Mooneyham column: Incentives can be a big deal for consultants
Wednesday, December 19th, 2007
By Chris Fitzsimon
By Scott Mooneyham
Capitol Press Association
RALEIGH — North Carolina is one of 38 states which bans lobbyists from taking contingency fees.
The idea behind the ban is simple. Getting a commission or percentage of the take of taxpayer money based on a favorable vote by a legislative body appears, on its face, unseemly. It also sets the stage for corruption that could make recent scandals look like kids playing tiddlywinks.
Imagine a lobbyist who receives a 10-percent commission from a company or a nonprofit organization which, based on a budget provision, will be receiving a $10 million grant or a $10 million tax break. From his or her $1 million take, the lobbyist then passes out $4,000 campaign contributions to a few legislators whose votes were key in passing the provision.
A kickback? Quid pro quo? Perhaps not in its strictest legally sense. But the scenario would certainly provide more confirmation for many that government is corrupt. It’s why North Carolina bans the practice.
So, why do state leaders allow the same unseemliness to take place when it comes to industrial recruiting?
That’s right. Those multimillion dollar offers of tax breaks and cash to lure big-name manufacturer to North Carolina are typically negotiated by consultants. And many are working on a contingency basis, earning 10 to 20 percent of the value of those deals.
Many of those consultants work for some of Raleigh’s largest, well-known law firms. more…
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