Decreasing federal budgets and a push for deregulation are
leading to expanding influence of state legislatures. This, in turn,
is leading to increased focus on state government relations activities
by corporations.
Given the increasing importance of state legislative agendas,
what are some of the key trends with implications for business?
Among the major thrusts are deregulation, government downsizing
and tax and welfare reform, according to Charlie Mahtesian, a staff
writer at Governing magazine, which covers state legislative
developments.
Particularly good news for corporate government relations
practitioners is his assessment that legislatures are a "very
receptive climate" for businesses today. Issues such as workers
compensation and tort reform "are getting a much better reception in
state capitals these days."
Many state legislatures also are more open to more dialogue or
partnerships with business and industry, said Peter Shafer, manager of
state affairs for the Grocery Manufacturers of America, Washington,
D.C.
"There is a shift by state governments to experiment with some
new ideas," especially in relation to new responsibilities that are
coming back to states from the federal government. While Shafer
believes there may have been some intensification of the at-times
adversarial relations that exist between government officials and
industry, there is "still a willingness" to listen and work with
industry. Some states even are experimenting with public
sector/private sector cooperative efforts to achieve goals formerly
achieved strictly through legislation or regulation, he said.
Term Limits Change Dynamics
One of the biggest changes in state legislatures is the adoption
of term limits, now in place in more than a dozen states. This has
brought many new faces to government bodies, forcing state government
relations executives to get to know these new legislators quickly. It
has prompted government relations professionals and lobbyists to "look
out two, three or four years" ahead to identify the new leadership
that will emerge, said Terry Pruitt, manager of state affairs for Dow
Corning Corp., Midland, Mich. Pruitt said that new legislators are
moving into positions of responsibility more quickly than in the past.
Another effect of term limits is that it makes legislators'
staffs even more important than they had been in the past, because
they are likely to remain on board after legislators are forced from
office. "When you have extensive term limitations, it does increase
the power of staffs," said Steve Chaudet, vice president of state and
local government affairs at Lockheed Martin Corp..
As a result, government relations executives and lobbyists will
need to pay even more attention to staffs than they have in the past,
he said.
Fast Legislative Pace
State legislatures in the past couple of years have been passing
legislation at a much faster rate than in recent history, possibly
fueled by term limits and the zeal for Republican agendas modeled
after the Republican Congress' "Contract With America" agenda. "The
train is moving much faster," although it has slowed down this year
with the approaching Presidential election, said Dow Corning's Pruitt.
"There is an urgency, and an almost frenetic pace," which has resulted
in some legislation passing with stunning speed, said Shafer of the
Grocery Manufacturers of America.
Paying Attention to Business
One of the major changes in state legislatures today is a shift
toward being more receptive generally to business. "I think we see a
lot more of our agenda being put on the table, both on the regulatory
side and on the legislative side," said Pruitt of Dow Corning. One
example he cited as coming up in a number of states is major product
liability reform--recently vetoed at the federal level by President
Clinton.
Another example of increased receptivity to business are the
financial and regulatory packages states are willing to offer
businesses to locate or remain in their states. The competition
between states for coveted businesses has intensified greatly, and has
become "a contact sport," said Lockheed Martin's Chaudet. (Governing,
202/862-8802; Grocery Manufacturers, 202/337-9400; Dow Corning,
517/496-8827; Lockheed Martin, 703/413-5996)
Major Trends in Corporate State Government Relations Functions
As the state legislative landscape has shifted, corporate public
affairs departments appear to be making a number of changes as well,
according to a recent study by the Public Affairs Council, Washington,
D.C.
Among the major changes:
-- Rising state government relations budgets, apparently at the
expense of federal government relations budgets.
-- Leveling out of expenses between federal PACs (Political Action
Committees) and state PACs. (Federal PACs traditionally were more
well-funded.)
-- Slightly increasing numbers of state government relations jobs.
-- Greater reliance on trade associations and on lobbyists,
consultants.
-- More use of technology (e.g. databases, Internet, faxing, etc).
-- Increasing use of coalitions and grassroots approaches.
-- More women in the field.
Source: Public Affairs Council