What is the true role of a real estate lobbyist?
Knowledge is power. It’s also the currency used by lobbyist Ken Strobeck, executive director of the League of Arizona Cities and Towns. “I think people have a very misunderstood view of what lobbying is,” says Strobeck. “You think of somebody who is sneaking around with money falling out of their pockets on edge of legality. … We’re in the business of (information and education). We don’t lobby the state for earmarks or handouts or grants like a lot of Washington lobbying. We provide information and perspective.”
The League, founded in 1937, is funded by member dues paid by the group’s 91 municipal members.
According to the Center for Responsive Politics, which pulls information from the Senate Office of Public Records, more than $52M from 235 commercial real estate clients from 692 lobbyists were collected in 2014. The highest percentage of lobbying money came from building materials and equipment, following by general contractors. Lobbying dollars peaked in 2009, when annual contributions reached more than $59M. For the last three years, lobbying funds in construction have increased by a few million a year.
“Lobbying in CRE is trickier than other industries; It’s a guarded industry,” says Russell Smoldon, CEO of B3 Strategies, who was a lobbyist for SRP for 26 years.
Smoldon, who is still “new” to the world of commercial real estate lobbying, says most of his work comes from companies that have already decided to move to Arizona before reading all the fine print. They use his services to get through tax issues, for example.
One of his challenges, Smoldon says, is the sheer amount of networking. You have to know the players, he says.
This is where trade organizations such as NAIOP come into play. The Arizona chapter of NAIOP, Commercial Real Estate Development Association, like other trade organizations, hires contract lobbyists to support the interests of its membership.
Depending on how aggressive of an agenda a group has, contract lobbyists may charge between $35,000 and $70,000 per group. Lobbying is also a long game. NAIOP-AZ has been pursuing property tax issues since President Tim Lawless was hired a decade ago. Over the years, the group has been effective but is really only halfway to its goal of bringing the property tax for businesses from 25 percent to near 10 percent.
The power of the media is another lobbying tool of which trade organizations are making use. It’s about lobbying the hill as much as it is educating voters, he says.
“Lobbyists are also to reach the general populous,” says Lawless. “When you’re a legislator, you care about your overall constituency.”