SPECIAL ETHICS LAW MEMO
TO:
Regulated Lobbyists, Prospective Regulated Lobbyists, and Elected State
Officials
SUBJECT: Lobbyist
Campaign Finance Activity for State Officials and Candidates
-
Policy Definition Issues (Md. Code Ann., State Gov’t §§15-707, 15-713,
15-714 and 15-715 (Supp. 2001)
This memorandum
addresses those provisions of the Ethics Law related to regulated lobbyist
campaign finance activity and includes some questions and answers to assist in
understanding the Law. It is based
on discussions with the State Ethics Commission but does not constitute an
advisory opinion of the Commission.
The information in this document addresses issues that are common to many
lobbyists and describes some approaches that may bring lobbyists into compliance
with the technical provisions of the law. Prior to taking any actions that
are not clearly consistent with the guidelines in this memorandum, you should
ask for specific review by the Commission.
§15-713 – Lobbyist Prohibitions
Section 15-713
addresses most of the standards of conduct for regulated lobbyists. Many of these standards have general
application but some specifically address campaign finance and election
activity.
Section 15-713 (14)
prohibits a regulated lobbyist, if serving on a State or local central committee
of a political party, from participating as an officer of the Central Committee,
engaging in fund-raising activity on behalf of the political party or action to
fill a vacancy in a public office.
There are other general standards in §15-713, which apply in campaign
finance or election situations. For
example, §15-713 (3) prohibits a regulated lobbyist from counseling a person to
violate any provision of Title 15 or any other State or Federal Law, and §
15-713(4) prohibits a regulated lobbyist from engaging in any fraudulent
conduct.
§15-714 – Restriction on Campaign
Contributions
A lobbyist, or a person acting on behalf of a regulated legislative
branch or executive branch lobbyist may not, for the benefit of the
Governor, Lt. Governor, Attorney General, Comptroller, member of the General
Assembly or candidate for these offices, engage in the following
activities:
1.
Soliciting or transmitting a contribution from any person or
political committee;
2.
Serving on a fund raising committee or a political
committee;
3.
Acting as a treasurer for a candidate or official, or treasurer,
or chairman of a political committee;
4.
Organizing or establishing a political committee for the purpose
of soliciting or transmitting contributions from any person;
or
5.
Forwarding tickets for fundraising activities or other
solicitations for political contributions to a potential
contributor.
The Law specifically
allows the lobbyist to 1) make a personal political contribution
in accordance with the Election Law and 2) inform the lobbyist's
employer, or others of the position taken by a particular candidate for
office. These two items are
examples of what a lobbyist may do but are not intended to be a list of all
permitted lobbyist activity. The
Law allows activities not specifically prohibited.
§15-707 – Lobbyist Campaign Contribution Activity
Report
Section 15-707 of the
Ethics Law requires an individual regulated lobbyist to file a report
disclosing political contributions made directly or indirectly by
the regulated lobbyist during the reporting period Laws for the benefit of the
Governor, Lt. Governor, Attorney General, Comptroller, member of the General
Assembly or a candidate for election to any of those offices in accordance with
the provision of State Election.
The report is to name the officials or candidates for whose
benefit a contribution was made, disclose the total contribution to that
candidate, and be filed with the State Ethics Commission at the same time
as the General Lobbying Activity Report.
§15-715 – Lobbyist Employer Campaign
Disclosure
This section establishes
a campaign contribution disclosure program for persons and entities who
compensate lobbyists. The Law
sets out thresholds and rules of attribution to determine under what
circumstances a contribution triggers disclosure by a person or a business
entity. The forms are to be
filed with the State Board of Elections using procedures and forms
specified by that agency.
General
Guidelines
1. How is the
language regarding a person acting on behalf of a lobbyist to be
interpreted?
Answer: The Law is intended to address attempts
at avoiding the prohibitions on campaign finance activities by using a
non-lobbyist to act on behalf of the lobbyist. Persons engaged in soliciting or
transmitting contributions governed by the Law should not be under the
direction, supervision, or control of a lobbyist. The ultimate test is whether in fact
the non-lobbyist is acting on behalf of the lobbyist in carrying out prohibited
solicitation and transmittal activities. If a lobbyist or a group of lobbyists
owns a law firm or lobbying firm, it will generally be presumed its employees
are acting on behalf of a lobbyist.
2. Does the Law prohibit a lobbyist from soliciting contributions for a general purpose PAC if any of the money raised is to be contributed to the State officials or candidates covered by the Law?
Answer: Yes, the purpose of the Law is to
bar lobbyists from fund raising as to these offices from any person or entity
(clients or non-clients) and also bar transmittal of contributions if any of the
funds is for the State officials and candidates covered by the
Law.
3. Is there any PAC work a lobbyist can do if the PAC is involved in contribution activity related to the State officials or candidates covered by the Law?
Answer: Assuming the lobbyist is not serving on
a fundraising committee or acting as an officer or treasurer of a committee, the
lobbyist may perform very limited ministerial tasks that do not amount to
solicitation, transmittal of contributions or organization of a PAC. Great care should be taken to limit this
activity to clerical, ministerial or administrative tasks and to avoid
activities that could identify or otherwise directly involve the lobbyist as
making a solicitation or transmittal or organizing a committee. Specific questions should be
referred to the State Ethics Commission.
4. What if the funds solicited by a lobbyist may be used for a variety of candidates, only some of which will be to the State officials or candidates covered by the Law?
Answer: If any funds are to go to State
officials or candidates for that office, then the prohibitions apply. Generally, if none of the funds is to go
to these persons, then the restrictions in §15-714 do not apply but §15-713 does
prohibit lobbyist members of central committees from engaging in any fundraising
on behalf of the political party.
5. What if a person files a lobbyist registration but does not meet the criteria for registration? Is this person restricted by the Law?
Answer: The conduct restrictions of the Law
do not cover these persons who do not meet the registration criteria, but
the reporting provisions are applicable to a person if registered to lobby
even if he or she has no activity.
6. If asked by an employer about a State official or candidate covered by the Law, what can a lobbyist say?
Answer: The lobbyist can say anything if he
or she does not engage in soliciting, transmitting or other specific conduct
prohibited under the statute. A
lobbyist generally can respond to any reasonably contemporaneous contribution
related questions from his employer regarding a State official or
candidate. Discussions can include
substantive evaluation and may also include specific contributions
recommendations where these are requested.
In complying with §15-714, one central test is whether the lobbyist's
conduct is in fact a solicitation or transmittal of a contribution as restricted
in the statute. A key fact in
evaluating this activity is whether the lobbyist is responding to an inquiry or
initiating a solicitation.
7. May a lobbyist solicit contributions for PACs or other committees or candidates as long as the activity is limited to officials and candidates not covered by §15-714?
Answer: Generally, unless the lobbyist is
also limited by the further restrictions of §15-713 as a member of a central
committee, the lobbyist can solicit for these other groups as long as the
money is not going to a State official or candidate covered by the
Law.
8. What does the word "solicit" mean?
Answer: Solicit generally means to ask or
seek, or to appeal for. Solicit
is an affirmative action such as asking for funds, holding or hosting a fund
raising event or having involvement in these activities.
9. What does the word "transmit" mean?
Answer: “Transmitting” means forwarding the
contributions by hand, mail, or other conveyance. It also means having someone else
transmit the contribution at the lobbyist's direction.
10. May a lobbyist serve on a PAC or other committee or be Treasurer or Chairman of a political committee that does not contribute to State officials and candidates covered by the Law?
Answer: Generally, a lobbyist
may serve on a PAC or other committee if it does not raise funds for or
contribute to the State officials and candidates covered by the Law. However, while a member of a central
committee, a lobbyist cannot be an officer of a central committee or do any
fund-raising on behalf of a political party.
11. If a lobbyist's employer buys a ticket to a fundraiser, may the employer give the ticket to the lobbyist so that the lobbyist can attend free?
Answer: The lobbyist may attend the
fundraiser with the ticket assuming he or she did not solicit the contribution
and that it was paid for without his involvement in transmitting the
payment.
12. If a lobbyist buys a ticket to a fundraiser, may he or she request the employer to reimburse him?
Answer: No.
13. How should a lobbyist handle a situation in which a State official or candidate covered by the Law solicits him or her personally to buy tickets to a fundraiser?
Answer: The lobbyist may use personal funds
to buy the tickets within the limits allowable by the Election Law. If the lobbyist decides not to buy the
tickets, the best approach to avoid the restrictions in the Ethics Law would be
to discard the tickets or return them to the sender. Section 15-714(d)(1)(v) specifically
prohibits forwarding tickets for fund-raising activities or other solicitations
for political contributions to a potential contributor.
14. Are contributions to the Woman's Caucus, Black Caucus, and similar organizations covered by this legislation?
Answer: No, unless these organizations
take on the function of political committees carrying out activities that are
controlled by the Law. These
contributions may, however, be considered to be a lobbying expense to be
reported on the General Lobbying Activity Report.
15. May a lobbyist ask State officials and candidates covered by the Law about the dates of their fundraisers in order to make personal contributions and attend the fundraiser?
Answer: The Law does not prohibit this
inquiry or otherwise prohibit personal contributions by lobbyists. (See also Question
13.)
16. May a lobbyist let clients know that a lobbyist may advise them on campaign finance at their specific request subject to the limitations of the Law?
Answer: The mere advising clients of
permissible activities under the Law is not prohibited. The lobbyist should be careful, however,
that the content, circumstances, and frequency of this advice do not take on the
characteristics of solicitation.
Also, the lobbyist has to make sure this does not become part of
organizing or establishing a political committee, which is prohibited by
§15-713.
17. Do the limitations of
the Law apply to contributions to State officials covered by the Law running for
other offices?
Answer: Yes. The language, purpose, and history of
the Ethics Law indicate that it applies to covered officials regardless of the
office sought.
18. If a lobbyist is sent fundraising tickets, are there any circumstances by which he or she would be permitted to send the tickets to the client?
Answer: No. The revisions of the Law in 2001 were
intended to prohibit lobbyists from forwarding to others solicitations for
officials or candidates. The
Robertson Commission specifically states that while it may be acceptable for a
regulated lobbyist to respond to inquiries regarding the appropriate contact
person for the specific entity that employs a lobbyist, it is inappropriate for
the lobbyist to forward solicitations.
19. May the in-house staff of a trade association that is under the management and control of a board be involved in campaign finance activities if the Director of the association is a lobbyist?
Answer: The Law impacts lobbyists and those
acting on behalf of lobbyists. The
best way to assure compliance is to have people who normally would not be
under the lobbyist's supervision handle campaign finance activities relating to
State officials and candidates covered by the Law. If this is not done, any
activity by association staff must clearly not be on behalf of the
lobbyist. In order to help assure
this separation, the following general guidelines should be
followed:
1. The
lobbyist's director should not be involved in solicitation, transmittal and
other practices prohibited by the Law.
2. The
lobbyist should not direct the staff in these campaign finance
activities. A board member or
other appropriate person should direct this activity. There should be a written policy
and procedure to document this process and give guidance to staff, board
members, and trade association members who need to know how these matters should
be handled.
3. The
lobbyist's name should not appear on contribution solicitation letters or
related contribution transmittal documents.
4. The
lobbyist cannot be involved, in any manner, in organizing or establishing
the political committee.
(See Questions 1 and 3
for more explanation and issues that may arise with this
context.)
20. May a lobbyist solicit friends or relatives to make political contributions to officials and candidates covered by the Law?
Answer: No. The Law
prohibits any contribution solicitation or transmittal activity as to covered
officials and candidates and this includes friends and
relatives.
21. May a lobbyist serving as an elected voting member on an association board vote on decisions to request a closely related Political Action Committee to make political contributions to State officials and candidates covered by the Law?
Answer: Based on the specific facts presented,
voting to make a contribution request to the Political Action Committee would be
prohibited by the solicitation provisions of the Law.
22. Are lobbyists allowed to serve on a county political party central committee?
Answer: Lobbyists may serve on county
political party central committees, but in accordance with §15-713 cannot
participate as officers of the central committee and cannot participate in
fundraising activity on behalf of the political committee. Additionally, lobbyists cannot
participate in actions relating to filling a vacancy in a public
office.
23. Does §15-714 restrict the fundraising activities of the State official or candidate covered by the Law?
Answer: Section 15-714
contains no express limitations on these activities. However, the State lobbying law
provisions address both civil and criminal penalties. This means that a knowing and willful
violation of the Law is a crime subject to the jurisdiction of the State
Prosecutor. Therefore, if a State
official or candidate covered by the Law knowingly and willfully attempted to
have someone violate the Law (for example, directing a lobbyist to make a
prohibited solicitation) there could be a criminal violation. The State Ethics Commission does not
administer the criminal enforcement of the Lobbying Law. If a State official or candidate covered
by the Law wants advice on the possible application of the criminal law, the
Office of the State Prosecutor should be contacted.
24. May a lobbyist be involved in fundraising and related activity on behalf of candidates who are not State officials or candidates covered by the Law?
Answer: The Law does not prohibit fundraising
activities on behalf of a person who is not a candidate for a listed State
office or the General Assembly.
This is true even if the candidate may later transfer some of his total
funds to a State official or candidate who is covered by the Law. However, this assumes that the lobbyist
has not entered into an express understanding or agreement that funds are to be
transferred to covered races. A
lobbyist could not condition his fundraising on a promise to make such
transfers. Although the fundraising
would generally be allowed, the lobbyist would not generally be permitted to
serve on a committee or be treasurer of a candidate committee making transfers
to covered races.
Lobbyists, of course, cannot solicit contributions for covered candidates. A lobbyist may not develop an understanding that a person will make a contribution to a State official if the lobbyist or some other person makes a contribution to a non-State official race in or outside of Maryland. However, if a lobbyist is serving on a State or local central committee for a political party, the lobbyist cannot participate in any fundraising activity on behalf of the political party.
25. May a
lobbyist covered by the Law run for a State office covered by the
Law?
Answer: Yes. The Law does not prevent a lobbyist from
running for a State office covered by the Law and raising campaign funds. However the Law continues to limit the
lobbyist’s activity as to others.
Therefore activities involving slates, transfers of funds, and other
similar activities would be impacted by the restrictions of the
Law.
26. If a lobbyist is covered by the campaign finance restrictions, for what period of time do restrictions apply?
Answer: The Law applies
while the person is a regulated lobbyist. Additionally, if the lobbyist terminates
lobbying, the restrictions in §15-714 continue to apply for the remainder of
that calendar year.
27. What should a lobbyist do to avoid violating the prohibition in §15-714 against organizing or establishing a political committee for the purpose of soliciting or transmitting contributions from any person?
Answer: This provision mandates
that a lobbyist not be involved in any way in activities assisting an employer
or others in organizing or establishing such committees. (See also Questions 1, 3 and
16.)
28. Are there other similar restrictions in State Law regarding lobbyist and campaign finance activity for local political campaigns?
Answer: There are also State Law campaign
finance restrictions relating to local campaigns for persons registered to lobby
in Montgomery and Prince George’s County.
These are detailed in Sections 15-844 and 15-845 of the Ethics Law.
29. What lobbyist campaign contributions are reportable under §15-707?
Answer: The Law requires a
report for contributions for the benefit of the Governor, Lt. Governor,
Attorney General, Comptroller, or member of the General Assembly or a candidate
for election to any of these offices at the same time of the lobbying
activity report covering contributions for the six-month reporting period. The Law explicitly covers direct or
indirect contributions by the regulated lobbyist. For example, reported contributions
would include those to a political committee for an applicable candidate and
also for a slate on which a candidate is a member. Other examples cited by the Robertson
Commission include a contribution to a PAC created to support a specific
candidate or group of candidates, a PAC contribution where a contribution is
designated for transfer to a particular candidate or candidates, or
contributions directed or arranged by a regulated lobbyist and the funds used
could be considered to be the lobbyist’s control. This may include a contribution by a
family member or a political action committee. Of course, the lobbyist also may not
solicit these contributions.
30. How is a lobbyist employer’s campaign contribution disclosure in §15-715 to be administered?
Answer: This program covers
the employers paying compensation to lobbyists. The disclosure is filed with the State
Board of Election, which has developed the forms for this activity.
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