Army of Capital Lobbyists Has Drawn $8 Million on Tobacco Fight

While the legislative battle over the proposed national tobacco settlement is just getting underway, Washington lobbyists already have hit the jackpot, pulling down nearly $8 million in fees and expenses for pressing the industry's views on tobacco issues during the first six months of this year.

The industry's multimillion-dollar payments to an army of nearly 30 law and lobbying firms come on top of several million dollars spent by their own corporate lobbying offices. Philip Morris Companies Inc., for instance, reported lobbying expenses of $5.9 million at its Washington shop during the same six months, although a spokesman said that includes payments to outside lobbyists and work on non-tobacco issues. R.J. Reynolds Tobacco Co. spent nearly $1 million on its in-house lobbying efforts.

Even seasoned Washington lobbyists were awed by the industry's push. "I would define a major battle as $1 million a year in reported lobbying costs," said J. Steven Hart, a well-connected Republican lobbyist. "So if you are spending this much, you are in a battle for your very existence."

Critics of such expenditures called the amounts staggering, especially when considered in tandem with the tobacco industry's campaign contributions. Common Cause reported yesterday that the industry gave $1.9 million to political party committees and another $575,000 to candidates in the first six months of 1997.

"It is a very disturbing but prime example of exactly what is wrong with the way Washington works," said Ann McBride, president of Common Cause. "With tobacco's back to the wall," she said, the industry has "pulled out all the stops in the way special-interest power is exercised in Washington-that is . . . big money contributions hand-in-hand with high-priced lobbyists."

The industry defended its actions, with one source saying, "Any company has the right to petition the government, and that is the way the system works."

Darienne Dennis, director of communications at Philip Morris's D.C. lobbying office, said that office spent more than $19 million in 1996. "I don't know how [that] will compare to the end of this year."

The expenditures were culled from the most recent lobby fee disclosures filed with Congress, which provide only estimates and do not break out how much was spent on specific issues.

The industry is in a monumental fight over the multi-faceted tobacco settlement reached on June 20 after three months of negotiations with anti-tobacco forces, including a coalition of state attorneys general, trial lawyers and public health representatives. In exchange for protection against certain lawsuits, the industry agreed to pay $368.5 billion over 25 years and to submit to federal regulation.

But so far the agreement, which must be approved by Congress and the Clinton administration, has garnered far more criticism than support. Girding for battle, the industry has teamed veterans of previous tobacco wars with newcomers, including the law firm of Verner, Liipfert, Bernhard, McPherson and Hand.

That firm has been the biggest winner among the lobbyists, reporting $4.7 million from the nation's four leading cigarette makers and United States Tobacco Co., which makes smokeless tobacco. Some of Verner, Liipfert's top Democrats, including former Texas governor Ann Richards, Harry McPherson and Berl Bernhard, have monitored the negotiations, lobbied the administration and Congress and worked to drum up support at the National Governors' Association conference in Las Vegas.

About $2.6 million of the total reported by Verner, Liipfert was paid out to pollsters, public relations firms and economists engaged in selling the settlement to the Washington establishment.

D.C.'s Barbour, Griffith & Rogers-which has reported $480,000 from the industry-was hired by the industry to work the Republican side of the aisle. It is home to former Republican National Committee chairman Haley Barbour.

The lobbying tasks-button-holing lawmakers, providing information to the gaggle of committees studying the deal and trying to persuade the White House to endorse the pact-have been spread strategically among scores of lobbyists with special experience or connections.

For example, veteran Republican lobbyist Charles Black Jr., whose firm Black, Kelly, Scruggs & Healey reported $120,000 in tobacco lobby fees, is trying to sell the deal to the Senate Commerce Committee, according to an industry source.

Anti-tobacco forces who helped negotiate the deal also have hired lobbyists to press their positions, including former senator Birch Bayh (D-Ind.), former representative Norman Lent (R-N.Y.) and several former House and Senate aides. So, too, have some of the deal's staunchest opponents, including Minnesota Attorney General Hubert H. Humphrey III, who has retained former congressmen Thomas J. Downey (D-N.Y.) and Rod Chandler (R-Wash.), who now have their own lobbying shop.

Few fee-disclosure reports have been filed by anti-tobacco lobbyists because the hirings were so recent, but a handful shows that their fees are dwarfed by the industry lobby expenditures. The law firm of Hogan & Hartson, for instance, reported income of $20,000 during the first six months to lobby on behalf of the American Cancer Society, which favors a settlement with major changes.