Home US K Street is booming. But there's a creeping sense of dread.

K Street is booming. But there’s a creeping sense of dread.


The $ 2.2 trillion coronavirus relief bill was just the beginning of a Washington lobbying bonanza — but lobbyists are rushing to get a piece of the action in case it evaporates with a cratering economy.

Lobbyists are hustling to influence the rules dictating how the first bundle of stimulus money will be spent, and looking ahead to how to get their clients’ priorities into the next mammoth spending package.

The gaming industry is trying to bend President Donald Trump’s ear so casinos can get emergency federal loans over the opposition of a crucial agency. Diagnostic labs are lobbying for direct funding to help process an unprecedented volume of Covid-19 tests, a key to reopening the American economy. And Native American tribes sued Treasury Secretary Steven Mnuchin on Friday to prevent billions of dollars in relief funds set aside for them from going to Alaskan Native corporations — which could mean less money for the tribes.

Business is booming on K Street, but lobbyists are also dreading what might be on the horizon if the economy slumps into a protracted recession, according to interviews with more than a dozen lobbyists for this story. Several privately expressed worry that business could dry up if the companies with falling revenue move to cut expenses. Some lobbying firms could even go under.

The pain has started already at some firms. K&L Gates — a prominent law and lobbying firm that snapped up former Rep. Jeff Denham (R-Calif.) when he left Congress last year — announced in an internal email last week that it would cut pay by 15 percent across the board starting next month. (Partners face bigger cuts, while those making less than $ 75,000 a year are exempt.) The pay cuts came even though K&L Gates has signed two new lobbying clients for coronavirus-related work in recent weeks, according to disclosure filings.

“I would never call it a gold rush, and I think it would be foolish for people to feel lobbying firms won’t feel a negative impact when the economy takes a hit like this,” said Hunter Bates, a former aide to Senate Majority Leader Mitch McConnell who’s now a top lobbyist at Akin Gump Strauss Hauer & Feld. His firm has signed at least eight new clients for coronavirus-related work.

Several lobbyists warned that some less established lobbying firms could fold, as they did in the 2008 financial crisis. “This is going to be like that, but orders of magnitude greater," one Democratic tax lobbyist said.

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But for now, the chaos has been unmistakably good for business. Hospitals, casinos, Indian tribes, pharmaceutical interests and private equity firms have all hired lobbyists for help, along with companies from 3M to Ticketmaster to Six Flags.

Weeks after Trump signed the bill into law, K Street has been working overtime to sway Mnuchin and other officials charged with writing the rules that will govern who gets the money and how much they get. They’ve also got an eye on upcoming legislation to battle coronavirus and give the flailing economy a shot in the arm — the next chance tuck industry requests into a must-pass spending bill.

“Everyone is preparing for 4.0,” said former Rep. Ryan Costello (R-Pa.), who left Congress last year and is now a lobbyist, citing the expected fourth coronavirus relief bill.

Lobbying itself, centered around in-person meetings and hobnobbing at fundraisers, is now confined to phone calls, text messages, emails and Zoom conferences, often with small children wailing in the background. The inability to meet with members of Congress on Capitol Hill has put even more of a premium on lobbyists who have their cell phone numbers.

“Communicating via email and cell phone are the keys to the game right now, and access is high for those that already have access and relationships with the key players,” Brian Wild, a one-time aide to former House Speaker John Boehner who’s now a lobbyist, wrote in a recent memo to clients.

The lobbying rush has given a boost to Wild’s firm, Brownstein Hyatt Farber Schreck, which has signed at least 17 new lobbying clients for coronavirus-related work, including the casino giant Wynn Resorts and the National Retail Federation, according to the firm.

Nearly 200 companies, trade groups and other organizations have hired lobbyists to advocate for them on coronavirus-related matters, according to a POLITICO analysis of disclosure filings. The health care giants Tenet Healthcare and Envision Healthcare have each brought on two new lobbying firms in recent weeks for help with coronavirus. General Electric, Ford, New York’s Metropolitan Opera, Uber and Darden Restaurants — which owns the Olive Garden and other chain restaurants — have also added lobbying firepower.

Other companies and trade groups have turned to lobbyists who were in Congress themselves not long ago. Former Rep. Bill Shuster (R-Pa.), who served as the House Transportation and Infrastructure Committee’s chairman before leaving Congress last year, lobbied on the coronavirus relief bill for the National Air Traffic Controllers Association. The trade group paid his firm $ 60,000 to lobby on the bill and other issues for a little more than a month, according to disclosure filings.

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“When I wake up, I’ve got at least 25 text messages and 50 emails from people who are on the East Coast, already at it,” said former Rep. Kevin Yoder (R-Kan.), who also left Congress last year and has lobbied on coronavirus-related matters out of his Kansas City, Kansas home. “Part of the experience of lobbying was to develop a relationship — you bring in your client, sit down with staffers, have a conversation, there’s a ritual that occurs. Obviously, it’s much harder to do that now.”

Lobbyists are already looking ahead to the next coronavirus legislation.

Movie theatres, for instance, are pushing for mortgage and rent deferral provisions that would help them stay afloat for months without moviegoers. The American Clinical Laboratory Association — a trade group that represents commercial lab giants like Lab Corps and Quest Diagnostics charged with processing the massive volume of Covid-19 tests — is advocating for direct federal funding to cover the costs of those tests, as well as supply chain support. The industry has struggled as routine checkups and elective surgeries have been canceled; Quest Diagnostics said last week that it would furlough thousands of employees to cut costs.

Some of the most intense lobbying battles are being waged over the implementation of the mammoth bill that passed last month.

The American Gaming Association, which lobbies for the casino industry, celebrated last month when the bill didn’t include any provisions that would prevent casinos from getting emergency loans. (The industry bitterly recalled that casinos had been blocked from taking advantage of tax breaks extended to other businesses in 2005 after Hurricane Katrina.)

But when the Small Business Administration announced the rules governing its loan program, the agency excluded small casinos and betting parlors such as Laredo Hospitality, an Illinois chain of “gaming cafes” that offer slots and video poker. The trade group appealed to Trump earlier this month for help and prevailed upon more than a dozen members of Congress to lobby the administration on its behalf without much success so far.

A wave of companies sought out lobbyists for the first time. Quest Food Management Services, an Illinois company that serves meals at schools and universities, hired its first Washington lobbyists last month after realizing it was too big to qualify for loans for paid leave provisions for its hourly workers. With schools shut down, the company had lost more than 90 percent of its revenue, said Nicholas Saccaro, the company’s president.

“I didn’t have a clue what to do. What do you do, Google ‘lobbying firm’?” Saccaro said, adding that he connected with Alexander, Borovicka and O’Shea Government Solutions, the lobbying firm representing the company, through a recommendation from a business connection.

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“We weren’t clued in enough, and we’ve never had to battle for this kind of stuff,” he said. “We suddenly realized that we were on the outside looking in.”

David Beavers contributed to this report.

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