Buying Influence in RI: Companies Spent $350k on Lobbyists in October

Monday, November 14, 2011


Pension reform may have held a stranglehold over the discussion at the State House in October, but that didn’t stop dozens of companies from virtually every sector from spending nearly $350,000 on lobbyists over the course of the month, a GoLocalProv review of lobbying reports shows.

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In total, 62 businesses, unions and advocacy groups reported shelling out $349,613.44 to lobbyists in October, with Twin River’s holding company (UTGR Inc.) leading the way by spending just over $139,000.

Other large payouts came from the Rhode Island Beverage Association, which spent $15,000 last month, and Feld Entertainment (the promoter of Disney on Ice), which spent $10,000. Groups from the automobile, tobacco and pharmaceutical industries also doled out more than $6,000 during the month.

Former State Rep: Public Financing a Solution

But the group that runs Twin River spent more than nine times what any other company spent, a trend this is likely to continue as Massachusetts continues to take steps toward building a casino. During the last General Assembly session, state lawmakers agreed to place a question about allowing table games at Twin River on the ballot in 2012. In Massachusetts, the state legislature has already approved three resort-style casinos and a slot parlor.

Just over $84,000 payments from the company were related to Twin River's bankruptcy, which the casino emerged from last year.. Former House Majority Leader and current head of the Board of Regents George Caruolo was among those paid to lobby for Twin River. Caruolo made $15,000 last month from the company.

According to former State Representative and now Executive Director of Demand Progress David Segal, money spent by special interests does play a role at the State House, but it’s isn’t nearly as much of a factor in Rhode Island as it is on the federal level.

“I think special interest money plays a significant role in Rhode Island, but an even more outsized role in federal politics,” Segal said. “There's just so much more money in play at the federal level. Money is still a major factor here, but having small, walkable districts in Rhode Island makes it easier for candidates to connect with voters without spending ungodly sums. The answer of course -- at the federal level and at the state level -- is to put public financing systems in place. That way we return power to the voters and strip it from money and the special interests that provide so much of it.”

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A Toxic Mix of Influence and Money

Still, $350,000 in just one month is a large sum of money by any standards. That number does not factor in those who are paid a salary to lobby, such as representatives from the National Education Association, one of the state’s two major teachers unions. According to Common Cause Executive Director John Marion –he himself is technically considered a lobbyist- the influence of lobbyist money is evident on Smith Hill.

“People and organizations have every right to lobby their government,” Marion said. “However, when it's combined with a system whereby they also finance the campaigns of those officials they are lobbying, there is a toxic mix of influence and money”

Marion pointed to a recent “60 Minutes” piece on Jack Abramoff, the former Washington lobbyist who wound up in jail for mail fraud and conspiracy, to illustrate how the system of lobbying, when combined with the ability to give gifts, campaign donations, and even jobs for former legislators and staffers, can become legalized bribery.

Marion said Rhode Island actually has strong gift laws in place, but “we still fund our campaigns in a way that allows those lobbying government to donate to the campaigns they are trying to influence.” He also noted that the state’s revolving door prohibition, which prevents public officials from lobbying the office they once held, is only for one year.

A Heavy Influence on Decision Makers

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Marion said lobbying is a big part of what happens at the State House. During the last General Assembly session for example, the Rhode Island Beverage Association managed to win a battle against a proposed one-cent per ounce excise tax on sugar-sweetened beverages. The group continues to spend thousands each month focusing on taxation-related legislation.

As the long list of those trying to gain influence shows, everyone is represented by lobbyists in one way or another, from the biggest corporations and unions to many of the smallest non-profit organizations. Marion said many of the most effective lobbyists are former public officials who understand where the pressure points are in the legislative process. One notable former elected official now lobbying for a number of organizations (including EngageRI, the pro-pension reform group) is Chris Boyle, the former House Majority Whip.

“All lobbyists that venture into the State House heavily influence decision makers,” Lisa Blais, who heads up the Ocean State Tea Party in Action, said. “I don’t think it’s just money and power that influences either. Knowledge of the subject clearly carries weight as well because some of the people on these committees are seldom experts in what's put before them.”

General Public’s Interests Rarely Represented

Blais said hearing rooms and the halls of the State House are not the only arena lobbyists like to work in. She said special commissions, working groups, task forces are also fertile ground, pointing to Governor Chafee’s executive order on the Healthcare Exchange as an example. Blais claims “all sorts of private healthcare companies, consultants, etc. are involved.”

Blais said her organization’s goal is to work on behalf of everyday Rhode Islanders, which is why she isn’t paid to lobby at the State House.

“The Ocean State Tea Party in Action has witnessed firsthand the general lack of passion and attention to anti-taxpayer legislation by paid lobbyists,” she said. “Whether it’s the private-sector or public-sector paid lobbyists rarely is the general public's interests represented with a furor. That is why we voluntarily lobby with the aim of bringing a dose of reality to the legislative process.”

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Editor's Note: An edit was made to reflect that just over $84,000 of Twin River's payments went toward bankruptcy-related services.

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