NEW YORK
TEMPORARY STATE COMMISSION
ON REGULATION OF LOBBYING

OPINION NO. 31 (80-2)

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FACTS

Law firm requests an opinion in response to the question: "May an individual law firm retained by multiple clients for lobbying purposes report total expenses incurred by such individual or firm without allocation to the individual clients provided the expenses are not billed back to the client and the client has no control or direction over the type or amount of expenses incurred by the firm?"

ISSUE

Must a lobbying firm report expenses for each client even if billing and bookkeeping practices of the firm do not segregate expenses attributable to each client?

DISCUSSION

Section 5(c)7 of the Regulation of Lobbying Act states (underlining added): "if the lobbyist is retained, employed, or designated by more than one (client), a separate statement of registration shall be required for each such (client)." Section 8(b) of the Act states in part "Such periodic report shall contain: ...2. the name, address, and telephone number of the (client) by whom or on whose behalf the lobbyist is retained, employed, or designated..." Section 8(b)5(I) of the Act states: "the salary in full, or that portion attributable to lobbying activities, fees, and reimbursement of expenses paid to the lobbyist, and any other expenses paid or incurred by the lobbyist for the purposes of lobbying."

Clearly, the Act intends that the lobbyist shall register and report separately for each client and all expenses of the lobbyist must be reported regardless of whether the lobbyist is reimbursed.

Experiences of the Commission in administering the Act has shown that expenses attributable to each client may not always be easily derived. This experience is reflected in Commission Opinion 78-12, Answer to Question #1 which states, in part: "(The periodic report) should separately set forth...a reasonable estimate of 'overhead' relative to its lobbying activities for the client."

Commission Opinion 29, page 2, states in part: "Fees and salaries are income and are separate from expenses. A fee is payment for services under a retainer. A salary is payment for services under employment. The client must separately report lobbying fees, expenses, and reimbursement of expenses paid. The lobbyist must report lobbying fees (income) and all expenses including overhead whether or not billed to the client as well as reimbursement received." A later sentence states: "When the item is only a percentage of the whole, a reasonable estimate is acceptable."

OPINION

The Regulation of Lobbying Act requires salaries or fees and expenses to be reported for each client. Therefore, the lobbyist must maintain records to report specific expenses attributable to each individual client on a quarterly and annual basis; expenditures relating to more than one but not all clients must be reasonably allocated and so reported for each of those clients; expenditures relating to all clients, such as overhead, must be reasonably allocated to each client and so reported.


APPROVED BY COMMISSION: MARCH 12, 1980

CONCURRING: TEMPORARY CHAIRMAN GAIL HELLENBRAND, D. CLINTON DOMINICK, FRANCES FOX, S. STANLEY KREUTZER, and HARVEY M. LIFSET.

/S/
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GAIL HELLENBRAND
Temporary Chairman


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