Millions Spent by S.C. Municipalities on Federal Lobbyists
By RICK BRUNDRETT
LOBBYISTS MAKING TRUCKLOADS OF MONEY OFF YOUR LOCAL GOVERNMENTS
Since 2003, at least 21 counties and local municipalities in South Carolina collectively have spent about $5.5 million on federal lobbyists, according to federal lobbying records reviewed by The Nerve.
From the Great Recession years forward, federal lobbyists have been paid about $3 million from local governments, including approximately $400,000 through the first half of this year, records show.
It’s unclear whether the approximate $5.5 million total includes reimbursed expenses, though a federal lobbyist for Columbia says he doesn’t list those amounts on his forms.
The city of Greenville – the state’s sixth largest with about 58,000 residents – leads all spenders with about $990,000 paid to lobbyists since 2003, including $60,000 so far this year, according to The Nerve’s review of lobbyist reports filed on the U.S. Senate’s online lobbying database.
The Nerve’s analysis started with 2003 because that’s when the most recent noticeable pattern of lobbyist spending began. The review included all of the state’s 46 counties and cities and towns with populations of at least 10,000, though in several cases, localities were omitted because it was unclear in the online database whether the municipality was located in South Carolina.
The Nerve’s review also did not include regional governmental agencies.
The state’s largest municipalities tend to spend the most on federal lobbyists, though there are some exceptions. The city of Mauldin, for example, which has a population of about 23,000, has spent a total of about $80,000 since 2003 – all of it since 2009 – compared to approximately $60,000 spent during roughly the same period by Richland County, which has a population of about 385,000, records show.
Julie Horton, government relations manager for the city of Greenville, told The Nerve last week that the lobbying money for her city has been well spent, noting that the city has received at least $50 million in federal funding since 2003.
“We feel like we have a compelling story to tell in Greenville about how the use of a federal lobbyist has paid huge dividends for us in finding and bringing home monies that directly benefit our constituents’ necessities and their quality of life,” Horton said in a written response to a list of questions from The Nerve.
Asked, though, in a separate interview about whether the city could have obtained federal funds without hiring lobbyists, Horton acknowledged, “I’m not saying it would be impossible.”
If you ask Anderson County Interim Administrator Rusty Burns, lobbyists aren’t necessary to obtain federal funding. The county, which has a population of about 187,000, was the second-highest spender (about $680,000) in The Nerve’s review, though it hasn’t used federal lobbyists since 2009, records show.
Burns, who has been the interim administrator for about 2.5 years, said a majority of a new county council decided to end the practice.
“They didn’t feel they were needed,” Burns told The Nerve last week. “We know where most of the grant programs are. We know what qualifies; we know what doesn’t qualify.”
Burns said within the past 10 days, the county was awarded a $2 million federal grant for an industrial water line to the First Quality tissue plant – an announced $1 billion, 1,000-job project that is being helped with millions in taxpayer-supported incentives – and another $500,000 grant for a jobs center on the Anderson campus of Tri-County Technical College.
Both Burns and Horton said most federal funding to their local governments isn’t free money. In Greenville’s case, the local match typically has been 20 to 50 percent, Horton said.
“Weight is given to local governments that can produce those matches, because it shows a commitment at the local level to a well-planned project that the local government will see through to the end,” Horton said.
And how do the lobbyists themselves view their roles?
“Mostly, it’s not about getting money,” said Howard Marlowe, president of the Washington, D.C., lobbying firm of Marlowe & Company, when contacted Tuesday by The Nerve. “A lot of work we do is to help them look at the Washington scene and how best they can impact that in terms of what their priorities are.”
Still, Marlowe was proud to point out his firm helped Myrtle Beach, North Myrtle Beach and Surfside Beach obtain $40 million in federal funding to extend pipes farther out into the ocean to keep storm water off the beaches.
In contrast to Marlowe’s perspective, Ralph Garboushian, a lobbyist with the D.C. firm of CapitalEdge Strategies, told The Nerve this week that his main job is to “get as much as a share of federal money as we can” for his clients. He represents the cities of Columbia – the state’s largest city with a population of about 129,000 – and Sumter, the eight-largest with about 40,000 residents.
“Our firm is a small firm, and we work only for city governments,” Garboushian said. “So we have a certain expertise in local-federal relationships.”
Garboushian said that “trouble-shooting with federal agencies is a big thing we do,” noting, “I think one of the more important things is to tell the city what not to do in certain situations.”
Asked if municipalities could obtain federal funding without lobbyists, Garboushian replied, “I think it would be tough.”
Growing Lobbying Tabs
Under federal law, lobbyists have to report all lobbying income quarterly; before 2008, two reports were required for income earned throughout the year. The current reports don’t require lobbyists to list specific amounts of less than $5,000, and recommend that amounts of $5,000 or more be rounded to the nearest $10,000.
Garboushian said when he likes to “error on the side of caution” when he submits his lobbying reports for the city of Columbia. He said he reports all income, though he noted that federal law requires him to list only the percentage of his income related to direct lobbying of lawmakers or agency officials and not for things such as research or “strategic planning.”
CapitalEdge’s contract with Columbia has totaled $409,363 since fiscal year 2005-06, including a proposed $62,100 contract for this fiscal year, according to figures provided by Garboushian, though federal lobbying reports put the total at $460,000 for the period.
Garboushian attributed the difference in figures to the rounding-up instructions on the federal lobbying forms. He added that the forms do not reflect reimbursed expenses; for example, he estimated travel, lodging and transportation costs for one or two trips to Columbia yearly at $2,000 to $3,000.
Following is a list of the local governments that have paid federal lobbyists since 2003 and the total approximate income reported by lobbyists during that period, according to The Nerve’s review:
- City of Greenville – $990,000;
- Anderson County – $680,000;
- City of Charleston – $580,000;
- Horry County – $500,000;
- City of Columbia – $460,000;
- Orangeburg County – $440,000;
- Dorchester County – $230,000;
- Town of Lexington* – $230,000;
- City of Sumter – $210,000;
- Greenville County – $198,000;
- City of West Columbia – $170,000;
- City of North Myrtle Beach – $160,000;
- City of Myrtle Beach – $100,000;
- Greenwood County – $100,000;
- Laurens County – $90,000;
- City of Mauldin – $80,000;
- Georgetown County – $80,000;
- Richland County – $60,000;
- Fairfield County – $50,000;
- Town of Hilton Head Island – $40,000; and
- City of Rock Hill – $20,000
- Total: $5,468,000
*$160,000 of that amount reported in 2005.The total reported lobbying income among the 21 municipalities has steadily grown, from a collective $130,000 paid by the cities of Greenville, Rock Hill and Sumter in 2003 to a total high of $890,000 in 2009 by 17 of the 21 governments. The cumulative reported lobbying income last year was $880,000, the second-highest tab next to 2009.
Contacted this week by The Nerve, Laurens County Administrator Ernest Segars disputed the $90,000 reported total lobbying bill for his county in 2009 and 2010, noting his records show that $75,257 was spent during that period.
Segars said the D.C. lobbying firm of Kinghorn, Hilbert & Associates was “very professional” in dealing with the county, noting that the firm helped in contacting federal housing and economic development officials on various projects. But Segars couldn’t provide The Nerve with specifics on any federal funding the firm helped obtain for the county.
Segars said the county’s contract with Kinghorn was “terminated” in May 2010 because of “budgetary matters.”
“We weren’t dissatisfied with the efforts or even the results,” Segars said. “Money was just tight.”
Asked if the county would rehire a lobbyist in the future, Segars replied, “At this point, we wouldn’t hire an outside lobbyist. But if things improve … we might.”
Trey Eubanks, administrator for the city of Mauldin in Greenville County, told The Nerve on Tuesday that the city has spent about $69,000 on federal lobbyists since 2009 – about $11,000 less than what the city’s lobbyist – Kinghorn Hilbert & Associates – reported on lobbying forms.
In his written response, Eubanks said the city has received no federal funding since hiring a lobbyist. Asked if he believed the lack of results justified the expense, Eubanks replied, “I wish there were more opportunities for competitive, merit-based federal funds – the reality is there are less and less such opportunities.”
In a story last week, The Nerve reported that a Washington lobbying firm run by William Clyburn Jr., a cousin of Democratic S.C. Congressman James Clyburn, has been paid about $285,000 by the city of Charleston since 2006.
That income was derived in part from three projects that both Clyburns were involved with recently, including federal funding for a study on deepening the Charleston harbor, though Charleston Mayor Joe Riley and Rep. Clyburn’s spokeswoman denied the pair communicated directly on any Charleston projects.
William Clyburn’s firm is small – just Clyburn and a consultant are listed on the firm’s website (www.clyburnconsulting.com). But some of Washington’s most powerful lobbying firms have represented or are representing Palmetto State municipalities.
For example, Patton Boggs, an international law firm, which, according to its website (www.pattonboggs.com), has more than 600 attorneys and “nonlawyer specialists,” represents the city of Greenville. In 2009, the National Journal, a weekly political magazine, ranked Patton Boggs as D.C.’s top-earning lobbying firm that year.
In her written response, Horton, Greenville’s government relations manager, said Patton Boggs has “worked closely with the city of Greenville officials to identify federal funding opportunities in the form of projects and grants, provide policy and technical support, and advice related to agency and regulatory developments.”
Coming in at No. 10 on the National Journal’s list of top-earning D.C. lobbying firms in 2009 was another large law firm, K&L Gates, which had represented Anderson County before the county quit using federal lobbyists. The firm has about 2,000 attorneys in the United States and abroad, and earned more than $1 billion in revenues in 2009 and 2010, according to its website (www.klgates.com).
Other Washington lobbyists who have represented or are representing S.C. municipalities include, according to federal lobbying records:
- CapitalEdge Strategies – cities of Columbia, Sumter;
- Marlowe & Company – cities of Myrtle Beach and North Myrtle Beach; towns of Atlantic Beach* and Surfside Beach*;
- Kinghorn, Hilbert & Associates – Georgetown, Greenwood and Laurens counties, cities of West Columbia and Mauldin, town of Hilton Head Island; and
- American Business Development Group – Greenville County
*Not included in The Nerve’s review because no income was reported in the U.S. Senate’s lobbying database for the review period.As of the first half of this year, two Columbia-based law firms – Nelson Mullins, which is the state’s largest, and the Kyle Michel Law Firm – had lobbyists representing South Carolina clients. During the period, Nelson Mullins represented Dorchester, Orangeburg and Richland counties, and the town of Lexington; Fairfield County was represented by the Michel firm, records show.
In addition, Donald Fowler of Columbia-based Fowler Communications Inc. represents Horry County, focusing solely, according to his lobbying reports, on obtaining federal funding for Myrtle Beach International Airport, which is county-owned.
Contacted this week, Jesse Emerson, a Nelson Mullins government relations consultant in D.C., referredThe Nerve’s questions about his firm’s client, Orangeburg County, to county officials.
Return on Investment
In a written response this week to The Nerve, Orangeburg County Administrator Bill Clark said the county in past years has contracted with Nelson Mullins for $60,000 per year, though for the fiscal year that started July 1, the amount was cut in half.
Clark said the law firm has been used to “assist with federal grant applications and research related to economic development infrastructure initiatives.”
“As one of South Carolina’s ‘Persistent Poverty Counties,’ Orangeburg County is striving to create jobs and economic opportunities in an area that lacks basic infrastructure and has endured generational poverty and high unemployment,” he said.
Clark provided a list of more than $38 million in federal grants awarded to the county for the 2009-2010 fiscal year. About half the amount was for a broadband project in the southeast portion of the county; the remaining money was for various water and sewer projects.
“These projects will extend water, wastewater and broadband infrastructure into area targeted for economic development,” Clark said.
The grant amounts for the projects ranged from 45 percent to 75 percent, with the balanced covered with long-term, low-interest loans, Clark said.
Contacted last week, Dorchester County Administrator Jason Ward told The Nerve that having “federal representation allows us to more fully accomplish our mission, which is directed at research related to grants and legislation impacting job creation and retention, as well as industry growth and economic development.”
Ward said the county has paid the Nelson Mullins firm at a rate of $5,500 per month. That works out to be $66,000 a year – $14,000 less than what was reported annually in the federal lobbying database in recent years.
Ward did not respond to follow-up questions from The Nerve about the discrepancy or specifics on federal funding the county received through Nelson Mullins’ lobbying efforts.
Columbia Assistant City Manager Teresa Wilson, who also is the city’s registered lobbyist with the state, provided The Nerve this week with a list of more than $353 million in federally funded projects from fiscal 2000-01 through fiscal year 2010.
Most of that amount – $284.5 million, or about 81 percent – was for the federal Empowerment Zone program, which provides grants, tax credits and other taxpayer-supported incentives to spur business in designated impoverished areas in the city.
Other big-ticket federal awards to the Capital City included a $26 million grant in fiscal year 2001 for low-income housing and $17 million the following two fiscal years for public buses and bus facilities. Smaller individual grants have been awarded over the years for such things as road improvement projects and law enforcement programs.
The list also show that another $1.4 million was awarded in fiscal years 2005 and 2006 for EngenuitySC, described on its website (www.engenuitysc.com) as an “active public/private partnership focused on the knowledge-based economy in the Columbia, South Carolina region.”
Asked why the city needs a federal lobbyist given her background as a lobbyist for the city, Wilson replied: “That is really to have a foot on the ground in D.C. Obviously I can’t be there every day.”
“I think we’re in a much better position (having a federal lobbyist),” Wilson added. “It’s a true team effort.”
Horton, Greenville’s government relations manager, provided The Nerve with a list of some of the federally funded projects that the city’s lobbyist has been involved with since 2003, including:
- $20 million in grants for low-income housing;
- $7.8 million in authorizations for mainly road improvement projects for Clemson University’s International Center for Automotive Research (ICAR); and
- $1.1 million to the South Carolina Palmetto Expo Center for “security enhancements” programs
Horton said the list didn’t include more than $20 million the city received in federal stimulus funds for roadways, “green” projects, housing, law enforcement and other first-responder support, and economic development projects. Most of that funding was through competitive grants, she said. “The assistance of our federal lobbyist was vital in helping us navigate through all the different rules and timelines put forth by the various agencies administering the monies,” Horton said.
Burns, the Anderson County interim administrator, told The Nerve that amid the current moratorium on federal earmarks – appropriations slipped into the federal budget by lawmakers with little, if any, public scrutiny for pet projects back home – he has noticed a shift by lobbying firms to advertising themselves as the “go-to people for grants.”
Congress committed earlier this year to ending the longstanding practice of earmarks ; Republican Sen. Jim DeMint of Greenville helped lead the recent charge against earmarks.
“If you’re paying somebody for (obtaining) earmarks these days, good luck,” Burns said.
Horton said that with the “ever-changing world of federal funding and appropriations, we will be trying to evolve, too, to follow the best course for accessing those funds.
“But,” Horton added, “given the current economic situation with the federal government, who knows? We’ll have to follow it to see how it shakes out, and we’ll continue to act in the best way we can to be good stewards of taxpayer dollars and our expenses.”