February 2, 2011
Published in Business in Savannah
Congratulations! You now have lobbyists on your payroll.
A recent change in Georgia’s law has greatly expanded the definition of lobbyist. Businesses beware – your salespeople may now be considered “vendor lobbyists” if they “court city and county agencies to buy goods and/or services.” Additionally, if they pitch any agency considered a “local political subdivision”, they must also register as a lobbyist.
The 2010 Georgia General Assembly passed new legislation significantly changing the face and consequences of the Georgia Ethics Law, now in effect as of January 10, 2011. The Georgia Government Transparency and Campaign Finance Commission, formerly known as the State Ethics Commission, now requires all salespeople who court city and county agencies to buy goods and/or services to register as lobbyists and to file reports on expenditures. In the past, this mandate only included statewide agencies.
By expanding the definition of a “state agency” to include “local political subdivisions,” the realm of the state agency and vendor lobbyists now includes anyone who attempts to influence a local county, city or other municipal official in the selection of goods or services provided to the local government unit. With respect to state agency lobbyists, the term refers to anyone who is hired to influence the passage of any rule or regulation of any local county, city or other municipal government unit.
Traditionally, the definition of a lobbyist includes paid personnel who act as advocates for a particular legislative policy and lobby political representatives with regard to a particular issue, goods or services at the behest of another individual, business or organization. Today, the definition of a lobbyist has a much broader scope and individuals who once would have never considered themselves a political lobbyist may now be included.
On which side of the line does your business fall? It is essential for businesses and corporations to study these changes in the new law closely. Businesses found in violation of the lobbyist disclosure rules are at risk for fines that can be as high as $10,000 for a late filing.
The old saying, “The devil is in the details,” couldn’t be more true when it comes to the contradictory, complex and often perplexing language found in the legislation and opinions interpreting the legislation. In December 2008, an opinion issued by the Ethics Commission stated that a salesperson who contacts a state agency “on his or her own initiative” and not in correlation with their “explicit [job] duties,” would not fall under the vendor lobbyist definition.
A few months later, the Ethics Commission issued another opinion differentiating between “specifically hired” and “exclusively hired,” stating that the two were not the same and that influencing vendor selection does not have to be an “enumerated duty” to be considered a lobbyist and required to register as such. Confused yet? Me too. I anticipate a significant clarification from the Commission in early 2011.
As of today, a good rule-of-thumb includes any employee whose job duties, whether specific or understood, include communicating with a person on a government payroll with the intent to influence that person to select their employer for a goods or a services contract, will need to register as a lobbyist under the new law.
Employers need to pay specific attention to what “specific duties” and “understood duties” of their salespeople actually mean. A strong business plan will include a clear comprehensive distinction of the two to be sure that companies know which side of the lines their business now falls. Seek appropriate counsel when in doubt.
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