Lobby firms beat the midterm blues

Greg Nash

Washington’s lobby firms are riding a spurt of momentum into the midterm elections.

Despite a campaign season that has kept lawmakers away from Washington, many shops saw their earnings increase in the third quarter of the year, which ran from July to the end of September.

ADVERTISEMENT
Lobbyists attributed the increase partly to the lame-duck session of Congress that looms after the elections, with businesses, municipalities and non-profits anxious to prepare.

“That uncertainty creates more interest in clients,” said Marc Lampkin, the managing partner of Brownstein Hyatt Farber Schreck’s Washington office.

Brownstein is among the K Street firms that posted growth over last year’s third quarter, taking in $6.35 million in lobbying revenue. The firm has earned more than $17.7 million for the year.

BGR Group, a GOP-leaning firm, also saw a third-quarter surge, with revenue crossing the $4 million mark, a 10 percent increase over the same period last year and the highest quarterly take for the firm since 2011.

Loren Monroe, a principal at BGR Government Affairs, said clients are eager to ensure that their priorities don’t get lost in the post-election shuffle.

“Our firm’s lobbyists were hired as Congress is working to resolve important tax, trade, health and energy issues before the end this calendar year,” Monroe told The Hill in an email. 

Congress only has only a few weeks left when lawmakers come back in mid-November to clear a legislative backlog that has built up for months.

Among the issues awaiting action are a government funding bill, a Defense authorization measure and legislation renewing a slew of tax cuts prized by the business community.

Mark Ruge, who co-chairs the large public policy and law practice group at K&L Gates, said he expects his firm to notch its best lobbying revenues since 2011 after earning more than $4.4 million in the third quarter.

“There’s a tremendous interest from our clients in what happens next, especially if the Republicans take the Senate,” he said. “Many people are focused on what the dynamics of that might be: What does that mean for our clients’ programs?”

Another third-quarter winner was Capitol Counsel, which continued its streak of rapid growth.

The firm’s quarterly revenues rose more than 20 percent over last year, boosting its yearly haul to $13.28 million.

While a majority of K Street’s big firms got a boost in the third quarter, a handful saw revenues decline, including Mehlman Castagnetti Rosen Bingel & Thomas, Podesta Group and Squire Patton Boggs.

Mehlman Castagnetti earned $8.54 million in the first three quarters, compared with almost $10 million during the same period in 2013, though partner David Castagnetti told The Hill that the firm "[anticipates] a robust 2015," because of policy work likely left unfinished at year's end.

Podesta Group’s revenue fell from nearly $20.5 million in the first three quarters of 2013 to less than $19 million this year.

Squire Patton Boggs, which is still in restructuring mode following its merger, took the biggest quarterly hit of all, posting a decline of 26 percent to $6.92 million during the third quarter.

The fall in business at Squire Patton Boggs makes official what The Hill reported this summer: Akin Gump Strauss Hauer & Feld is now the No. 1 lobby shop by revenue in all of Washington.

Akin Gump boosted its third quarter revenue by $300,000 over the same time in 2013, taking in $8.79 million from July through September alone. During this year’s first three quarters, the firm made almost $26 million.

“Our numbers are a reflection of the cyclical nature of our work and we remain very pleased with the direction of our business,” said Don Pongrace, the head of the public law and policy group at Akin Gump.

Though overall lobbying revenue has been stagnant for years, several firms say the numbers don’t tell the whole story because of a growing demand for services that aren’t reported under the Lobbying Disclosure Act. 

Foreign lobbying, grassroots campaigning and strategic consulting are among the K Street moneymakers that aren’t reflected in the numbers, lobbyists say.   

“We have a variety of new policy projects underway for non-U.S. clients in Latin America, Asia and Africa focused on a variety of areas, including market access issues, technology and natural resources,” said Dan Bryant, the chair of Covington & Burling’s public policy and government affairs practice group, in an email. “We see this global and non-U.S. work being a significant part of our future.”

Covington's numbers fell when looking at the third quarter of this year compared to last year, but it still posted gains over 2013's total year-to-date earnings, pulling in nearly $9.2 million so far in 2014.

Rich Gold, the head of public policy group at Holland & Knight, said his firm laid the groundwork years ago for a business expansion — including decisions to do away with billable hours and bolster its advocacy in high-trafficked policy areas such as healthcare, energy and technology. 

Holland & Knight earned almost $5 million during 2014’s third quarter, an 8 percent increase over the previous year. 

Lampkin, a former aide to Speaker John BoehnerJohn Boehner3 ways the next president can succeed on immigration reform Republican Study Committee elders back Harris for chairman Dems to GOP: Help us fix ObamaCare MORE (R-Ohio), said lobby firms such as Brownstein that planned ahead for the ebb and flow of the election-year schedule are reaping the rewards.

Still, he added: “One of the hallmarks of a growth in revenue is keeping your current clients happy.”