Forty years after passage of the state’s first law regulating lobbyists, requiring them to publicly register, identify their clients, and disclose what they spend to influence the legislative process, the agency charged with administering and enforcing the law is suffering a major crisis of confidence.

In what turned out to be a rather extraordinary meeting of the State Ethics Commission on Feb. 18, Executive Director Les Kondo briefed commissioners on his plan to revisit and potentially reverse a 2007 commission policy requiring so-called “goodwill lobbying” to be disclosed.

Kondo was responding to a request by the commission to review any staff plans to proactively investigate matters not tied to specific complaints or required activities. It was an unusual request, and it opened the door for an unusually candid presentation of preliminary legal concerns that would otherwise not have been presented publicly until more thorough research and vetting of a legal opinion had been done.

Les Kondo, executive director of the Hawaii State Ethics Commission, speaks during a meeting last year.

PF Bentley/Civil Beat

Kondo told the commission that he planned to review the policy toward goodwill lobbying because he now believes the specific language of the law is not broad enough to demand disclosure of social gatherings, whether one-on-one dinners between legislators and lobbyists, or receptions bringing dozens of legislators together to drink and dine with special interest groups, where specific legislation is not discussed.

“Professional lobbyists take legislators to meals off-session all the time, not to talk about any  bill, but maybe just to talk about how the family is doing, how your health is, or how the weather is,” Kondo said. “But they are building a relationship, so that when they need to pick up the phone, they can get access, they can get somebody on the other side that says, ‘Yeah, I’ll talk to him.’”

And while these are important — and from the public’s perspective, perhaps the most important kinds of lobbying activities — Kondo said he no longer has confidence in the commission’s legal authority to compel disclosure.

“A lot of lobbyists are very experienced, and a lot are attorneys. And it’s likely that they will push back.” — Les Kondo, executive director, State Ethics Commission

Kondo had already cancelled a workshop for lobbyists at the Hawaii Convention Center that had been scheduled in January. He told the commission it had been cancelled “due to uncertainty about certain interpretations of the statute.”

Kondo said he feared the commission’s authority to require full disclosure of goodwill lobbying would be publicly challenged during the event.

“A lot of lobbyists are very experienced, and a lot are attorneys,” Kondo said. “And it’s likely that they will push back.” 

“And I want to be confident, if we have to take them the whole nine yards, that when an appellate court looks at what we did, the court will say, ‘We agree,’” Kondo said. “And I’m not confident of that result, given our definition.”

The majority of commissioners indicated they did not support spending additional staff resources to research the issues and did not support a change in policy at this time. Instead, they reaffirmed the existing policy.

And Kondo said he would do his best to defend the commission’s policy and interpretation of the statute despite his misgivings, but admitted to being confused about how to move forward.

Kondo declined to comment on the issue when contacted by Civil Beat on Tuesday.

“I’m not able to comment at this point, since we need to first spend more time developing the issue,” he said. But in light of the commission’s action, that’s going to be a sensitive matter.

A Few Words Make a Big Difference

On the surface, Hawaii’s lobbyist law is pretty straightforward.

Lobbying is defined in the law as attempting to influence legislative action, which in turn is defined separately. Put the two definitions together and this is the result: (A graphic with this combined definition was displayed for the commission.)

“Lobbying” means communicating directly or through an agent, or soliciting others to communicate, with any official in the legislative … branch, for the purpose of attempting to influence … the sponsorship, drafting, introduction, consideration, modification, enactment, or defeat of any bill, resolution, amendment, report, nomination, appointment, or any other matter pending or proposed in the Legislature.

On its face, it seems to be a very broad and inclusive definition.

And since 2007, the commission’s position has been that expenses incurred for goodwill lobbying are included in the definition of lobbying and must be disclosed because they are intended to influence legislation, whether or not that is made explicit.

“Personally, if it’s up to me, I think goodwill lobbying, relationship lobbying, it should all be reported, and not just when in session, when lobbying about a specific bill.” — Les Kondo

The policy was spelled out in a Dec. 6, 2007, memo from Dan Mollway, the commission’s executive director at the time.

“When trade associations and others meet with lobbyists for the purpose of ‘getting to know’ legislators or to develop rapport, this is considered ‘goodwill lobbying,’ and would constitute lobbying under HRS section 97-1, since there is communication for the purpose of lobbying,” Mollway wrote.  “The fact that specific legislative measures are not discussed does not mean that the meetings are not considered lobbying. If the purpose of the meeting is to develop a relationship with legislators, getting to know legislators, or establishing rapport with legislators, and the trade association, etc., will be lobbying, then such meetings with legislators constitute lobbying in accordance with chapter 97 and must be reported on the appropriate expenditures report for the appropriate lobbying reporting period.”

But Kondo’s concern is that the final phrase in the definition of lobbying narrows the law’s scope, and means communications with legislators must be about matters “pending or proposed in the legislature” in order to be considered lobbying.

It isn’t just lobbyists schmoozing with legislators over drinks and dinner while talking about the weather that Kondo thinks is outside the commission’s purview.

Another area of contention is “education.”

“We have some law firms that are paid by clients to ‘educate’ legislators about issues,” Kondo told the commission. “In my opinion, they are clearly trying to influence, to shape the legislators view of the world, so to speak. They are not paid by their clients to give a neutral playing field, they want to shape the legislators’ views.”

An example might be a law firm hired by a developer that educates legislators in the off-session of the benefits of developing in Kakaako.

“There’s no bill,” Kondo said, “but they want to get ahead of the ball.”

Kondo said that while he feels this should be considered lobbying and required to be disclosed, he is constrained by what he considers the plain language of the lobbyist law.

“Personally, if it’s up to me, I think goodwill lobbying, relationship lobbying, it should all be reported, and not just when in session, when lobbying about a specific bill,” Kondo said. “At a gut level, I think most of us would agree that it’s important for people to report goodwill lobbying.”

“But if I look at the statute, if I look at the language of the statute, I’m not sure the language of the statute captures that.”

Betwixt and Between

It’s hard to figure out what happens next. Kondo said this week that no one has requested an advisory opinion, which would force the commission to launch a more formal legal review. And for now, the commission’s policy remains unchanged.

Lobbyists, concerned about public reactions, are probably unlikely to directly challenge the commission. But now that the genie is out of the bottle, the status quo seems untenable. The likely result will be a steady increase in the amount of goodwill lobbying and relationship building that goes unreported. It will then be up to the commission to decide whether it wants to initiate an enforcement action that would trigger a test case.

Kondo told the commission the best approach would be to ask the Legislature to clarify the law by explicitly adding goodwill lobbying to the statute, but I doubt many political observers believe that’s likely to happen any time soon.

The bottom line is that an already relatively weak lobbyist law just got a lot weaker.