I published recently a blog about conducting Audits for State Government Relations programs.
In response, lobbyist/attorney Dennis Duncan of Zimmer, Duncan & Cole in Sioux Falls, South Dakota offered his own advice for hiring and managing lobbyists and other aspects of state government relations. After a few rounds of emails I thought about this blog and appreciate Dennis’s participation.
Annually, I and my colleagues at Stateside Associates interview, retain and manage dozens of state and local lobbyists for clients. Understanding the perspective of the lobbyist, in addition to that of the client, is valuable and so I’ve captured my exchange with Dennis below. Hope you enjoy it.
Please note that my thoughts are my own and Dennis’ are his. Please join the conversation online!
Dennis: I would suggest blogs on the dynamics of conducting negotiations on fees with clients. You would suspect that everyone would know how to do this but you often run into the situation that the fee expectation of the client and the lobbyist are worlds apart, which leads to extended conversations that do not result in retention. Often this could be avoided by the client clearly stating at the outset what their fee expectations or limits are so the parties can determine early if there is interest in continuing discussions on retention or [whether] the client needs to look elsewhere. All lobbyists have their standard fees for different scopes of services but the repeated discussions as to scope of work and exchange of CVs and etc. sometimes is really unnecessary because a fee agreement will never be reached for lack of agreement on fees.
Stateside: Interesting perspective. I usually sit on the client side of these negotiations and never have the client offer a fee for lobbying.
Dennis: My experience is different. Clients often set the fee. On that topic in discussions with colleagues I would suggest multi-year agreements often times results in a lower fee quote from lobbyists. I suggest a long term agreement rather than a one year or one scope of service and out. Most lobbyists are willing to take a smaller annual fee if it is a long term agreement rather than just a one and done.
I also understand those seeking lobbyists often times due to their corporate culture require interviews of several candidates. This is a frustrating and expensive process which in my humble opinion results in decisions driven by factors other than who can do the best job.
Stateside: You presume that clients have a budget for an engagement. In fact, they often do not. They might have a notion of cost and need to confirm it before getting the resources.
Dennis: You would have a better handle on that fact. I am surprised they do not have a fee in mind.
Stateside: Regarding one year versus multiple year…check. My counsel to clients is to expect to pay more for the one shot, BUT—over time, I have actually seen no difference in proposed fees and we’ve hired hundreds of times in 25 years. It is a market and the more people know “the going rate” they tend to hire close to that and keep the fees in check.
How to Find a Lobbyist
Stateside: How do you recommend a client find a lobbyist if you don’t like the multiple interview approach?
Dennis: They should ask their lobbyists in the other states that they know (for example in South Dakota) that are in the process of locating a lobbyist. Asking lobbyists they know from past experience in other states will get [your clients] referrals to the best lobbyists. I do it all the time. I am often asked who I know in North Dakota, Nebraska or Iowa and make the referral to people I know to be the best in the business in those states. Most of us attend national meetings with lobbyists from several states, so the client can ask a lobbyist, for example: ‘who do you know in South Dakota or Iowa or Nebraska’ and I bet in 100% of the cases they will have a name for them. The lobbyists are not going to steer them wrong because they want to maintain a good working relationship with the client. The client can than look at the lobbyist’s client list, or ask the referring lobbyist for information and see who he/she is representing to see if they like the looks of the lobbyist. Good clients hire good lobbyists and this method is far superior and much cheaper than the beauty contest approach.
If they do not have lobbyists in other states the client still must have business contacts within the state to which they can make inquiry. It is not an apples to apples comparison but I get hired a lot on matters relating to the representation of insurers and insurance producers based on recommendations from staff at the Division of Insurance. They often make recommendations when asked who in the state (in this case South Dakota) has experience dealing with similar issues within the Division of Insurance. My point is that anyone who needs a lobbyist would be well served by asking for references from people that know your work, which answers the question you posed about capacity, ethics and subject matter knowledge.
The interview process is expensive for all parties and in my humble opinion does not produce the results most of the companies may think it does. Ask yourself this, ‘how often does the interview process fail you when you employ staff?’
Stateside: Clients and political contributions. Some cannot. Some won’t. We suggest they do whenever possible and if they cannot make direct contributions, supporting the partisan organizations of state officials, such as RAGA, DAGA, DLLC, RLCC, RGA and DGA is the next best thing and highly valuable with a well-executed plan of engagement. What’s your view?
Dennis: Bottom line…clients should make contributions if they are able. Anyone who does not think legislators do not look to see who is contributing to their campaigns is deluding themselves. At times we ask legislators to take difficult positions, and those that do deserve (and quite frankly expect) to be supported financially in their campaigns. The contributions to the groups you suggest are not as effective as contributions to local PAC’s which support the legislator whose support you are seeking. A well-executed plan is one which polls your lobbyist as to whom the contribution should go.
Stateside: Ok, next topic—grassroots. We see tremendous value, but success can be achieved on a much smaller scale than necessary for “federal” campaigns. And, anything too slick is easily dismissed as fake. What’s your experience in integrating grassroots into a lobbying campaign?
Dennis: Mixed results. If it is done to identify true local grassroots support it can be effective. If true local grassroots support is not identified and [something else is] used we call it AstroTurf. South Dakota is such a small state if the grassroots is not local the effort is quickly identified and generally disregarded. An example is the use of voluntary health groups, if the national group (take, for example the cancer society) comes in they need a location-based face and to generate grassroots contacts from local people. We are a parochial state in which outsiders are not generally effective.
Social Media and State Legislators
Stateside: I predict that underestimating the impact of social media on state government relations is going to be the downfall of many. The speed, the penetration, the ability to screw up on a grand scale, instantly, is going to take some time to adjust to. But, adjust we must. In the olden days–pre-2013-Marketing and Communications folks kept tabs on social media. But, this is now a job for government relations since the legislators themselves are doing the tweeting and posting.
How is Social Media affecting your work in Pierre?
Dennis: The use of social media is becoming much more common particularly among younger legislators. Legislators see it as an efficient way to communicate to a focused group of people. Social media generally permits you to communicate with people you know have an interest in your efforts and it also has a high efficiency perspective in that you can reach a large group of people in a short amount of time. It also permits legislators to at times know what their opposition is doing or saying in regards to a position being staked out by a legislator. Legislators have to remember your “friends list” can often times be very expansive.
A problem I have seen in the use of social media is when it is used in an effort to show some type of “grassroots” support or opposition. There is a need to utilize this effort only if a fair representation of the issue and the legislator’s position is made and posted to social media in an effort to engender support or opposition. If there is a misrepresentation or misunderstanding as to a legislator’s position on an issue the use of social media is generally not effective and in fact can be harmful. To date I have not encountered a real effective use of social media in South Dakota due to the fact the few coordinated uses of it have been on issues where the proponents of its use have been “fringe” groups who were mostly out of the mainstream of thought held by legislators and the message attempting to be conveyed was ignored. The principal reason the messages got ignored are that they were seen as out of the mainstream of thought among most legislator’s core supporters or the bulk of the messages were comments from people who were not voters in the legislator’s district.
I am told by many legislators that they use more limited messaging if they wish to poll people as to what they think about issues because they generally want to focus on their core supporters. However, social media certainly permits a more broad opportunity to determine the thoughts of constituents generally on an issue. It is an effective vehicle to reach a larger number of people quickly. Which is why I believe it is more effective to be used by a legislator rather than grassroots groups who are often not electors of the person to whom they are reaching out.