Lobbyist lowdown: building a productive relationship with your contract lobbyist.

AN ISSUE ON YOUR ASSOCIATION'S RADAR SCREEN JUST EXPLODED unexpectedly in the newspaper; another association executive just called wondering if you were aware of your contract lobbyist's conflict of interest; your PAC checkbook is depleted even though you've never presented a check to a legislator yourself; and you can't fire your contract lobbyist because he or she has become too chummy with some of your board members.

Is all of this possible? Yes, unfortunately. Is it avoidable? Absolutely. By applying some basic management techniques and being aware of some potential pitfalls, you can get the best results from your contract lobbyist.

Contract lobbyists can be a great benefit to any government affairs program. Larger associations can use them to handle big projects and even mentor staff. Smaller associations may find that they can gain instant access and quickly match the clout of political adversaries.

For example, suppose a pharmaceutical association is suddenly faced with a tax on prescription drugs to pay for road improvements, but its veteran in-house lobbyist has just retired. The association would probably consider hiring different lobbyists to maintain access to various players (e.g., senators, representatives, key committee chairs), and to gain access to areas that are outside the organization's normal sphere of work (e.g., transportation committee members). The association also might want a contract lobbyist who can mentor a rookie in-house lobbyist. A political opponent, such as an organization representing the highway construction industry, would be likely to hire contract lobbyists for the same reasons.

Increasingly associations--particularly state organizations--are turning to contract lobbyists to realize the benefits just outlined. Two developments have hastened this evolution. First, state governments have grown. In the past 20 years state budgets have ballooned, and the federal government has ceded more local control of key issues to statehouses. In my home state of Minnesota alone, the number of lobbyists has nearly tripled since 1980, and spending by clients and lobbyists alike has increased 16 times. Second, the measure of success for many association executives, like it or not, has gradually become increased member services and stronger finances. This is especially true for small associations; although their resources may be strapped, they still carry the burden of members with high expectations. Since they can't be at the capitol and managing member services simultaneously, many executives have turned to a ready surrogate: the contract lobbyist.

Unfortunately, many association executives find contract lobbying something of a mystery. More than any other consultant you may hire, the contract lobbyist is difficult to manage. While contract lobbyists and association staff lobbyists may share a similar working knowledge of political processes and association issues, contract lobbyists are rarely seen at the association offices, defer to many bosses, and have priorities that rise and fall given the situation. If you have minimal knowledge of government affairs or the people in it, you can be left feeling helpless--relying almost blindly on your contractors to guide you through a labyrinth of protocol, rules, precedence, unique customs, and complex interrelationships to achieve their goals. With the stakes for your association high--such as passage or defeat of an important piece of legislation--skillful management of your contract lobbying resources is critically important.

Set expectations

Effective management of a contract lobbyist begins during the hiring process with an assessment of your expectations.

Start by asking yourself a simple question: What are you trying to accomplish? Are you trying to pass legislation, which is often a demanding job, or defeat legislation, which is typically easier? Or, are you just looking for the easiest of lobbying duties: monitoring legislative activity? Many associations face obstacles as they seek to affect the actions of a state agency, particularly rulemaking or administrative actions. Both the legislature and an agency will follow specific but often very different rules.

With your goal established, it begs the next question in this influence game: Who do you need to influence to achieve this goal? Most state legislatures have two deliberative bodies: a house and a senate. Do you need to influence one (trying to stop legislation) or both (trying to pass a law)? Will you need to influence a broad range of committees or a select few? Also, how do state agencies play into your plans? Is the governor's office or other statewide officials, such as an attorney general, a factor?

The last question before you begin to hire a lobbyist is simple, but important: What type of lobbying is now required to obtain your goal? Do you require access to key legislative leaders? Or, do you need a level of expertise on an issue because of its complexity? For instance, working on tort reform is not something that everyone can do. Are you looking for broad coverage of every legislator or a narrower focus on specific committees? Finally, are you in need of strategic help in addition to the daily grind of lobbying? Often these questions will hinge on the level of controversy your issue may bring.

Examine background

With your goals laid out before you and your needs clearly defined, it is now possible to start screening lobbyists. Start with their background. It is an inescapable fact that most lobbyists grew into their jobs through some sort of prior political activity. Campaign work is not an essential prerequisite, but from campaigns grow access and influence for potential contract lobbyists. Make sure that if they did work for a candidate their party affiliation will fit your needs. Also, remember that legislatures are amoebae-like creatures, constantly changing and evolving into new dynamics as lawmakers come and go and others rise in seniority. Some may be more familiar than others with you and your issues. If a potential contract lobbyist claims political activity, make sure it was recent and benefiting a sitting legislator.

Contract lobbyists come in many different flavors. They are men and women of diverse backgrounds, with different strengths, skills, and stature. Here are a few common circumstances you may find.

* Lawyers: It's nice to have lawyers involved, especially when an issue requires complicated bill drafts or legal interpretations. But remember that lobbying is a separate skill and a law degree does not automatically yield greater success.

* Lobbying firms: Occasionally lawyers or nonlawyers will band together but focus more on lobbying than law. They bring the strength of diverse backgrounds and the ability to cover every ideological corner of the capitol. However, it often takes a deep client list to support such a firm and there is a greater risk of conflicts of interest.

* Lone wolves: Stand-alone lobbyists with no firm or associates behind them should never be discounted. Their solitude often makes them nimble enough to keep up with big firms and they have usually, out of necessity, developed excellent information networks. They can also nicely round off a team of lobbyists that an issue may require.

* Niche lobbyists: Some contract lobbyists focus on specific issues areas (e.g., appropriations, environment, education) and can be extremely effective in their area of expertise. They have the added benefit of being a quick study to the association's issue. They can help you avoid a potential waste of important time by not having to learn an issue while on the clock for you. Just make sure their niche matches the association's needs.

* Former legislators and staff: Access and knowledge of process are key to any successful effort, and hiring someone who used to be on the inside is often the best way to get that done. Ensure that their ability to pitch the association's needs are present and that party match-ups are correct.

* Elite lobbyists: A rare breed, but every state has a few. These are lobbyists who have the luxury of picking the projects they wish to work on. They can afford this because their depth of contacts and track record with issues grant them an equally deep client list. Any of the lobbyists described here can be elite lobbyists. These individuals value time above all else. They can be very effective but may not want to spend a tremendous amount of time in client meetings away from their sphere of influence: the capitol.

It is possible that you will need more than one firm to combine and complement the strengths of the different lobbyists you have identified. If you use several firms or more than one lobbyist from a single firm, make sure you identify a lead lobbyist. This person should serve as your primary contact to the lobbying contingent. This is important, not only for your communication but for communication among your lobbyists as well.

Research the lobbyist

Use a simple research technique that is all too often ignored: Pick up the phone. Call those very same legislators you want your lobbyists to work with and ask them about the lobbyists' access, respect, and reputation. Focus especially on those in leadership positions. As a courtesy, be sure to inform the potential contract lobbyists that you are conducting these calls. They will undoubtedly object to this tactic, insisting that you are upsetting the delicate balance of individual relationships. Nonsense. If the relationship is that tenuous, it will likely never hold up to the rigors of a legislative session anyway.

Legislators themselves will appreciate this call. After all, if you are planning on besieging them with some issue, they will want you to hire someone they can work with. If your contract lobbyist is blacklisted, unwanted, or mistrusted by a key legislator, it's important to know that up front--not after you're deep into your issue.

Call some fellow association executives as well. Look for colleagues who may have faced similar situations and gain from their experience.

Pinpoint conflicts of interest

Conflicts are an unavoidable reality in lobbying, and the bane of the contract lobbyist's existence. Conflicts of interest exist when one lobbying firm represents diverse sides of the same issue. For example, when the Minnesota Automobile Dealers Association, St. Paul, sought changes in its franchise law several years ago, the law firm representing the manufacturers who opposed the bill also represented the deputy registrars who supported the bill. The Minnesota Deputy Registrars' Association, Rochester, decided to retain the contract lobbyist despite the conflict, but today the organization is represented by a different firm.

Conflicts may be obvious at the start, such as a lobbyist working for a fireworks association and a fire marshals association. Or, conflicts may arise after relationships are already established. One lobbying firm may represent a professional baseball team and the state restaurant association. Under normal circumstances this would not represent a conflict. However, if the baseball team decided to move forward with a proposal to build a new stadium and pay for it with a tax on restaurant food, which the association is opposed to, that would be a conflict of interest. The lobbying firm cannot represent both sides of the issue.

The existence of conflicts does not always mean the end of a lobbying relationship. That will depend on the scope and degree of conflict. You may decide to relax conflict rules to avoid losing your lobbyists, especially if the conflict is not wrapped around a central or consequential issue. For example, the lobbyist representing the fireworks association may work for the fire marshals association only for the purpose of passing a law for tougher fireproofing on children's pajamas. Since the fireworks association may not care, or may even support this bill, they may decide to allow the lobbyist to represent both traditionally opposite interests.

Like any other problem in association management, conflicts need to be managed. Communication and anticipation are the keys.

First and foremost, the association staff should decide if there is a conflict--not the lobbyists. Demand that all existing clients and any new clients and their issues be disclosed immediately. Law firms are generally better at checking for and disclosing conflicts because local bar associations demand it. But it should never be taken for granted. Many states require registration of lobbyists and some even post lobby-client relationships on the Internet. Check with your appropriate regulatory authority.

Second, try to anticipate the future. It is difficult to know what will happen in the course of legislative battle, but you can anticipate with a better degree of accuracy your reaction to news of conflict. Be clear at the outset what your reaction will be if conflicts occur (e.g., dismissal, reduced pay, shortened length of contract, activation of other lobbyists, etc.).

Besides the traditional conflicts over issues, here are some other conflict scenarios you may encounter at the capitol:

* The paper wall is a common method some firms will use to solve a conflict of interest. Under this scenario, the firm may insist that since the two conflicted interests are being represented by two different lobbyists within the same firm, there is no conflict. This is more illusion than practical argument. As long as the firm is sharing income, expenses, and resources, the lobbyists will not be capable of making unadulterated judgments about their shared clients' best interest. A conflict is a conflict.

* Watch for committee pile-ups. These occur when a single lobbying firm has several different clients besieging the same legislative committee. The clients themselves may not constitute a conflict, hut the fact that the contract lobbyists keep appearing in front of the same group of lawmakers advocating their cases can cause a problem. The well of a lawmaker's goodwill can run dry and you don't want your issues to he last or the one that legislators "trade away" in favor of some other client.

* Project work is unique to states with set periods of adjournment. As deadlines approach, many lobbyists will be hired by interests whose issues are getting down to the wire for approval or defeat. Typically contract lobbyists, who trade off their relationships and knowledge of the legislature, will charge considerably more for this late-session demand. It is the association's job to make sure that its interests aren't lost in the late-session shuffle.

Do not assume that you have no leverage when pitted against a deep-pocket, monied interest vying for your lobbyists' attention. While the glamour of a big issue and quick money is tempting, many contractors understand that it's the trade associations and professional societies that have a long history at the state capitol. Contract lobbyists are also businesspeople, and they will make sound business decisions based on the coming years as well as the current session. The associations, if treated with respect, will be around for the contractor tomorrow providing steady income and leads for other clients.

Ask for reports

It's an electronic age, and there is no reason to he left wondering what's going on at the capitol. Your contract lobbyist should always be within easy reach of you by pager or cell phone. Once you hire a lobbyist, insist on regular reports. It is not unreasonable to expect your lobbyist to touch base before events happen, such as when schedules are posted. It is especially important to he contacted after key events such as hearings, floor debates, and even press conferences. Besides keeping you up to date, and therefore helping you keep your board up to date, this habit will have the added benefit of conditioning the contractor to always be where the action is. A written end-of-session report should be easy for the lobbyist to accomplish, but as with day-to-day communication, set up a system and agree on it early to avoid missed connections later.

Know campaign contribution rules

The association executive who claims that PAC money or conduit funds are easy to raise is a rare thing. Access to political money is hard won and is a huge asset. No matter how much contract lobbyists will claim to represent your interests with a legislator, and may even try, they can't. Unfortunately, contract lobbyists simply represent too many interests. It is unreasonable to expect candidates for office to distinguish that the lobbyist is wearing the hat that represents you when accepting a check from your contractor. Even under the best circumstances, the lobbyist (and by default all his or her other clients) will get some measure of the credit for the donation. Do not let contract lobbyists distribute PAC funds or any hard-earned political money. (This applies to 501(c)(6) organizations, the only ones eligible to operate PACs.)

However, be mindful that your contract lobbyists can still provide important access. If they request funds for a candidate, don't snub them. To get the most mileage out of your political funds, make sure that you, your staff lobbyist, or your members are present with the contractor when money is presented.

Remember who's boss

If the preceding is too much detail or may not work for your particular situation, two rules will, if followed, ensure the job security and well being of any association executive.

First, your contract lobbyists work for you. They exist to accomplish organizational goals, and ultimately their achievements are part of an overall staff effort that must reflect well on everybody. That contract lobbyists should have only an arm's-length relationship with the association board is essential. Contract lobbyists are skilled at ingratiating themselves with people and gaining their confidence. It is what their entire careers are based on and should not be underestimated. Many an association executive has found out too late what can happen when his or her contract lobbyist suddenly has an overstated importance within their organization. If your contract lobbyists become cozy friends with your board members, your control of those consultants will gradually slip away. Once they are in tight with board members, they are harder to manage and hold accountable. Ideally, the contract lobbyist should be briefing the association staff. The staff should then brief the board on political and legislative deve lopments.

Second, there should never be any surprises. A contract lobbyist surprised by events at the legislature has dropped the ball and is no longer worthy of the association's employment. Mistakes can get made, legislative battles can get rancorous, even lost. All of those are the risks you face when you engage in government affairs. But a surprise in the form of a headline the next day or a successful amendment out of the blue should never occur. State capitols, even in the nation's largest states, are small communities. A successful legislative effort requires selling ideas and garnering support. This is true for both associations and their opponents. Any contractor who is not able to pick up on those signals and is surprised by events is either overextended with other clients, has not established an adequate network, or is simply lazy. An unexpected event should be a red flag that you might not have the best person in place for the job.

If managed correctly, good contract lobbyists are worth their weight in gold to the association. They bring an outside perspective to issues, can train staff, provide access, help spot pitfalls, give advice and counsel, and contribute to the organization's overall success. Executives who effectively manage and have confidence in their contract lobbyists will find satisfaction and success in this arena.

RESOURCES

For more information about contract lobbyists and association lobbying in general, cheek out these resources from ASAE. To order publications, contact the Member Service Center by phone, 202-371-0940 or 888-950-ASAE; or by e-mail, service@asaenet .org.

* Guide to State Legislative Lobbying, by Robert L. Guyer (2000, ASAE). Request product AMB-250352; $50 for members and nonmembers.

* Lobbying by Associations (1998, ASAE). Request product AMB-121071; $44 for members, $66 for nonmembers.

For additional information, contact ASAE's Government Relations Section at [e-mail].

Scott Lambert, CAE, is a registered lobbyist and executive vice president of the Minnesota Automobile Dealers Association, St. Paul. E-mail: [e-mail].