The Thursday before the 2019 General Assembly session opened in January, the House Republican leaders’ political action committee held a fundraiser at the stately Capital City Club in downtown Atlanta, taking in about $168,000 from big-money businesses and lobbyists hoping to persuade lawmakers to give them tax breaks or help them smite their competitors or reduce government oversight.
Some of the same people showed up at the same location that week at a fundraiser for incoming Lt. Gov. Geoff Duncan, who raised $186,000, mostly from special interests looking to get on his good side when he became the president of the Georgia Senate the following Monday, Jan. 14.
In all, statewide elected officials, lawmakers, their caucus PACs and the major state parties collected about $1.5 million in the two weeks before the start of the session, some taking in checks less than 24 hours before the General Assembly was gaveled in for a new session.
Lobbyists make the rounds of such fundraisers days before each legislative session, but a bill the Georgia Senate passed last week would change state law so that — every other year — the public wouldn’t know who contributed until months after the session ends.
The legislation, Senate Bill 213, would eliminate the disclosure state officials and lawmakers have to make around Jan. 31 each year that shows contributions in the days leading up to the start of the session.
Those contributions would instead be reported in July in non-election years, such as 2019. So if an industry contributed $100,000 to lawmakers and top state officials or their PACs the day before the session, and then won approval for a multimillion-dollar tax break, the public wouldn’t know until after the governor signed it into law.
House members have already raised objections about that provision in SB 213, and a committee studying the measure will likely amend the bill to keep the early disclosure for lawmakers. Even some lobbyists think it’s a bad idea to delay when the public can find out which special interests contributed to House and Senate leaders at pre-session fundraisers.
“If you are looking for more transparency, doing away with some of the reporting is not accomplishing that goal,” said Ronnie Chance, a former Senate leader who represents Dish Network, MARTA and others.
Where did the idea come from?
While the bill is sponsored by state Sen. Bill Heath, R-Bremen, the recommendations came from the state ethics commission, formally know as the Georgia Government Transparency & Campaign Finance Commission. The commission is charged with collecting campaign finance, vendor gift and lobbying expenditure reports; registering lobbyists; issuing advisory opinions; and dispensing penalties for violations.
Bethany Whetzel, deputy executive secretary of the commission, said the bill was designed to clear up confusion in reporting requirements and fix a loophole in the law that allows some PACS — funds generally created to support certain businesses or political interests — to avoid having to disclose what they spend.
Whetzel said her agency has also seen problems with local officials not filing the reports for the Jan. 1-31 fundraising period because they didn’t know it was required. The reports were instituted in 2014 specifically to make sure the pre-session fundraising was reported while the session was going on. The reporting period is essentially meaningless for local government officials.
But Whetzel said, “The way the law is written, it’s a one-size-fits-all approach.”
So the commission recommended doing away with the early session report in non-election years. Lawmakers are up for election every two years. They would still have to file the report in election years.
The bill passed the Senate without opposition on March 7, or Crossover Day, one of the busiest days of the session because it’s the deadline when legislation typically needs to pass at least one chamber to have a good chance of becoming law.
Neill Herring, a veteran Sierra Club lobbyist, has long been critical of the pre-session fundraising, and he said the bill would allow “essentially secret funding by lobbyists behind the backs of voters, the press and the bills’ opponents.”
“The natural inclination of the class of elected officials tends powerfully toward secrecy regarding their own behavior,” he said.
Pre-session fundraising is a big business
What’s not a big secret is that statewide elected officials and lawmakers take in huge amounts of money each January right before the session. While lobbyists can buy lawmakers lunch or dinner during the session, they can’t donate to their campaigns.
So the early January fundraisers are the last chance lobbyists have to show legislators some campaign love before they start voting on bills.
Chance, who once served as Senate majority leader, remembers going to pre-session events where he had trouble escaping an elevator because so many lobbyists and business types wanted to give him checks.
Lobbyists tell stories of having to dodge cars on Peachtree Street running between pre-session fundraisers, where they were expected to deliver contributions to multiple lawmakers.
As is the case every year, many of the biggest donors have big-money legislation before the General Assembly.
Several of the top donors this year were involved in the annual fight over the state’s certificate of need law. Right now a private business that wants to open a hospital or expand a health care operation must obtain a certificate from the state declaring that the service is really needed.
The most prominent supporter of changing the law to allow more competition, Cancer Treatment Centers of America, which wants to expand its business in Georgia, contributed about $70,000 in the weeks leading up the session. That included $25,000 to the Georgia House Republican Trust — the chamber’s leadership PAC — and $2,600 each to House Speaker David Ralston, R-Blue Ridge,House Speaker Pro Tem Jan Jones, R-Milton,House Majority Leader Jon Burns, R-Newington, and Senate President Pro Tem Butch Miller, R-Gainesville.
Two of the leading opponents of the bill, the Georgia Hospital Association and Georgia Alliance of Community Hospitals, gave about $50,000 and $20,000, respectively, to state officials and lawmakers in the same period, often to the same people as CTCA. The Hospital Association also contributed $25,000 to Gov. Brian Kemp’s inaugural committee. Some hospitals also spent big — one estimate reached $2 million — on an advertising campaign to defeat the bill that would change the certificate of need law.
The measure failed to win approval in the House.
Delta Air Lines’ PAC gave about $15,000, spreading the money to about two-dozen lawmakers, including House and Senate leaders. Delta has already won approval in the House for a 20-year suspension of the state tax on jet fuel, which is expected to save airlines $35 million to $40 million a year. As the dominant air carrier in Georgia, Delta would reap the lion’s share of that savings. The measure — House Bill 447 — is awaiting a vote in the Senate, but it has Kemp’s backing.
Auto dealers are traditionally among the biggest donors to state candidates, and the new-car dealers lobby contributed more than $55,000 to state officials in the first two weeks of January, including $6,600, each, to Kemp and Duncan. The new-car dealers lobby backed a bill to lower the tax rate Georgians pay on cars and force used cars to be taxed based on the sales price, rather than the lower book value. New cars are taxed on the sales price. House Bill 365, which the new- and used-car dealers lobbies agreed to after years of costly battles at the Capitol, has passed the House and awaits action in the Senate.
Several lobbyists and businesses backing and opposing legislation that would have put a tax on digital video, books, music and video games, including streaming services such as Netflix, gave big as well. The measure was designed to subsidize construction of internet lines in economically depressed rural parts of the state. It also would have eliminated franchise fees for cable TV and landline phones, and sales taxes on landline phones, cellphones and broadband equipment.
The cable industry and AT&T, the largest force in the telecommunications industry at the Georgia Capitol, backed the proposal. AT&T, which asked for changes so as not to affect parts of its businesses that would have seen new taxes, gave $33,000 to more than two-dozen lawmakers in the weeks leading up to the session. The Cable Association gave $12,000, a majority of which went to Duncan, Miller and Ralston.
The bill failed to get out of the state House.
None of the fundraising would go away if the original version of SB 213 passed. It would just be hidden in non-election years until after the session.
State Rep. Bruce Williamson, R-Monroe, sits on the committee considering the legislation in the House and is treasurer of the House Republican Trust, which raised the $168,000 four days before the session. The trust raises money to help Republican House candidates at election time, and virtually all of its checks come from Capitol special interests and other lawmakers.
Williamson said he doesn’t want to see the Jan. 31 filing go away.
“I like the Jan. 31 reporting. I think the transparency is better,” Williamson said. He’d rather see the law changed so that political action committees have to file reports if they spend anything on candidates, which would eliminate the loophole the ethics commission wants to close. Currently, they don’t have to file reports until they spend $25,000.
Chance’s client, Dish Network, opposed the broadband bill because it would have added taxes for satellite services. The former lawmaker said he received dozens of invitations to attend pre-session fundraisers for state officials, lawmakers and PACs this year. He said some lobbyists feel like they have to attend the pre-session events and give money.
He doesn’t. His invitations wound up in the trash can, he said.
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