Lobbyists hired to get money for Fresno Met

WASHINGTON -- Lobbyists could not save the Fresno Metropolitan Museum, though some tried.

Well before the museum shut its doors for good this week, officials had hired well-connected lobbyists in hopes of securing federal aid. The museum paid Capitol Hill experts $180,000 between 2001 and 2004, public records show. They had their work cut out for them.

"There's just a lot of competition," the Fresno museum's chief former lobbyist Ilisa Halpern Paul said Wednesday, adding that "art is seen as an extra by most people." The lobbying fees took only a small slice from the Fresno museum's annual budget, and none of the specific assistance being sought would have kept the facility's doors open.

Besides using hired guns, Fresno museum officials also tried the informal route.

Scott Nishioki, chief of staff for Rep. Jim Costa, D-Fresno, recalled Wednesday that a museum official contacted Costa's office within the past year asking about earmarks. Nishioki said the futile request came after a formal appropriations deadline already had passed.

"In this environment, it's a hard sell, particularly if they don't have their own financial house in order," Nishioki said.

The Fresno Metropolitan Museum, of course, has not been alone in working the political angles. Organizers of a proposed Ag Science Center planned for Stanislaus County have reported paying lobbyists at least $300,000 since 2006 as they seek start-up help.

The California State Railroad Museum Foundation in Sacramento, Children's Discovery Museum of San Jose and Oakland Museum of California, among others, have all hired Capitol Hill lobbyists in recent years as well, lobbying records show.

The lobbyists are paid to know how Washington works. The state railroad museum, for instance, hired former Sacramento-area congressman Vic Fazio.

Similarly, Ilisa Halpern Paul gained experience working for Democrat Sen. Dianne Feinstein before she became a lobbyist. Even so, a museum presented a different professional challenge than some of her other corporate clients.

"People don't always see this as essential," Paul noted, adding that "one of the key problems we had was the perception that museums got a lot of private support, even though in a town like Fresno that doesn't always hold."

The Fresno museum did not hire lobbyists in Sacramento to seek state aid. From Washington, museum officials sought two rounds of assistance.

With the help of Feinstein and others, the museum obtained a $900,000 earmark in early 2003. The supporters included two GOP members, Reps. George Radanovich of Mariposa and Devin Nunes of Visalia, who no longer ask for earmarks.

"We were very strategic, very bipartisan," Paul said.

The money was supposed to help build what then-Rep. Cal Dooley, D-Visalia, termed a "state-of-the-art science-based exhibition and learning center." Even so, it wasn't enough to offset soaring costs from the museum's ambitious renovation. Costs ballooned from $12 million to $28 million by the time it was completed in November 2008.

The museum later received $99,200 designed to help establish a mobile museum serving remote San Joaquin Valley communities. Paul said the museum subsequently curtailed its lobbying and focused on its private fundraising once it had received these federal allocations.



The reporter can be reached at mdoyle@mcclatchydc.com or (202) 383-0006.

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Lobbying culture a threat to financial stability: report

THE financial industry's lobbying about US mortgage rules may have contributed to the recent financial crisis and may pose a threat to the industry's stability, according to a report published by three International Monetary Fund economists.

The economists found that institutions that lobbied the most also had more lax lending standards, tended to securitise more of their mortgages and had faster-growing loan portfolios.

The delinquency rates were also higher in areas in which these companies' lending grew fastest, the report showed.

"Our analysis suggests that the political influence of the financial industry can be a source of systemic risk," Deniz Igan, Prachi Mishra, and Thierry Tressel said in the conclusion of their report.

"It provides some support to the view that the prevention of future crises might require weakening political influence of the financial industry or closer monitoring of lobbying activities."

Regulators worldwide are pressing companies to improve risk oversight after the world's biggest banks and brokerages reported more than $US1.7 trillion in write-downs and credit losses since 2007 tied to the global financial crisis.

In the US, the Government has extended the $US700 billion financial rescue program until October.

The authors favoured a "moral hazard" interpretation of their findings, where financial companies lobby seeking looser lending standards because they expect to be bailed out during a crisis or because they favour short-term gains.

The report noted that 16 of the 20 lenders that spent the most on lobbying between 2000 and 2006 received funds under the US Emergency Economic Stabilisation Act.

Spending by finance and real estate industry companies accounted for about 15 per cent of overall lobbying in any election cycle, the report said.

Spending on lobbying was $US479,500 per company in 2006, compared with $US300,273 for defence companies and $US200,187 for construction companies, the authors said.

Source:smh.com.au/