For the first time in almost a decade, total lobbying revenues did not increase last year, with the recession pinching K Street budgets and major legislative initiatives such as health care reform winding down.
Some of this change may be attributed to a quirk in accounting practices under which lobbying expenditures are reported, but it is also indicative of several major players scaling back their Washington influence spending last year.
Total lobbying expenditures were $3.5 billion in 2010, which was a decrease of $104 million, or 2.9 percent, from the previous year, according to a CQ MoneyLine analysis of filings made by lobbying entities under the Lobbying Disclosure Act. These numbers could change slightly in the upcoming weeks, as late filers trickle in and some firms file amendments. But based on the previous year’s filings, it is highly unlikely that the final tally will exceed the revenue reported in 2009, making last year the first time since 2001 that lobbying income has not risen.
“I think the recession has contributed to the decline in business expenses across the board, and lobbying is not immune to budget cuts,” said Jan Baran, a senior partner at the Wiley Rein law firm who specializes in lobbying compliance.
Lobbying dollars for those involved in agriculture, defense, health care, retail, real estate, transportation and construction sectors declined last year. Energy, communications, finance and organized labor lobbying revenues rose only slightly.
Aside from the economy, experts said, other factors were likely responsible for the overall revenue dip, including completion last March by Congress of the health care overhaul that consumed K Street for more than a year.
Spending by health care companies and associations dropped almost 9 percent in 2010, with drug companies such as Pfizer Inc., which lobbied for the health care overhaul, posting some of the biggest declines.
Other industries and associations, which ramped up to either defeat or shape portions of the health care bill, also scaled back after the legislation was completed.
The U.S. Chamber of Commerce, which underwrote a multimillion-dollar ad campaign in 2009 aimed at defeating the health care measure, spent $23 million less on lobbying in 2010 than the previous year. A steep decline in the chamber’s lobbying bill has a particularly large effect on overall revenue figures since the business group tops the list of annual lobbying expenditures by companies and associations, shelling out more than $100 million in 2010.
The American Beverage Association also launched a media campaign in 2009 to kill a proposal to levy a tax on soda to defray cost of the health care reforms.
The intense lobbying continued into the first half of 2010 in part because the association was also lobbying to fend off efforts in state Capitols to impose the soda tax to plug budget holes.
But by the fourth quarter of 2010 the association’s lobbying expenditures had plummeted to $230,000 compared with almost $10.2 million in the same period in 2009.
“Lawmakers had started to back off the idea of taxing soft drinks,” said a spokesman for the beverage association.
The completion of the health care legislation did not necessarily mean that professional groups or companies trimmed their Washington, D.C., operations.