Senator's firm capitalizes on his office

He co-founded an economic development consulting firm that promotes Pearson’s pull under the Gold Dome.

The Sandy Springs-based Pendleton Consulting Group states on its Web site: “We’re not lobbyists. But we do know who to call and how to get action from top management at Georgia’s companies (large and small), and influencers who work behind the scenes. We know how government works.”

In fact, two of the four founders are registered lobbyists with longtime business and political connections.

As chair of Economic Development, Pearson oversees any legislation relating to economic development, business, trade and tourism.

The consultants are telling business clients that they can grease wheels in the state and handle all aspects of the governmental process to get a project completed. In its promotional material the company says “Pendleton Consulting’s understanding and knowledge of political and business leaders” can help with “political policy & process” for a development project.

“Our rolodex is remarkable,” their ad copy declares.

Under state ethics law, public officials are not supposed to “take any official action with regard to any matter under circumstances in which he knows or should know that he has a direct or indirect monetary interest in the subject.”

Pearson said he has not crossed ethical lines by mixing his business and his legislative duties.

“We checked this out up front and I consulted (outside) legal counsel,” Pearson said. “They showed me where the bright line was and I have stayed on my side of the line.”

However, ethics watchdogs say it’s dangerous to have lawmakers working with lobbyists, who are paid to influence what legislators do during General Assembly sessions.

Bill Bozarth, executive director of Common Cause Georgia, a nonpartisan group lobbying for stronger ethics laws, said Pearson’s connections to Pendleton are “bothersome.”

“What we’ve been doing this session is trying to create distance between lobbyists who try to influence policy and those who create policy,” he said. “This would indicate that there is a very tight fit between how Mr. Pearson makes a living and his role as a legislator.”

Lt. Gov. Casey Cagle, the Senate’s president, said he isn’t worried about Pearson’s role in Pendelton.

“Senator Pearson has been an astute businessman, prominent civic leader and respected senator,” Cagle said. “I’m confident he is well aware of both his oath of office as well as the ethics laws that govern all legislators.”

The Pendleton Consulting Group was formed in 2008, according to Secretary of State corporation records. Pearson’s connection to the company — though long rumored — was not made public until recently, when his bio was published on the company’s Web site. The site touts Pearson’s political and state connections. Pearson’s photograph is posted next to the Georgia state flag.

For years, Pearson was a successful businessman in North Georgia with numerous businesses in development and construction. During the recession, however, many of these businesses contracted or collapsed.

One of Pendelton’s co-founders is Phil Jacobs, a former top executive at BellSouth and AT&T and former longtime member of the state economic development board. He is registered to lobby for the Georgia Alliance of Community Hospitals.

Jacobs declined to comment for this story.

Another co-founder is Craig Lesser, former commissioner of the Georgia Department of Economic Development under Gov. Sonny Perdue. Lesser was a lobbyist with McKenna, Long & Aldridge before setting up his own firm, JEL Group, which represented Kia Motors. Kia’s West Point plant has been among the Perdue administration’s biggest economic development successes.

Lesser currently lists his firms, JEL Group and Pendleton Consulting Group, as his only lobbying clients. But Lesser said neither he nor Jacobs lobby for Pendleton Consulting clients.

“What we agreed to do is anyone we had as clients before we came together we kept in our separate (companies),” he said. “We don’t mix that up. We keep that separate.”

The Pendleton Group’s other founding partner is Dwight Evans, a former longtime Southern Company executive who once served as executive vice president of, among other things, the group’s lobbying efforts.

Lesser said the group advises companies on “general strategy” and marketing.

“People are just interested in hearing what our years of experience have taught us,” he said. “We work with the highest level people in companies.”

A State Ethics Commission advisory opinion issued last October determined that “ ‘economic development consultants’ that deal with public policy decisions” must register as lobbyists and report regularly to the State Ethics Commission.

Pearson said he doesn’t do any lobbying. He said he consults on real estate and construction projects.

He said he had been thinking about going into the business for a while, using the connections he has made in business and politics.

“Twenty-five years in real estate and construction gives you a pretty good contact list and a pretty good sense of the industry,” the senator said.

Pearson’s major bill introduced this session, SB 374, calls for the creation of a Legislative Economic Development Council, which would have power to set state economic development policy. Under his bill, Pearson would automatically be one of the key members of the new council.

News of Pearson’s direct stake in an economic development consulting business with two lobbyists comes as the Legislature is wrestling with an ethics reform package that would tighten rules for lobbyists and legislators. The bill is now before the House Rules Committee.

Pressure for ethics reform arose last fall, when House Speaker Glenn Richardson (R-Hiram) resigned in disgrace after his former wife publicly accused him of an affair with a lobbyist. New House Speaker David Ralston (R-Blue Ridge) has proposed tighter rules on lobbying that would forbid lobbyists from even texting legislators while they are in committee.

For decades, legislators have used their political and governmental experience and connections to launch lucrative careers after they leave office. For example, former Senate Republican leader Skin Edge, top Senate Democratic leaders Pete Robinson and Wayne Garner, former Department of Natural Resources Commissioner Joe Tanner, ex-Secretary of State Lewis Massey and former Perdue counsel Robert Highsmith are all prominent lobbyists.

It is less common for a sitting lawmaker to launch a business on the exact subject that he oversees as a committee chair.

Still, for years, lawmakers in the insurance business have populated legislative insurance committees and lawyers have run the judiciary committees of the General Assembly.

Some MARTA officials raised questions last year when the engineering firm PBS&J hired state Sen. Doug Stoner (D-Smyrna). The company has had major contracts with MARTA for years. While he’s in the minority party and doesn’t have as much power as a Republican like Pearson, Stoner has been deeply involved in legislation affecting MARTA and transportation funding. The company said Stoner would work on water issues, not transportation.

Lesser said Pearson won’t be put into a position where his legislative decisions could be influenced by his role in the company.

“We’re not stupid. We’re not going to put him in any danger. We’re not going to put our clients in any danger and our firm in any danger,” he said. “By the same token, just because he’s an elected official doesn’t mean he can’t have a job.”