Big Business Sets New Record For Lobbying In State Capitol

Watchdogs alarmed by $360 million that companies spent to guard their interests

By Patrick McGreevy, LOS ANGELES TIMES

February 3, 2019

Big business and other interest groups spent a record $360 million last year on lobbying California government, led by the state’s largest electric utilities, which weighed in on efforts to change laws that govern billions of dollars in wildfire-related costs.

Other top spenders included oil companies that fought new restrictions aimed at offshore drilling and telecommunications giants that opposed a sweeping net neutrality bill.

The money eclipsed the previous record of $342.6 million spent in 2017 and renewed concern about the amount of cash going toward swaying decisions at the state Capitol.

“Money has too much influence on our political system,” said Rey Lopez-Calderon, the executive director of California Common Cause. “Every year we see the lobbying spending increase is a year we risk disenfranchising more voters and silencing the voices of ordinary citizens.”

The top spender on lobbying in 2018 was Pacific Gas and Electric Co., which paid $9.9 million to advocate on issues that included legislation allowing utility companies to shift some fire-related costs to customers.

Edison International, parent company of Southern California Edison, was the third-biggest spender on lobbying last year, paying $4.2 million, as it joined PG&E in supporting Senate Bill 901. The legislation allows utilities to ask regulators for permission to charge ratepayers to help finance costs for 2017 fires and those in 2019 and beyond, even when the companies did not act properly.

The measure was signed by then-Gov. Jerry Brown in September after intense lobbying late into the legislative session. The stakes were particularly high for PG&E, which filed for bankruptcy protection last month in the face of significant potential wildfire liability.

“It goes back to the threat of climate-driven wildfires, and that being the biggest issue facing our company today and one of the most critical issues facing California,” said Lynsey Paulo, a spokeswoman for PG&E. “We have to continue to work together to ensure that there is going to be ongoing investment in climate resiliency, and that’s why we were advocating for that type of action.”

She noted that money for lobbying comes from shareholder funds and not utility customers. While much of it went to professional lobbyists, about $6.7 million went to what it called “payments for grassroots and other advocacy,” which includes advertising.

The investment in lobbying could yield the utilities tens of billions in “bailout funds,” said Jamie Court, president of the Santa Monica-based nonprofit group Consumer Watchdog. He referenced the “Godfather” trilogy in criticizing utilities.

“PG&E bought up more lobbyists than the Corleone family had hit men on the street after Sonny was shot on the causeway,” Court said. “They went to the mattresses.”

An Edison representative said in a statement that the company supported the 2018 wildfire legislation as a starting point to address serious issues.

“During the 2018 legislative session, Southern California Edison supported efforts to find comprehensive solutions to the urgent and growing threats of wildfire and exercised its responsibility to engage with state policymakers,” said Charles Coleman, a company spokesman.

Another heavily lobbied bill last year sought to implement net neutrality regulations in California that were were repealed by the Trump administration at the federal level. The rules, which now face a challenge from a federal lawsuit, would bar broadband and wireless companies from blocking or hindering access to internet content, and from boosting some websites through charging for faster speeds.

Opponents of the bill included AT&T, Verizon, Comcast and the California Cable and Telecommunication Assn., which spent a combined $4.7 million on lobbying last year.

“It was a huge amount of money,” said Ernesto Omar Falcon, legislative counsel for the Electronic Frontier Foundation, which supported the bill and spent $56,000 on lobbying last year. “It really indicated that this was for all the marbles for them. They needed to win the political fight in California so as not to risk losing the litigation fight. Their back is up now to try to win this in court.”

The oil industry has been a perennial top spender on lobbying at the Capitol. In 2017, Chevron Corp. and Western States Petroleum Assn. topped the list of those paying lobbyists to advocate on their behalf as the Legislature voted to limit the ability of air quality regulators to adopt carbon-cutting rules for refineries.

The oil industry was once again in the Top 10 last year. WSPA spent the second most in 2018, more than $7.8 million, while Chevron placed fifth on the list, spending $3.9 million.

Bills fought by the industry included a measure by Sen. Hannah-Beth Jackson (D-Santa Barbara) aimed at blocking Trump’s proposal for more offshore drilling by barring the construction of pipelines and onshore support facilities needed to transport the oil and gas from federal waters to state land.

“The oil industry has historically been very powerful,” Jackson said after the lobbyist reports were filed. “They are kind of shameless about their pandering. This time around it didn’t work so well.”

Another big spender on lobbying last year was the cannabis industry. Trade groups and firms including Eaze and Weedmaps spent more than $880,000 in a year in which the Brown administration approved new rules allowing home deliveries in cities that ban cannabis retail stores.

The explosion of lobbying has created a challenge for the state watchdog agency that oversees advocacy, the Fair Political Practices Commission, which has begun tightening rules to shed more light on the activity.

“With record spending being recorded it is clear the FPPC must continue to be vigilant,” said Alice Germond, the commission chairwoman. “We will continue to consider more ways to increase meaningful disclosure of money in politics.”

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