Bloomberg News

Lobbyists Lurk, Use Jobs Maps to Woo Supercommittee Members

September 22, 2011

(Updates to add comment from lobbyist in 21st paragraph.)

Sept. 22 (Bloomberg) -- Stephen Brown is spending much of his time these days in places where he can bump into one of 12 people. He lurks in hallways, lingers in committee hearings and buys his way into fundraisers.

As a lobbyist for oil refiner Tesoro Corp., Brown is trying to protect his company from government budget cuts and tax increases that might be recommended by the dozen members of a deficit-reducing congressional supercommittee.

Brown is not alone. He’s part of a lobbying stampede on Capitol Hill as the supercommittee began its work to trim $1.5 trillion out of the federal deficit, cuts that have the potential to affect every corner of the U.S. economy. With such stakes, businesses and trade groups are using unconventional lobbying techniques to get their messages heard.

“We’re using pretty much every trick in the book to get in front of these guys,” Brown said in an interview.

One energy trade group is planning a bus tour through the panel members’ home states. The contractors’ lobby flew in more than 200 constituents to descend on the offices of lawmakers. Private equity and hospital organizations are showing committee members how many jobs in their districts would be affected by budget moves. A nursing home association is undertaking a multimillion dollar ad blitz.

Bottom Lines

“They’re going to be trying to protect their bottom lines,” said Bill Allison, editorial director at Washington’s Sunlight Foundation, which promotes government transparency. “I can’t think of an industry that won’t be affected.”

The Aug. 2 deal that averted a federal default gave the committee a Nov. 23 deadline for making recommendations, which would require congressional approval by the end of the year. If either step fails, $1.2 trillion in across-the-board spending cuts would be triggered over a decade, starting in 2013, affecting defense and non-defense programs equally.

Tesoro, based in San Antonio, benefits from a tax break for manufacturing that might be on the cutting block. The lack of “constraint” on the supercommittee when it comes to slashing programs or raising revenue is disconcerting, said Lee Fuller, a lobbyist for the Independent Petroleum Association of America in Washington.

“They could rewrite the entire tax code or entire entitlement statutes if they wanted,” Fuller said in an interview. “If you get seven members together, then you have a package that gets an up or down vote.”

Committee Members

Washington Democratic Senator Patty Murray and Texas Republican Representative Jeb Hensarling chair the committee. The other senators are Republicans Jon Kyl of Arizona, Pat Toomey of Pennsylvania and Rob Portman of Ohio, and Democrats Max Baucus of Montana and John Kerry of Massachusetts. Michigan Republicans Fred Upton and Dave Camp round out the House side, along with Democrats Chris Van Hollen of Maryland, Xavier Becerra of California and James Clyburn of South Carolina.

More than 180 people who have worked in the offices of the committee members have registered as lobbyists at some point, according to Legistorm, which compiles congressional data.

“There’s only a dozen members to lobby,” said Allison, who also expects an uptick in political donations to the group. “Normally this would be diffused over 535 members of Congress.”

Bus Tour

Industries are employing inventive tactics to get their message across. The Institute for Energy Research, a Washington group that promotes oil and gas development, and its American Energy Alliance advocacy arm are targeting five panel members with a bus tour through Ohio, Pennsylvania, Michigan and Montana. They’re also creating a website and seeking out anti- tax groups such as the Tea Party and Americans for Tax Reform for joint rallies.

“The supercommittee is going to be the only game in town and there are weighty issues to discuss,” said Tom Pyle, president of the institute, in an interview. “We want to be part of that discussion.”

Technology groups are joining forces to make sure lawmakers understand the importance of their industry and its job-creation potential, said Kevin Richards, senior vice president of the federal government affairs division for the Washington trade group TechAmerica.

The Task Force on American Innovation, an alliance of companies, universities and scientific societies, yesterday showed congressional staff a Power Point presentation on the components of an Apple Inc. iPad.

The idea was to show “the different pieces in it and how government research and development support helped create those innovations,” Richards said.

Fly In

The Associated General Contractors of America flew in constituents to argue their case for protecting and increasing spending on infrastructure. Some are pushing for a raise in the federal gasoline tax to support roadwork.

“Hopefully this shows a sense of urgency,” said Cedric “Butch” Brooks, a highway contractor from Puyallup, Washington, who took time away from his business to visit the Capitol and meet with Travis Lumpkin, a senior adviser to Murray, yesterday. “Nobody else is going to speak for us.”

The contractors had almost 200 meetings set up with lawmakers or staff in the last two days, and 30 of their members split up visits to Murray, Kyl, Baucus and Clyburn’s offices. The group coached Brooks and other contractors on how to talk to lawmakers and avoid being intimidated by the halls of power.

“If we’re not talking about our laundry list of ideas, we’re going to be left out of the mix,” said Jeff Shoaf, the group’s top lobbyist.

Private Equity

The private equity industry also is using constituents to make its case. Tagged by some as “corporate raiders” responsible for job cuts, the industry is trying to focus attention on how it helps the economy and away from a proposed tax increase on profit-sharing known as carried interest.

Its trade group, the Private Equity Growth Capital Council, created a picture of the states and districts where the companies owned by private equity firms reside and employ workers. A Sept. 8 report sent to Kerry, Murray, Portman and Toomey showed that their states are in the top 16 for private equity investments. On the House side, Camp’s Michigan district ranked 17th nationally.

Portfolio Companies

Now, the council is trying to arrange in-district visits with plant managers and lawmaker meetings for local company chief executive officers. That means fewer visits by executives from New York firms such as Blackstone Group LP and KKR & Co., and more from the companies in their portfolios that have local influence.

While the council won’t say which companies it plans to bring in, the range in private equity portfolios spans from SeaWorld Parks & Entertainment Inc. to Toys “R” Us Inc. The industry knows it’s hard to get noticed.

“It’s going to be difficult to have the same kind of impact in D.C. as you would under normal circumstances,” said Steve Judge, the interim CEO of the Washington industry group.

With entitlements and Pentagon spending at the top of the list for cuts, health-care companies and defense contractors are echoing the private equity industry’s jobs theme.

The American Hospital Association, based in Chicago, has put together a list of how many workers hospitals employ in each congressional district. The group also released an analysis on Sept. 9 that found the automatic cuts to the Medicare health program for the elderly might cost as many as 194,000 jobs.

The American Health Care Association, the Washington-based lobby group for nursing homes, including Kindred Healthcare Inc. and Sun Healthcare Group Inc., is responding with millions of dollars of television and print advertisements, along with visits by industry executives, nurses and patients to the home districts of targeted lawmakers.

An August ad from the group features nurses taking care of patients. “We understand the need for sacrifice, we’ve given our fair share, and more,” one of the nurses says.

--With reporting from Angela Greiling Keane, Richard Rubin, Juliann Francis, Drew Armstrong, Jonathan Salant and Roxana Tiron in Washington. Editor: Jeanne Cummings

To contact the reporters on this story: Kristin Jensen in Washington at kjensen@bloomberg.net; Jim Snyder in Washington at jsnyder24@bloomberg.net

To contact the editors responsible for this story: Timothy Franklin at tfranklin14@bloomberg.net


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