The reasons a company might hire a lobbyist run the gamut. As difficult as it often is to launch a business, maintaining certain parts can be next to impossible — especially when it means staying on top of shifting regulations that might affect the associated industry.
While everyone has a constitutional right to petition the government, it can sometimes be intimidating. Lobbyists can help simplify an often complicated process.
Why hire a lobbyist?
If you’re a business owner who feels like the law (or those regulating it) is being unfair to your company — or you are creating a new market the law doesn’t yet recognize or is acting unfriendly toward — pairing with a lobbyist may help you to navigate your way forward. Hiring a contract or in-house lobbyist can mean changing the direction of a bill before it’s passed or getting a problematic law changed altogether.
It’s common for companies and industries across the country to lobby the government in order to influence legislation they care deeply about. And when dollars and cents are concerned, some industries appear to care far more than others. Between 1998 and 2023, the pharmaceutical industry spent more on lobbying than any other (over $5.8 billion). Other industries spent a considerable chunk in the same period, including the insurance, oil and gas, electric utilities and hospital industries.
When to hire a lobbyist
Reasons a business leader might hire a lobbyist may include:
- Learning about available state grants and commissions. Because lobbyists make it their business to know what currently exists, they can provide the most up-to-date funding information.
- Moving a business across state lines. If you want to move your business from another state into this one, for example, it’s possible you don’t know where to start. A lobbyist has the ability to walk you through the process and help familiarize you.
- Expanding a business locally. Lobbyists can often provide information on available tax breaks related to expansion.
Sometimes, business leaders hire contract lobbyists on a retainer basis to track bills that might impact their companies. Hiring a lobbyist is akin to keeping an expert around to monitor all that happens on Capitol Hill.
Cost versus value
Lobbying can sometimes get a bad reputation because lobbyists who charge too much. In fact, federal lobbying spending rose to over $4 billion in 2022, the highest since 2010. Adam Gardiner, VP of government relations at 47G and president of ASG Consulting, Inc., says that the biggest expense to consider when it comes to hiring a lobbyist, though, is less related to money than it is to time.
“Time is the biggest expense,” Gardiner says, adding that he’s spent 20 years cultivating relationships and learning. “You’re using lobbyists’ expertise and relationships. How much do you want out of your lobbyist? The more you need, the more expensive it’s likely to be.”
With that said, any business owner can have an opinion about a bill, pick up the phone and call their legislator — or visit and speak to them in person. Legislators love their constituents and will talk to them over lobbyists any day of the week.
You don’t need to hire a lobbyist to pick up the phone and call your rep, Gardiner says, “But if you actually want to get things done or be fully engaged in the process, if you want to be informed on a bill’s progress then, yes, it’s probably time for you to hire a lobbyist.”
