On July 24, 2009, the Obama administration issued a Memorandum that eased certain restrictions previously applied to lobbyists regarding non-written communications with executive branch employees about the distribution of stimulus funds under the American Recovery and Reinvestment Act of 2009 ("ARRA") (Public Law 111-5). The July 24 Memorandum superseded all prior written guidance issued by the Obama administration, including a March 20, 2009 Memorandum from the Office of Management and Budget ("OMB"), and eased some concerns expressed by interest groups following the distribution of ARRA funds. In order to help understand the relevant changes, this Alert discusses (1) the restrictions outlined in the March 20, 2009 Memorandum; (2) an overview of the relevant changes described in the July 24, 2009 Memorandum; and (3) the remaining restrictions imposed on federally registered lobbyists.

The Original Guidance from OMB Regarding Lobbyist Communications

On March 20, 2009, the OMB issued a Memorandum concerning the distribution of funds from the ARRA. To help ensure that the funds appropriated under the ARRA were distributed based on merit alone, Section 3 of the Memorandum placed unique and unprecedented limitations on communications between executive branch employees and those registered as lobbyists under the Lobbying Disclosure Act of 1995 (2. U.S.C. 1601). Those limitations included: no telephonic or in-person contact by a registered lobbyist on behalf of particular projects, applications, or applications for funding; all written contact from a registered lobbyist to an executive department or federal agency will be placed on the website "Recovery.gov"; and oral contacts between a registered lobbyist and an executive department or federal agency that are of a general nature are permitted, but will be subsequently documented on the website "Recovery.gov." These lobbying limitations caused significant concern among those interest groups tracking the distribution of stimulus funds released under the ARRA.

New OMB Guidance Issued July 24, 2009

After much protest from organizations such as Citizens for Responsibility and Ethics in Washington ("CREW"), the American Civil Liberties Union ("ACLU"), and the American League of Lobbyists ("ALL"), the Obama administration has changed course and will now allow lobbyists to meet and have telephonic discussions with executive branch employees regarding ARRA-funded projects. The July 24, 2009 Memorandum clarifies that the prohibition on oral communications between executive branch employees and registered lobbyists regarding specific ARRA projects will only apply during the period commencing after the submission of formal applications for, and up through the awards of, competitive grants or other forms of federal financial assistance under the ARRA.

Communications with lobbyists regarding the mere logistics of ARRA funding or its implementation are not restricted and need not be documented or posted on the Internet. Likewise, communications between lobbyists and executive branch employees held at "widely attended gatherings" need not be documented or made public on the Internet. In addition, the restrictions that remain in place have been expanded to include all persons outside the federal government (not just federally registered lobbyists) who initiate oral communications concerning pending competitive grant or loan applications under the ARRA.

Important Restrictions Remaining in Place

While the new guidance eases restrictions on communications held before or after ARRA funds have been awarded, the same restrictions described in the March 20, 2009 Memorandum remain in place during the period that the award is being considered. In other words, during the period of time commencing with the submission of a formal application by an individual or entity for a competitive grant or some other type of competitive form of federal financial assistance under the ARRA, and ending with the award of the competitive funds, executive branch employees still may not participate in oral communications initiated by any person concerning the pending application, whether or not the initiating party is a federally registered lobbyist. This restriction applies unless the communication is:

  • Purely logistical
  • Made at a widely attended gathering
  • To or from a federal agency official and another federal government employee
  • To or from a federal agency official and an elected chief executive of a state, local, or tribal government, or to or from a federal agency official and the presiding officer or majority leader in each chamber of a state legislature
  • Initiated by the federal agency official  

Conclusion

The most recent guidance from the Obama administration provided some relief to those concerned about the various restrictions preventing lobbyists from communicating with executive branch employees. The new guidance is a welcome change, but significant restrictions still remain in place.