The debt ceiling deal signed last week has K Street buzzing about a resurgence of business for lobby shops that represent cities, counties, state universities, transit agencies and other local entities jockeying for the ear of the “super committee” that will decide how to cut $1.2 trillion in discretionary spending.
It’s unclear how the cuts will be dispersed among municipalities — a bipartisan group of 12 lawmakers will meet in September to propose a budget plan — but the uncertainty all but ensures the committee will be heavily courted by lobbyists fighting to preserve local programs on behalf of municipal clients big and small.
“There are going to be winners and losers because it’s not an across-the-board cut,” said Susan Lent, a lobbyist and partner at Akin Gump who represents public entities seeking federal funding for transportation, water and renewable energy projects.
In the past two months, dozens of municipalities from rural counties in the Pacific Northwest to the nation’s largest urban cities have retained lobbyists on various appropriations issues.
K Street heavy hitter Patton Boggs signed Miami-Dade County late last month, becoming the sixth lobbying firm to be hired by the county this year on housing, transportation and public works projects, according to an analysis by the Center for Responsive Politics. Patton Boggs was also hired by the city of Atlanta in June to lobby for airline and water infrastructure funding and transportation and homeland security appropriations.
In July, the Ferguson Group signed a spate of smaller counties: Sutter County, Calif. (transportation, water management and flood control appropriations), Umatilla County, Ore. (federal grants for the Eastern Oregon Trade and Event Center), and Madison County, Ind. (transportation grant for a bridge replacement project), according to an analysis by the Sunlight Foundation. The three are among more than 70 counties, cities, towns, transit authorities and water districts that have hired Ferguson, one of the go-to shops for small and mid-size municipalities, since January.
Lobbying firms that made their mark doing appropriations work for smaller cities or towns — which took a hit last year after Congress banned earmarks — may now be poised to rebound, said Ivan Adler, a headhunter who places lobbyists for The McCormick Group, an Arlington executive search firm.
“It’ll be interesting to see people who have done mostly appropriations whose business has gone down, and whether their business will be reborn,” Adler said. “It’ll be city versus city, issue versus issue for the money. Will that business be rejuvenated as cities fight for money?”
Barry Rhoads, president of Cassidy & Associates, expects so.
“I have not seen anyone yet from the groups we’ve worked with who believed it’d be in their best interest to retrench,” said Rhoads, whose firm’s key clientele includes colleges and universities. “In fact, I’ve seen people more attuned to Washington than ever because they believe at the end of the day with the cuts, there’s going to be dollars spent on certain essential items, in particular transportation. We’re seeing a pick up in pace in what people want us to do in Washington, particularly from people who don’t have offices inside the beltway.”
But smaller constituencies already struggling to funnel federal dollars to rural areas may face a steeper uphill battle, said Rich Gold, head of the policy group at Holland & Knight.
“In the current era of Congress not directing spending on projects, the big losers have been smaller rural governments to begin with because most money directed to federal grant programs on a competitive basis ends up going to large urban counties and top 100 cities,” Gold said.
Eliminating earmarks hurts smaller municipalities disproportionately, according to a study by the Ferguson Group. In 2006, federal money allocated for buses and bus facilities went to 441 local programs. In 2007, when the Dept. of Transportation distributed federal funding through the grant process, only seven grants were given — to six of the biggest cities in the United States. The number jumped up to 316 in 2008 when Congress resumed earmarking.
“Smaller communities will be out there pushing for their share, I just think it’s getting harder and harder,” Gold said. “Earmark reform was strike one. Now, the increasing pressure on domestic discretionary spending ... makes it even harder for them because federal agencies are going be looking to projects to give them more bang for their buck. To a large extent, that’s going to be larger projects impacting greater population areas.”