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New Lobbying Disclosure Rules & Congressional Gift and Travel Rules Presented by Mayer Brown LLP Mary Streett Andrew Kugler Joe Seliga.

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Presentation on theme: "New Lobbying Disclosure Rules & Congressional Gift and Travel Rules Presented by Mayer Brown LLP Mary Streett Andrew Kugler Joe Seliga."— Presentation transcript:

1 New Lobbying Disclosure Rules & Congressional Gift and Travel Rules Presented by Mayer Brown LLP Mary Streett Andrew Kugler Joe Seliga

2 2 New Rules – New Consequences The Honest Leadership and Open Government Act of 2007 was enacted into law on September 14, The Honest Leadership and Open Government Act of 2007 was enacted into law on September 14, The law is far-reaching and significantly changes the system governing lobbyists and organizations that employ lobbyists. The law is far-reaching and significantly changes the system governing lobbyists and organizations that employ lobbyists.

3 3 New Rules – New Consequences Among the changes in the law: Among the changes in the law: –Bans gifts from lobbyists and lobbyist employers to Members of Congress and their staff –Significantly increases the frequency and scope of lobbyist disclosure (including with respect to contributions) –Holds lobbyists and lobbyist employers liable for improper gifts and disclosures

4 4 ENFORCEMENT - LDA Donor Liability – The Lobbying Disclosure Act (“LDA”) was amended to make lobbyists and lobbyist employers liable for providing gifts or travel known not to be permitted by Senate or House rules. Donor Liability – The Lobbying Disclosure Act (“LDA”) was amended to make lobbyists and lobbyist employers liable for providing gifts or travel known not to be permitted by Senate or House rules. Increased Penalties – The LDA was amended to increase civil penalties for violations and add criminal penalties (up to 5 years in prison and/or fines under Title 18 of the U.S. Code) for “knowingly and corruptly” violating the law. Increased Penalties – The LDA was amended to increase civil penalties for violations and add criminal penalties (up to 5 years in prison and/or fines under Title 18 of the U.S. Code) for “knowingly and corruptly” violating the law. GAO audits. GAO audits.

5 5 Topics New Lobbyist Disclosure Rules New Lobbyist Disclosure Rules New Gift Rules New Gift Rules Federal Campaign Contribution Limits and Corporate Facilitation Federal Campaign Contribution Limits and Corporate Facilitation

6 6 New Semi-Annual Disclosure LDA-203 Both Lobbyists and Lobbyists’ Employers (LDA Registrants) will be required to file a semi-annual report detailing political contributions, donations, and other expenditures made to, or for the benefit of, covered legislative and executive branch officials. The report will be due 30 days after the end of each semi- annual period. Both Lobbyists and Lobbyists’ Employers (LDA Registrants) will be required to file a semi-annual report detailing political contributions, donations, and other expenditures made to, or for the benefit of, covered legislative and executive branch officials. The report will be due 30 days after the end of each semi- annual period.

7 7 Contents of LDA-203 Certification – With each semi-annual report, lobbyists and lobbyist employers must provide a certification that: (1) they are familiar with the House and Senate gift rules, and (2) they have not provided, requested, or directed a gift (including travel) to a Member or staff in violation of such rules. Certification – With each semi-annual report, lobbyists and lobbyist employers must provide a certification that: (1) they are familiar with the House and Senate gift rules, and (2) they have not provided, requested, or directed a gift (including travel) to a Member or staff in violation of such rules.

8 8 LDA 203 Disclosures: Federal Political Contributions Federal political contributions made by the filer and any political committee “established or controlled” by the filer. Federal political contributions made by the filer and any political committee “established or controlled” by the filer. –The Corporation must report the contributions of its connected PAC. –Lobbyist that sits on the board of a PAC or is treasurer of a PAC must disclose applicable contributions and payments of the PAC on the lobbyist’s LDA-203.

9 9 LDA 203 Disclosures of “Other Donations” Payments to pay the cost of an event to “honor” or “recognize” a covered legislative or executive branch official. Payments to pay the cost of an event to “honor” or “recognize” a covered legislative or executive branch official.

10 10 Required Disclosures of “Other Donations” Example: The March of Dimes hold its annual dinner and invites Senator Clinton and Speaker Pelosi to be “honored guests.” Corporation contributes $3,000 to the March of Dimes for the dinner. Example: The March of Dimes hold its annual dinner and invites Senator Clinton and Speaker Pelosi to be “honored guests.” Corporation contributes $3,000 to the March of Dimes for the dinner. The Corporation would disclose a payment of $3,000 to the March of Dimes with the notation that Senator Clinton and Speaker Pelosi were “honored guests”. The Corporation would disclose a payment of $3,000 to the March of Dimes with the notation that Senator Clinton and Speaker Pelosi were “honored guests”.

11 11 Required Disclosures of “Other Donations” Example: The Corporation holds an event at the Mayflower with Senator McCain listed on the invitation as an attendee. Senator Obama is listed on the invitation as a speaker. The Corporation pays $10,000 to the caterer and $5000 to the Mayflower to partially fund the event. Example: The Corporation holds an event at the Mayflower with Senator McCain listed on the invitation as an attendee. Senator Obama is listed on the invitation as a speaker. The Corporation pays $10,000 to the caterer and $5000 to the Mayflower to partially fund the event. The Corporation would disclosure that it paid $10,000 to caterer and $5000 to the Mayflower for an event “recognizing” McCain and Obama. The Corporation would disclosure that it paid $10,000 to caterer and $5000 to the Mayflower for an event “recognizing” McCain and Obama.

12 12 LDA 203 Disclosures of “Other Donations” To an entity that is named for a covered legislative branch official, or to a person/entity in recognition of such official. To an entity that is named for a covered legislative branch official, or to a person/entity in recognition of such official. –Example: Lobbyist writes a check to the University of Texas to help endow the “Senator Kay Bailey Hutchinson Chair in Economics”: Reportable by lobbyist, including date, amount and name of member.

13 13 LDA 203 Disclosures of “Other Donations” To an entity established, financed, maintained, or controlled by a covered official; or an entity designated by such official. To an entity established, financed, maintained, or controlled by a covered official; or an entity designated by such official. –Example: Donations to Member associated charities: Reportable –Example: NRSC or DCCC retreat: Reportable as Federal Political Contribution if $200 or more

14 LDA 203 Disclosures of “Other Donations” To pay costs of a meeting, retreat, conference, or similar event held by, or in the name of a covered official To pay costs of a meeting, retreat, conference, or similar event held by, or in the name of a covered official –Example: After checking with the Senate Ethics Committee to make sure the payment was permissible under the gift rules, Corporation pays $10,000 to attend “Senator McCain’s Conference on Climate Change”: Reportable –Donations to Presidential Inaugural Committee or Presidential Libraries: Reportable 14

15 15 Internal Compliance Procedures Request/Record of Payments Request/Record of Payments Quarterly Sub-certifications Quarterly Sub-certifications

16 16 LDA REQUEST & RECORD OF PAYMENTS Payment Date 6/4/2008 6/4/2008 Amount of Payment $3,000 $3,000 Payee Address Purpose Purchase table at the Chamber of Commerce annual gala Name and Title of Federal Officials honored or Listed on Invitation. Senator Trent Lott, Secretary of State Rice Brief Description of Event Seated dinner for Speaking program and award ceremony. See attached program and invitation. Employees Attending Andrew Kugler Notes Payment Date Amount of Payment Check # Name of Requestor: __Andrew Kugler _______ Request Date: ____________________ Approved by: __Mary Streett__________________ Date: _________________________

17 17 CONTENT OF THE DIVISION SUB-CERTIFICATION I have read and am familiar with the House and Senate Gift Rules. I have read and am familiar with the House and Senate Gift Rules. I have provided copies of the House and Senate Gift Rules to the individuals in my division who are likely to have direct contact with Members of Congress or their staff, plan events where Members of Congress or their staff may be in attendance, or are in a position to approve expenses that may relate to activities involving Members of Congress or their staff. I have provided copies of the House and Senate Gift Rules to the individuals in my division who are likely to have direct contact with Members of Congress or their staff, plan events where Members of Congress or their staff may be in attendance, or are in a position to approve expenses that may relate to activities involving Members of Congress or their staff.

18 18 CONTENT OF THE DIVISION SUB-CERTIFICATION This division has not provided, requested, or directed a gift to a Member of Congress or their staff in violation of these rules. This division has not provided, requested, or directed a gift to a Member of Congress or their staff in violation of these rules. The attached “Lobbying Disclosure Act Record of Payments” contains the list of all funds paid, contributed or arranged by the division for the following activities during the period of certification: The attached “Lobbying Disclosure Act Record of Payments” contains the list of all funds paid, contributed or arranged by the division for the following activities during the period of certification: –Meetings, conferences, or similar events attended by, for the benefit of or named for any Legislative or Executive branch employee. –Any entity established, maintained, or controlled by any Legislative or Executive branch employee. –Presidential Inaugural Committees or Library Foundations.

19 19 QUESTIONS? Press *1 on your telephone For more information please contact us at: Mary Streett Andrew Kugler Joe Seliga

20 20 Topics New Lobbyist Disclosure Rules New Lobbyist Disclosure Rules New Gift Rules New Gift Rules Federal Campaign Contribution Limits and Corporate Facilitation Federal Campaign Contribution Limits and Corporate Facilitation

21 21 New Gift Rules Bottom line: With limited exceptions, lobbyists, entities that employ or retain lobbyists and foreign agents are prohibited from giving ANY gifts to Members of Congress or staff Bottom line: With limited exceptions, lobbyists, entities that employ or retain lobbyists and foreign agents are prohibited from giving ANY gifts to Members of Congress or staff –Ban applies to all employees of a company that employs or retains lobbyists Lobbyists must now certify compliance with gift rules Lobbyists must now certify compliance with gift rules Subject to potential civil and criminal penalties Subject to potential civil and criminal penalties

22 22 New Gift Rules What is covered? Meals Meals Personal hospitality Personal hospitality Discounts Discounts Entertainment Entertainment Transportation Transportation Lodging Lodging The term “gift” essentially means anything of monetary value, including—

23 23 New Gift Rules What is covered? Gifts to entities controlled by Member or staffer Gifts to entities controlled by Member or staffer Gifts to family and friends if— Gifts to family and friends if— –Given with the knowledge and acquiescence of the Member or staffer; and –Member or staffer has reason to believe they were given because of official position Charitable donations made at behest of Member or staffer Charitable donations made at behest of Member or staffer

24 24 Exceptions to Gift Ban Personal Friendship G ifts up to $250 based on personal friendship are permissible. Factors include— –History of the relationship –Tax deduction or reimbursement sought? –Similar gifts given to other Members or staffers?

25 25 Exceptions to Gift Ban Widely Attended Events Free attendance at conferences, conventions, dinners and other events is permissible if– Event is “widely attended”; Event is “widely attended”; Invitation came from sponsor of event; and Invitation came from sponsor of event; and Attendance is related to official duties Attendance is related to official duties

26 26 Exceptions to Gift Ban Other types of permissible events Appetizers only Appetizers only Charity Fundraisers Charity Fundraisers - Charity must be recognized by IRS - Charity must be recognized by IRS - Invitation must come from sponsor - Invitation must come from sponsor Fundraising and Campaign Events Fundraising and Campaign Events National Convention Events National Convention Events

27 27 Travel Ban Travel rules prohibit a company that retains/employs lobbyist from paying for officially connected travel expenses for Members of Congress and their staff, except under very limited circumstances that require pre-approval from the House and/or Senate Ethics Committees. Travel rules prohibit a company that retains/employs lobbyist from paying for officially connected travel expenses for Members of Congress and their staff, except under very limited circumstances that require pre-approval from the House and/or Senate Ethics Committees.

28 28 LDA 203 Semi-Annual Reports Applies to LDA registrants and individuals who have been listed as active lobbyists by their employer-registrant Applies to LDA registrants and individuals who have been listed as active lobbyists by their employer-registrant Must certify compliance with gift and travel rules Must certify compliance with gift and travel rules Subject to potential civil and criminal penalties Subject to potential civil and criminal penalties Best practices Best practices

29 29 QUESTIONS? Press *1 on your telephone For more information please contact us at: Mary Streett Andrew Kugler Joe Seliga

30 30 Topics New Lobbyist Disclosure Rules New Lobbyist Disclosure Rules New Gift Rules New Gift Rules Federal Campaign Contribution Limits and Corporate Facilitation Federal Campaign Contribution Limits and Corporate Facilitation

31 Federal Election Campaign Law

32 32 Federal Election Campaign Law: Contribution Limits for Individuals To Candidates: $2,300 per each election (a primary, a general, etc.) with biennial limit of $42,700* to all candidates To Candidates: $2,300 per each election (a primary, a general, etc.) with biennial limit of $42,700* to all candidates To Corporate or Non-connected PACs: $5,000 per individual, per calendar year, with a biennial limit of $65,500* to all PACs and parties (with no more than $42,700 going to state and local parties and PACs) To Corporate or Non-connected PACs: $5,000 per individual, per calendar year, with a biennial limit of $65,500* to all PACs and parties (with no more than $42,700 going to state and local parties and PACs) *Limit is indexed for inflation and adjusted at the beginning of each election cycle.

33 33 Federal Election Campaign Law: Contribution Limits for PACs To Candidates: $10,000 per election cycle ($5,000 for primary, $5,000 for general)* To Candidates: $10,000 per election cycle ($5,000 for primary, $5,000 for general)* To PACs: $5,000 per year To PACs: $5,000 per year To State and Local Parties: $5,000 aggregated to all party committees in a state per year (unless local committee’s independence can be demonstrated) To State and Local Parties: $5,000 aggregated to all party committees in a state per year (unless local committee’s independence can be demonstrated) To National Parties: $15,000 per year To National Parties: $15,000 per year * once multi-candidate status has been reached

34 34 Federal Election Campaign Law: Prohibited Contributions Contributions in excess of legal limits Contributions in excess of legal limits Contributions by corporations, labor organizations Contributions by corporations, labor organizations Contributions “made in the name of another”— including reimbursed contributions Contributions “made in the name of another”— including reimbursed contributions Contributions by non-citizens of the U.S. not admitted for permanent residence Contributions by non-citizens of the U.S. not admitted for permanent residence

35 35 Corporate Facilitation The rules generally require that any such use of resources must be paid for in advance by a source that may lawfully contribute under the federal campaign laws, such as the corporation's PAC, its employees from personal funds (within their lawful contribution limits), or the candidate's campaign. Advance payment is required for the use of a broad range of corporate resources, including: The rules generally require that any such use of resources must be paid for in advance by a source that may lawfully contribute under the federal campaign laws, such as the corporation's PAC, its employees from personal funds (within their lawful contribution limits), or the candidate's campaign. Advance payment is required for the use of a broad range of corporate resources, including: –staff time of corporate employees; –any corporate-owned lists, such as customer or supplier lists; and –food or other catering or services provided or arranged by the corporation.

36 36 QUESTIONS? Press *1 on your telephone For more information please contact us at: Mary Streett Andrew Kugler Joe Seliga


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