications community all agreed to that language and that’s why it passed with such significant numbers,” Wagle said.
During the three months the bill was under consideration, communications companies and industry associations supporting the bill – including cellphone companies Verizon and Sprint – spent a combined $33,000 feeding and entertaining legislators and made more than 500 individual contacts. AT&T alone accounted for more than $12,000 and 241 paid contacts.
Other companies spent more than AT&T. The biggest spender on Statehouse lobbying so far this year has been the Kansas Bankers Association at $23,914 over three months.
The group came to the Capitol with a menu of requests, including:• Reinstating a tax deduction for bank shareholders worth $2.5 million that was inadvertently eliminated in last year’s income tax cut bill.
• Allowing banks to self-fund employee health insurance plans in preparation for full implementation of the Affordable Care Act.
• Replacing the mortgage interest rate cap with a new system that caps the rate at 15 percent per year.
• Allowing banks to shuffle money in the checking accounts of public agencies with other banks to ensure the deposits are FDIC-insured.
• Eliminating the need for banks to send notices to people whose accounts are garnished by the government, if the person has closed the account with the bank.
All of those bills passed with little resistance and have been signed into law.
Doug Wareham, a lobbyist for the association, said the vast majority of the $17,400 in unitemized spending is for an annual, half-day workshop and reception that all lawmakers are invited to.
“Most bankers aren’t able to catch lawmakers during the day because their schedules are so full,” he said.
The association also paid for about 200 breakfasts, lunches and dinners with lawmakers – and the occasional plaque or pedicure.
Wareham said he wants to make sure his industry is at the table for discussions that might affect it.
“We’re pretty aggressive about it,” he added. “We want them to know what our issues are.”
Lobbying doesn’t always achieve results.
UnCork Kansas, a business coalition seeking to allow the sale of full-strength alcoholic beverages in grocery stores and convenience stores, spent more than $15,000 on legislators in three months.
That made UnCork second only to the bankers association in lobbyist spending on legislators.
But the group appears to be no closer to its goal despite that effort plus a widespread TV advertising campaign costing an additional $13,179.
The effort has so far been staved off by a coalition of religious conservatives concerned about expanding access to alcohol, and small-town lawmakers whose communities depend on neighborhood liquor stores for commerce and property tax income.
‘It’s not changing people’s votes’
Rep. Nile Dillmore, D-Wichita, said that having nearly three-quarters of lobbying money unaccounted for could leave many Kansans wondering who is benefiting and what businesses and interest groups are getting out of it.
“That really does lack any transparency,” he said.
Dillmore said that lawmakers are invited to standing receptions Monday through Thursday evenings. Some receptions feature a buffet and cocktails, and direct lobbying is quietly discouraged to allow for more relaxed socializing. Others, however, involve lobbyists who want to talk about specific bills.
In the end, however, Dillmore said the lobbyists’ efforts don’t have much influence on how he votes. But he said it must be working because companies and interest groups keep investing in lobbying.
“They must be getting some reinforcement somewhere,” he said.
Kansas has a transparent system of recording lobbying and no significant corruption, said Rep. Scott Schwab, R-Olathe, chairman of the House Elections Committee that sometimes deals with lobbying laws.
The state has reasonable gifting limits, it bans lawmakers from accepting campaign money during the legislative session, and the fact that people can see the unitemized spending means it is being reported, he said.
Compared to the problems seen in other states, Schwab said, Kansas is doing well.
“It’s not changing people’s votes,” he said. “I think we’re getting the information the people want. We could make it more transparent and more transparent, but we could get to the point that it’s information overload.”
Schwab said most voters are interested in how lawmakers vote, not how many lunches they had with lobbyists.
Lobbying activity is mostly geared toward building relationships and trust, he said.
“The entire thing is based on trust,” he said. “And to establish trust on a core level, you’ve got to get out of the office.”
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