Lobbying Disclosure Act of 1995: A Summary and Overview for Associations

5 min

On December 19, 1995, President Clinton signed into law the Lobbying Disclosure Act of 1995 (P.L. #104-65)(the "Act"), which took effect on January 1, 1996. The Act significantly overhauled the prior legal framework governing lobbying registration and reporting in an attempt to provide greater public disclosure of who is lobbying on what issues, on behalf of whom, and for how much.

As expected, the Act has greatly increased the number of registered lobbyists and the amount of information they must disclose. This article briefly discusses the Act's major features and their application to trade and professional associations and other nonprofit organizations.

A. Who Is a Lobbyist?

For purposes of trade and professional associations and other nonprofit organizations, the Act defines a "lobbyist" as an employee who makes more than one "lobbying contact" and spends at least 20 percent of his or her total time lobbying on behalf of the organization. An exception is provided, however, for organizations whose employees lobby on its own behalf and whose lobbying expenses are less than $22,500 (indexed for inflation) in the six-month reporting period. While associations are not themselves considered "lobbyists," they must register on behalf of their employees that lobby. Outside, retained lobbyists have their own independent obligation to register and report as to their lobbying on behalf of their clients.

B. Lobbying Activities and Lobbying Contacts

The Act defines a "lobbying activity" as any action taken in support of a lobbying contact, including planning and preparation, research intended for use in the contact, and coordination with other lobbyists. A "lobbying contact" is defined as any oral or written communication to a "covered legislative or executive branch official" regarding the following matters: 1) the formulation, modification or adoption of federal legislation, including legislative proposals, or of executive branch policies, including rules, regulations and executive orders; 2) the administration or execution of a federal program or policy; and 3) the nomination or confirmation of any person who requires Senate confirmation. "Covered officials" under the Act include Members of Congress and all legislative (as opposed to administrative) staff, and cabinet secretaries, executive branch political appointees, and other high-level executive branch officials.

The Act provides exceptions from the definition of "lobbying contact" for communications by public officials and media representatives in the course of their work, communications disseminated to the general public, communications which are legally required to be kept confidential, and certain other types of communications. In addition, "lobbying contacts" do not include communications made in a variety of official settings, including administrative requests for information, testimony before a committee of Congress, comments regarding a proposed rulemaking, communications made on the record in public proceedings, and legally compelled communications, among others.

Despite these exceptions, the Act encompasses numerous activities, the most important being its coverage of congressional staff and key executive branch officials. In addition, the Act's definition of "lobbying activities" for the purpose of calculating lobbying expenditures includes amounts expended for all activities in support of lobbying, not merely the amount expended for making a direct lobbying contact. One important activity not covered by the Act is "grassroots" lobbying, where the advocacy is directed at the general public to influence policy decisions.

C. Registration

For associations and other nonprofit organizations, within 45 days of the date the lobbyist (e.g., employee) first makes a lobbying contact for the organization, the organization must register the lobbyist(s) with the Secretary of the Senate and the Clerk of the House of Representatives. Each registration must include the name and address of the following entities: 1) the registrant (organization) and its employees meeting the criteria as "lobbyists," including a general description of the organization's activities; 2) any other organization that contributes more than $10,000 in the six-month reporting period toward the registrant's lobbying activities and "in whole or major part plans, supervises or controls" those activities; and 3) any foreign entity connected with the registrant in various ways. Each registration must also include a statement of the general issue areas about which the registrant expects to lobby and any specific issues the registrant's lobbying has already addressed or is likely to address. Finally, the registration must disclose the name of any lobbyist the registration covers who, in the two years prior to first lobbying for the registrant, served as a covered legislative or executive branch official, and the position he or she held.

D. Reporting

In addition to the initial registration, every organization that employs lobbyists must file semi-annual reports with the Secretary of the Senate and Clerk of the House. Each report must contain the names of the organization's lobbyists (e.g., employees), any changes to the information in the lobbying registration, certain information about each general issue area in which lobbying occurred during the reporting period, and a good-faith estimate of the organization's total lobbying expenditures. Many tax-exempt organizations will be able to meet their obligations for estimating lobbying expenses through use of alternative approaches. Specifically, 501(c)(6), 501(c)(5) and 501(c)(4) organizations subject to the lobbying tax law (IRC &#sect; 162(e)) may use the same lobbying definitions and expense estimates used for those purposes for their reports filed pursuant to the Act. Section 501(c)(3) organizations that have elected the percentage test for allowable lobbying (the so-called "501(h) election") may use the definitions of lobbying and expense totals used for those purposes for their reports filed pursuant to the Act.

E. Enforcement

The Act provides that any person or organization who fails to remedy a defective filing within 60 days after notice from the Secretary of the Senate and/or Clerk of the House, or who fails to comply with any other provision of the Act, is subject to a civil fine of up to $50,000.

F. Public Access to Information

The Act requires the Secretary and Clerk to maintain a publicly-available list of all registered lobbyists, lobbying firms and lobbying clients; make registrations and reports available for public inspection and copying; and retain such registrations and reports for six years.

G. Miscellaneous Provisions

The Act contains a number of miscellaneous provisions concerning required oral disclosures by lobbyists, required disclosure by covered officials, a prohibition on federal funding (including grants) to any 501(c)(4) organization that lobbies, an exemption from foreign agent registration for those who register under the new law, and an alteration to the so-called "Byrd Amendment."