Lobbying firms report massive profits amid reconciliation, China bill fights

K Street’s top lobbying firms raked in enormous revenues in the second quarter, according to figures shared with The Hill, indicating that the prolonged lobbying boom isn’t letting up just yet.

Lobbyists have keyed in on Democrats’ budget reconciliation package, bipartisan legislation to boost U.S. competitiveness with China and annual government funding bills, among other measures.

Corporate clients are spending big to ensure that they don’t lose out as lawmakers rush to pass a flurry of bills before election season ramps up.

“What’s fueling interest in Washington is that companies, trade associations need to be ever vigilant to ensure that they’re aware of 1,000 plates spinning at the same time, because you don’t know when deals are going to come together or when bills are going to be resuscitated,” said Marc Lampkin, managing partner of Brownstein Hyatt Farber Schreck’s Washington office.

Brownstein, the No. 1 firm by total revenue last year, raked in $15.2 million from April through June, its best quarter to date. That’s up 10 percent from the same period last year.

Most of the top Washington lobbying firms continue to build on last year’s record-smashing revenues, and nearly all of them are earning more than they did in 2020, when COVID-19 introduced a flood of first-time lobbying clients seeking federal funds.

In return, K Street lobbyists have delivered results for powerful corporations and other cash-flush clients.

The newly slimmed-down reconciliation bill approved by Sen. Joe Manchin (D-W.Va.) doesn’t include corporate tax hikes, and its provisions to regulate drug prices are more industry friendly than previous iterations.

Senators are prioritizing a stripped-down version of the China competition bill that includes $52 billion in chipmaking subsidies, but few or none of the restrictions on outsourcing or tough-on-China trade provisions opposed by large corporations.

Bipartisan antitrust bills to crack down on tech giants’ business practices have appeared to stall amid intense opposition from the largest tech firms and their trade groups, but K Street remains wary of a last-minute comeback.

“To the extent that bills are still alive, that means there’s a threat and risk assessment you have to make,” Lampkin said. “And I think that’s why business continues to be so good.”

Akin Gump Strauss Hauer & Feld reported roughly $12.8 million in second-quarter earnings, down 5 percent from its record-breaking haul during the same period last year.

Brian Pomper, a partner at Akin Gump, said in an email that the firm has been focused on tax, climate and health care issues in the reconciliation package, legislation to reauthorize Food and Drug Administration user fee programs and issues surrounding the China competition bills.

“We expect to remain quite active on a variety of these same issues even as we head toward the election this fall,” he said.

Lawmakers are rushing to pass bills before the August recess, which typically spells doom for numerous legislative efforts as lawmakers shift their focus to November’s elections.

Lobbyists expect business to stay relatively strong as clients turn to the bipartisan infrastructure bill’s implementation and gear up for a potential GOP takeover in November.

“I don’t see people walking away from town right now,” said Rich Gold, a partner at Holland & Knight. “There’s a lot going on still.”

Holland & Knight had its best quarter ever, bringing in nearly $10.7 million from April through June — a 26 percent increase from the same period last year — as it shifted some of its focus to policies and funding opportunities in the infrastructure package.

BGR Group reported $9.6 million in second-quarter earnings, an increase of 12 percent from last year. Invariant boosted its year-over-year revenue by 25 percent, bringing in $9.4 million.

Lobbyists say that government funding bills have prompted significant lobbying activity, as has the National Defense Authorization Act (NDAA) which is set to provide the Pentagon with tens of billions more than it requested.

A wide range of corporate interests were alarmed by the House Energy and Commerce Committee’s advancement of a bipartisan bill to enact federal data privacy standards. The Walt Disney Co., Fox Corp. and H&R Block recently hired K Street lobbyists to work on the issue.

Around a dozen lobbying firms raked in $5 million or more in the second quarter, a feat that would have been unheard of just a few years ago.

Squire Patton Boggs saw its second-quarter lobbying revenue fall from $7.2 million to $6.8 million.

Mehlman Castagnetti Rosen & Thomas boosted its earnings from $5.7 million to nearly $6.5 million. Tiber Creek Group brought in $6.4 million, up from $6.2 million last year. Forbes Tate Partners’ earnings remained nearly unchanged at $6.2 million.

Cassidy & Associates reported $5.5 million in second-quarter earnings, up from less than $5.1 million during the same period last year. K&L Gates brought in $5.4 million, up from $5.2 million a year ago.

“We anticipate a busy second half of the year, with a continued emphasis on appropriations, NDAA, and reconciliation on the Hill, as well as a variety of executive actions such as infrastructure package implementation,” K&L Gates partner Paul Stimers said in an email.

“Increasingly, we are working with clients to prepare for the risks and opportunities surrounding the coming elections and possible majority changes, including the potential shift in focus on oversight,” he added.

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