Healthcare and Wall Street reform legislation boost K Street profits

The legislative maneuvering over healthcare reform and Wall Street regulation boosted the revenues of several lobbying firms during the first half of 2010, according to disclosure forms filed Tuesday.

Patton Boggs, usually the top firm on K Street, reported earning $20.8 million in lobbying fees so far this year. That’s a 12 percent increase over its performance at this point in 2009.

ADVERTISEMENT
“I think there is a growing realization in the business community that everything that impacts their bottom line and daily activities is impacted by an extraordinarily activist government in Washington. They need to be engaged on many levels going forward,” said Kevin O’Neill, deputy policy chairman at Patton Boggs.

Washington's second-biggest lobbying shop, Akin Gump Strauss Hauer &  Feld, reported revenue of $18.2 million for the first half of the year, an increase of 13 percent from mid-2009.

K Street is coming off a remarkably active legislative calendar. After President Obama signed the healthcare reform bill in March, lobbyists had to stay in high gear to keep tabs on the financial services reform legislation.

With both pieces of legislation now complete, lobbying executives said they are expecting a slowdown in business for the rest of the year.

“I think it is tough because it’s an election year. How many days are really left in this Congress? You have a leadership that is very interested in protecting their members and will want to adjourn early in October,” said Al Mottur, managing partner of the Washington office of Brownstein Hyatt Farber Schreck.

Mark Ruge, co-chairman of the policy group at K&L Gates, said the midterm elections are likely to create a new pool of potential hires for K Street firms.

“There is going to be an amazing number of people leaving Congress — not just members but their staff, too — so that’s a new class of people to hire,” Ruge said. “Also, people don’t know who is going to be controlling Congress, particularly the House, so that influences, to some degree, who they hire.”

K&L Gates reported $9.8 million in lobbying fees during the first half of 2010, a 3 percent increase in revenue from this point last year.

Brownstein continues to be one of the fastest-growing lobby firms in Washington, according to the latest reports. The firm has earned $11.8 million in lobbying fees so far in 2010 — a 28 percent climb over the $9.2 million it had reported by mid-2009.

“I believe in the two R’s, which are retention and referral. We were able to build off the client list we put together last year,” said Brownstein’s Mottur. But the lobbyist is not expecting the same growth during the second half of 2010.

“A whole host of new companies and potential clients were excited about Recovery Act opportunities in the fall of ’09. That’s just not the case now,” Mottur said.

Another big earner was the Podesta Group, which reported $14.3 million in lobbying fees for 2010’s first half, a 23 percent increase compared with 2009.

Other firms aside from Brownstein and Podesta reported revenue growth in the second quarter, though their gains were not quite as dramatic.

Drew Maloney, CEO of Ogilvy Government Relations, said his firm recorded a 2 percent increase this past year despite having fewer registered lobbyists at the firm. The firm reported about $9 million in lobbying fees for the first half of this year, compared to $8.8 million at this point in 2009.

Maloney thinks this election year will be better for lobbying than 2008 because of the potential for “significant lame-duck” activity and possible rebalancing in Congress after November.

Maloney said that, in the event of substantial Republican gains in November, tighter margins in both the House and Senate are likely to affect the balance of power among lobbying firms. For example, the 2008 election saw a surge in business among heavily Democratic-leaning firms.

“Firms that have similar balances [to the makeup of Congress after November] will prosper in that environment,” Maloney said.

Bob Jones of Alston & Bird said that while a drop-off in legislative activity during an election year is common, his firm’s latest numbers run counter to that trend.

Alston & Bird has earned $5.5 million in lobbying fees so far, a 10 percent increase from the 2009 halfway point for the firm. Jones attributed the increase to Congress’s and the Obama administration’s intense focus on healthcare and the economy.

“Government and Congress are involved in areas of business that they hadn’t been involved in before,” Jones said.

Rich Gold, a partner at Holland & Knight, said his firm’s revenue rose 2 percent from last year, to $10.8 million. The firm’s lobbyists have focused on healthcare reform as well as energy and climate change legislation.

Gold said he is surprised to see an increase in lobbying revenue during an election year, but with a number of key legislative battles looming, lobbyists are keeping busy.

“I think people are staying engaged on these issues, realizing that the Hill is going to influence what happens going forward,” Gold said.

[Not all lobby firms were able to report their revenue figures before press time Tuesday. Check back with The Hill to see how other firms on K Street are doing this year. ]



Silla Brush and Roxanna Tiron contributed to this article.