Bernardi Seeks Tighter Controls on Lobbyists Who Work in City Hall

Last fall, two developers fighting over a controversial hotel project in the San Fernando Valley put together impressive teams of lobbyists, including an ex-congresswoman and former city councilman, to advocate their positions before the Los Angeles City Council.

With millions of dollars at stake, a developer seeking to build the hotel and a rival trying to stop the project took no chances. Altogether, a dozen lobbyists were hired by the two because of their influence with council members.

However, only the lobbyists’ employers and a few City Hall insiders knew who was involved in the lobbying effort and how much it cost, despite a 19-year-old municipal law requiring advocates to disclose who they represent and what they get paid.

The reason: Lobbyists are able to skirt the law, and it is not being stringently enforced by City Atty. James K. Hahn, lobbyists and city officials told The Times.

“What law?” Phil Krakover, a prominent City Hall lobbyist, asked facetiously. “Who observes it? Because nobody does anything (to enforce it), people tend to ignore it.”

Theoretically, the law should have resulted in clear identification on the public record of the lobbyists battling over the hotel plan. It requires lobbyists--those paid to influence decisions at City Hall--to register with the city. Lobbyists must identify their employers, specify the interests they are advocating and list their pay.

City Atty. Hahn said his office enforces the law “when (a violation) is brought to our attention.”

Hahn said he does not have the resources to check for possible lobbying violations, in contrast to his high-profile policy of aggressively seeking out slumlords and toxic polluters. But those instances are different, he said, because he is able to draw on other city departments to help with investigations.

A deputy city attorney, who spoke on condition that he not be named, said the lobbying law’s vagueness makes it difficult to enforce.

A check of lobbyists’ registration statements required by law shows that many lobbyists fail to register. Many do not clearly identify their employers or the issues they are seeking to influence. And virtually none of the lobbyists report how much they are spending on lobbying.

This has prompted Councilman Ernani Bernardi, who authored the present statute, to propose a tougher law similar and, in some respects, stronger than the state’s lobbying control measure. Bernardi has proposed requiring businesses to report lobbying expenditures, requiring advocates to identify every city official they contact and limiting lobbyists’ entertainment expenses to $10 per official per month.

Currently, there is no limit on entertainment expenses, and city law does not require businesses to disclose their lobbying efforts. Lobbyists are required to report when they appear before the City Council, but they rarely report private meetings with individual city officials. Consequently, the reports on file in City Hall “give the appearance that nothing is going on” when lobbyists are busy talking to city officials, Krakover said.

Enforcement Stressed

Walter Zelman, California director of Common Cause, said that while he supports Bernardi’s proposal, he doubts that it would be any more effective than the existing law unless it is vigorously enforced.

Nearly 200 lobbyists are registered with the city, although there are many more at work. They mostly represent developers asking approval of multimillion-dollar projects, companies seeking lucrative city contracts and city employee groups trying to improve pay and working conditions.

With the rewards for lobbyists on the rise each time a major building project gets approved, the lobbyists’ ranks have swelled. So important are lobbyists to business interests that several lobbyists are sometimes hired to promote a single project. Lobbying has become so big in City Hall that specialists have developed--lobbyists hired because of their specific influence with certain council members. Among them are former council staffers, who frequently lobby their former bosses.

The battle over the San Fernando Valley hotel site illustrates the high-stakes competition.

Curtis Rossiter, a former chief deputy to Council President Pat Russell, was hired last fall by Warner Center developer Robert Voit to lobby Russell to oppose construction of a Hilton hotel. It would compete with a Marriott hotel being built nearby on property owned by Voit. But Hilton lobbyists were at work, too, and Russell was the only member to vote against the project.

“We were told to work our strengths,” said Steve Afriat, a former chief deputy to Councilman Zev Yaroslavsky who was among half a dozen lobbyists hired by the Hilton developer. Afriat lobbied his former boss.

Lobbying also has become so lucrative that the number of lobbyists has sharply increased. Former Councilman Arthur K. Snyder quit his elected job and became a lobbyist, and former Councilman Robert M. Wilkinson joined the lobbyists’ ranks after his retirement. Another ex-City Hall official now a lobbyist is Ken Spiker, who became close to several council members in his years of handling their legislative matters and arranging their business and social activities at meetings around the country. Former city employees are required to wait a year before they can lobby on issues in which they were involved as city employees.

Position in Council Meeting

During crucial debates, lobbyists position themselves next to a rope that separates council members from the audience in the council chamber. Usually, the lobbyists who have been the most generous campaign contributors can summon a council member to the rope the quickest. Council members often leave their seats during debates to talk with lobbyists.

One of the lobbyists’ most closely guarded secrets is their pay. Spiker said it is not uncommon for advocates at City Hall, in the case of a multimillion-dollar development, to receive payment in six figures if their side prevails. They also sometimes receive bonuses for each vote they deliver for their client.

The Bernardi proposal aims to shine more public light on lobbyists’ activities by tightening requirements for disclosure of pay, clients and campaign contributions.

Those proposals are aimed at remedying reporting flaws illustrated by the Valley hotel controversy.

A check of lobbyists’ registration statements found, for example, that Norman Emerson, one of the advocates who sought to kill the Warner Center hotel project, failed to register as a lobbyist. Emerson, director of public affairs for developer Voit, said he spoke with his attorney and, “based on his interpretation of the city ordinance, which tends to be vague . . . (registration) wasn’t necessary” because his lobbying was incidental to his job.

Assistant City Atty. Anthony Alperin, while declining specific comment on Emerson, said company employees must register, even if they spend only a fraction of their time lobbying.

Rossiter, although registered as a lobbyist on a number of projects, did not include his lobbying activity on the Warner Center hotel project in his report until questioned about it by a reporter. He said the omission was an oversight.

Several lobbyists who are also attorneys said they do not file reports because they insist that they are exempt from the registration requirement.

Ban in State Law

Indeed, Alperin said, a section of state law bans cities from regulating attorneys in “quasi-judicial” matters, such as zoning disputes adjudicated by government agencies. Attorneys also are exempt, Alperin said, if they are engaged in duties only an attorney can perform, such as offering a legal opinion at a city hearing.

However, Alperin said, lawyers appearing at city hearings must register if they are there to lobby on legislative matters. But, the assistant city attorney said his office does not challenge attorneys on whether they should be registered “unless we’re asked to” by a city official, which he acknowledged is rare.

Also, some lobbyists list as their clients their own lobbying firms rather than the organization that hires their firms. “This practice serves to screen from the records the identities of any client, or ‘real party of interest’ who retained the legal firm or the lobbyists’ corporation and for whose benefit the services are performed,” Bernardi said.

Bernardi has also proposed that lobbyists be required to report all money received and spent for lobbying.

Under existing law, many lobbyists--especially attorneys--list only fees received for the time that they spend giving their pitch to public officials and not the total fees received by their firms.

Limited Reporting

For example, Krakover reports only what he is paid by his own firm, Engineering Technology Inc., to lobby, rather than the larger amount his firm receives from the businesses that it represents. Krakover said that is permitted by the law, which he said he obeys “scrupulously.”

When asked if this is legal, Alperin said, “I can’t discuss that without doing research, and we generally don’t do legal research for the press.”

Also, Spiker and Gary Morris, both of whom lobbied for the Hilton hotel’s construction in Warner Center, reported only what they were paid by their own lobbying firm, rather than the larger amounts their firms received from the hotel developer.

Rick Taylor and Leslie Winner, lobbyists seeking to kill the hotel project, reported they were paid $150 an hour without saying how much time they spent lobbying.

Bernardi contends that a lot of lobbyists also hide costs by not reporting fees for “consulting” or other time spent promoting projects.

“It’s easy to defy the law,” Afriat said. “You can pay me $10,000. I’ll report $1,000 for the time I spent talking with city officials. I can say the rest was spent for consulting, which I don’t have to report.”

Bernardi also wants lobbyists to report contributions that they make or deliver on behalf of clients. Recipients now must report contributions, but, Bernardi said, the public should be able to link contributions to lobbying without going on a paper chase and the way do that is to require disclosure by the donor.

Bernardi’s proposal, due to come before the council’s Governmental Operations Committee within a few weeks, is expected to be opposed by lobbyists, who claim it is too restrictive.

Earning Report Opposed

Krakover, for example, said he opposes any effort to require him to report how much he earns from clients, contending it would weaken his competitive edge.

“That’s like asking the butcher how much he pays for meat wholesale,” he said.

Councilman Yaroslavsky said he supports Bernardi’s proposal but believes its chances of receiving council approval are “slim.”

Bernardi, however, has shown that he is not reluctant to go directly to the people when the council balks at adopting his proposals. Last year, he sponsored a petition drive to qualify a ballot measure to limit political contributions in city campaigns. After it appeared that he had collected enough signatures, the council grudgingly put the measure on the ballot. It was overwhelmingly approved by voters.

THE LOBBYIST PROPOSAL

EXISTING LAW

Who must register

Anyone paid to lobby. Included are attorneys who lobby on legislative matters and employees who lobby on behalf of their companies.

Client information

Lobbyists must disclose who they represent. Many list their own lobbying firms as their clients rather than the businesses that retain their firms.

Pay

Lobbyists must report how much they are paid to lobby. Many list what they receive from their own firms rather than what they receive from clients. Many also report only what they receive for time spent talking to city officials.

Lobbying activity Lobbyists must report what issues they are seeking to influence. Many list a case number known only to bureaucrats. Lobbyists have to report when they appear before the City Council or a city board or commission.

Expenditures

Lobbyists are required to itemize expenditures greater than $25.

Other requirements

Penalties

Violation of the law is a misdemeanor.

BERNARDI PROPOSAL

Who must register

Same.

Client information

Lobbyists would have to clearly identify the “real party of interest.” Businesses would have to report whom they hire to lobby.

Pay

Lobbyists would have to report all monies received from clients. Businesses also would have to report how much they spend on lobbying.

Lobbying Activity Lobbyists would have to clearly identify what issues they are seeking to influence. Lobbyists would have to identify every city official they contact.

Expenditures

Lobbyists could spend no more than $10 a month on entertainment for each city official. They would have to itemize all expenditures.

Other requirements Lobbyists would have to report all contributions they make or deliver on behalf of their clients to council members.

Penalties

Same but would also set up a system of fines for incomplete or late reports, plus strip repeat violators of lobbying privileges.