GENERAL ASSEMBLY OF NORTH CAROLINA

SESSION 1993

S	1 

SENATE BILL 398*

Short Title:  Amend Lobbyist Law.	(Public)
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Sponsors: Senators Odom; and Lee.
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Referred to:  Rules and Operation of the Senate.
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February 24, 1993

A BILL TO BE ENTITLED
AN ACT TO REQUIRE LOBBYISTS OF THE EXECUTIVE BRANCH OF STATE GOVERNMENT TO REGISTER AND FILE EXPENSE REPORTS WITH THE SECRETARY OF STATE, TO MAKE OTHER CLARIFYING AMENDMENTS TO THE LOBBYING LAW, AND TO MAKE AN APPROPRIATION THEREFOR.
The General Assembly of North Carolina enacts:
Section 1.  Article 9A of Chapter 120 of the General Statutes reads as rewritten:
"ARTICLE 9A.
"Lobbying.
"§ 120-47.1.  Definitions.
For the purposes of this Article, the following terms shall have the meanings ascribed to them in this section unless the context clearly indicates a different meaning:
	" " " (1a)	Compensation. – Any money, thing of value, or economic benefit conferred on or received by any person in return for services rendered or to be rendered.  The term includes, but is not limited to, salaries, fees, retainers, and commissions. The term does not include reimbursement of actual travel and subsistence expenses unless lobbying is a significant part of the duties of the individual who receives the reimbursement.
(1b)	Executive Action. – The proposal, drafting, development, consideration, amendment, adoption, approval, issuance, modification, rejection, or postponement of a rule, license, contract, order, determination, or other quasi-judicial action or proceeding by (i) a State agency, or (ii) an officer or employee of a State agency acting or purporting to act in an official capacity.
(1c)	Expenditure. – Any advance, compensation, contribution, conveyance, deposit, gift, honorarium, loan, payment, pledge, reimbursement, retainer, salary, or any thing of value, and any agreement, contract, or other obligation whether or not enforceable.  The term does not include: (i) a prize or award with a value not exceeding one hundred dollars ($100.00); (ii) compensation to one individual not exceeding one hundred dollars ($100.00) in a calendar year; or (iii)  reimbursement of actual travel and subsistence expenses unless lobbying is a significant part of the duties of the individual who receives the reimbursement.
(2),	(3) Repealed by Session Laws 1991, c. 740, s. 1.1.
(4)	" Legislative Action. – The preparation, research, drafting, introduction, consideration, modification, amendment, approval, passage, enactment, tabling, postponement, defeat, or rejection of a bill, resolution, amendment, motion, report, nomination, appointment, or other matter by the legislature or by a member or a legislative employee acting or purporting to act in an official capacity.
(4a)	Legislative Employee. – Defined in G.S. 120-129(2).
(5)	Lobbying. – The term includes:
a.	Influencing or attempting to influence:
1.	Legislative action through direct oral or written communication with a member of the General Assembly; or
2.	Executive action through direct oral or written communication with an officer or employee of the State agency that is authorized to take that executive action; or
b.	Solicitation of others by lobbyists to influence directly or indirectly (i) legislative action, or (ii) executive action taken or to be taken by a State agency.
(6)	Lobbyist. – An individual who:
a.	Is employed and receives compensation, or who contracts for compensation, for the purpose of lobbying; or
b.	Represents another person and receives compensation for the purpose of lobbying.
	The term 'lobbyist' shall not include those individuals who are specifically exempted from this Article by G.S. 120-47.8.  
(7)	Principal. – The person whom the lobbyist represents or in whose behalf the lobbyist is lobbying.
(8)	Person. – Any individual, firm, partnership, committee, association, corporation, or any other organization or group of persons.
(9)	Regular Session. – The period of time between the date set by the General Assembly on which it shall convene until the General Assembly either:
a.	Adjourns sine die; or
b.	Recesses or adjourns for more than 10 days.
(10)	State Agency. – An agency, board, commission, committee, department, office, or other body of the executive branch of State government.
"§ 120-47.2.  Registration procedure.
(a)	A lobbyist shall file a registration statement with the Secretary of State before engaging in any lobbying.  A separate registration statement is required for each lobbyist's principal.
(b)	The form of the registration shall be prescribed by the Secretary of State and shall include the registrant's full name, firm, and complete address; the registrant's place of business; the full name and complete address of each person by whom the registrant is employed or retained; and a general description of the matters on which the registrant expects to act as a lobbyist.
(c)	Each lobbyist shall register again with the Secretary of State no later than 10 days after any change in the information supplied in his last registration under subsection (b) of this section.  Each supplementary registration shall include a complete statement of the information that has changed.
(d)	Within 20 days after the convening of each session of the General Assembly, the Secretary of State shall furnish each State agency, each member of the General Assembly, and the State Legislative Library a list of all persons who have registered as lobbyists and whom they represent.  A supplemental list shall be furnished periodically each 20 days thereafter as the session progresses.
(e)	Each registration statement required under this Article shall be effective from the date of filing until January 1 of the following odd-numbered year.  The lobbyist shall file a new registration statement after that date, and the applicable fee shall be due and payable.
"§ 120-47.3.  Registration fee.
Every lobbyist's principal shall pay to the Secretary of State a fee of seventy-five dollars ($75.00) which fee shall be due and payable by either the lobbyist or the lobbyist's principal at the time of registration.
A separate registration, together with a separate registration fee of seventy-five dollars ($75.00), shall be required for each lobbyist's principal for which a person acts as a lobbyist.  Fees so collected shall be deposited in the General Fund of the State.
"§ 120-47.4.  Written authority from lobbyist's principal to be filed.
Each lobbyist shall file with the Secretary of State within 10 days after his registration a written authorization to act as such, signed by the lobbyist's principal.
"§ 120-47.5.  Contingency lobbying fees and election influence prohibited.
(a)	No person shall act as a lobbyist for compensation which is dependent in any manner upon (i) the passage or defeat of any proposed legislation or upon any other contingency connected with any action of the General Assembly, the House, the Senate or any committee thereof, or (ii) the outcome of any executive action.
(b)	No person shall attempt to influence the action of any member of the General Assembly or any elected officer or employee of the executive branch of State government by the promise of financial support of the individual's candidacy, or by threat of financial contribution in opposition to the individual's candidacy in any future election.
"§ 120-47.6.  Statements of lobbyist's lobbying expenses required.
(a)	Each lobbyist shall file an expense report with the Secretary of State with respect to each principal no later than September 30 of each year.  This expense report shall include all expenditures made between January 1 and July 31 of that year.  The lobbyist shall file a supplemental report including all expenditures made between August 1 and December 31 by February 28 of the following year.  The lobbyist shall file both expense reports whether or not expenditures are made.
(b)	Each expense report shall set forth the date of each lobbying expenditure, to whom paid, the name of any legislator or any officer or employee of a State agency who benefitted from each expenditure, and the amount of each expenditure made during the previous reporting period in connection with lobbying, in each of the following categories: (1) transportation, (2) lodging, (3) entertainment, (4) food, (5) any item having a cash equivalent value of more than twenty-five dollars ($25.00) and (6) contributions made, directly or indirectly.  It shall not be necessary to report any expenditures made in connection with the attendance of a legislator or an officer or employee of a State agency at any fund-raising function sponsored by a nonprofit organization qualified under 26 U.S.C. § 501(c).  When more than 10 members of the General Assembly benefitted or were invited to benefit from an expenditure, the lobbyist shall not be required to report the name of any legislator, but shall be required to report the number of legislators and, with particularity, the basis for their selection.  The lobbyist shall retain the records corroborating the expenditures reported under this subsection for a period of three years after the filing deadline for each report.
(c)	All reports shall be in the form prescribed by the Secretary of State and shall be open to public inspection.
(d)	When a lobbyist fails to file a lobbying expense report as required herein, the Secretary of State shall send a certified or registered letter advising the lobbyist of the delinquency and the penalties provided by law. Within 20 days of the receipt of the letter, the lobbyist shall deliver or post by United States mail to the Secretary of State the required report and an additional late filing fee of ten dollars ($10.00).  Filing of the required report and payment of the additional fee within the time extended shall constitute compliance with this section.  Failure to file an expense report in one of the manners prescribed herein shall result in revocation of any and all registrations of a lobbyist under this Article.  No lobbyist may register or reregister under this Article until he has fully complied with this section.
"§ 120-47.7.  Statements of lobbyist's principal lobbying expenses required.
(a)	Each lobbyist's principal shall file an expense report with the Secretary of State no later than September 30 of each year.  This expense report shall include all expenditures made between January 1 and July 31 of that year.  The principal shall file a supplemental expense report, including all expenditures made between August 1 and December 31 by February 28 of the following year.  The principal shall file both expense reports whether or not expenditures are made during a reporting period.
(b)	Each expense report shall set forth the name and address of each lobbyist employed, appointed, or retained by the lobbyist's principal, the date of each expenditure made, to whom paid, name of any legislator or any officer or employee of a State agency who benefitted from each expenditure, and amount of each expenditure made during the previous reporting period in connection with lobbying, in each of the following categories: (1) transportation, (2) lodging, (3) entertainment, (4) food, (5) any item having a cash equivalent value of more than twenty-five dollars ($25.00), (6) contributions made, directly or indirectly, and (7) compensation to lobbyists in connection with their lobbying activities.  It shall not be necessary to report any expenditures made in connection with the attendance of a legislator or an officer or employee of a State agency at any fund-raising function sponsored by a nonprofit organization qualified under 26 U.S.C. § 501(c).  When more than 10 members of the General Assembly benefitted or were invited to benefit from an expenditure, the principal shall not be required to report the name of any legislator, but shall be required to report the number of legislators and, with particularity, the basis for their selection.  In the category of compensation to lobbyists the principal shall estimate and report the compensation paid or promised directly or indirectly, to all lobbyists based on the estimated time, effort and expense in connection with lobbying activities on behalf of the principal.  If a lobbyist is a full-time employee of the principal, or is compensated by means of an annual fee or retainer, the principal shall estimate and report the portion of all such lobbyists' salaries or retainers that compensate the lobbyists for lobbying.  The principal shall designate on the report the amounts paid in reimbursement of expenditures made on behalf of the principal by each lobbyist.  The principal shall retain records corroborating the expenditures reported under this subsection for a period of three years after the filing deadline for each report.
(c)	All reports shall be in the form prescribed by the Secretary of State and open to public inspection.
(d)	When a lobbyist's principal fails to file a lobbying expense report as required herein, the Secretary of State shall send a certified or registered letter advising the lobbyist's principal of the delinquency and the penalties provided by law.  Within 20 days of the receipt of the letter, the lobbyist's principal shall deliver or post by United States mail to the Secretary of State the required report and a late filing fee of ten dollars ($10.00).  Filing of the required report and payment of the late fee within the time extended shall constitute compliance with this section.
"§ 120-47.8.  Persons exempted from provisions of Article.
The provisions of this Article shall not be construed to apply to any of the following:
(1) 	An individual, not acting as a lobbyist, solely engaged in expressing a personal opinion:
a.	On legislative action to members or employees of the General Assembly, or
b.	On executive action to officers or employees of a State agency.
	(2)	A person appearing before a legislative committee at the invitation or request of the committee or a member thereof and who engages in no further activities as a lobbyist in connection with that or any other legislative action.
(2a)	A person appearing before a State agency at the invitation or request of the State agency or of an officer or employee of that State agency and who engages in no further activities as a lobbyist in connection with that or any other executive action.
(3)	a.	A duly elected or appointed official or employee of the State, the United States, a county, municipality, school district or other governmental agency, when appearing solely in connection with matters pertaining to his office and public duties.
b.	Notwithstanding the persons exempted in this Article, the Governor, Council of State, and all appointed heads of State departments, agencies and institutions, shall designate all authorized official legislative liaison personnel and shall file and maintain current lists of designated legislative liaison personnel with the Secretary of State and shall likewise file with the Secretary of State a full and accurate accounting of all money expended on lobbying, other than the salaries of regular full-time employees, at the same times lobbyists are required to file expense reports under G.S. 120-47.5.
(4)	A person performing professional services in drafting bills or in advising and rendering opinions to clients, or to legislators on behalf of clients, as to the construction and effect of proposed or pending legislation or executive action where the professional services are not otherwise, directly or indirectly, connected with legislative action or executive action.
(5)	A person who owns, publishes or is employed by any news medium while engaged in the acquisition or dissemination of news on behalf of the news medium.
(6)	Repealed by Session Laws 1991, c. 740, s. 1.1.
(7)	When in discharge of their legislative duties, members of the General Assembly and legislative employees.
(8)	A person responding to inquiries from:
a.	A member of the General Assembly or a legislative employee, and who engages in no further activities as a lobbyist in connection with that or any other legislative action, or
b.	An officer or employee of a State agency, and who engages in no further activities as a lobbyist in connection with that or any other executive action.
(9)	An individual giving facts or recommendations pertaining to legislative action to the individual's own legislative delegation only.
(10)	A person who submits written comments, oral comments, or both, on a proposed rule at a public hearing held by a State agency or during the period of time set by a State agency for written comments and who engages in no further activities as a lobbyist in connection with that executive action.
(11)	An attorney who represents a party in a request for a declaratory ruling or in an administrative hearing under Chapter 150B of the General Statutes or any other quasi-judicial proceeding.
"§ 120-47.9.  Punishment for violation.
Whoever willfully violates any provision of this Article shall be guilty of a misdemeanor and upon conviction shall be fined not less than fifty dollars ($50.00) nor more than one thousand dollars ($1,000), or imprisoned not exceeding two years, or both.  In addition, no lobbyist who is convicted of a violation of the provisions of this Article shall in any way act as a lobbyist for a period of two years following his conviction.
"§ 120-47.10.  Enforcement of Article by Attorney General.
The Secretary of State shall report apparent violations of this Article to the Attorney General.  The Attorney General shall, upon complaint made to him of violations of this Article, make an appropriate investigation thereof, and he shall forward a copy of the investigation to the district attorney of the prosecutorial district as defined in G.S. 7A-60 of which Wake County is a part, who shall prosecute any person who violates any provisions of this Article.
"§ 120-47.11.  Rules and forms.
The Secretary of State shall make, amend, and rescind any rules, orders, forms, and definitions as are necessary to carry out this Article to effectively protect the public interest from undue influence in the governmental processes of the State."
Sec. 2.  In addition to other funds appropriated to the Office of the Secretary of State, there is appropriated from the General Fund to the Office of the Secretary of State for the 1993-94 fiscal year the sum of sixty-five thousand two hundred thirty-nine dollars ($65,239); and for the 1994-95 fiscal year the sum of fifty-eight thousand five hundred thirty-nine dollars ($58,539).
Sec. 3.  This act becomes effective January 1, 1994.