THE ETHICS REPORTER
May 2009
Kentucky Legislative Ethics Commission
22 Mill Creek Park, Frankfort, Kentucky 40601-9230 Phone: (502) 573-2863
Health Care and Tobacco Interests Lead Lobby Spending
in ’09 General Assembly
 Businesses and organizations spent close to $5.5 million lobbying during the recently-completed 2009 General Assembly. A significant majority of spending ($5.1 million) was paid as compensation to lobbyists employed by the businesses and organizations. Related expenses such as lobbyist travel and lodging, and phone banks accounted for about $266,000 of employer spending.
About $77,000 was spent on receptions, meals and events to which groups of legislators were invited, and less than $34 was reported spent on food and beverages provided to individual legislators.
Based on reports received by the April 15 filing deadline, at least 51 businesses and organizations spent over $20,000 lobbying between January 1 and March 31.
For the three months during which the 29-day session took place, the biggest spender on lobbying was DaVita, Inc., a California-based provider of dialysis services for people diagnosed with chronic kidney failure. The company paid five lobbyists $25,500 per month for January, February, and March, for a total of $76,500 for the session. DaVita initially registered in Kentucky in late 2007, and in the 12 months ending December 31, 2008, the company paid $149,500 to its Kentucky lobbyists.
Altria Client Services, Inc. and its affiliates, including U.S. Smokeless Tobacco Co. and Philip Morris USA, the largest U.S. tobacco company, appear to have spent about $78,000 in the three-month period, but the company’s expenditures were divided between two entities. Altria spent about $56,000, including $46,700 paid to three lobbyists, and UST Public Affairs paid four other lobbyists $22,000 through MultiState Associates Inc., an Alexandria, Va. based government relations firm.
The Kentucky Chamber of Commerce, representing 2,700 member businesses, was the third highest spending employer in the ’09 session, spending $74,386, including $23,625 per month to six lobbyists and $3,511 on Chamber Day 2009, a January event in Lexington to which all legislators were invited.
Next on the spending list is Reynolds American, Inc., the parent company of R.J. Reynolds Tobacco Co., the second-largest U.S. tobacco company. Reynolds spent a total of $67,145 on session lobbying, including $24,335 in total compensation to seven lobbyists, and $42,810 in phone bank expenses for February and March.
The Kentucky Medical Association (KMA), a professional organization for physicians,spent close to $55,000, including $53,000 to four lobbyists who lobbied bills relating to the medical profession and health care. KMA was followed on the spending list by the Kentucky Retail Federation, a non-profit association representing over 6,000 retailers. The Retail Federation spent about $50,000, with $46,243 going to the organization’s four lobbyists.
Next on the employers’ spending list is the Kentucky Education Association (KEA), a membership organization for school employees. KEA spent $48,928, including about $39,600 in compensation to eight lobbyists.
Two health care businesses were next on the spending list, with Norton Healthcare, Inc. spending $45,520, almost all of that amount on compensating nine lobbyists. Norton operates four hospitals, 11 immediate care centers and over 60 physicians practice locations.
Norton is one of the health care providers which in 1997 established University Healthcare, Inc., a Medicaid managed care plan which spent $45,000 on five lobbyists during the session. University Healthcare, which does business as Passport Health Plan, serves 140,000 people in the state’s Medicaid and KCHIP populations. (Passport is administered by Philadelphia-based AmeriHealth Mercy, which spent $15,000 on five lobbyists during the 2009 session.)
Three other organizations spent more than $40,000 on lobbying during the session. Those include Kentuckians for the Commonwealth (KFTC), a citizens’ organization which focused in the ’09 Session on coalfield issues, tax reform and restoration of voting rights. KFTC paid 26 lobbyists about $24,900 during the three-month period, and paid over $16,000 in lobbying expenses for a session total of about $41,000.
The Kentucky Farm Bureau Federation spent $40,647 in compensation to five lobbyists. Farm Bureau represents agricultural producers and rural communities, and one of its programs, the Farm Bureau Mutual Insurance Co., spent about $12,000 on three lobbyists during the session.
The Kentucky Justice Association, a group of more than 1,400 attorneys, paid two lobbyists about $40,100 for lobbying on issues including workers compensation and medical negligence.
For a complete list of spending by all businesses and organizations which employed lobbyists during the recently-completed General Assembly, go to the website of the Kentucky Legislative Ethics Commission at http://klec.ky.gov/
Lobbying by Local Governments and Affiliated Organizations
Public organizations working on behalf of state and local governments and officials spent more than $500,000 lobbying during the first three months of 2009, including the regular session of the General Assembly.
The organizations which employ lobbyists include local governments and officials, education, and economic development groups. The Kentucky Association of Counties (KACo) was the leader among public organizations in spending during the 2009 session, spending about $33,800, with almost the entire amount paid to six lobbyists. In comparison, KACo spent about $44,000 on lobbying during last year’s 60-day session, and $110,000 during all of 2008. KACo represents Kentucky’s 120 county governments.
The Coal County Coalition, which represents 38 coal-producing counties, employed two lobbyists and spent $6,500 during the 2009 session, including about $6,300 on compensation.
A variety of organizations representing county officials also employed lobbyists during the 2009 General Assembly. These include the County Clerks’ Association, which spent about $21,100 from January to March; the Magistrates & Commissioners Association (about $14,900); the County Judge/Executive Association (about $14,200); the Sheriffs Association ($12,170); the Jailers’ Association ($10,670); the County Attorneys Association ($4,670); and the Property Valuation Administrators Association ($3,550).
The Kentucky League of Cities, an association of 400 cities and municipalities, spent about $14,000 on session lobbying, including compensating 10 lobbyists ($11,600) and paying $1,913 for a reception for legislators and city officials on February 10. The Jefferson County League of Cities spent $3,200 on its lobbyist during the first three months of the year.
Several local governments employed lobbyists to represent the interests of the specific government, including the City of Franklin, which spent $10,000 compensating a lobbyist to work on issues relating to gaming; and the City of Frankfort, which spent $2,100 on lobbying in January and February, including $1,000 on a Welcome Breakfast for legislators during the first week of the session.
The Louisville & Jefferson County Metro Government spent about $3,200 compensating two of its employees for lobbying; Greater Louisville, Inc., the Metro Government’s economic development agency, spent about $25,000 on nine lobbyists in the ’09 Session, after spending $78,668 in the 12 months ending December 31, 2008; the Transit Authority of River City spent about $12,200; the Louisville Regional Airport Authority spent $12,000 on four contract lobbyists; the Jefferson County Fire Trustees Association spent $10,000; the Louisville Water Company spent $7,667; and the Jefferson County Attorney spent $3,288 on one lobbyist’s compensation and expenses.
Lexington-Fayette Urban County Government was represented by one of its employees, and paid him about $8,000 during the session to lobby on a wide variety of legislation, including bills on pensions and public notice. Commerce Lexington, which promotes economic development, spent about $17,500 including about $6,600 in February for “An Evening in the Bluegrass” reception at Frankfort’s Buffalo Trace Distillery; and Blue Grass Airport in Lexington spent $2,000 on two contract lobbyists.
Other local governments and related entities which employed lobbyists include the Henderson County Fiscal Court, which spent $1,875, the Henderson County Riverport Authority ($1,500), the Greenup-Boyd Riverport Authority ($3,840), Larue County ($2,000), the Marshall County/Calvert City Riverport Authority ($1,800), the Meade County Riverport Authority ($2,400), Sanitation District No. 1, which serves Boone, Kenton and Campbell Counties ($10,000); and Scottsville/Allen County Industrial Authority ($5,000).
Local Economic Development and Tourism Efforts Represented by Lobbyists
In addition to Louisville, Lexington, and other local governments mentioned above, several other organizations supported local economic development, tourism, transportation, and public protection efforts in the 2009 General Assembly.
The Northern Kentucky Chamber of Commerce spent $17,000 for two lobbyists in February and March after spending about $66,000 throughout 2008, including $24,500 on a Night in Frankfort event in February 2008; the Northern Kentucky Convention Center spent $7,500 on six contract lobbyists after spending $25,000 in the 12 months ending December 31, 2008; The Project Coalition, agroup of business, civic, labor and government organizations supporting the construction of the Ohio River bridges in Louisville, paid $15,000 to four lobbyists in the first three months of 2009.
Greater Owensboro Chamber of Commerce spent $10,500 on three contract lobbyists and an employee after spending about $30,000 throughout 2008, including $8,000 on a February 2008 reception; the Paducah Area Chamber of Commerce spent $9,000 on a contract lobbyist for the ’09 Session, after spending the same $3,000 per month throughout 2008; the Kentucky Public Transportation Association, representing about 40 transportation providers, spent $4,700; the Kentucky Center for the Arts Endowment Fund spent $4,500; and the Kentucky Association of Convention & Visitors Bureaus spent $3,000.
The Kentucky Rural Water Association spent about $9,400, including $5,100 to compensate a lobbyist; the Municipal Electric Power Association of Kentucky spent $6,000 to pay two lobbyists, who were also paid $3,000 for the ’09 Session by the Municipal Water & Wastewater Association of Kentucky.
The Kentucky Firefighters Association, representing almost 300 local fire departments, did not compensate its two lobbyists, but spent about $12,000 on expenses such as travel, food and lodging for its lobbyists. Legal Aid of the Bluegrass spent $2,000 to compensate a lobbyist for January and February.
Spending by Schools and Education Administrators
 Several educational institutions and groups of school officials employed lobbyists for the 2009 General Assembly. Among the state universities, Kentucky State University spent $13,750; the University of Louisville Foundation spent $12,200 and the University Medical Center at UofL spent $11,250; Eastern Kentucky University spent $10,500; Murray State University spent $8,000; and Morehead State University spent $4,000.
Elementary and secondary schools and administrators who employed lobbyists during the session include Jefferson County Public Schools, which spent about $17,000 for the first three months of 2009, after spending $41,000 in the year ending December 31, 2008; the Kentucky Association of School Administrators, which spent $10,450, after spending $37,647 in all of 2008; the Kentucky Association of School Superintendents, which spent $7,500, after spending $42,759 in all of 2008; and the Kentucky Association of School Councils ($1,750). |
