oversight

An Evaluation of H. R. 1180 in Terms of the Disclosure of Lobbying Activities

Published by the Government Accountability Office on 1977-04-06.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

                          DOCUOENT RESURS
00450 -   A1051999]
(An Evaluation of H. B. 1180 in Terms of the Disclosure of
Lobbying Activities]. April 6, 1977. 12 pp.
Testimory before the Hcuse Committee on the Judiciary:
Administrative Law and Goverrnental Relations Subcommittee; by
Robert F. Keller, Deputy Comptrcller General.
Issue Area: Federal Regulatory Activities (3000).
Contact: Office of the Comtroller General.
Budget Function: General Government: Legislative Functions
     (801) .
Congressional Relevance: House Committee on the Judiciary:
    Administrative Law and Governmental Relations Subcommittee.
Authority: H.R. 1180  94th Cong.). S. 2477 (94th Cong.). Energy
    Policy and Conservation Act. Federal Energy Administration
    Act of 1974. Federal Regulation of Lobbying Act of 1946.
    Impoundment Control Act of 1974.

          The administration ad enforcement of the Federal
Regulation of Lobbying act of 1946 has proved to be inadequate.
Replacing this act by adopting H. B. 1180 should el:iminate many
 of the present difficuties. Instead of the present annual
expenditure reqauirement the proposed bill specifies a inimum
quarterly expenditure that requires organizations to register
and report their lobbying activities. The bill also applies to
lobbying activities drected toward executive officials as well
as toward members of Congress. It would be advisable or the
bill's coverage also to extend to indirect cr grassroots
lobbying activities and to lobbying activities requested by a
third party. An additional advantage of the bill is its
requirement that both the lobbyist and the retaining
organization maintain records relating to the lobbying
activities. It is recommended that the lobbyists also be
required to furnish a breakdown of their income according tc the
various lobbied issues. The bill could be improved by
stipulating that the Comptroller General has civil enforc-ent
authority. Such a stipulation would place enforcement within the
legislative branch and avoid conflict between the Comptroller
General and the Attorney General. (LD)
           United States General Accounting Office
                   Washington, D.C. 20548

                                        FOR RELEASE ON DELIVERY
                                        Expected at 9:30 a.m.
                                        April 6, 1977


                        STATEMET OF

        ROBERT F. KELLER, DEPUTY COMPTROLLER GENERAL

                    OF THE UNITED STATES

                         BEFORE THE

SUBCOMMITTEE ON ADMINISTRATIVE LAW AND GOVERNMENTAL RELATIONS

                             OF THE

                 COMMITTEE ON THE JUDICIARY

                  HOUSE OF REPRESENTATIVES

            ON LISCLOSUPRE OF LOBBYING ACTIVITIES


Mr. Chairmani and Members of the Committee:

     I appreciate the opportunity to pr,:sent the views of the

.General Accounting Office on H.R. 1180 as requested in Chair-

man Rodino's letter to us.

     As you may know, on April 2, 1975, GAO issued a report

entitled "The Federal Regulation of Lobbying Act--Difficulties

in Enforcement and Administration."   Since its enactment in

1946, the Federal Regulation of Lobbying Act has been the

subject of continual congressional scrutiny and generally has

been judged to be ineffective.    In our report, we confirmed
this judgment.     We found the enforcement and administration
of the Act to be woefully inadequate and, in 1975, testified to

this effect before this Subcommittee and the Senate Committee

on Government Operations.     I   elieve the necessity for change
in the present law is now almost universally accepted.

                             H.R. 1180
     Mr. Chairman, we believe that H.R. 1180 constitutes a

marked improvement over the current lobbying act,     and should
eliminate most of    he difficulties that have arisen under the
present law.     I would like to make some comments about sug-

gested changes or areas of the legislation which we definitely

believe should be retained.

                         SCOPE OF-COVERAGE
Quarterly Expenditures

     The bill would apply to any "organization" that spends

in excess of $1,250 in any "cuarterly filing period" to retain

another person to engage in certain lobbying activities on its

behalf.

     Although we have no opinion on the appropriate minimum

expenditure that should be required before an organization

must register and report under a new lobbying law, a minimum

quarterly expenditure threshold does seem desirable.

     Quirterly expenditures are comparatively easy for organ-

izations that lobby to determine and for the administering

agency to verify.    A quarterly expenditure threshold is also


                              - 2 -
preferable, in our view, to an annual expenditure requirement.

With         nly an annual expenditure requirement, an organization

could delay registration for 1 year simply by delaying pay-

ment to the person retained to engage in lobbying. Disclosure

of lobbying actlrities to Congress and the public must be

timely to be effective. We think the quarterly expenditure

threshold in H.R. 1180 would accomplish this objective.

         11ne disclosure provisions of the bill also apply to an

organization that employs "at least one individual who spends

20 percent of his time or more in any quarterly filing period

*   *   *"   engaged in prescribed lobbying activities.   As indi-
cated earlier, other provisions of the bill establish a quar-

terly expenditure threshold for organizations that retain

rather than employ lobbyists.

         It should be recognized, however, that it may be diffi-

cult for an organization to determine and for the administer-

ing agency to verify when an employee has spent 20 percent

or more of his time engaged in lobbying. Further,         an organi-
zation could employ 20 individuals to spend 19 percent of

their time lobbying and escape the bill's registration and

reporting requirements. If just one individual, however,

were to spend 20 percent of his tilue       obbying, the employer
organization would be required to register and file lobbying

reports.




                                  -3-
Executive Branch Coverage

     H.R. 1180 would also require lobbying organizations sub-

ject to the bill to register and report as lobbyists when

they attempt to influence high-level executive branch offi-

cials with respect to any report,   investigation, or rule,
with certain exceptioas, as well as when they attempt to

influence the outcome of legislation. The present law only

applies to lobbying that is directed toward the Congress.

We think it especially wise that the disclosure provisions

of the bill currently cover lobbying directed at activities

of the executive branch which, like legislation, directly

affects the public. As we testified before this Subcommittee

on September 12, 1975, we see no convincing reason why the

executive branch is less susceptible than the legislative

branch to the pressure of special interest groups seeking

favored treatment.

     On this point, the bill does not cover lobbying of

legislative branch agencies such as the General Accounting

Office, Cost Accounting Standards Board, Office of Technol-

ogy Assessment, Congressional Budget Office, and others.      I
cannot speak for othnes but insofar as te General Acount-

ing Office and the Cost Accounting Standards Board are con-

cerned we recommend that they be covered by the bill.

     The provisions of the bill also apply to communications

made to influence the award of Government contracts.    In our


                            -4-
opinion, these provisions need clarification.     As presently
drafted, they arguably could be construed to require that a
company keep track of routine sales contacts where the commu-
nication involved merely relates to a company's performance
capabilities.
Grassroots Lobbying
     The disclosure provisions of the bill do not, however,
extend coverage to organizations whose sole lobbying activity
is indirect or grassroots lobbying. Indirect or grassroots
lobbying generally means encouraging the general public to
communicate to Congress or executive branch policymakers by,
for example, mass mailings.
     We suggest that this     ubcommittee consider extending the
bill's coverage to indirect or grassroots lobbying when the
total direct expenses of the lobbying exceed a specified
dollar amount.
Exempt Lobbying Communitcations
     Certain communications are specifically excluded from
H.R. 1180's coverage. For example, communications "made at
the request" of a Congressman are exempt from disclosure.
Presumably, this exemption is intended to be limited to com-
munications not only made at the request of but also made to
the requesting Congressman. If this is correct, we recommend
the provision be amended to remove the possibility that an




                            - 5 -
organization that lobbies Congressmen at the request of another

Congressman might escape the bill's disclosure requirements.

                        LOBBYING RECORDS
     E.R. 1180 would require lobbying oganizations and per-

sons retained by lobbying organizations to maintain records

relatirg to their lobbying activities. The fact that persons

retained by a lobbying organization will also be required to

maintain and preserve records should facilitate verification

of the lobbying organization's registration and reports, as

well as investigations of the organization's lobbying activi-

ties. Regulations governing the maintenance of records would

be issued by the Comptroller General. And t.he records would

be preserved for a period of at least 5 year..   The authority
to issue regulations governing the maintenance of records

is essential,   in our opinion, to establish fair, realistic

and necessary recordkeeving requirements as experience is

acquired in administering a new lobbying disclosure law.

                            REPORTS
     H.R. 1180 would require lobbyists to file quarterly

reports with the Comptroller General and the information

required in those reports would b ~= considerably more de-

tailed than the information required for registration.

    A report filed under H.R. 1180 would contain a descrip-

tion of the "primary issues" on which the organization spent

a "significant amount" of its lobbying efforts. Another bill


                            - 6 -
pending in the Congress would require a description of the 25

issues on which the organization spent the greatest portion

of its lobbying efforts and a general description of any other

lobbied issues.

     None of the bills, however, require lobbyists to report

their total ependiture for each issue they sought to influ-

ence. The amount of money expended by a lobbyist on a particu-

lar issue may be of interest to Congress and the public, at

least where the amount expended exceeds a certain dollar mini-

mum. For example, if a lobbyist organization spent a total of

$50,000 lobbying on 10 separate issues during a quarterly fil-

ing period, but $40,000 was spent on one issue, it seems, in

our opinion, that the Congress and the public should be aware

that $40,000 was expended to influence the outcome of just one

of the 10 lobbied issues.

                    POWERS AND DUTIES OF
                   THE COMPTROLLER GENERAL
     H.R. 1180 would designate the Comptroller General as the

official with primary responsibility for administering the

bill's lobbying disclosure requirements.

     The duties imposed on the Comptroller General would include

maintaining and making available to the public, for inspection

and copying, lobbyist registration statements and reports, and

compiling and summarizing the information contained in thes,



                            -7   -
reports in a meaningful and useful way. In addition, the Cc:,p-

troller General would be (mpowered to conduct investigations;

administer oaths and affirmations; take testimony by deposition;

issue subpoenas;    initiate civil actions for the sole purpose
of compelling compliance with a subpoena;       and render advisory
opinions concerning the bill's registration, recordkeeping, and

reporting requirements.

     These administrative powers and procedures should signi-

ficantly improve the effectiveness of lobbying disclosure and

eliminate many of the weaknesses of the current law identif'ed

in our report.     We do have a reservation, however, about one of
the duties the bill would impose on the Comptroller General.

     H.R. 1180 only authorizes the Comptroller General to pre-

scribe   "procedural rules and regulations." This 'procedural"

limitation could affect the timely implementation and effec-

tiveness of      new lobbying disclosure law.

     If, for examplF, a general principle concerning       .R.
1180's applicability evolved in a series of advisory opinions

and the Comp roller General promulgated a rule embodying this

principle, would a court enforce the rule on the theory that

it was "procedural" c- would the court hold that the Comptroller

General had exceeded his authority because the rule had sub-

stantive characteristics?

    We do not know precisely what effect the "procedural"

limitation may have on the Comptroller General's ability to

                             - 8
effectively implement a new lobbying disclosure lw. Thus, we
recommend that the "procedural" limitation be deleted from
the bill.
     There is one other limitation on the Comptroller General's
rule-making authority that we wish to mention.       All proposed
rules must be transmitted to the Congress before they may take
effect.     The bill provides that either House of the Congress
may veto the regulation within a prescribed time period.       These
veto provisions could prevent the timely implementation of
the bill as well as the issuance of urgently needed regulations.

                              ENFC)RCEMENT
     Finally, we would like t       discuss the enforcement provi-
sions irt H.R. 1180.    The methods of enforcement contemplated by
H.R, 1180 should eliminate many of the       nforcement weaknesses
identified    n our report.
     Under the bill, the Ccmptroller General would have investi-
gative authrity and limited authority to go to Court to enforce
a subpoena, a matter we alluded to earlier.
     It is the Attorney General, however, wiio would have the
exclusive authority to enforce the substantive provisions of
the bill through civil and criminal enforcement proceedings.
In addition, the Attorney     eneral would be empowered to defend
all civil declaratory    ci    s that challenged advisory opinions
rendered by the Comptro3       General on the applicability of the
bill's registration, recordkeeping, and disclosure requirements.

                              -9-
     We believe the administering agercy should be given civil

enforcement authority and we question whether H.R. 118u's

present allocation of authority between the Comptroller General

and the Attorney General would prove to be workable or effective.

Disputes undoubtedly would arise between the Comptroller General

and the Attorney General. The bill establishes no procedure

for resolving such disputes. Moreover, although the Comptroller

General would havy primary responsibility for implementing the

law, the Attorney General would have ultimate control because

he alone would have authority to go to court to compel

compliance.

     Similarly, advisory opinions issued by the Comptroller

General could be rendered meaningless if the Attorney General

failed to defend a declaratory action filed by a lobbyist

against tha Comptroller General.     In short, H.R. 1180 would

place the Comptroller General in the awkward position of having

his actions effectively overruled by the Attorney General.

     Mr. Chairman, it is for these reasons that we have con-

sistently stated before this Subcommittee and the Senate Com-

mittee on Government Operations that the agency responsible

for administering a new lobbying disclosure law should be

given civil enforcement authority.     This should, of c,,urse,

include the authority to go to court to defend civil      hallenges

to the Comptroller General's advisory opinions and to compel



                          -   10 -
compliance with the civil provisions of any new lobbying dis-

closure law.

       There is ample statutory precedent for authorizing the

Comptroller General to go to court in his own right or on behalf

of the Congress.   Specifically, the Energy Policy and Conser-

vation Act directs the Comptroller General to collect energy

information for the Congress and empowers him, through

attorneys of his own selection, to institute a civil action

to collect civil penalties or enforce subpoenas he issues

under the Act. Similarly,   the Federal Energy Administration Act

of 1974    uthorizes the Comptroller General to institute a civil

action to compel comoliance with subpoenas he issues under that

Act.   And the Impoundment Control Act of 1974 euthorizes the

Comptroller General t    bring a civil action in Fderal court,

again through   attorneys of his own selection, to ccmpel release

of impounded tudget authority.

       Irn short, we believe that vesting civil enforcement powers

in the Comptroller General will not only place the enforcement

of the legislative branch's information gathering power within

the legislative branch where it should be, but would,    in our
view, eliminate potential conflict between the Comptroller

General and the Attorney General.

       We do not believe, however, that the agency responsible

for administering a new lobbying law should be given cri.inal

enforcement powers.    As a general principle, enforcement of
 the Federal criminal laws through formal criminal proceedings

 is a function of the Attorney General.     We can see no reason
 for departing from this principle in the proposed lobbying

 legislation.

       Alternatives to vesting complete civil enforcement powers

in the Comptroller General have tLen proposed in the past,

most recently by S. 2477, a lobbying disclosure bill passed by

the Senate during the 94th Congress.      S. 2477 contained a pro-
vision authorizing the Comptroller General to institute a

civil action in Federal    court whenever, after notifying the
Attorney General, the Attorney General failed to bring a civil

suit within a specified period of time.     Although adoption of
this alternative would conceivably strengthen the enforcement

provisions of H.i.    1180, it would a.so enable the Comptroller
General to second-guess and effectively overrule the Attorney

General, and like the provisions of the present bill, could

cause needless friction between the Comptroller General and

the Attorney General.

      Ve recommend, therefore, that H.R. 1180 be amended to

vest in the Comptrol-er General civil enforcement powers,

including the authority to file civil enforcement actions

and to defend civil challenges to advisory opinions.

      Mr. Chairman and Members of the Committee, this concludes

our   statement.   We will be glad to respond to any questions
you have.
                             - 12 -