Spending on Annapolis Lobbyists Holds Up During Recession
Monday, August 3, 2009
With the state budget battered by the economy, most interest groups staggered away from this year's legislative session in Maryland with less than they wanted. But one profession emerged largely unscathed: the State House lobbying corps.
Lobbyists in Annapolis collectively made $24.7 million during the six-month period that included this year's 90-day legislative session, according to figures compiled by the State Ethics Commission. That was down about $400,000 from the year before, but the earlier six-month period was far busier. It included a high-stakes special session in which lawmakers raised taxes and passed legislation authorizing slot machine gambling after years of debate.
The new numbers out of Maryland provide some of the firmest evidence to date that State House lobbying appears to be a largely recession-proof business. Figures from Virginia have yet to be released, but veteran lobbyists in Richmond say they noticed no significant drop-off in activity during a session that featured battles between moneyed interests over a ban on smoking in restaurants and regulations affecting payday lenders and energy companies.
"I'm not aware of any dilution," said Charles J. Davis III, whose clients in Richmond include tobacco companies and health-care interests. "In fact, it wouldn't surprise me if it's gone up some."
In Maryland, 11 individual lobbyists reported earning $500,000 or more during the six-month period that ended in April, the same number as the year before.
In some respects, the recession appears to be helping the profession. Many businesses and nonprofit groups that are cutting costs elsewhere are loath to forgo hired help in state capitals for fear of what they might lose in a time of shrinking budgets.
"You need to be adequately represented when money is tight and the decisions are tougher," said Gene M. Ransom III, chief executive of the Maryland State Medical Society, the largest organization representing doctors in the state. "Advocacy is too important to cut."
In response to the recession, Ransom's group has laid off staff members and cut back significantly on social and networking events.
But during the six-month period that ended in April, the medical society spent $314,146 on lobbyists, up almost $20,000 from the year before. Its spending was second only to that of the Maryland Jockey Club, which operates two of the state's largest horse racing tracks and has been active on the slots issue for years. It spent $390,000 during the period.
The doctors group was involved in numerous battles during the past legislative session, including several involving rates paid by the state for medical services.
It also vigorously fought a bill proposed by Gov. Martin O'Malley (D) to make it easier to bring lawsuits against doctors and hospitals for alleged fraud. That bill, which died in the Senate, was also opposed by the Maryland Hospital Association, which spent $311,074 on lobbyists during the six-month period, up more than $60,000 from the year before.
Several lobbyists suggested that the relatively steady spending overall masked ups and down for individual lobbyists and their clients, some of which is attributable to the economy and some of which is not. "A couple of clients have had to cut back, while at the same time, we have also been fortunate enough to be retained by some new clients who had legislative needs, both related and unrelated to the budget," Joel D. Rozner said.
Rozner, the top-earning lobbyist in Annapolis during the six-month period, has more than 70 registered clients, including energy companies and real estate interests. Rozner reported earnings of $905,211 during the period, up more than $100,000 from the year before. Among the top 10 lobbyists in Annapolis, six reported higher earnings than the year before; four reported a drop-off.
Rozner's new clients included FedEx, which fought a bill cracking down on employers who misclassify workers as independent contractors, often to avoid providing benefits. Rozner and other lobbyists from his firm, who received $67,913 from FedEx, successfully sought amendments to prevent the bill from applying to companies such as FedEx, which argued that it was doing nothing wrong.
A group that hired an Annapolis lobbyist for the first time had less immediate success. The newly formed Maryland Marine Contractors Association hired Gerard E. Evans, a perennial top earner in Annapolis, to help roll back recent changes in state permitting requirements for such construction projects as piers and watercraft lifts. The group argued that the cost and time required to attain permits was undercutting members in tough economic times.
A bill pushed by the group did not pass this year, but a representative said the $26,000 it paid Evans was worth it. The group intends to try again next year.
"We couldn't do this alone," said Brandon S. Weems, the group's president. "We all have businesses to run."
The budget climate has also produced a steady demand for lobbying to preserve state spending on Medicaid. That program reimburses a wide range of providers, including doctors and nursing homes, and has been an inviting target for budget cuts.
"In these budget times, it's difficult for the providers to reduce their presence," said lobbyist Michael V. Johansen, who was second on the recent earnings list, at $736,502.
Some increased spending on lobbyists was completely unrelated to the economy or state budget. Marylanders for Restorative Justice, a group opposed to capital punishment, spent $223,856 during an unsuccessful push by O'Malley to repeal the death penalty. A bill that tightened evidentiary standards in capital cases was enacted instead.
The anti-death penalty group, which spent about $70,000 more than the previous year, retained lobbyists from two leading Maryland firms and outspent several corporate interests with a constant lobbying presence in Annapolis, including Constellation Energy and CareFirst BlueCross BlueShield.
Staff writer Anita Kumar contributed to this report.