Philadelphia’s New Lobbying Law Silences Grassroots Advocacy (via David A. Ross and Associates)

Philadelphia’s New Lobbying Law Silences Grassroots Advocacy (via David A. Ross and Associates). On June 15, 2011, the City of Philadelphia’s Board of Ethics held a public meeting to hear comments and concerns about the city’s new lobbying disclosure ordinance (Regulation No. 9). Who spoke on behalf of Philadelphia’s 5,000 grassroots nonprofit organizations?  The PA Bar Association and the Philadelphia Chamber of Commerce have opposed the regulations as complex, costly and burdensome. How many charities have to run afoul of this law before the city listens?

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Philadelphia’s New Lobbying Law Silences Grassroots Advocacy (via David A. Ross and Associates)

Philadelphia has over 5,000 grassroots nonprofit organizations. How many will run afoul of this new complicated and burdensome lobbying law, and how much will it cost to comply with it? Is there a solution? ABSOLUTELY.  READ MY BLOG!

Philadelphia’s New Lobbying Law Silences Grassroots Advocacy __________________________________________________________________________________________ UPDATE: On June 15, 2011, the City of Philadelphia’s Board of Ethics held a public meeting to hear comments and concerns about the city’s new lobbying disclosure ordinance (Regulation No. 9). The lobbying law itself passed in … Read More

via David A. Ross and Associates

Philadelphia’s New Lobbying Law Silences Grassroots Advocacy

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Storm clouds gather of Philadelphia's City Hall

Storm clouds gather over Philadelphia's City Hall

UPDATE (6/17/11): On June 15, 2011, the City of Philadelphia’s Ethics Board held a public meeting to hear comments on the city’s proposed Regulation No. 9 of the City’s recent lobbying ordinance. The ordinance was unanimously approved by the City’s Ethics Board in June 2010, but the registration and reporting requirements were not scheduled to take effect until July 1, 2011.

Now, just days before the proposed regulations would take effect, Philadelphia’s Bar Association and Chamber of Commerce are expressing serious concerns. While the Bar Association objects to lobbying regulations of lawyers that are engaged in the practice of law, the Chamber of Commerce objects to the regulations’ restrictions on small businesses and individuals.  Even the Committee of Seventy, one of the chief proponents of the lobbying law, offered amendments to both the regulations and the underlying law at the June 15th meeting. The Philadelphia law and regulations were drafted using the Pennsylvania law and regulations as a template.  Not surprisingly, the arguments against the Philadelphia law and regulations are the exact same arguments that I and others used (with some success) to oppose the state’s lobbying law and regulations. Philadelphians may have to learn these lesson the hard way.

[UPDATE: (7/29/11)] Due to these objections and many others, the Philadelphia Ethics Board did NOT vote to approve the proposed regulations. Instead, the Board stated that they expect to schedule another meeting within several weeks to review the public testimony and take final action on the regulations.

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THERE IS STILL MUCH THEY HAVEN’T HEARD.  It’s your right to petition city hall, to talk to your local government official and to engage in grassroots advocacy! Lobbying laws that are vague, complicated, or costly to comply with, chill advocacy rights for small businesses, smaller charities and average taxpayers.

URGE THE BOARD TO (1) raise the registration and reporting threshold to $5,000 per reporting period; (2) lower the registration fee to $100; (3) simplify requirements for tracking expenses; (4) lower the penalties to $50 per late day, maximum $2,000; and (5) reduce the ban on lobbying from 5 years to 2 years.

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Read my updated ANALYSIS below.

Also read the following:

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ANALYSIS (Updated 6/17/11)

On June 2, 2010, the City of Philadelphia added its name to a growing list of American cities that have enacted lobbying registration and disclosure laws. After watching New York and Pittsburgh enact lobbying laws, Philadelphia followed suit, but with a much stricter law — based on the current PA State law enacted in 2006. City officials hoped that this new law would help end corruption by their own City Council members.  By July 1, 2011, citizens, lobbyists and organizations seeking to influence Philadelphia city government must formally register with the City and disclose the how much they spend lobbying what issues and to whom. Regulations to carry out this new law will be promulgated shortly. Unfortunately, Philadelphia’s law as it was enacted, has the potential to do more harm than good.

Lobbying laws help. Generally speaking, lobbying laws are helpful. Lobbying laws improve transparency and accountability from our elected officials. They put on record who is influencing government policy decisions, on what issues, and how much they are spending to influence those decisions. This increased level of transparency in city government allays anxieties about undue influence by special interests. Elected officials also benefit from lobbying disclosure because it lets them know “where the hits are coming from”, so they can respond strategically. Organizations like the Committee of Seventy in Philadelphia and Common Cause of Pennsylvania (based in Harrisburg) are the chief proponents of lobbying registration and disclosure laws.  And to be fair, Common Cause has been very effective on this issue, in the name of preserving Democracy.  However, the questions to ask, are how much information is truly necessary, for whom, for what purpose, and at what cost?

Am I a lobbyist? You may be a “lobbyist” under Philadelphia’s new ordinance and not even know it. If the City’s Ethics Board approves the regulations (which could be as soon as July 1, 2011, you may need to register with the city, track your communications and expenses, and publicly disclose this information online. Still skeptical? Read the law.

The Philadelphia law. The Philadelphia lobbying law requires annual registration and quarterly expense reporting online by any person organization or business that spends more than $10,000 per year ($2,500 per calendar quarter) lobbying Philadelphia City government.  Lobbying is defined as any effort to influence legislative or administrative action of city officials or employees including direct or indirect communication, incurring office expenses; and providing any gift, hospitality, transportation or lodging to a city official.  The city law defines “Lobbying” as direct and indirect communications, as well as any gifts, hospitality or transportation expenses given to city officials. “Direct Communication” is any effort, written, oral or by any other medium, made by a lobbyist or principal, directed to a city official or employee, the purpose or foreseeable effect of which is to influence legislative or administrative action. “Indirect Communication” is any communication to the general public for the purpose of disseminating or initiating a Communication. Indirect communication includes mailings, telephone banks, print or electronic media advertisements, billboards, publication or education campaigns. When calculating the value of direct and indirect communications (for purposes of disclosure) the value of personnel and office expenses used to support these activities must be included. Reportable office expenses include office space, equipment or supplies. “Personnel Expenses” include any salaries or other compensation such as benefits, vehicle allowances, bonuses or travel expenses paid to a lobbyist, staff or consultant for research, monitoring, public relations, strategic or technical support, or clerical and administrative support. So you can see from these definitions that this law is much broader than the traditional federal definition of lobbying.

Who is exempt?  While the Philadelphia law is broad, the law provides a few exemptions. Individuals who spend less than $2,500 and less than 20 hours lobbying in a calendar quarter (3 months), need not register, track, or disclose their communications. These individuals are exempt from lobbying registration because their lobbying is “incidental” to their regular employment. “Incidental” is measured using a good faith prorated estimate of the value of time that the employee devoted to lobbying during that period. That said (which is a mouthful in itself), the value of the employee’s time and activities must still be reported under the employer’s lobbying disclosure, if the employer is required to report.

What’s wrong with the law? Philadelphia’s new law is based on the current State lobbying law. By using an existing law as a template, Philly also inherits the problems inherent in that other law. The state law took approximately 4 years to write, and another three years to develop regulations. By most accounts, it is still a “work in progress”.  Now Philadelphia’s lobbying law has the same problems: (1) Threshold is too low; (2) Registration fee is too high; (3) Compliance is too complex; (4) Penalties are too severe; and (5) Banning lobbying for up to 5 years is extreme.  Taken as a whole, Philadelphia’s new lobbying registration and disclosure law chills advocacy right of small businesses, smaller charities (thousands of them) and individuals (average taxpayers without “big money backers”).

Here’s what’s wrong with the law:

   (1) Threshold is too low. The Philadelphia law, requires registration and disclosure if a person expends over $2,500 per calendar quarter (or $10,000 per year) communicating with city government officials or employees. This is identical to the state’s threshold. However, the devil is in the details. It captures all direct communications as well as grassroots activity, research time prorated hourly, staff support time, and other overhead such as computer use, telephone rental, and office square footage. When calculating all of this together, a registrant reaches $2,500 very quickly– especially in Philadelphia where transportation, parking and rental space can be pricey.

  (2) Registration fee is too high. Initially the State law set the registration at $100 for a two-year registration period. A regulation increasing the registration fee to $200 for a two-year period was just approved by the Independent Regulatory Review Commission on June 3, 2010. The Philadelphia law however, carries a $500 per year registration fee –nearly 5 times the state fee. This is basically pay to play, and is beyond the reasonable means of the average person.

  (3) Compliance is too complex. Compliance requires specific tracking of every phone call, email and minute researching the issues, determining which category in which to report these activities, as well as compiling and filing quarterly expense reports and retaining source documents for 4 years. Each one of these tasks takes a substantial amount of time, adds burden, and adds cost.

  (4) Penalties are too severe. Any person who violates any provision of the new law or who makes a material misstatement or omissions in any filing could receive a civil fine of up to $2,000 for each violation. Any person in violation of the law could forever be disqualified from holding any elected or appointed City office or employment with the City, its agencies, authorities, boards or commissions.

* In 2011, a bill was proposed in the PA State House to significantly increase penalties for material nondisclosure under the state’s lobbying law. Read: (2/22/11) New PA Lobbying Penalties Bill Would Chill Grassroots Advocacy, for a clear example (albeit at the state level) of how the threat of high penalties could shut down grassroots advocacy.

  (5) Lobbying ban is extreme.  Additionally, any person in violation of the new law may be punished by debarment from any contract with the City for up to three years and prohibited from lobbying for up to five years. Being banned from lobbying for financial compensation for up to 5 years is excessive.

A more detailed analysis of the law is posted on PAGR’s website.

The Result. Philadelphia’s new lobbying registration and reporting law chills advocacy rights for small businesses, charities and average citizens.  This law silences advocacy of mom & pop shops, the handicapped, the homeless, and the charitable nonprofit organizations that assist them. The $500 registration fees and is just too expensive for small grass roots organizations, charities and individuals trying to make a difference. Hundreds of small Philadelphia charities operate on the front lines of society’s problems, possess specialized knowledge and experience. These critical grassroots organizations will be less willing to work with the City to innovate solutions, and will simply withdraw from the public arena. After all, why would they want to put themselves on the hook for potentially thousands of dollars in fines and negative publicity for a vague law that is open to multiple interpretations and even abuse of authority? When penalties are so steep that they actually inhibit compliance, the Citizens of Philadelphia lose.

HERE’S MY SOLUTION:

(1) raise the registration and reporting threshold to $5,000 per reporting period;
(2) lower the registration fee to $100;
(3) simplify requirements for tracking expenses;
(4) lower the penalties to $50 per late day, maximum $2,000; and
(5) reduce the ban on lobbying from 5 years to 2 years.

Contact David Ross at davidross@davidarossandassociates.com.

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About David A. Ross, J.D. Since 2006, David Ross has been nearly a lone voice advocating that strong lobbying laws silence advocacy of small businesses, grass roots organizations, charities and individuals trying to improve their communities. As Public Policy Officer of the Pennsylvania Association of Nonprofit Organizations, Ross organized coalitions, drafted and submitted comments for the record, testified on proposed regulations, and negotiated with members of the State’s Lobbying Regulations Committee to improve the proposed regulations.  Eventually, the Regulations Committee acknowledged Ross’ concerns, but determined that the Committee was limited in their ability to solve the problem through the regulations.  Instead, they felt that the underlying law needed to be amended to take into account the needs of smaller businesses and nonprofits that engage in grassroots advocacy.  Ross’ work continues at the advocacy consulting firm, David A. Ross and Associates. Contact David Ross at davidross@davidarossandassociates.com.

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