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WASHINGTON — When Elliott Portnoy joined Sonnenschein Nath & Rosenthal in 2002 to build the firm’s new federal lobbying practice, he believed that a major component of his success would be a flush political action committee. And he knew that the first step in building a successful PAC would be to convince the firm’s 700 attorneys — especially those outside the Beltway — that campaign fund raising is not just optional. So in early 2003, at Sonnenschein’s annual partner meeting in its home city of Chicago, Portnoy gave a simple, yet dramatic, presentation. He played a recording of four personal telephone messages from members of Congress requesting campaign donations. The messages — shared with the lawmakers’ permission — demonstrated just how aggressively elected officials are seeking hard dollars from lobbyists. Portnoy’s lesson: Like it or not, campaign giving is essential to maintaining friendly relations with lawmakers. Since the passage of the Bipartisan Campaign Reform Act of 2002, which eliminated soft money contributions to political parties, the importance of the more closely regulated “hard dollar” contributions to candidates and others has further increased, many lobbyists say. And as the pressure to give intensifies, more firms are looking to PACs as a way to manage donations. A PAC offers a useful mechanism for a firm to tap into the wallets of its attorneys outside the Beltway. By aggregating contributions from attorneys and lobbyists at a firm, a PAC reinforces a firm’s name recognition on Capitol Hill. But creating a strong PAC is by no means an easy task. Richard Gold, who heads the public policy group at Holland & Knight and is treasurer of its PAC, calls establishing a robust PAC “the hardest part of building a strong federal public policy practice.” Lobbying members of Congress, he says, “pales in comparison to having to ask your partners to contribute their hard earned money.” At Sonnenschein, Portnoy’s effort had the intended effect. The response to the firm’s request for PAC contributions, he says, “exceeded our expectations.” In 2002, Sonnenschein’s PAC raised $27,635. In 2003, 243 of the firm’s attorneys and lobbyists contributed $212,953, making Sonnenschein’s PAC the fourth largest among law firms with D.C. offices. It supported, among others, Banking, Housing and Urban Affairs Committee Chair Sen. Richard Shelby, R-Ala.; Finance Committee Chair Sen. Charles Grassley, R-Iowa; and ranking member of the Rules and Administration Committee, Sen. Christopher Dodd, D-Conn. — who also serves on the Banking, Housing, and Urban Affairs; Foreign Relations; and Health, Education, Labor, and Pensions committees. However, not every big law and lobbying firm sees a PAC as the answer. In fact, two of the largest such firms — Patton Boggs and Covington & Burling — rely instead on individual lawyers and lobbyists making donations on their own, rather than contributing to a PAC. Lobbying boutiques also are mostly sitting out the PAC game, often because they’re too small to collect the volume of checks necessary to make it worthwhile. The PMA Group and Wexler & Walker Public Policy Associates are among the few lobby shops with sizable PACs. The PMA Group’s PAC raised $148,978 in 2003. The firm declined comment on its fund-raising activities, but, according to Federal Election Committee filings, the defense-focused shop gave money to Sen. Daniel Inouye, D-Hawaii, and Reps. James Moran, D-Va., and Jerry Lewis, R-Calif. All three serve on the appropriations subcommittees, with jurisdiction over defense issues. Van Scoyoc Associates and Cassidy & Associates both have small PACs, which exist only to cover the overhead costs of events such as food and room rental. Lobbyists at these firms can then donate to campaigns on an individual basis. Wesley Bizzell, an election law attorney at Winston & Strawn, points out that the demand on law firm and lobby shop PACs is not coming only from members of Congress. Politically savvy corporations are also expecting more fundraising power from their D.C. representatives. “A lot of corporations that hire law firms that � do federal relations expect to see a vibrant political action committee,” Bizzell says. “It’s becoming part of the vetting process.” At the top of the list of law firm PACs is Piper Rudnick, which raised $818,967 in 2003 for campaigns, including $15,000 each to the Democratic National Committee and the Republican National Committee. Before merging with lobbying powerhouse Verner, Liipfert, Bernhard, McPherson and Hand in September 2002, Piper Rudnick did not have a PAC, says John Merrigan, a Piper partner who serves as the PAC’s treasurer. Verner’s PAC had raised approximately $350,000 during the 2001-02 cycle. Following the merger, the firm decided to create a powerhouse PAC, says Merrigan, who came to Piper from Verner. “Post-campaign finance reform, we regard a PAC as an indispensable tool,” he adds. Like Portnoy at Sonnenschein, Democrat Merrigan and a Republican counterpart at Piper, Roger Levy, embarked on a campaign to persuade the firm’s attorneys of the importance of a strong PAC. A little more than a year later, 392 Piper Rudnick professionals have contributed to the PAC. “The amount of money is one thing, but the amount of participation is really, really good,” says Merrigan. He expects the PAC to raise and disburse approximately $1 million by the end of the 2003-04 cycle. PAC POWER On the most basic level, a PAC allows a firm’s attorneys to share the burden of campaign giving. But its benefits go beyond practicality. A PAC is also a useful branding tool. When Portnoy joined Sonnenschein in 2002, the firm was not well known inside the Beltway. An active PAC, he says, helped raise the firm’s profile among members of Congress. In less than two years, the Clark Consulting Federal Policy Group, which launched a lobbying practice in early 2002, has built a healthy PAC. Established in August 2002, the PAC, which is managed by Patrick Raffaniello, a firm director, disbursed $112,500 in 2003. But, unlike some lobbying outfits, Clark has the advantage of drawing from the employees of parent company Clark Consulting, which offers compensation and benefits consulting and has more than 70 offices nationwide. Indianapolis-based Baker & Daniels launched a PAC last year under the name of its lobbying affiliate B&D Sagamore. David Zook, who manages the firm’s D.C. office, says the PAC has streamlined the administration of campaign giving at Baker & Daniels — replacing a laborious accounting process for making sure no partner went over individual spending limits. As PACs become more visible, firms say they feel more competition. Another Indianapolis-based law firm with a D.C. lobbying presence, Barnes & Thornburg, filed the papers for a PAC on Jan. 29. “It’s so new we haven’t even issued a check,” says Walt Sanders, co-chair of the firm’s federal relations practice, which represents Indiana University Health Care Associates and the Chicago South Shore & South Bend Railroad. Barnes & Thornburg started the PAC in part to simplify its campaign giving, but the firm’s leadership also recognized that they had to keep up with their regional competition, including Baker & Daniels. “More and more regional firms are finding this is a useful tool in the process of government relations,” says Sanders. And as new firms get into the PAC game, even the more established Washington law firms are feeling the pressure to compete. Craig Engle, counsel at D.C.-based Arent Fox Kintner Plotkin & Kahn, began managing its PAC at the beginning of 2003. “The goal for me was to double the amount of Arent Fox attorneys contributing to the PAC, and then double the number of candidates who could receive contributions from our PAC,” he says. In the two years that ended with the 2002 elections, Arent Fox raised and disbursed about $140,000, Engle says. In 2003 alone, about 131 contributors have almost matched that amount, raising $139,926. According to FEC filings, some of that money went to Rep. Roy Blunt (R-Mo.), a member of the House Energy and Commerce Committee who serves as House majority whip. “So you can see in one year we did what it used to take us two years to do,” Engle says. ‘VALUABLE TOOL’ PACs come in various forms and are subject to a host of limits and regulations. Law firms and lobby shops generally form either corporate PACs or noncon-nected PACs. Corporate PACs can collect funds only from people affiliated with the corporation, while nonconnected committees can solicit contributions from anyone who is legally permitted to contribute to federal candidates. Both types of PACs can give to candidate and Capitol Hill leadership PACs, as well as to national, state, and local commit-tees. Contributions by the PACs are subject to a range of spending limits. Every law firm and lobby shop has its own system for managing PAC contributions and building support among its members. Engle has focused on recruiting first-time donors, including associates. “Any associate at Arent Fox who contributes to our PAC can attend for free fund-raisers and meet-and-greets we have for federal officeholders here at the firm,” Engle says. Sonnenschein changed the oversight structure of its PAC to include more attorneys — especially those outside the Dis-trict. The reason for the management changes, Portnoy says, is “to ensure that our partners in San Francisco or Kansas City or Chicago or New York see the PAC, not simply as a tool for the public policy practice, but as a valuable tool for the whole firm and all the firm’s clients.” Akin Gump Strauss Hauer & Feld, which had 125 contributors to its PAC in 2003, holds open, informal meetings of firm lawyers. Decisions about campaign donations are decided by a majority of the group. At Arent Fox, instead of weighing each request individually, Engle and the firm’s partners decided on a set of parameters that a campaign contribution must meet. Requests that meet those standards are always approved. At Holland & Knight, partners Tillie Fowler and Janet Studley chair a committee of eight to 10 of the firm’s attorneys from around the country, who meet every two to four months to consider requests. Gold, the firm’s lobbying practice leader, says the committee itself is diverse in terms of ethnicity, gender, geography and political affiliation. And the 10-person PAC committee at Shaw Pittman doesn’t meet in person at all. Instead, members make their decisions by weighing in on an online database. Even firms that don’t have PACs still see their potential value. John Jonas, who heads Patton Boggs’ public policy practice group, says that a PAC would help with firm branding. But he adds that members of Congress don’t care whether their hard-money donations come from a PAC or individuals. Patton Boggs hosts at least two events a week, Jonas says. “The numbers in terms of what we give individually and we raise for our clients is very, very large.” FEC filings show that Patton Boggs chairman Thomas Boggs Jr. alone gave more than $50,000 to campaigns and committees in 2003. And a source at Patton Boggs indicated that the issue of whether to form a PAC is being re-evaluated there as well. Covington & Burling lobbying partner Roderick DeArment also sees benefits to having a PAC. Not only is the ceiling on giving higher for PACs than individuals, but also, he adds, “it’s easier than rounding up individuals to write checks.” DeArment says that the firm may decide to start a PAC in the future. FEELING THE PRESSURE Wexler & Walker’s PAC has raised $61,532 in 2003 from its 16 lobbyists. “For our size, we are very satisfied with the level of PAC participation and the amount that we’re able to do,” says firm principal and PAC Treasurer Sena Fitzmaurice. But the demand is high. Fitzmaurice es-timates that the firm receives as many as 15 requests in one day for campaign contributions — up to 100 a week. This time of year, she says, is particularly busy. “Everyone wants good numbers for the first quarter.” However, she notes that more requests seem to be crossing her desk since the passage of campaign finance reform. “The number of requests that come in now is significantly increasing, and the amount of money that people are asking for is also increasing,” she says. Even larger PACs, like that of McGuireWoods, which raised $154,670 in 2003, feel pressure. “I don’t think there’s anyone who’s ever said they have enough money for their PAC,” says Frank Donatelli, who manages the firm’s PAC with L.F. Payne Jr., president of McGuireWoods Consulting. “There’s always a greater demand than supply.” Piper Rudnick’s Merrigan says that the demand is as high as it has ever been and not slowing down: “They haven’t lost our phone number, I’ll tell you that.” Kristen A. Lee is a reporter for Legal Times, a Recorder affiliate based in Wash-ington, D.C. This article first appeared in the Feb. 18 issue of Influence, a Legal Times sister publication that covers the business of lob-bying.

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