Ethics: Advisory Opinion No. 1995-4

Advisory Opinion No. 1995-4
Advisory Opinion No. 1995-4

Further Interpretation Of Term “Organized Primarily
For The Purpose Of Lobbying” As Used In
Conn. Gen. Stat. 1-95(a)(3)

In Advisory Opinion No. 94-11, 56 Conn. L.J. No. 2, p. 8D (7/12/94), the State Ethics Commission provided some basic guidelines on how to determine whether an entity is organized primarily for the purpose of lobbying, as that term is used in Conn. Gen. Stat. 1-95(a)(3).  That section reads in part:  “If the registrant is formed primarily for the purpose of lobbying, it shall disclose the name and address of any person contributing one thousand dollars or more to the registrant’s lobbying activities in any calendar year.”

Brenda L. Mathieu, auditor for the State Ethics Commission, has asked for further clarification regarding the application of Conn. Gen. Stat. 1-95(a)(3).  Ms. Mathieu asks how the statute would apply to a nonprofit corporation which describes itself in its mission statement filed with the Internal Revenue Service as a corporation organized to promote the common interests of a particular industry as well as to advance the interests of a particular segment of the general population.  The corporation further describes its “primary activities” to include monitoring and communicating with legislatures on behalf of its members concerning proposed legislation affecting the particular industry.  Finally, the corporation breaks down its budget in the following manner:

Administrative expenses     33.00%
Telephone                            3.15%
Equipment/Rent                    2.13%
Freight/Postage                     5.76%
Travel                                   5.34%
Legal                                    3.56%
Federal Lobbying                19.46%
Publication/Printing                8.10%
State Lobbying                    13.46%
Misc. Other                           3.92%
Misc. Office                           2.12%

The corporation indicates that approximately 40% of its state lobbying activity in the year in question took place in Connecticut.

Specifically, Ms. Mathieu asks whether, in determining if the entity was organized primarily for lobbying, one should consider only whether the entity’s activities in Connecticut were primarily for lobbying, or whether one should consider the entity’s overall activities, including activities in other states or at the federal level.  Ms. Mathieu also questions the effect of the budget breakdown on this determination.  Finally, Ms. Mathieu asks how to determine whether a particular contributor needs to be reported.

The State Ethics Commission in Advisory Opinion No. 94-11 indicated as a preliminary matter that any determination of whether an entity must comply with 1-95(a)(3) will be based on “the totality of the circumstances surrounding the lobbying activity rather than on an inflexible specific percentage of the overall activity which must be lobbying-related.”  Here, the entity itself has described its primary purpose to include lobbying; this description goes a long way to answering the question of whether the entity must comply with 1-95(a)(3).

With this preliminary consideration in mind, and taking Ms. Mathieu’s questions in order, as the Commission first stated in Advisory Opinion No. 94-11, if the vast majority of an entity’s overall activity is not lobbying related, that entity need not comply with 1-95(a)(3), even if the entity’s Connecticut activities are primarily lobbying related.  By the same token, if the vast majority of an entity’s activities are lobbying related, and the entity is also registered to lobby in Connecticut, the entity may have to comply with 1-95(a)(3).  The entity’s overall activities, not just its activity in Connecticut, should be considered in determining whether to comply with 1-95(a)(3).

Turning to Ms. Mathieu’s second question, in its budget, the entity has explicitly allotted a third of its expenditures to state and federal lobbying.  That budgetary breakdown may be somewhat misleading, however:  expenditures in furtherance of lobbying should also be considered, and a certain percentage of the other budget categories of administrative expenses, telephone, equipment/rent, postage, publication/printing, travel and legal almost certainly represent such expenditures.

Thus, in the words of Advisory Opinion No. 94-11, the totality of the circumstances presented indicate that this entity should comply with 1-95(a)(3).  Each of the circumstances considered (i.e., the mission statement, the description of primary activities, the budget breakdown) provides information to help make this determination; no one circumstance taken alone constitutes the indisputable answer to the question of whether to comply with 1-95(a)(3).

Finally, Ms. Mathieu asks how to determine whether a particular contributor needs to be reported.  Clearly, those persons and/or entities who contributed $1000.00 or more in a given year with the specific intent that the money be used in Connecticut must be reported.  Additionally, those persons and/or entities who contributed to the lobbyist organization’s general effort must be reported if at least $1000.00 of the contribution was used to fund lobbying activity and activities in furtherance of lobbying for Connecticut, or if a division of the contribution over the states where lobbying took place results in an attribution of at least $1000.00 to the Connecticut effort.

By order of the Commission,

Rev. William Sangiovanni
Acting Chairperson

Content Last Modified on 9/7/2005 8:01:11 AM