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Lobbyists Play the Waiting Game as Gridlock Deepens
June 23, 2004
Influence Magazine By Kate Ackley

As a stalled Congress puts damper on business development, creativity is key for government relations specialists

With bitter partisanship on Capitol Hill, a presidential election on the way, and most members’ attention focused on the war in Iraq, Congress is as gridlocked as ever. But that doesn’t mean the advocacy business grinds to a halt.

Lobbyists are looking for creative ways of working around the gridlock to get things done. They are refreshing contacts on the Hill, attempting to subvert the logjam by pitching policies to government agencies, making fund-raising events a priority, and focusing on the few pieces of legislation that have a shot. At the very least, they are laying the groundwork for issues that likely will crop up in the 109th Congress.

The gridlocked environment, though, can be a difficult one in which to attract new business.

Most clients agree that they are waiting until after the November elections to make new hiring decisions. And some Washington-savvy clients, in particular, say they are saving their lobbying dollars because few pieces of big legislation are on the horizon.

“It’s my experience that it’s very hard to sign on new clients,” says Stewart Partners’ Jarvis Stewart, a former chief of staff to Rep. Harold Ford Jr. (D-Tenn.). “I think both Democrats and Republicans will say it’s a bad time for client development.”

The issues Stewart cares about—like predatory lending legislation, which he’s watching for the Coalition for Fair and Affordable Lending—so far haven’t gained traction in the relevant committees, he says.

So Stewart says he is focusing on meetings with his contacts on the Hill to network and to discuss legislative issues, and he is spending a big chunk of his time at fund-raising events.

“My assistant just handed me 15 requests for fund-raisers next week,” he says. “On Wednesday, there are 10 that I’ve been invited to. You have to pick and choose which ones are most important. I’ll probably do four or five that night. The others, I might just send a check in.”

Stephanie Silverman of Venn Strategies says she turns to governmental bodies besides Congress during times like these. “You look to other venues, federal agencies like USTR [U.S. Trade Representative], Commerce, Treasury . . . or you work with the not-for-profit community and [nongovernmental organizations] with the assumption that next year might be better.”

The situation for many in-house lobbyists is similar. One in the communications sector says he is “relationship-building and relationship-strengthening. But I’m not focusing on passage or enactment of legislation right now.”

This lobbyist and two others say their respective companies are holding off on hiring additional outside consultants until after Election Day.

Bad for Business: Gridlock, says Jarvis Stewart, makes it hard to sign new clients.

But one of the lobbyists notes that if it appears that John Kerry is likely to win in November, it might make sense to hire Democrats close to the Massachusetts senator before the election. That way it’s possible to pay a cheaper, pre-election price of, say, $10,000 to $15,000 a month, compared with a post-election price of $25,000 a month or more.

John Jonas, who heads the legislative practice at Patton Boggs, says that many of his clients—which include the Alzheimer’s Foundation of America and Amgen Inc.—understand that several of their issues won’t come up on the congressional agenda until 2005. “We’re really preparing for next year, when we’ll either have a new administration or President Bush will be re-elected,” Jonas explains. “And he will probably come in and say, ‘This is my last term’ and will push Congress to move quickly.”

Next year, lobbyists will be up against intense competition with one another for federal dollars as the White House and Congress cope with more budget pressures. “That makes the battle all the tougher,” Jonas explains, and makes getting clients’ messages to Congress this year more critical.

One of Jonas’ clients, Kidney Care Partners, a coalition of dialysis doctors and patient groups, is pushing to modernize Medicare funding for end-stage renal disease. For now, Jonas and the coalition are working on getting sponsors lined up, drafting legislative proposals, and figuring out the costs and mechanics of such a bill, so he doesn’t start from scratch next year.

Even so, Jonas says the environment of gridlock weighs heavily. “It’s just kind of a psychologically discouraging environment to compete in,” he says. “Lobbyists are competitive people who like to win and generally don’t like periods of prolonged inaction and gridlock.”

To be sure, some lobbyists thrive on the gridlock—and help to create it. And lobbyists are quick to note that if you’re trying to get something stopped, this is the perfect environment.

Lee Culpepper, the top lobbyist for the National Restaurant Association, says that while he doesn’t see this year as dramatically different from other election years, many of the measures his group wants to pass are stuck.

“We’ve seen a number of issues that we care about related to legal reform that have been slowed down or stopped,” says Culpepper.

The restaurant association, he says, is also accustomed to battling a minimum wage increase—something, he says, that Democrats such as Sen. Edward Kennedy of Massachusetts propose routinely during an election year.

“Each of those examples are what you’d expect,” Culpepper says. “They’re what cause gridlock. The minority party is trying to get its issues out there. The majority party is trying to get bills passed to solidify its message with voters.
“They don’t peacefully coexist.”

No matter how inactive Congress might be, lobbyists and other political insiders point to the 13 spending bills as a certainty—or as much of a certainty as is possible with legislation. Some lobbyists who specialize in appropriations matters say they are preparing for some of the bills to get lumped together in an omnibus bill later in the year. That can push the stakes higher and increase competition for securing a client’s earmark, a chunk of money designated for a certain project. Many of these lobbyists are gearing up for a possible lame-duck session.

Most appropriations lobbyists take it in stride. Geoffrey Gonella of Cornerstone Government Affairs says, “As the environment changes, we adjust how we approach the Congress. We design our strategies around what’s happening. It changes on a daily basis. From a scheduling standpoint, it’s not significantly different than it was last year, but it’s just on a day-to-day basis.”

C. Michael Fulton, an executive vice president at Golin/Harris International who specializes in appropriations lobbying, says while some of his clients’ matters are moving slowly, he has shifted focus to planning events and bringing supporters of their projects together in Washington.

Recently, Fulton helped organize a “state of the university address” event for West Virginia University in which former Iraq prisoner of war Jessica Lynch made an appearance. He is also working on other events to showcase clients’ perspectives in Washington.

“We’ve got invitations going out, e-mails, Dear Colleague [letters] circulating. The clock doesn’t stop,” he says. “This is the time, in my judgment, that you want to try to bring very interesting, provocative events to the attention of Hill staffers and federal agency staffers to move the needle on your issue. Perhaps the legislation itself might be stalled or waiting for consensus, but many good things come out of these events.”

The National Court Reporters Association is one Golin/Harris client whose legislation—a measure that would authorize competitive grants to help fund training programs for court reporters and captioners—is stalled. Fulton says the bill has 45 Senate sponsors and the support of more than a quarter of House members.

“This is a great example of a bill that should be passed but for partisan gridlock,” Fulton says.

Sometimes when bills don’t move or clients lose out, Fulton says his company will take a hit and work for the client at a lower rate in the future. “Sometimes I’ll work for them for nothing or a reduced fee for the following year,” he explains, “because I like them, I believe in them, and it’s an investment. It’s good for business.” He currently has two such clients: Holy Cross Hospital in Silver Spring, Md., and Community Memorial Hospital in Staunton, Ill.

Jeffrey Taylor, federal relations group chairman for Barnes & Thornburg, says that it can be difficult to compete for attention when so many eyes on Capital Hill are focused on Iraq and when partisanship is at a peak leading up toward Election Day.

New Focus: Legislative gridlock means C. Michael Fulton is re-prioritizing his activities.

“I represent Allen County, Ind.,” he says. “They have worked for the better part of 20 years on creating a major highway that connects a certain part of the county to another. We were able to help them get $11 million in TEA-21 [Transportation Equity Act for the 21st Century].”

But the House, Senate, and White House haven’t agreed on a dollar amount for the bill. So, Taylor says, the client realizes that his job is basically done. However, the bill is stuck in conference committee, which is, at the moment, negotiating only non-money provisions of the reauthorization.

It’s not all bad news. On the appropriations side, Michael Herson, president of American Defense International, says that most matters for his 85 clients are on track.

“I think it does appear unlikely that they are going to pass all 13 appropriations bills [on time], but we’re fortunate,” he says. The defense spending bill is on schedule, and, he says, Congress attached a $25 billion war supplemental to the appropriations bill. “If you put it as part of your Defense bill, I think you’re forcing [Defense] to move quicker because they want to get that supplemental passed.”

In addition to defense, other measures are also trickling through.

Sharon Cohen, a health care and biotechnology lobbyist at PodestaMattoon, points to BioShield legislation, which would provide a government market for vaccines and other products to combat a bioterror attack. The legislation is likely to be enacted this year.

“Instead of the big behemoth focus on a really extraordinary piece of legislation many years in the making, you’re seeing other things move in unique discrete areas,” says Cohen, a former lobbyist for the Biotechnology Industry Organization.

Frank Rapoport, a partner at McKenna Long & Aldridge, worked on the BioShield measure on behalf of such clients as the Human Genome Project and Aventis Pasteur. “Anything anti-terrorism,” he says, “is going to go through.”

And Bruce Heiman, a partner at Preston Gates Ellis & Rouvelas Meeds who has been working the massive postal reform effort, says the gridlock has actually helped move the legislation

along because members want to take something productive home to voters.

“It is still on track,” Heiman says. “The next step is action by the full House and Senate each. And we’re hopeful that that will occur this summer. The previous unanimous bipartisan votes show this is one of those few issues that Democrats and Republicans seem to be able to agree on.”

Joel Johnson, managing director of the Harbour Group, has been pushing hard this year for asbestos litigation reform—so far the measure has not come to fruition.

“Legislators who are going to stand for re-election are going to be judged on their accomplishments. The gridlock generally tends to break apart right after the August recess,” says Johnson. “I think it’s too early to write off a lot of stuff.”

Other lobbyists say they are hopeful that the Foreign Sales Corporation-Extraterritorial Income bill, aimed at promoting U.S. exports, will pass, after much maneuvering.

“I think you’re going to see a lot more movement this summer than you might have seen this spring or winter,” says Robb Watters, president of the Madison Group. “I think it’s going to be a really busy summer. That leaves a lot of room for negotiations and strategic planning when it comes to legislation. So I don’t look at that as a negative experience at all.”

Kate Ackley is the news editor for Influence. Her e-mail address is kackley@influence.biz.