Will Lobbyists Still Party Hardy in 2008?

New Ethics Law Casts Pall Over Conventions

Posted November 2, 2007 at 6:11pm

Ready to party like it’s 1999? Don’t get your hopes up. Congress’ new ethics law has put a distinct chill in the air.

For years the Republican and Democratic national conventions espoused a laissez-faire attitude about rocking and rolling. Partying got top billing.

Corporate America reigned supreme with companies such as AT&T, Lockheed Martin and Merck feting the likes of former Sen. John Breaux (D-La.) in a soiree rivaling a New Orleans Mardi Gras at Universal Studios during the 2000 Democratic National Convention in Los Angeles.

The party continued in 2004, when companies such as PepsiCo got on board at the Republican National Convention in New York City, throwing a lavish benefit honoring then-Majority Leader Bill Frist (R-Tenn.) at the Metropolitan Museum of Art’s Temple of Dendur.

That could be a thing of the past at the 2008 national conventions.

With the conventions less than a year out, party plans are in limbo as lobbyists and companies are struggling to figure out what’s kosher in the new ethics environment.

“Right now we’re not planning to do anything that’s a party because as I look at these ethics rules anything you would try to do potentially could look like you were trying to circumvent them,” said Kenneth Kies, head of the lobby shop Clark Consulting’s Federal Policy Group.

The ethics bills that passed earlier this year include a provision that precludes companies that retain or employ lobbyists from holding an event during the convention honoring any Member who is not running for president.

And that means not just parties hosted by corporate behemoths, but smaller events sponsored by trade associations and lobbyists also are out.

So far, ethics lawyers have been waiting for the Senate and House ethics committees to issue an advisory opinion on appropriate convention parties.

Among the most important issues to be decided are whether parties honoring state delegations — instead of specific Members — would be permissible and which parties would meet the widely-attended-event exception.

That has left ethics lawyers in a tough position to try and advise corporate clients who, under normal circumstances and with the conventions only 10 months away, usually already would have made sure they had their event spaces reserved.

“Everyday I look for white smoke coming from the ethics committees,” said Marc Elias, an ethics lawyer at Perkins Coie. “So far there’s been none.”

That hasn’t stopped some from scheming about finding ways around the new rules. One idea that has been proliferating on K Street is throwing an event the day before, or the day after, the official convention.

And fundraisers, for example, are not banned. Still, they are likely to be of little use, say election lawyers, because by the time the conventions roll around, almost every potential donor will have given the maximum permissible contribution.

The two host committees, however, still are permitted to hold events honoring specific people.

“There is a lot of caution with respect to events at the conventions,” said Jan Baran of Wiley Rein. “Already there have been attempts by host committees to suggest if a company would give them money, they will hold an event in honor of some Member.”

But regardless of whether lobbyists and corporations will be able to hold events, the current uncertain environment already has convinced some that it’s time to quit the party circuit.

Kies, for one, says his lobby shop isn’t planning anything for the 2008 conventions. That’s a striking difference from 2004, when Clark Consulting’s Federal Policy Group chartered a yacht, holding more than a dozen events for Members of Congress.

“If you put on a party at the convention, why are you doing it? You are hoping Members of Congress and staff come. I have just described something that is contrary to the basic message of the ethics rules,” said Kies.

The ambiguity of what the new law actually allows has prompted some corporate lobbyists to wonder what the benefit of throwing parties is in the first place.

“I’m always asking the question to myself: ‘At the end of the day, what do you really get for doing this,” said Galen Reser, head of Pepsi’s Washington, D.C., office. Pepsi is not planning to throw a party for the 2008 conventions, he says, unlike 2004.

“I don’t regret that we did it. I think it was a lovely event and you know, we were a New York company so it made sense for us,” he said.

Not everybody is ready to throw the towel in, though.

“We’re going to have to wait a little bit to see what the ethics committees and the FEC do,” said David Norcross of Blank Rome, who served as chairman of the Republican National Convention’s Committee on Arrangements for the 2004 convention in New York City. Norcross said Blank Rome is still weighing its options for convention events.

Despite reservations in Washington, convention planners in Denver, where the Democrats will hold their convention in late August, and St. Paul, where Republicans will meet in early September, are keeping a stiff upper lip.

“I believe everyone is acquainting themselves with the new rules and are making plans consistent with those guidelines,” Jeff Larson, CEO of the RNC Host Committee, wrote in an e-mail statement.

While Joe Weber, who formed the convention planning company, Twin Cities Strategies, with his brother, former Rep. Vin Weber (R-Minn.), acknowledges the delays in planning, he expects it to pick up after January, when a lead candidate presumably will emerge.

“All of this adds to a little more wait-and-see attitude,” Weber said.

One group that hasn’t been shy about setting up their party is the Minnesota Agri-Growth Council. With 250 member companies including Cargill, Hormel and Land O’Lakes, it’s gone ahead and booked a two-day event, including a gala and educational displays open to the public the following day.

“We looked at that pretty closely,” Daryn McBeth, executive director of the ag group, said about the new ethics law. “We’re inviting 2,500 people, not honoring anybody. It’s a stakeholder event.”