Expenditures 101

A person who expends more than $500 in a calendar quarter for certain purposes must register as a lobbyist. Once registered, all lobby expenditures must be reported and fall into several categories. In some cases, you must identify the individual who benefits from a lobby expenditure and provide other details. There are a number of prohibitions and exceptions to be aware of as well.

Here is a basic primer we developed on lobby expenditures in Texas:

What is a Lobby Expenditure? The expenditures that count toward the expenditure threshold are expenditures that benefit a state officer or employee or the immediate family of a state officer or employee, that are made to communicate with a state officer or employee to influence legislation or administrative action, and that fall into one of the following six categories:

  • transportation and lodging;
  • food and beverages;
  • entertainment;
  • gifts;
  • awards and mementos; and
  • the attendance of a state officer or employee at a political fundraiser or charity event.

An “expenditure” is “a payment, distribution, loan, advance, reimbursement, deposit, or gift of money or any thing of value and includes a contract, promise, or agreement, whether or not legally enforceable, to make an expenditure.” Gov’t Code § 305.002(5).

Lobby Expenditure Made on Behalf of Another Person. Beginning on September 1, 2007, if a registrant, or a person on the registrant’s behalf and with the registrant’s consent or ratification, joins with another person to make an expenditure described by the lobby law, the amount of the expenditure made by or on behalf of the registrant for purposes of the lobby law includes only  (1) the amount of the portion of the joint expenditure contributed by the registrant and (2) the amount of any portion of the joint expenditure that:  is made on behalf of the registrant by a person who is not a registrant; and is not otherwise reported under the lobby law.  Gov’t Code § 305.0021.

What Is Not Counted as a Lobby Expenditure?

Taxes and Tips. A tax or tip paid in connection with a lobby expenditure is not counted as part of the lobby expenditure for purposes of calculating the threshold or reporting. 1 T.A.C. § 34.9.

Lobbyist’s Own Expenses. An expenditure for a person’s own food, beverages, entertainment, transportation, and lodging is neither counted toward the expenditure threshold nor reported on lobby activity reports.

Certain Expenditures Reimbursed by a State Officer or Employee. A payment of less than $200 is not a lobby expenditure if the person who makes the expenditure is fully reimbursed by the state officer or employee benefiting from the expenditure before the date the expenditure would otherwise be required to be reported. 1 T.A.C. § 34.1 (definition of expenditure).

Gift to a State Agency. A gift to a state agency (as opposed to a gift to or expenditure for an individual officer or employee of that agency) is not a lobby expenditure. A gift to a state agency becomes state property, and neither the agency nor any officer or employee of the agency is permitted to use it for personal or private purposes. Ethics Advisory Opinion No. 130 (1993). Whether a state agency may accept a gift depends on the laws specifically applicable to that agency. Id.

Information provided by Texas Ethics Commission Guide to Lobbying in Texas