Former Rep. John Thune (R-S.D.) will continue to lobby for several South Dakota companies even as he pursues a challenge to Senate Minority Leader Tom Daschle (D) in November.

Thune confirmed to Roll Call on Friday that he has signed on to represent a handful of clients, including a beef products manufacturer and a railroad company. He is also on the verge of signing up a company that owns ethanol processing facilities.

“That will be an ongoing thing,” Thune said. “At least in the early going, I intend to do some work for some South Dakota groups.”

Campaign finance law permits Congressional candidates to draw salaries and even work as Washington lobbyists.

“As long as you are actually doing some work, receiving a salary is OK,” said Kelly Huff, a spokeswoman for the Federal Election Commission.

Thune’s decision drew immediate criticism from Democrats, who publicly castigated the appearance of impropriety, and privately rejoiced that his decision in all likelihood removes the potency of the lobbying work of Daschle’s wife as a campaign issue.

“Questions should be raised about how proper it is for [Thune] to be lobbying Congress at the same time he is seeking a job in Congress,” said Daschle campaign manager Steve Hildebrand.

Thune campaign manager Dick Wadhams quickly struck back, alleging that the Minority Leader serves as “chairman of the board of Daschle Inc.”

When asked to explain, Wadhams replied: “Lobbying seems to be the [Daschle] family business, based out of Washington, D.C.”

The back and forth between the campaigns is the first major skirmish since Thune formally entered what is expected to be the most high-profile — and contentious — Senate race on the 2004 docket.

In anticipation of his toughest election since coming to the Senate in 1986, Daschle’s campaign operation has been going full tilt for the better part of the past year.

He is expected to show roughly $4 million on hand in his year-end FEC report, and the campaign already has dozens of field operatives putting together a turnout organization.

Thune entered the contest Jan. 5 after more than a year of courting by the National Republican Senatorial Committee. He has admitted that he begins the race as an underdog.

This initial dustup over the lobbying ties of both Thune and Daschle serves as a preview for what is likely to become one of the major points of contention in the race.

The debate centers on whether Thune’s decision to lobby nullifies potential Republican attacks against Linda Daschle, a lobbyist at Baker, Donelson, Bearman & Caldwell.

National and state GOPers have long maintained that Linda Daschle’s occupation represents a blatant conflict of interest for the Senator.

In an attempt to avoid the appearance of impropriety she has voluntarily refused to lobby the Senate.

Wadhams dismissed the idea that Thune’s work as a lobbyist removes Linda Daschle’s work as a potential campaign issue.

“I don’t think there is any comparison,” said Wadhams. “John Thune is not an elected official, Tom Daschle is. That is a big, huge difference.”

Hildebrand warned that any attempt to make Linda Daschle’s career a matter of public debate would be fought strongly by the campaign and could backfire on Thune.

“If [Thune] begins to attack Tom’s family we will certainly raise the question of fairness,” Hildebrand said.

Much of the current controversy surrounds Thune’s activities in the 14 months since his 524-vote loss to Sen. Tim Johnson (D-S.D.) in 2002.

Shortly after his defeat, Thune started his own lobbying firm, The Thune Group, and quickly established a business relationship with Arent Fox Kintner Plotkin Kahn, a major law firm and lobbying shop in Washington. He has resigned from his post at Arent Fox effective Jan. 31.

Through the Thune Group, the former three-term House Member has worked to secure federal funds for Sioux Falls-based DM&E Railroad from the Federal Railroad Administration.

Thune also lobbied the Interior and Agriculture departments to give the freight railroad company permits for easements and rights-of-way.

Thune earned $20,000 representing the company from mid-April to the end of June last year, according to lobbying disclosure forms filed with the Senate.

Figures for the July 1-Dec. 31 period are not yet available.

Late last year, the Thune Group signed up to help beef producer BPI Technology Inc. win contracts to help supply the Agriculture Department’s school lunch program. It is unclear how much Thune will be paid to represent the firm.

Thune also is nearing a deal to represent the Broin Companies, a Sioux Falls-based ethanol producer.

“I’m in the process of working that out right now,” he said.

Because his one-year ban on lobbying expired just a few weeks ago, most of his work in Washington so far has focused on federal agencies, not Members of Congress.

But Thune said it is possible that he will now begin lobbying on Capitol Hill.

One of his other post-Congressional ventures met with less success.

He created South Dakotans for Responsible Government, a 527 group designed to “promote our prairie values — in South Dakota and across the country,” according to a fundraising mailer for the group. But less than two months later, he resigned his post as president after Democrats, led by the Daschle campaign, questioned the propriety of a potential candidate for federal office heading up a group that accepts soft-money checks while his campaign committee remained active. The group closed its doors shortly afterward.

Under the Bipartisan Campaign Reform Act, which was passed in the 107th Congress, no federal officeholder can be involved in the raising of soft money.

Thune is not the first Republican Senate candidate in recent memory to have ties to a lobbying firm while pursuing higher office. Two freshman Republican Senators are among those who worked for law firms that lobbied government agencies.

Sen. Norm Coleman (R-Minn.), then the former mayor of St. Paul, held a position with a St. Paul law firm until July 2002, a few months before Election Day, according to the financial disclosure form he filed in May 2003.

In the first half of 2002, the firm, Winthrop & Weinstine, paid Coleman $107,566. He started with the firm in 2001, a year in which he took in $54,923, earning more than $160,000 total in little more than a year with the firm.

Sen. Jim Talent (R-Mo.) stopped working with his firm — Arent Fox, the same firm whose D.C. office Thune worked out of — at the end of 2001, but his financial disclosure forms revealed that he was much more handsomely paid for his non-campaign work in the off-year than Coleman, receiving $242,403 for the year.

In addition, Talent held a lucrative part-time teaching position at Washington University in St. Louis, a job he held until May 2002. In 2001, the college paid him $152,976, bringing his annual salary that year to just less than $400,000. In 2002, after he left Arent Fox, Washington University paid him another $38,640.

Paul Kane contributed to this report.