At least 123 of Washington’s top lobbyists occupy the same ethical gray area now threatening to bring down high-profile influence peddler Jack Abramoff, according to a new study by the Center for Public Integrity, American Public Media and Medill News Service.
Like Abramoff, these registered lobbyists sit on the governing boards of non-profit organizations called 501(c)(3)s, which get their name from the section of the tax code under which they are authorized. As board members, these lobbyists can help set policies for the groups and are privy to inside information about the non-profits—including their sponsorship of congressional travel.
Contributions to such groups are tax-deductible and, because they are non-profits, by definition are supposed to be restricted primarily to education, research and service activities. IRS regulations prohibit 501(c)(3) groups from attempting to influence legislation as a substantial part of their activities. The IRS code does not define what it means by “substantial.”
One such group, the Ripon Educational Fund, spent more than $1.3 million dollars sponsoring a single conference in London during the summer of 2003, according to its tax return. Eighteen members of Congress attended, along with more than 100 corporate representatives, according to Ripon board members. That same year the Ripon Educational Fund spent just $10,000 underwriting a single university scholarship.
At the time of the trip, the REF board of directors counted among its members at least four registered lobbyists, including former U.S. Rep. Susan Molinari, a New York Republican.
While such non-profits can legally pay for trips for members of Congress and staff, congressional rules forbid registered lobbyists or agents registered to represent foreign interests from paying for such travel themselves.
Credit card receipts and other documents that have surfaced in recent weeks appear to show that Abramoff personally paid for travel and entertainment for House Majority Leader Tom DeLay (R-Texas). DeLay’s office has said he was unaware that Abramoff had personally paid for the trip to England and Scotland, which included a golf outing at the famed St. Andrews course.
DeLay’s office has said that the majority leader believed the trip was paid for by a non-profit called the National Center for Public Policy Research. Abramoff was a member of that group’s board of directors at the time of the trip in 2000. Abramoff went along on the trip with fellow lobbyist Edwin A. Buckham. Both work for Preston Gates Ellis & Rouvelas Meeds LLP.
The fact that non-profits have registered lobbyists sitting on their boards is not unusual, or even uncommon, according to government ethics lawyer Kenneth Gross.
“There are lots of folks who are lobbyists who sit on the boards of these organizations,” said Gross, who is a partner in Skadden, Arps, Slate, Meagher & Flom LLP. “Merely being on the board and also being a lobbyist isn’t a problem.”
Gross said he would advise non-profits with registered lobbyists on their boards to be extremely familiar with the rules on paying for trips for congressional members and staffers and follow those rules to the letter.
“To me, it is a matter of following the money,” said Gross. “The organization needs to make sure that it is staying completely within the rules.”
It can be next to impossible for the public and media to determine who is staying within the rules, however. Disclosure forms on privately-sponsored trips by congressional members and staffers supply only bare bones information.
In fact, some of the most damning evidence in the DeLay case—Abramoff’s credit card receipts—were leaked to the press. They were not found in public records. Neither trip sponsors nor congressional members and staffers are required to disclose any such documents to substantiate their disclosures.
Even when apparent violations of congressional travel rules are disclosed, there is rarely a public investigation, or any punishment meted out.
In one recent case, five members of Congress disclosed that a registered lobbying firm, Kessler and Associates, paid for a trip to Ireland’s Ashford Castle. After that apparent violation of House and Senate rules became public, the members of Congress simply amended their travel disclosures—changing the name of the trip’s sponsor from the lobbyist to the non-profit group.
As a former board member of the Ripon Educational Fund and the current president of the Ripon Society, Kessler and Associates founder Richard Kessler has helped organize and sponsor well over half-a-million-dollars of congressional travel—more than any other single lobbyist in Washington.
Neither the members of Congress who traveled to Ireland, nor the ethics committees in the House or Senate have made public any travel receipts for the trip. And unlike in the DeLay case, there has been no public investigation.
In some cases, the distinction between a lobbying firm and an affiliated non-profit is so vague even members of Congress fail to note the difference.
Sen. Mike Enzi (R-Wy) recently amended a travel report that originally listed a lobbying firm, Campbell Crane and Associates, as the sponsor of an Independence Day trip to Cape Cod. Enzi revised his form to show the sponsor was the Invest to Compete Alliance—a non-profit trade association. The Invest to Compete Alliance shares office space with Campbell Crane and Associates and Jeanne Campbell, one of the firm’s named partners, organizes the Alliance’s annual July 4th trip.
Enzi is not the only member of Congress to have disclosed that Campbell Crane and Associates paid for a trip. Former Senator John Breaux disclosed the lobbying firm paid for a weekend in Florida in December 2003.
Non-profit groups who have registered lobbyists on their governing boards include some of the best known names in Washington’s influence industry, the study found.
They include such policy influence heavyweights as the Aspen Institute, the American Enterprise Institute, the Brookings Institution, the Congressional Black Caucus Foundation, Citizens for a Sound Economy, the Congressional Hispanic Caucus, Grover Norquist’s Council for National Policy, the International Republican Institute, the U.S. Chamber of Commerce‘s National Chamber Foundation, the National Parks Conservation Association, the Ripon Educational Fund, the Simon Wiesenthal Center, the United States-Spain Council and the United States-New Zealand Council.
The Center, APM and Medill analyzed every Congressional junket between Jan. 2000 and mid-2004. This analysis was done on the most current lists of board members the Center could obtain.
Among the findings:
- At least 850 trips with a total cost well over $4 million were paid for by non-profit organizations with one or more registered lobbyists on their boards. Many of those trips included a member’s spouse or children.
- Among the international destinations of the trips were Paris, London, Rome, Rio de Janeiro, Cuba, the Cayman Islands, Ireland, Scotland, Singapore, South Korea, Denmark, New Zealand, Spain, South Africa and Greece.
- Among the domestic destinations were Las Vegas, Miami, New York, Los Angeles, Scottsdale, San Francisco, Boca Raton and San Diego. Also on the list were St. Croix, St. Thomas and Puerto Rico.
- Many of the trips included substantial tabs for fine food, first-class accommodations and other items, such as golf outings.
- Just four groups sponsored about 600 of the more than 850 trips: the Aspen Institute, the Ripon Educational Fund, the International Management and Development Institute and the Korea-U.S. Exchange Council. The total cost of those trips was $3.7 million.
An August 2001 trip paid for by the Korea-U.S. Exchange Council that included DeLay and other Republican House members has come under public scrutiny in recent weeks. Justice Department documents showed that the council was a registered foreign agent at the time of the trip. Members of Congress are prohibited from accepting paid trips from such agents.
The head of the non-profit program that is the leading sponsor of congressional travel thinks the disclosure rules need to be tightened and better enforced.
Dick Clark, a former U.S. Democratic senator from Iowa and ambassador at large, is director of the Aspen Institute’s Congressional Program, which has sponsored 488 trips for congressional members in the last four and a half years, with a total cost of more than $2.5 million.
“My personal feeling is that no one ought to be able to pay for congressional travel if they hire a lobbyist or have a lobbyist on their staff,” said Clark, who founded Aspen’s Congressional Program in 1980. “I don’t think members of Congress should accept such travel.”
Clark said his group discloses all of its funders to members of Congress when they are invited to one of its meetings. He said the group also has a policy prohibiting lobbyists from participating in its congressional travel program meetings.
Clark said he has never approached top officials at Aspen Institute about prohibiting registered lobbyists from serving on the organization’s board. He said he has never met most of the members of the Aspen board.
“I think it would be a very good idea for any sponsor to have to reveal exactly where their money comes from, to both the member of Congress and the public,” said Clark, who provided a list of the group’s funders for this report. “Otherwise, non-profits can easily become just a pass-through for lobbyists.”