Lobbyists boost D.C. spending

By Casey Ross
Globe Staff / June 9, 2009
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Despite the recession, Massachusetts companies and interest groups have sharply increased spending in Washington, D.C., to influence how federal officials distribute more than $1 trillion to revive the lagging economy.

In the first three months of the year, local firms spent $14.4 million to lobby the US government, according to federal records, 21 percent more than in the first quarter of 2008. Also, the number of Massachusetts companies hiring lobbyists increased 14 percent this year, to 320.

"That spending is up this year is a telling reminder that lobbying is a very different kind of industry," said Sheila Krumholz, executive director of the Center for Responsive Politics, which monitors the influence of money in politics. "It may seem counterintuitive during an economic decline, but many companies feel it's a good way to maximize their chances at shaping legislation that will affect them."

Industry specialists gave several reasons for the increased spending on lobbying, including a change in presidential administration that brought new faces to the seats of power and a new bounty of government spending initiatives, most prominently the $787 billion stimulus package.

Companies and other parties that lobby the US government are required to disclose their activities quarterly to the US Senate. But the disclosure forms provide few details on the filer's interests, other than to indicate generally which areas of federal policy or certain proposed laws or rules they are lobbying on.

Still the forms show that some firms have nearly doubled their spending over last year, while others were compelled to hire lobbyists for the first time because of conditions in their sector.

First Wind Energy LLC, a Newton-based firm that runs wind farms nationwide, hired Washington lobbyists after the market for tax credits that finance its projects collapsed during the larger credit crisis last year, according to the records. First Wind spent $120,000 to get access to US lawmakers who were working on a proposal to revive the use of tax credits for renewable-energy projects.

"This is absolutely critical both to our company and to the growth of renewable energy across the country," said Carol Grant, vice president of external affairs for the company, which is seeking funding to build four wind farms in New England.

Grant said First Wind representatives met with lawmakers to discuss problems with the financial markets and ways to restore credit. The Obama administration is still developing guidelines for the energy incentives approved in the legislation.

The top spender in the first three months of the year was Waltham-based Raytheon, which reported its lobbying costs increased to $1.36 million, 24 percent higher than in the first quarter of 2008, according to disclosure forms filed with the US Senate. The firm reported lobbying numerous agencies, from the Department of Defense to the Federal Aviation Administration to the CIA, on defense and transportation matters, as well as on the economic stimulus bill.

A Raytheon spokesman said the company would not comment on its lobbying spending.

Massachusetts Mutual Life Insurance Co. reported one of the largest increases in lobbying costs: $790,000 in the first quarter, 41 percent higher than the $560,000 it spent a year earlier. MassMutual indicated it lobbied lawmakers, the Department of Labor, the Federal Reserve, and other agencies on economic stabilization proposals and issues related to pension reform and taxation.

A spokesman declined to discuss the firm's lobbying activities. A financial services powerhouse, MassMutual did not apply for or receive any of the funds the US government set aside to revive the ailing sector.

Lobbying activity typically increases with the arrival of a new president, as the incoming administration launches an array of policy initiatives and spending programs.

About 60 Massachusetts entities, ranging from energy companies to local governments to universities, reported lobbying officials on the stimulus program, although it is difficult to get an accurate count because of the vagueness of the information on the disclosure forms.

Sensitive to concerns that lobbyists would influence the course of the stimulus package, President Obama issued an executive order requiring federal agencies to post online their contacts with lobbyists over the $787 billion plan. He also created a federal oversight board to monitor how the money is spent.

Other matters Massachusetts firms lobbied on include healthcare reform and regulations affecting drug companies, the $700 billion financial industry bailout, and energy and environmental issues.

Among other firms that increased lobbying activity were:

  • Sepracor Inc., a pharmaceutical company based in Marlborough, spent $1.3 million, up from $20,000 in the first quarter of 2008. The firm indicated it lobbied members of Congress on Medicare and Medicaid reimbursement, according to federal disclosure forms.

  • Sepracor officials did not return a call seeking comment. The company makes drugs for the treatment of allergies and asthma. In 2008, the federal agency that oversees Medicare cut the reimbursement rate for Xopenex, its main asthma medication.

  • State Street Corp. reported spending $210,000 on lobbyists, a 24 percent increase, according to Senate records. State Street said its records indicate its lobbying expenses were flat.

  • The firm reported lobbying members of Congress on international tax policies, economic recovery legislation, and banking regulations. A spokeswoman said the firm also lobbied lawmakers on rules relating to pensions and investment funds. The company has applied to return the $2 billion it received from the US Treasury last fall as part of the government's program to inject capital into the financial system.

  • Vertex Pharmaceuticals Inc. of Cambridge increased lobbying by $80,000, to $180,000, citing interest in legislation related to drug safety and hepatitis C.

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