David Poole and his team at VPAP have provided another illustration of how the reporting requirements placed on lobbyists at the state Capitol are intentionally vague and useless. The chart above deals with the reports on lobbyist compensation.
This is usually the figure at the heart of the occasional stories about the amount spent by an individual company, or the gross amount spent on lobbying by all who file these forms. But in practice almost nobody reports in full what they are paid, and they of course do things other than lobbying with their time. So they pro-rate their fee and salary and report only a portion of it.
Who draws the line? Who picks the formula for pro-rating the time? The lobbyist or the principal do so for themselves and are never asked to report their rationale. That’s why comparisons are impossible – some report 5 percent and some 100. Partly there is the natural reluctance everybody has to reveal their income, but there is also a reluctance to stand out as a big spender on charts like those produced by VPAP or in a news story.
A Peek Inside the Process
Years ago, one of the best lobbyists I ever worked with, a fine lawyer, instructed me that only the time I spent talking or writing to a legislative or executive branch official about a specific bill or vote was lobbying. The time I spent researching the issue, drafting legislation or talking points, driving to the meeting, sitting in the anteroom – none of those hours, the bulk of the time, constituted lobbying. The ten or fifteen minutes in the room, that was the only actual lobbying.
This all flows back to the very narrow definition of lobbying in Virginia law, which does not get into indirect lobbying or grassroots lobbying or lobbying preparation, all things that come up when companies are deciding what is and isn’t lobbying for federal tax compliance purposes. This situation is too ridiculous to be accident or oversight, and extremely convenient for both the lobbyists and the lobbied.
Compensation is not that relevant. What matters far more, the real glaring gap in the reports, are the details about what specific subject matters, bills, budget amendments, gubernatorial appointments or procurement decisions are being influenced. The shameful gaps in the reports include loopholes that allow expensive dinners, gifts or entertainment to be given with no recipients named, or money to shuffle between various entities under the guise of some unregistered coalition.
Also, the full extent of grassroots or indirect efforts needs to be revealed. More and more issues now spark television, direct mail, phone bank and other campaign style communications efforts, and every dime spent on those should be just as transparent as if they were being spent on a candidate.
One area where compensation should be reported in full is when the client is the government. Beyond that, we need to focus on those other more important failings in the current non-disclosure disclosure regime, although this contribution by VPAP is useful in demonstrating that somebody out there thinks we’re stupid.
Carpetbagger. Bob Goodlatte is the 13-term congressman from Virginia’s 6th Congressional District who has blessedly chosen to retire this year. In my opinion he represents just about everything that is wrong with the GOP. Born in Holyoke, Massachusetts and educated at Bates College in Maine, Goodlatte somehow avoids the “carpetbagger” moniker so quickly put on Terry McAuliffe by Virginia’s Republicans. He won his congressional seat at age 39 and has spent the last 26 years in Congress. Yet he goes uncriticized as a “politician for life” by the conservative Newt Gingrich types who claim to eschew such long running elected officials. He is a polluter’s best friend with apparently no concern for the property rights of those negatively affected by the pollution he justifies and defends. However, he’ll be gone soon and you’d think we’re past the damage done by this phony conservative. Oh no. Even in his final days in office Goodlatte is actively denying people protection of their property rights despite “property rights” supposedly being a core tenet of conservative Republican dogma. What a farce.
The following are updates on earlier Bacon’s Rebellion stories of mine.
Yes Virginia, there is a United States. Most posts published on this blog are dedicated to Virginia-specific issues. This post is an exception. It is an attempt to understand the unexpected popularity of Donald Trump. While all states are impacted by the federal government and national politics, Virginia is perhaps the most affected state. The proximity of Northern Virginia to the nation’s capital as well as the military influence over Hampton Roads’ economy make the federal government particularly important to Virginia. So it behooves us to understand the president and how the heck he got elected.
The Truth Is Out There (To Be Revealed Friday)
On Friday Governor Ralph Northam and Secretary of Finance Aubrey Layne will be presenting to the House and Senate money committees, part of their report looking back (at the completed fiscal year), but the key parts of their message looking forward. Both are expected to put some flesh on the bare-bones announcement made last Friday about how the Governor wants Virginia to respond to the opportunities created by federal tax reform.
The announcement was telegraphed by the left-leaning Commonwealth Institute for Fiscal Analysis, which endorsed converting Virginia’s Earned Income Tax Credit into a fully refundable version, putting cash in people’s pockets, discussed in a previous Bacon’s Rebellion post. The political angle was described well this morning by the Democrats’ Virginia media strategist Jeff Schapiro, also of the Richmond Times-Dispatch, who tagged the EITC proposal as aimed at the 2019 legislative elections.
Finally you can see the strategy in the Governor’s own guest column today, this from the Roanoke Times.
What the Governor and Secretary Layne know that we don’t yet is, well, everything. The state commissioned a detailed study of the state-level financial impact of the various federal tax rules changes. That was the apparent basis for the Governor’s announcement Friday that about $500 million plus in new state revenue will result, half of which he wants to use to finance the EITC refunds and half of which he wants to keep in the General Fund.
Secretary Layne assured Bacon’s Rebellion after that press conference that the full report from the consultant will be released and available online Friday after the Governor speaks. Until that report is picked apart, anybody who hasn’t read it is just speculating. I won’t join in that yet.
Probably the best analysis of the issues – written without access to the new report on the numbers – was released this week by Jared Walczak of the Tax Foundation. Come Friday it should be clear where that $500 million estimate came from, which tax provisions produced additional revenue and which taxpayers may pay more in the long run. And it may be clear whether that windfall results from full conformity to the myriad federal changes, no conformity to the federal changes, or from cherry-picking which provisions to accept or reject – meaning a different combination produces a different revenue result.
There has been no mention so far, but expect news on Friday, about the potential state revenue boost from requiring more out-of-state retailers to collect and remit sales tax on goods they ship to Virginia customers. And until Friday we really won’t know the size of any surplus from fiscal year 2018, or the status of the reserve funds. Those are also key parts of this coming tax debate.
This is the best opportunity in a generation Virginia has seen for some intelligent tax reform, something positioning our economy for this century. And tax reform does not mean cut my taxes and raise somebody else’s. As previously noted the EITC is an effective anti-poverty program, and Virginia’s income tax is arguably regressive, hitting lower income workers harder than it should. But that is just one element of what needs to be a long conversation that ranges over the whole tax code, one that has been stymied for decades because of the various political risks.
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Posted in Commentary, Economy, General Assembly, Taxes
Tagged Stephen D. Haner