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US Chamber of Commerce dips to second place in K Street spending

Mega-bills fueled the influence business last year, as lobbyists pivot to new perils of divided government

Lobbying firms on K Street and organizations that fund them disclosed heavy spending in 2022.
Lobbying firms on K Street and organizations that fund them disclosed heavy spending in 2022. (Bill Clark/CQ Roll Call file photo)

The 10 biggest spenders on lobbying shelled out $326.6 million in 2022 to influence the Democrat-controlled Congress and executive branch, a more than 17 percent increase from the year before. The U.S. Chamber of Commerce fell to second place, behind the National Association of Realtors.

Now, with divided control on Capitol Hill this year, lobbying groups and corporations say they expect continued interest in the machinations of Congress and the administration but with a different focus. Instead of working to shape mega-bills, such as last year’s all-Democratic climate and health care law, K Street interests are preparing for more defensive posturing as House Republicans look for federal spending cuts and launch congressional probes. 

Lobbyists also say they are keeping an eye out for possible peril as lawmakers set the stage for brinkmanship over the debt limit increase and fights over federal spending. But there also may be hints of bipartisanship on some matters, such as in the farm bill, an annual defense authorization and items in the technology sector, including in cryptocurrency.  

“The divided government creates a lot of need for political intelligence,” said Stewart Verdery, CEO of Monument Advocacy, whose clients include some of the top 10 spenders, such as Amazon and Pharmaceutical Research and Manufacturers of America, the drug industry lobby. 

Amid wrangling over the debt limit, appropriations and other big-picture issues, “leadership intelligence is going to be at a premium,” added Verdery, whose firm said it grew its lobbying revenue by more than 30 percent last year over 2021. 

No. 2 in ’22 

The U.S. Chamber of Commerce, typically the biggest spender on federal lobbying as measured by filings to Congress under the Lobbying Disclosure Act, or LDA, fell to No. 2 in 2022, behind the National Association of Realtors, also a perennial top spender. 

The chamber has found itself at odds with some in House GOP leadership in recent years, including over endorsements of Democrats. The U.S. Chamber’s leaders have said they’re focusing on an immigration overhaul, trade deals and other issues this year. 

The group’s tax returns showed that in 2021, total revenue declined to $204 million from $230 million the prior year. The chamber spent more on federal lobbying in 2022, $79.4 million, than the $64.8 million spent in 2021. Even with the lower spending in 2021, the chamber led other groups in the top 10 that year. 

The National Association of Realtors increased its spending more dramatically in 2022, to $81.5 million from $43.8 million in 2021. The realtors group disclosed a litany of policy matters on its fourth-quarter lobbying report, including data security and appropriations measures as well as the Democrats’ climate and health care law, housing and financial services matters. 

Patrick Newton, a spokesperson for the realtors group, said NAR usually reports more in election years because it includes such spending, though not required, in its lobbying reports. On policy issues, “the increased spending generally in 2022 supported NAR advocacy efforts both in Washington and around the country to protect private property rights, increase the supply of affordable housing, and ensure fair and equitable access to property ownership,” Newton added.

The advocacy group for retirees, AARP, had not been a top 10 spender recently, but it increased its outlay on federal lobbying to $15.9 million in 2022 as it pushed for legislation that now allows Medicare to negotiate prescription drug prices and caps prices for insulin. Still, it’s nowhere near AARP’s lobbying tabs from the mid-aughts — for example, when it spent $36.3 million in 2005, the year President George W. Bush outlined a plan to privatize Social Security. 

Last year’s Medicare prescription drug changes were viewed as a win for AARP and a big loss for PhRMA, which spent $28.3 million on federal lobbying, a slight decrease from what it spent in 2021, $29.6 million. 

Growth at top firms

Some of K Street’s biggest firms, which represent multiple clients, posted gains in 2022, defying some expectations of an election year slump. 

Brownstein Hyatt Farber Schreck, the biggest lobbying practice as measured by LDA revenue, said it had reported a total of $61.6 million in lobbying fees from hundreds of clients last year, including the U.S. Chamber of Commerce. That was a nearly 10 percent increase from its total the previous year. 

Nadeam Elshami, once an aide to former House Speaker Nancy Pelosi who co-chairs Brownstein’s lobbying practice, credited the uptick in lobbying revenue to the firm’s bipartisan team that “has access to House and Senate leadership, both sides of the aisle, leaders of committees, rank and file members and to the administration and on a variety of issues.” He noted the firm last year hired Will Dunham, a top aide to current Speaker Kevin McCarthy, who like Pelosi is from California.  

Elshami said he sees opportunities for growth with oversight matters, as well as the farm bill and appropriations measures. Clients also are spending a lot of time early this year on meeting the new House and Senate members and their aides, Elshami added.

“They want to meet them and have a chance to provide them with a view of their top priorities,” he said. 

The second-biggest lobbying practice, Akin Gump Strauss Hauer & Feld, said it had reported a total of $53.1 million from clients in 2022, a slight decrease from the $53.4 million the prior year. The fourth quarter of 2022, though, was the biggest quarter to date at $14.1 million, the firm said in a news release. 

“Our strong results reflect an extraordinarily active quarter as Congress wrapped up a historic omnibus appropriations package that included a host of critical issues for clients,” said Akin Gump partner Brian Pomper in a news release. “We closed out 2022 with our strongest quarter in firm history, and we feel well-prepared heading into a divided Congress with the recent addition of Reggie Babin, former Chief Counsel to [Senate Majority] Leader [Charles E.] Schumer, to round out our bipartisan team of former senior staff to House and Senate Leadership offices.”

Pomper added that contrary to “predictions of partisan doom and gloom, we expect significant activity around the debt limit, cryptocurrency, the farm bill, FAA and Defense reauthorizations, expiring [2017 tax overhaul] provisions, and issues regarding China where Akin Gump has unmatched strengths and is uniquely positioned to help clients navigate the evolving landscape.”

Cryptocurrency and China ahead

The lobbying practice at K&L Gates, which recently added former Pennsylvania Democratic Rep. Mike Doyle to its roster, reported a small increase in total lobbying revenue in 2022: $21.4 million from $21.2 million in 2021. 

“We expect another year of growth,” said K&L Gates partner Karishma S. Page. “Even beyond the legislative activity, with the Republicans taking control of the House, there is a very significant oversight agenda where clients are very interested in what risks may be present as a result of that. And on the regulatory side, there will be implementation of very significant legislation, for instance, the Inflation Reduction Act.”

Page said that last year, what fueled the lobbying activity were “these significant pieces of legislation that then served as vehicles for a host of issues.” 

She sees the likelihood of some action on China — House Republicans have set up a new select committee to look at potential economic and security ramifications related to China — and also the potential for bipartisan action on cryptocurrency oversight. Cryptocurrency has been in the legislative spotlight in recent months with the high-profile collapse of FTX and arrest of its CEO, Samuel Bankman-Fried, a top political donor in the 2022 election cycle. 

On crypto, Page said, “Given the volatility in this space, I do anticipate this could be a key area of bipartisan, bicameral consideration.”

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