ANNAPOLIS – Understaffed agencies and tough legal requirements allow numerous employers to skirt a Maryland disclosure law without threat of prosecution, according to a Capital News Service analysis of government records.
At issue is a state disclosure law that requires lobbyists’ employers who contribute more than $500 to a campaign or political committee to file a form listing those donations and the names of the lobbyists they employ.
The law was passed during the 2001 General Assembly session in the wake of a series of State House corruption scandals.
“The whole purpose of the bill was to be able to connect contributions with issues the (General Assembly) was determining in Annapolis,” said Delegate Elizabeth Bobo, D-Howard, a co-sponsor of the bill.
Former House Speaker Casper R. Taylor Jr., D-Allegany, introduced the legislation after top state lobbyist Gerry Evans was barred from lobbying after a federal fraud conviction.
Other provisions in the reform package toughened penalties for misconduct, broadened the State Ethics Commission’s enforcement powers and prohibited lobbyists from contributing directly to state campaigns.
The disclosure provision was included to track indirect political influence, Bobo said.
But about 55 percent of employers required to file with the Board of Elections for contributions made during a six-month period ending in January, did not, according to board records.
The derelict companies are unlikely to face punishment, the state prosecutor said.
“That’s a hell of a lot of work,” said Stephen Montanarelli, who heads a staff of eight lawyers and one paralegal. “You can’t do that with the squad that I have.”
As of February, 883 employers were paying lobbyists in Maryland, according to the State Ethics Commission. According to a search of the Maryland campaign contributions database, 150 employers made contributions of more than $500 between August 1, 2002, and Jan. 31, 2003, and 86 failed to file, as of April 10.
The list of employers who failed to file ranges from local interest groups to international corporations.
Among the violators were Paxil manufacturer GlaxoSmithKline, the Maryland State Teacher’s Association, Annapolis lobbying firm Alexander and Cleaver and the state Fraternal Order of Police.
Not all connections were direct and some groups slipped through the process, but many were caught under language that requires employers to file if their directors or subsidiaries contributed above the limit. That includes political action committees, said Ross Goldstein, Board of Elections campaign finance director.
For example, the Greater Baltimore Committee PAC donated $1,000 to Delegate Howard P. Rawlings, D-Baltimore, and the Greater Baltimore Committee, which employs three lobbyists, did not file.
“It’s certainly not deliberate,” said GBC spokesman Gene Bracken. “We do everything we can to keep up with what the reporting requirements are.”
Other groups claimed they were immune from the law because their PACs are wholly separate from the employer, although Goldstein disputed that claim.
That includes the Maryland Association of Certified Public Accountants, which hired four lobbyists and its PAC donated $1,000 to Gov. Robert Ehrlich’s campaign, said Executive Director Tom Hood.
Pespi-Cola Co., which gave Ehrlich $4,000, is also exempt because the Pepsi Bottling Group hires the lobbyists, said spokesman Dave DeCecco.
But some groups, including the Maryland State Teacher’s Association, which donated $27,500 to 10 candidates and three slates through the parent group and a PAC clearly violated the law. MSTA, which employs eight lobbyists, did not return calls for comment.
The responsibility for filing falls to the employer, although lobbying firms advise their clients of changes in Maryland law, said lobbyist Pam Kasemeyer.
Enforcement of the provision is all but impossible, said Montanarelli and the Board of Elections.
No specific funding was allocated to the board or prosecutor for enforcement, according to the bill’s fiscal note.
“They passed the law but there’s no funding to take care of it” Montanarelli said. “They just assumed the agencies would be able to absorb it.”
Enforcing the disclosure law – which carries a maximum penalty of $1,000 fine and a year in prison — is tough, Montanarelli said. Winning a case requires proof that the company knew about the law and intentionally did not file, he said.
The law is “over-reactionary,” said lobbyist Bill Pitcher, because it pins administration on the Board of Elections, whereas all other lobbyist- related filings are handled by the State Ethics Commission.
“I inquired at the board about how this thing was being done and learned that the board isn’t really set up to do this,” Pitcher said. “My advice is that the Legislature repeal this law or transfer the duties to the Ethics Commission.”
Pitcher alerted his clients to the law, but said he isn’t surprised by the lack of employers who filed.
One of the top problems is that the board hasn’t done any outreach, he said. Another may be its administration of the law.
The Board of Elections has not filed any complaints since the law took effect in 2001.
“We take it seriously and will look into it,” Goldstein said, who would not comment on his staff and resources. “We are primarily an administrative agency, not an enforcement agency.”
Disclosure is imperative to discovering who wields influence in Annapolis, ethics reform groups said, and failing to fund the agencies charged with enforcement doesn’t serve the public.
“That’s a heavy lift,” said Sean Dobson, deputy director of Progressive Maryland. “It’s hard to keep up if you’re understaffed.”
Of the 64 employers that did file, many did so after the Feb. 5 deadline, while others left out the names of lobbyists or amount of contributions.
“I’m sure some of the mistakes are just honest mistakes,” Dobson said. “On the other hand, ignorance is no excuse for failure to comply.”
That is especially true for larger corporations who have the money and the resources to hire legal aid, Dobson said.
The public has a right to know what interests may influence decisions in Annapolis, such groups said.
“Often times $500 buys you a seat at the table, or on the yacht or at the private party,” said James Browning, executive director of Common Cause Maryland. “If we don’t have that information we can’t connect the dots.”
Common Cause released a study in February that tracked about $500,000 in campaign contributions from gambling interests made through a web of corporate subsidiaries and executive officers.
The CNS investigation only tracked contributions from the employer or political action committees directly related to the employer.
“These companies either don’t know or don’t care about the law,” Browning said. “Clearly (they) can’t police themselves.” -30 – CNS-5-1-03