Planning to Deregister? Not So Fast

Posted June 9, 2009 at 6:20pm

Advocates trying to retroactively terminate their status as federal lobbyists in order to meet President Barack Obama’s stringent ethics rules may be out of luck.

The Secretary of the Senate and the House Clerk’s Office put out joint guidance Friday detailing who must file an LD-203, the individual lobbying report due every six months. The next filing deadline is July 30.

The notice focused primarily on filing requirements for individual lobbyists, but ethics lawyers say the guidance applies more broadly to lobbyists trying to “deregister— or cleanse themselves in order to be eligible to join the Obama administration.

“Basically you cannot retroactively deregister,— said Ken Gross, an ethics lawyer at Skadden, Arps, Slate, Meagher & Flom. “It’s true that many people were listed on these lobbying reports that more than likely didn’t meet the [lobby registration] test, but there wasn’t much of a downside. Now people are sharpening their pencils and asking, Wait, do I actually meet this definition?’—

Individuals must register as federal lobbyists if they make two or more contacts with covered officials and spend more than 20 percent of their time trying to influence legislation.

Lobbyists looking to amend previous lobbying reports will be considered “inactive from the amended period forward, but they would still be required to file the LD-203 for that period,— House Administration Committee spokesman Kyle Anderson said.

The notice clarifies several instances where lobbyists must still file reports, even after terminating their status as active lobbyists.

Lobbyists must file an individual report “regardless of whether they were required to be listed (as in the case in which a registrant listed an individual as a lobbyist in an abundance of caution),— according to the notice.

Additionally, amending previous reports to deregister lobbyists “does not undo the effect of having listed a lobbyist on the original form— and lobbyists must still file an individual lobbying report, according to the posting.

Secretary of the Senate Nancy Erickson said the notice was posted in response to filers who received notices from the Senate and House after some lobbyists failed to file their LD-203 reports, in which lobbyists disclose their campaign contributions.

“In lieu of the lobbyists filing LD-203, some registrants responded by stating that the lobbyists in question were never lobbyists, and in a few cases, refiled reports retroactively terminating or erasing the listing of particular names,— Erickson said in a statement.

“After further legal review, we wanted to signal that we believe their responses were non-compliant with Section 203 of [Honest Leadership and Open Government Act], so we posted the notice to communicate our position to the registrants,— she added.

The House and Senate have been faced with a deluge of lobbyist terminations after the Obama White House put out an executive order in January barring people entering the administration from working in an agency that they lobbied in the past two years and from making policy on any issues involving their former employer or clients for a period of two years.

The House Clerk’s Office received 1,200 individual lobbyist terminations in 2008, Anderson said. So far, the office has received 300 terminations this year.

The Senate, however, does not keep such a tally, said Beth Provenzano of the Office of the Secretary of the Senate.

It’s unclear whether the Obama White House will allow lobbyists who have retroactively amended lobbying reports to join the administration. The White House did not respond to a request for comment.

Groups like the Center for Lobbying in the Public Interest have argued that the Obama administration should change the rule, which bars many from entering public service.

“I think the administration has recognized that perhaps the [Lobbying Disclosure Act] was an imperfect trigger for getting at some of the issues that it wants to tackle around cleaning up government and the appearance of corruption,— CLPI President Larry Ottinger said.

Despite the administration’s recent move to relax lobbying restrictions on stimulus funds, so far, there doesn’t appear to be the same appetite to make changes to the executive order.

The administration has given itself a one-year review period.

The Open Society Institute’s Stephen Rickard suggested the administration could keep the executive order intact but also allow people into the administration if they registered as lobbyists only out of an abundance of caution and can document that they never actually qualified as a lobbyist.

“This is an example of the continuing ripple effects of the administration trying to use a square peg for a round hole,— Rickard said. “What the Obama ethics order has done, with the best of intentions and classic example of an unintended consequence, is convert the attitude of when in doubt, disclose or register’ to an attitude of strictly follow the letter of the law.’—

While the Open Society Institute hasn’t yet amended lobbying reports or deregistered any of its lobbyists, Rickard said he expects the group to review its policy and look into examples where there is over-reporting.