Lobbying surpasses $10.6M for 2018 session, could end up about $22M for year. Perish the thought: legislative corruption in other states, too?

John Schaaf

By John Schaaf, Executive Director, Kentucky Legislative Ethics Commission

The final lobbying spending numbers for the 2018 General Assembly are in, and spending hit an all-time high of $10.67 million, putting Kentucky on track for a record-breaking year in which more than $22 million will be spent on lobbying.

The lobbying spending reports filed by a wide array of businesses and organizations give another clear picture of the increasing importance of public policy to the groups that lobby the General Assembly. This year’s spending total for the session is 11 percent higher than 2016 and 19 percent higher than 2017, and those were record years for even- and odd-year lobbying spending.

The 2018 surge in lobbying spending was led by several businesses which upped their lobbying efforts from prior sessions. For example, while fighting a proposed increase in the tobacco tax, Altria (Philip Morris), spent $379,760, which is more than twice as much as any other business spent, and about three times more than the average spent by Altria in each of the previous four legislative sessions.

Likewise, the second-leading spender, the Kentucky Chamber of Commerce, spent $187,103, or 29 percent more than the business group’s average in the past four sessions. Like the Chamber, the Foundation for a Healthy Kentucky supported a tobacco tax hike, and was the fifth-leading spender, at $110,766, which is 30 times more than the Foundation spent in all of 2017.

Third on the list is LG&E & KU Energy, which spent $126,858, mostly in support of HB 227, a bill to cut payments to utility customers who generate excess electricity via solar power, and sell it to utility companies. That four-month total is more than twice as much as LG&E has ever spent in a full 12-month period of lobbying.

In addition to LG&E and the Kentucky Chamber, other top-spending businesses listed HB 227 on their lobbying reports. Those include Kentucky Association of Electric Cooperatives ($79,376); Greater Louisville, Inc. ($66,849); Big Rivers Electric Corporation ($54,305); and Kentucky Coal Association ($50,954).

The KY Hospital Association finished in the top five at $111,696, which is 12.5 percent more than the average spent by the group in the last four sessions. Other top spenders include: 1-800 Contacts ($96,347); KY League of Cities ($77,203); Anthem, Inc. ($72,064); KY Education Association ($71,968); Baxter Healthcare ($70,000); KY Justice Association ($67,060); KY Medical Association ($65,308); KY Retail Federation ($62,535); KY Bankers Association ($60,728); Marsy’s Law for All ($54,240); U.S. Justice Action Network  ($53,500); CSX ($52,864); KY Farm Bureau Federation ($52,574); KY Association of Healthcare Facilities ($51,707); and Pathfinder Capital ($50,000).

Businesses and organizations which terminated lobbying registration after the end of the 2018 General Assembly are:

Advance America Cash Advance Centers, Inc.; American Progressive Bag Alliance; American Retirement Association; Americans United for Separation of Church & State; Crown Cork & Seal Co.; Hollenbach-Oakley, LLC; Oldham Reserve Partners, LLC; Opternative; Petersen International Underwriters;  QC Holdings, Inc.; Simple Contacts; SpeedWash Car Wash – Fern Creek;  Starr’s Liquor; Thomas D. Clark Foundation, Inc.; and Warby Parker.

Newly registered employers are: Lyft, Inc. and Organization for International Investment.

Legislative corruption captures headlines in other states

The news from other states is focused on legislative corruption – federal investigations, charges, and convictions.  In response to similar problems 25 years ago, Kentucky adopted one of the nation’s strongest legislative ethics laws, and for a quarter century, no Kentucky legislator has been indicted for misusing his or her legislative office.  By complying with the ethics law, Kentucky legislators have strengthened the institution of the General Assembly, and avoided the corruption charges that have severely damaged the lives of other states’ legislators.  For example:

Arkansas — Five legislators convicted of federal crimes after directing public money to non-profits in exchange for kickbacks. 

Maryland — Two legislators convicted as part of a larger federal investigation into a pay-to-play scheme involving state lawmakers who sold their votes on legislation to expand liquor store sales in Prince George’s County.

New York — The former Speaker of the New York State Assembly was found guilty (for a second time) of federal corruption charges related to nearly $4 million he obtained in illicit payments in return for taking actions that benefited a cancer researcher and two real estate developers in New York.

Ohio — FBI agents searched the southwest Ohio home and storage unit of the former Ohio House Speaker, apparently part of an investigation into the money behind his international travel and lavish lifestyle while serving as one of the state’s most powerful politicians.

South Carolina — Anti-racketeering proposals before the S.C. General Assembly would target corrupt lawmakers and lobbyists who illegally buy and sell influence, supporters said.  “This building is rampant with corruption,” Lt. Gov. Kevin Bryant said at the State House.  Bryant specifically cited the ongoing State House corruption investigation, being conducted by a state special prosecutor, as the reason he is supporting the anti-racketeering bill.

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