Lobbyists Hired to Bolster Budgets

In 2004, the city of Fayetteville hired a Washington, D.C., lobbying firm to help deliver the pork.
Now the city is living high off the hog.
In 2005, Van Scoyoc Associates Inc., which was paid $80,000 that year, secured $13.8 million in appropriations for Fayetteville, or about $172 for every $1 spent.
The potential for that kind of return on investment has encouraged other cities and universities to turn to lobbyists for help in securing federal appropriations, a trend that has public watchdog groups screaming for reforms.
Before Arkansas State University at Jonesboro hired a lobbyist about five years ago, it didn’t receive any federal earmarks. Now for the upcoming 2007 federal budget, it has nearly $24 million in the pipeline, said ASU President Les Wyatt. ASU’s 2005 contract with Dickstein Shapiro Morin & Oshinsky LLC of Washington, D.C. — which has former U.S. Sen. Tim Hutchinson, R-Ark., on its staff — cost $190,000.
The University of Central Arkansas at Conway recently hired lobbyist firm James Lee Witt Associates — at $96,000 a year — to help secure grants and earmarks.
Because of the firm’s work, UCA hopes to receive between $500,000 and $3 million to research the best technology practices in K-12 education.
“We fully expect for this contract to pay for itself within the first two years,” said UCA President Lu Hardin.
The lobbyist craze has gotten out of hand, said Michael Franc, vice president for government relations at the conservative Heritage Foundation in Washington, D.C.
“Earmarks have created a corrupted influence over the entire appropriation process. He said it’s cast a shadow over it,” he said. “It bypasses any pretense that the money is going to be distributed according to some merits through a grant competition.”
Other critics say cities shouldn’t use taxpayer money to hire lobbyists to gain more taxpayer money. And, critics say, senators and representatives should already be working for the benefit of cities and public universities in their home districts.
“It begs the question: Why can’t the local affiliates — like the local governments, local universities — work through their delegation and their individual members?” Franc said.
Sen. Blanche Lincoln, D-Ark., said her door is always open to Arkansans.
“My six Senate offices throughout the state and in Washington provide our cities and universities the outreach assistance they need in seeking competitive grants and other funding opportunities, regardless of their decision to employ a lobbyist,” she said in an e-mail statement to Arkansas Business.
The city of Fayetteville said its residents are entitled to some federal dollars because they pay federal income taxes.
“And if it takes this level of effort to ensure that we bring more of our public dollars back home for investment in much-needed public infrastructure and other public projects, then it is worth it,” Fayetteville Mayor Dan Coody said in an e-mail response to Arkansas Business.
But not every city has had a success story working with lobbyists.
The city of Monticello hired former U.S. Rep. Jay Dickey’s JD Consulting Co. of Pine Bluff to help secure funding for its sports complex.
“We haven’t gotten the first dime yet,” said Monticello Mayor David Anderson. “[Dickey] supposedly got us $150,000 put in the appropriations bill for ’05, and we still haven’t been able to draw money down.”
Anderson said the request for funding was put in the wrong appropriations bill “and it’s taken all this paperwork” to get it straightened out.
Anderson said the city couldn’t afford to pay in advance for Dickey’s help, so he agreed to take the lobbying work on contingency. If he does get the money, the city will pay him 10 percent of the earmark amount.
Dickey didn’t return a call for comment.
Even with the trouble of getting the earmark, Anderson said having a lobbyist has helped the city.
“I think it gives us a foot up on a lot of these towns and mayors,” Anderson said.
The number of earmarks has exploded since 1996, when there were 958 earmarks in appropriations bills, to 13,997 in 2005, according to Citizens Against Government Waste in Washington, D.C.
“In large part, this escalation in the number of earmarks reflects the growing number of lobbyists offering to obtain them for a fee,” according to an April report by Ronald Utt, a senior research fellow in the Thomas A. Roe Institute for Economic Policy Studies at the Heritage Foundation.
Total spending on lobbyists jumped 54.2 percent between 1998 and 2005 from $1.44 billion to $2.22 billion.
The Heritage Foundation’s Franc said public agencies hiring lobbyists is a sign of the times.
“It shows that state and local governments … recognize that the real return on the dollar comes from lobbying,” Franc said.
Normally, cities or universities would work through their own delegations to get some money for projects. But the public entities have realized their members of Congress might not have the clout to get things done, Franc said.
To get a client’s business, the lobbyists tout their connections.
“They’re very happy to broadcast far and wide the trophies they have or previous earmarks obtained for their clients,” Franc said. “In some cases the same client comes back for more and more and more.”
Success Story
The city of Fayetteville has been happy with the result of its lobbying effort.
“Competition for federal earmarks is very intense,” Fayetteville Mayor Dan Coody said in his statement to the Northwest Arkansas Business Journal. “City leaders felt that a more concerted effort in Washington would improve our chances of receiving more substantial federal funds.”
But the city didn’t have the experience on its staff nor the time to work with members of Congress.
So it hired Van Scoyoc Associates.
In 2005, the lobbying firm, which also represents the University of Arkansas at Fayetteville, succeeded in lining up $9 million in federal funds for the improvement of the Fayetteville Expressway Economic Development Corridor, which includes the Fulbright Expressway and the redevelopment of the College Avenue Corridor.
The firm also rounded up $500,000 for regional wastewater system improvements.
By having a lobbyist in Washington, Fayetteville and Fayetteville’s projects are on the forefront of congressmen’s minds, said Susan Thomas, Fayetteville’s public information and policy adviser.
Still, she said she knows the city isn’t going to get money every year.
The city of Little Rock also believes a lobbyist is a necessity these days. It recently hired James Lee Witt Associates and will split the firm’s $75,000 annual fee with the Little Rock Port Authority and the Little Rock National Airport, said Odies Wilson III, intergovernmental relations manger for Little Rock.
Wilson said it’s important to have a presence in Washington because so many other cities have lobbyists who are bombarding senators and representatives with requests.
“It’s about having a constant presence,” Williams said. “Having someone with your agenda as opposed to (a senator or representative) having to represent a whole congressional district or a whole state.”
Williams said one of the projects the lobbyist will be working on is securing money to extend Central Arkansas Transit Authority’s River Rail trolley to the Little Rock National Airport.
Thomas said the city of Fayetteville’s decision to hire a lobbyist wasn’t because of a lack of attention by the Arkansas delegation.
“I think it was a proactive move on the city’s part to be more vocal,” she said. “The delegation has always done a very good job of paying attention to what’s going on across the state, and we don’t have any complaints about that at all.”
School Lobbying
The fact that universities have also been hiring Washington lobbyists is an especially troubling sign for the D.C. watchdog group Americans for Prosperity.
In 2003, academic earmarks surpassed $2 billion for the first time, said Annie Patnaude, press secretary for Americans for Prosperity. In 2005, academic earmarks surpassed $2.4 billion.
“Part of the problem with … earmarks for higher education is that they circumvent the competitive grants-making process that is there to make sure tax dollars are being used in the most efficient and effective way possible,” Patnaude said. “So when universities hire lobbyists to try to get earmarks it doesn’t … come down to whether they merit the earmark; it comes down to how much money they have, how powerful a lobbyist they can hire.”
Patnaude said the process is unaccepted and doesn’t ensure that the tax dollars are “reaching our nation’s highest spending priorities.”
ASU President Wyatt said the federal government spends a lot of money inappropriately.
“But by and large, we try and identify those things that would be meaningful for us to pursue,” he said. “We don’t have a lot of time to waste on the part of our people who are employed to do these things. We try to make sure what we’re going for is important.”
ASU felt like it had to start using lobbyists because other schools across the country had them under contract.
“These firms have well-established networks,” Wyatt said. “They have contacts on the ground in Washington and business and industry, government or private foundations, and they have access to knowledge, to individuals and to sources of information that the universities simply don’t have. And there’s no way we could match their abilities through the individuals that we might hire to reside here in Jonesboro, for example.”
Wyatt said ASU has received $9 million in earmarks just for three projects.
Sen. Mark Pryor, D-Ark., said in a statement to the Business Journal that he would prefer to hear from the schools directly.
“At the same time, the federal appropriations process can be an intimidating and difficult process, so I can understand why a university or college would hire outside counsel to advocate on their behalf,” he said.
Still, Wyatt said that without the help of the Arkansas congressional delegation, ASU wouldn’t receive any money.
“The lobbyist don’t do it themselves and couldn’t do it themselves,” he said. “It takes the elected officials to make it work.