The coronavirus (COVID-19) pandemic poses profound threats to the health of individual Americans, to the U.S. economy and to long-established ways of doing business. In response, federal, state and local governments are considering a range of measures to combat the virus and the associated economic fallout, including the largest-ever federal stimulus package in the Coronavirus Aid, Relief, and Economic Security (CARES) Act
Events — including the drafting of legislation, the issuance of state executive orders and the award of state contracts — are moving at a lightning pace. But companies reaching out to federal, state and local government officials should keep in mind that, notwithstanding the crisis, such activities may trigger registration and reporting obligations under federal, state and local lobbying laws. As a general matter, lobbying laws operate at every level of government in the United States and often cover attempts to influence any form of governmental decision-making, including the promulgation of executive orders or regulatory guidance and procurement decisions.
Here are some key points to keep in mind for companies that are communicating with public officials during the COVID-19 crisis.
- Lobbying laws vary widely from jurisdiction to jurisdiction and potentially cover a broad range of contacts related to COVID-19 matters. Increasingly, state and local lobbying laws cover attempts to influence governmental procurement decisions. This is particularly the case where a decision circumvents established procurement processes and where contacts involve senior government officials (e.g., executive officers or their deputies). As a result, procurement decisions related to COVID-19 may be at an elevated risk of implicating state and local lobbying regimes. Lobbying laws also cover a range of actions by governors, mayors and other state and local executive officers. This potentially includes the decision to issue — or to relax — shelter-in-place or social distancing requirements issued via executive order or regulatory guidance regarding essential business activities.
- Before communicating with a public official, it is essential to know before you go what is required for lobbying registration and compliance. Lobbying registration thresholds differ across jurisdictions, and in some cases, a single meeting or communication may be sufficient to trigger registration obligations. Moreover, last-minute registrations are not always possible, as some jurisdictions require registration in advance of making a lobbying contact. Violations of lobbying laws can have significant reputational and legal consequences — up to and including debarment from government procurement and the reversal of favorable governmental decisions. Registration as a lobbyist can also result in a number of collateral consequences, including limits on gifts and campaign contributions, as well as heightened "revolving door" restrictions. Lobbying laws also vary widely in terms of registration exceptions, and in some cases, it may be possible to structure activities to avoid triggering registration.
- Lobbying laws are, by design, disclosure regimes. Rather than attempting to prevent stakeholders from trying to influence government officials, lobbying laws instead are intended to promote transparency for governmental decision-making, and legal exposure under lobbying laws typically is limited to circumstances where a party fails to comply with its disclosure obligations. Registration and reporting for lobbyists and/or clients frequently includes disclosure of 1) the lobbyist/client relationship and the issues being lobbied; 2) the lobbyist's compensation; 3) expenditures made in furtherance of the lobbying activities; and 4) who was lobbied (e.g., agencies or individuals).
- Lobbying registrations and reports are almost always accessible on a jurisdiction's website and are otherwise considered public information. Additionally, many jurisdictions publicly post information about enforcement actions.