New disclosure requirement for grassroots lobbying. As you have probably heard, Proposition C, which San Francisco voters approved this month, requires businesses, nonprofit organizations and labor unions which spend $2,500 or more on “grassroots lobbying” during any calendar month to register and file reports with the Ethics Commission. The new law refers to these filers as “Expenditure Lobbyists.” This new filing requirement applies to situations such as:
- A real estate developer enlists residents to testify at a Planning Commission hearing in support of its project and spends $2,500 printing signs, buttons and T-shirts, chartering buses to City Hall, providing box lunches to attendees, etc.
- A nonprofit organization pays an economist $2,500 for a report about the impact of mental health issues on the criminal justice system, and sends the report to other community organizations in an effort to convince them to pressure the Board of Supervisors to increase funding for mental health services.
- Employees of a mobile meal delivery service spend time preparing and sending text messages and e-mails to its customers urging them to contact the Mayor and the MTA in support of a proposed ordinance to allow meal delivery trucks to park in bus zones.
Despite claims by some nonprofits that requiring them to file grassroots lobbying reports would impede their work, this disclosure requirement was previously part of the City’s lobbying law, and is a routine part of lobbying laws on the state level, and in San Jose, Los Angeles, San Diego, etc. The Ethics Commission removed this requirement when it switched to an electronic system a few years ago – not, as some argue, because the Commission is influenced by lobbying interests, but rather because the City’s IT department encountered technological challenges when trying to adapt the electronic filing system for grassroots lobbying reports.
The new law takes effect on February 1, 2016, so organizations which spend $2,500 or more on grassroots lobbying activities in February will have to file Expenditure Lobbyist reports by March 15, 2016. Organizations will be required to file paper reports via e-mail until the City develops an electronic filing system for Expenditure Lobbyist reports (if it is able to do so this time).
Businesses, nonprofit organizations and labor unions which currently do not have registered lobbyists must pay attention to this new disclosure requirement if their employees spend time attempting to organize citizens or community groups to work on City Hall matters, or if they pay for mailers or ads urging residents to contact their Supervisors or the Mayor. Lobbyists who are already registered will also have to pay attention to this new law if they encourage their clients to spend money on coalition building and outreach as part of a lobbying effort.
Potential lobbyist contribution ban. A local activist is planning a ballot measure for the June 2016 ballot to ban all campaign contributions from registered lobbyists to City candidates and elected officials. This proposal would bring San Francisco in line with laws on the state level and in Los Angeles – where registered lobbyists are prohibited from making campaign contributions to officials whom they may lobby. We do not know whether the measure will qualify for the ballot – but we are pretty certain that voters will pass it if it does.
New emphasis on lobbying law enforcement. After levying only one fine for a lobbying law violation during its first 15 years, the Ethics Commission has now made lobbying one of its top enforcement priorities. In just the last year it has levied four fines against lobbyists, ranging from $500 to $5,500 (as well as the $75,000 fine levied by the City Attorney’s office against former Supervisor Michael Yaki in 2013 for failing to register as a lobbyist). The Ethics Commission has also begun conducting random audits of lobbyist reports.
These fines and audits reveal that the Ethics Commission is targeting lobbyists for failing to report each and every e-mail which they send to City officials and employees, even when they disclose other e-mails and meetings on their reports. The fines and audits have also encouraged “gadflies” and political opponents, who have figured out that a simple Sunshine request for e-mails relating to a pending project, when compared to a lobbyist’s monthly filings, can lead to an Ethics Commission investigation and fine. Given this new emphasis on lobbying law enforcement, registered lobbyists should take time at the end of each month to make certain that they have reviewed all of their e-mails for potentially reportable lobbying contacts, accurately listed all fees billed to lobbying clients, and confirmed the campaign contributions they raised for City candidates and ballot measures.
New Executive Director. Finally, the Ethics Commission announced yesterday the hiring of LeeAnn Pelham as its new Executive Director. We worked with LeeAnn when she was the Los Angeles City Ethics Commission’s Executive Director; she is a terrific choice to lead the Commission, and we wish her all the best.
Feel free to call with any questions about these lobbying reporting requirements.
THIS ALERT IS INTENDED FOR GENERAL INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSTITUTE LEGAL ADVICE.