Some Colorado Lobbyists Aren't Required To Report Who Pays Them

Nov 27, 2017

Colorado lobbyists representing the Denver Broncos, Peabody Energy, Dow Chemical, United Airlines and a host of other companies didn’t report income from their clients in 2017. 

Because several of the lobbyists work for law firms, the lobbyists are paid by the firm, not from specific clients. According to the Secretary of State's office, that means they don't necessarily have to report income from specific clients.

Even if it isn't required by law, most lobbyists -- including some law firms -- do report income from their clients. 

“People have a right to know what’s being spent to influence policy in our state,” said Mike Beasley, a lobbyist since the early 1990s. 

That’s the intent behind 2006 and 2014 laws requiring lobbyist disclosure, according to former state Sen. Morgan Carroll, now chairwoman of the Colorado Democratic Party.

“You don’t get a get-out-of-disclosure-free card as a lobbyist just because you happen to be a lawyer,” she said. “If you’re acting like a lobbyist you need to disclose like a lobbyist.” 

KUNC compared companies represented by lobbyists with whom lobbyists (or their firms) reported receiving payment from. One public affairs firm began reporting its client income in September after questions from KUNC.

Among the examples of instances where client payment wasn’t revealed based on KUNC’s analysis: 

  • John Karakoulakis reported monthly payments from the law firm he works for, Holland and Hart. But payments from clients including Peabody Energy, Adams County, Colorado Mountain College, the National Shooting Sports Foundation and Level 3 aren’t reported by Holland and Hart or by Karakoulakis. 
  • Sewald Hanfling Public Affairs began filing reports of client payments in September for the current fiscal year. But previously, its lobbyists only reported what they received from the firm. Payments from clients including the Denver Broncos, Colorado Rockies, Adams State University, Colorado Health Partners and many others weren’t reported. 
  • Thomas Rogers III and Dieter Raemdonck reported receiving payments from the law firm Lewis Roca Rothberger Christie. But neither the lobbyists or the law firm reported payments from clients including United Airlines, the Colorado Catholic Conference, Colorado Natural Gas and others. 
  • David Foster reported receiving payments from the law firm Foster Graham Milstein Calisher. But neither the firm or Foster reported payments in fiscal 2017 from the Colorado Contractors Association, the only client Foster represents. In July, Foster began reporting his income as coming from the Contractors Association. 
  • Julie Hoerner files lobbying reports as Hoerner Law Offices, reporting monthly payments from the law firm. But no payments from clients, including State Farm Insurance and Rocky Mountain Health Plans, are listed. Hoerner said in an email that lobbying is not the primary focus for her firm, and that she performs other legal services for her clients. 
  • Ellen Zuckerman, a lobbyist based in Arizona, reported representing Honeywell, Whirlpool, Dow Chemical and others during this year’s legislative session. She said in an email she hadn’t received payment from her seven clients but that she’d billed them nearly $2,500, mostly for expenses. 
  • Andrea Evans and Brad Regens reported lobbying on behalf of their employer, Corrections Corporation of America, a private prison operator. But they didn’t report what proportion of their income went to lobbying in Colorado, which the Secretary of State’s office said is required. 

Joshua Hanfling, one of the founders of Sewald Hanfling, said laws and rules for lobbyists aren’t always clear. 

“Who pays you and how much is not so clear, which is why we interpreted it one way then and choose to do it a different way now,” he said. “I don’t feel the way we were doing it in the past was wrong. There are different ways to interpret it and people do it either way.” 

Karakoulakis said he reports what he’s paid by his law firm for lobbying services, but Holland and Hart doesn’t have to report what Peabody Energy or others pay the firm for that service. 

“We’ve been told by the Secretary of State that we don’t have to since we’re not organized as a lobbying firm,” he said. 

But other law firms do report payments from clients. Global law firm Dentons reported nearly $161,000 in revenue from the city of Aurora and other clients in fiscal 2017. Lawrence Jones Custer Grasmick reported a little less than $20,000 in lobbying revenue for the same year. 

Still, Karakoulakis’ interpretation is correct, said Angela Lawson, who manages the lobbyist reporting program for the Secretary of State. 

“They’re not actually getting that money from the direct client. It’s going through the firm, and then they’re getting paid by the firm,” she said. “So they are reporting what they’re getting from the firm and they’re reporting their activities on who they’re actually lobbying on behalf of and the positions that they’re taking.” 

Colorado Democratic Party chair Morgan Carroll, however, disagreed with that interpretation of the law. She and others said enforcement is a missing link when it comes to Colorado’s lobbyist disclosure equation system.  

“We have pretty good law on the books on this,” Carroll said. “Who’s going to enforce it? How are we going to make sure that the public interest is served and it’s not being ignored?” 

Deputy Secretary of State Suzanne Staiert said state law doesn’t require the office to enforce the law unless someone files a complaint – and that’s relatively rare. 

“The legislature has never put upon the secretary’s office a duty to audit or investigate aside from a complaint-driven basis,” Staiert said. 

For lobbyist Mike Beasley, that could be the topic of future action in the General Assembly. 

“That’s probably the next area where you’ll see a legislative conversation about what is enforcement," he said. "What does it mean?”