III. Lobbyists
A. Texas’ Top Lobbyists
B. Fattest Lobby ContractsA. Texas’ Top Lobbyists
Twenty-eight Texas lobbyists reported maximum lobby incomes exceeding $1.5 million apiece in 2007, down from the 30 lobbyists who cleared this amount in 2005. Yet two staff lobbyists who are paid from $50,000 to $100,000 by the Texas Medical Association misleadingly reported that 17 individuals who served as TMA officers and directors each also paid them up to $100,000 apiece. This gave the mistaken impression that these TMA staff members rank among Texas’ best-paid lobbyists. Putting them aside, the 26 remaining mega-lobbyists received up to $67 million for 944 contracts, which accounted for 19 percent of all Texas lobby dollars.
Texas’ $1.5 Million Lobbyists
Lobbyist
Value of Contracts
Value of Contracts
ContractsLobbyist Description Todd M. Smith Impact TX Communications Carol McGarah Ex-Senate Aide; Blackridge, Inc. Russell T. Kelley Ex-Speaker aide; Blackridge, Inc. Robert D. Miller Ex-Senate aide W. James Jonas III Holland & Knight Randall H. Erben Ex-Ast. Sec. of State Arthur V. Perkins Coats Rose Law Firm Amy Tankersley Coats Rose Law Firm Andrea McWilliams Ex-legislative aide Stan Schlueter Ex-legislator Michael Toomey Ex-Governor’s aide; ex-legislator David Sibley Ex-Senator Frank R. Santos Ex-House aide; Santos Alliances Laura M. Matz At Santos Alliances Luis E. Gonzalez Ex-House aide; Santos Alliances Walter Fisher Ex-Parliamentarian Mignon McGarry Ex-Senate aide Bill Messer Ex-Legislator Ron E. Lewis Ex-Legislator Christopher Shields Ex-Gubernatorial aide Reginald G. Bashur Ex-Gubernatorial aide Dean McWilliams Ex-Senate aide Neal ‘Buddy’ Jones Ex-legislator; ex-Speaker’s aide J.E. Buster Brown Ex-Senator Karen G. Batory* TX Medical Association Gayle Harris Love* TX Medical Association Jack Roberts Ex-Comptroller aide Demetrius McDaniel Ex-House Aide; Ex-Agricult. aide *The Texas Medical Association paid these staff members from $50,000 to $100,000 apiece. These lobbyists then reported that they also received this amount from 17 individuals who served in TMA leadership roles. This inflated their actual lobby income by a power of 17.
Mr. Smith Goes to Washington
With the up to $3.9 million that he reported in 2007, Todd M. Smith surpassed Rusty Kelley and Kelley partner Carol McGarah as Texas’ top-grossing lobbyist. Yet a closer look at Smith’s top clients suggests that puffery may have given him the edge. Smith reported that three clients paid him mega-contracts worth an unknown amount exceeding $200,000 apiece.56 In each case, Smith listed his own firm as the mega-client (attributing two mega-contracts to his Austin-based Impact Texas Communication and a third to his Washington-based Impact U.S.). It is hardly clear what it means to have three large contracts with yourself.
Self-referential contracts aside, Smith’s main business comes from health-care interests, led by home-health businesses and trade groups for organizations that treat mental illnesses and addictions. (In a new line of work, Smith reported six sprinkler clients in 2008, led by the Irrigation Business Council.) Smith’s lobby partners, Richard Stone and Kent Willis, registered using the address of Lubbock lawyer Nathan Ziegler, a former chief of staff of Rep. Carl Isett.57 Smith served as Rep. Isett’s spokesman in the flap over that lawmaker’s hefty campaign payments to his wife’s bookkeeeping company.58
Todd M. Smith’s Top 2007 Clients
† Home-health care interest.
Client
of Contract
of ContractImpact TX Communication (Smith’s TX lobby firm) Impact TX Communication (Smith’s TX lobby firm) Impact U.S. (Smith’s federal lobby firm) National Co. of Community Behavioral Healthcare American Petroleum Institute Catalis, Inc. Highland Campus Health Group Outreach Health Services, Inc.† Republican Home Care Council† TX Co. of Cmty. Mental Health/Retardation Centers* American GI Forum of the United States Bristol-Myers Squibb Co. Chartwell Community Services† City of Granbury* Hawthorn Group Mead Johnson & Co. Jordan Health Services† Nurses Unlimited, Inc.† TX Pharmacy Assn. Thomson, Inc. United Way of TX
* Smith also lobbied for this client in Washington.
Major clients of Smith’s that are lesser known include Catalis, Inc. and Highland Campus Health Group. Abilene-based Highland does billing for campus health centers. Austin-based Catalis makes software for medical offices. Austin physician Gregg Lucksinger gushed about this software in an Internet testimonial that failed to identify him as a Catalis investor and board member.59 In a 2007 lawsuit that has since been settled, Dr. Lucksinger accused Catalis of defrauding investors through a Ponzi scheme.60Smith also registered as a federal lobbyist in 2007. He helped the City of Granbury seek federal funds for an evacuation route that residents can use if the nearby Comanche Peak Nuclear Power Plant blows its top. 61
*An earlier version of this report erroneously reported that Smith was a federal lobbyist for the American Health Care Association in 2007. TPJ regrets the error.
B. Fattest Lobby Contracts
The 2007 Texas Legislature reformed a major lobby-disclosure failing. Texas lobbyists report contract values in ranges (e.g. “$150,000 – to $199,999”), with the highest category long set at “$200,000 or more.” This maximum category did not keep up with runaway lobby incomes. With Texas lobbyists reporting 86 of these mega-contracts in 2005, the public had no way to know if such a contract was worth $200,001 or $2 million. The 2007 reform pushed the maximum category up to “$500,000 or more” and required lobbyists to report the exact value of any contract compensation exceeding $500,000.62
Although this reform took effect in September 2007, initial glitches prevented the reform from being implemented smoothly. Many lobbyists, for example, continued to report using old software that contained the outdated cap of “$200,000 or more.” Pressed on this issue in early 2008, the Texas Ethics Commission reran updated year-end 2007 lobby data that disclosed what version of software each lobbyist had filed with. The resulting data included just seven contracts that used the newly expanded compensation categories (see accompanying table). This included two McGinnis Lochridge & Kilgore lobbyists whom the agency listed as receiving more than $500,000 apiece from their firm. Interviewed about these contracts in August 2008, an Ethics Commission attorney attributed them to software glitches and a filing error. He said the contracts were subsequently reported to be worth up to $150,000. Elsewhere in this report TPJ does not rely on this funky initial data. While some glitches may be expected when new rules take effect, it remains to be seen if watchdogs will need to file formal complaints to get lobbyists to comply with the new disclosure law.
2007 Contracts Reported Using New Compensation Categories
Lobbyist Client
of Contracts
of ContractsCarl Galant McGinnis Lochridge & Kilgore Jennifer Patterson McGinnis Lochridge & Kilgore Charles Griffey Reliant Energy, Inc. Thomas A. Forbes Kemp Smith LLP Mignon McGarry HCA-Hospital Corp. of America Mignon McGarry Energy Future Holdings Corp. Curtis Seidlits, Jr. Energy Future Holdings Corp.
The accompanying table lists 59 mega-contracts that Texas lobbyists reported in 2007 (including the seven mega-contracts that appeared to use the new disclosure categories).63 Note that 32 of these mega-contracts involve external clients, whereas in the remaining 27 cases the lobbyists reported their lobby firm as the client. In such cases lobbyists may be simply disclosing the compensation they receive from their lobby firm. Yet it also is possible that lobbyists and firms abuse such disclosure to conceal the identities of other paying clients. For one huge contract, the Texas Association of Realtors reported itself as both the lobbyist and client.
Fattest Lobby Contracts
(Maximum Contract Value Exceeds $200,000)†Mark Smith reported two mega-contracts with Hunt Building Co., whatever that means.
Lobby Client
Huge ContractsFat-Contract Lobbyist(s) Atmos Energy Corp. Gary Compton, Locke Lord Bissell & Liddell Baker Botts, LLP Denise Davis, Pam Giblin, Jim Grace, Robert Strauser Baylor College of Medicine Thomas Kleinworth, Dir. State Relations Bicameral Consultants, Inc. Johnnie B. Rogers, Jr. Boeing Co. Jeffrey Dodson, Dir. State Gov. Relations CGI-AMS W. James Jonas III, Holland & Knight LLP Christopher S. Shields, PC Christopher S. Shields CitiFinancial Corp. G. Gail Watkins, Akin Gump Strauss Hauer Constellation Energy Group Jean M. Ryall, Gov. Relations Energy Future Holdings Corp. Lionel Aguirre, Keith Fullenweider, Fred Goltz, Andrew Kever, Ron Kirk, Marc Lipschultz, Michael MacDougall, Mignon McGarry, Curtis Seidlits GEO Group, Inc. Lionel Aguirre, spouse of the late Lena Guerrero Harris Co. Commissioners Court Robert M. Collie, Jr., Andrews Kurth LLP Holland & Knight, LLP W. James Jonas III Hospital Corp. of America Mignon McGarry, sole proprietor Hunt Building Co. Mark A. Smith† Impact TX Communication Todd M. Smith* Impact U.S. Todd M. Smith* Ind’t Colleges/Universities of TX Carol L. McDonald, President Kemp Smith, LLP Thomas A. Forbes Locke Lord Bissell & Liddell Gary Compton, Margaret Keliher, R. Bruce LaBoon, Robert D. Miller Mesa Water, Inc. Monty G. Humble, Vinson & Elkins, LLP McGinnis Lochridge & Kilgore Gaylord Armstrong, Wm. Bingham, Carl Galant, Russell Johnson, Campbell McGinnis, Jennifer Patterson, Mary Reagan, Shawn St. Clair, Catherine Tramuto Pearson Education W. James Jonas III, Holland & Knight LLP Perry Homes Robert Miller, Locke Lord Bissell & Liddell Reliant Energy, Inc. Charles Griffey Ryan & Co. Ben. Bruce Gibson, Dir. Public Affairs Shell Oil Co. George Pickle, Sr. Gov. Affairs Counsel TX Assn. of Realtors Not disclosed TX Industry Project Pamela M. Giblin, Baker Botts LLP TX Pipeline Assn. Patrick J. Nugent, Executive Dir. TX Trial Lawyers Assn. Nicholas K. Kralj, Kralj Consulting, Inc. TXU Corp. Curtis L. Seidlits, Jr., Sr. Vice President Vinson & Elkins, LLP Glen Rosenbaum, Joe B. Watkins Winstead, PC Phil Haag
* Todd Smith reported three mega-contracts with his own firms, whatever that means.
*The Realtors Association listed itself as both lobbyist and client on this contract.
©Copyright Texans for Public Justice, September 2008
