Breaux-Lott’s Fat 1st Quarter

Posted April 22, 2008 at 6:54pm

Less than four months after he left office, former Sen. Trent Lott (R-Miss.) has already scored a major payday downtown. The firm he founded with former Sen. John Breaux (D-La.) earned at least $945,000 during its first quarter in business, according to House filings.

That take is impressive in its own right. But it is also likely to grow, as the firm, officially known as the Breaux-Lott Leadership Group, continues to ink new contracts.

Just this month, as the second quarter got under way, it signed up two blue chip clients, the Coalition for Patent Fairness and Tyson Foods.

The firm’s first-quarter total did not include its earnings from the United Space Alliance, whose report was not available online at press time.

Bret Boyles, Lott’s former chief of staff and now a lobbyist with the firm, declined to comment on any aspect of the firm, its clients or its fees.

Breaux, Lott, their respective sons John and Chet, Boyles and two other former aides to the Senators make up the firm, which now has 16 clients.

Most lobbyists and industry watchers said the results should come as no surprise. The two former Senators offer prized insight into the legislative process and claim goodwill on both sides of the aisle that translates into valuable access.

“There’s no doubt in my mind that if you have two folks the stature of John Breaux and Trent Lott that they’re going to do well,” said Alex Vogel, former chief of staff to then-Senate Majority Leader Bill Frist (R-Tenn.) and now a partner at Mehlman Vogel Castagnetti.

But there are also several factors weighing against the firm in its start-up year. Prime among them is the revolving-door prohibition that bans Lott from lobbying either chamber this year.

“They’re beating expectations for a firm where one of the partners can’t even talk to” lawmakers, one Democratic lobbyist said. Lott can still lean on executive branch agencies.

Add to Lott’s sidelining the fact that presidential election years usually make for skimpy legislative agendas — a phenomenon compounded in the last year of an administration — and an economic downturn that is prompting many potential clients to sit on their wallets.

The firm’s first-quarter results present an incomplete snapshot. While Breaux-Lott opened its doors Jan. 7, it didn’t start work for several clients until February or even March.

Still, the firm’s first-quarter filings suggest it has built a stable of at least seven clients paying $50,000 a month, close to the top end of what the toniest lobby shops charge. Last year, only 28 clients across town averaged payments that high or higher, according to a tally by CQ MoneyLine.

“I would say there are a lot of former Members and staffers who would love to have the start-up these guys have had. They would give their eye teeth to have those numbers,” said Ivan Adler, a headhunter for the McCormick Group.

Breaux-Lott’s top-paying clients during the first three months of the year include AT&T ($150,000 for help on FISA legislation); the Association of American Railroads ($150,000 for a tax cut on infrastructure investments); and the Plains Exploration and Production Company ($150,000 for work on offshore oil and gas issues).

It earned $125,000 over the three-month period from Delta Airlines for work on the company’s proposed merger with Northwest Airlines.

On Feb. 15, it signed up Chevron, which paid $75,000 over the ensuing six weeks for help in the climate change debate.

On March 1, it added to that list by signing three clients that each paid $50,000 for the month: Shell Oil (for work on offshore oil and gas issues); Nissan North America (climate change and clean air issues); and Northrup Grumman (naval vessels and an Air Force tanker), filings show.

The shop has also taken on a handful of clients that appear to be paying significantly less. Among them is the LHC Group, a for-profit home health care provider.

Eric Elliot, vice president of investor relations for the company, said they hired the firm to help restore higher Medicare reimbursement rates for health care providers operating in rural areas.

Breaux joined the board of the Louisiana-based company last year, and Elliott said he impressed firm principals with a speech to investors in New York City. “He’s very good at getting his point out,” he said.

Peggy Wilhide, spokeswoman for the Association of American Railroads, confirmed the shop is worth its price. “They’re giving us good advice and guidance,” she said.

But the firm’s fast success has given pause to one reform advocate. It highlights the need for lawmakers to consider the best way to slow the revolving door between Capitol Hill and K Street, said Craig Holman, a lobbyist for Public Citizen.

Lott quit the Senate days before the mandated cooling-off period for former Senators jumped to two years from one under the reform law Congress passed last year.

But Holman said the fact that former lawmakers can still hit pay dirt so soon suggests the law should go further, banning them entirely from setting up shop until a full Congress has passed.

“That would take away the natural edge they have from the relationships built while serving in Congress,” he said.