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Lobbying Helps Rich Cities Get Richer

Lobbying at the state and federal level is a good investment for all cities, but pays off most for ones that are already wealthy.

Park scene in Manhattan
City Hall Park in New York City. (David Kidd/Governing)
Editor's Note: This article appears in Governing's Spring 2024 magazine. You can subscribe here.

In 2023, local governments spent more money on lobbying than any previous year. It’s not hard to understand why. Under the Biden administration, federal aid to states and local governments has reached historic highs. In response, cities and counties across the country have mobilized to compete for funding created by major legislation such as the Infrastructure Investment and Jobs Act and the Inflation Reduction Act.

One of the key tools in their arsenal? The ability to hire professional lobbyists to guide them through the competitive grant application process and to work effectively with federal agencies and officials. In my recent book, When Cities Lobby, I found that lobbying allows cities to secure more funding from states — but that richer cities get the most bang for their buck.

I collected data on the lobbying disclosure records of every municipality in the U.S. with a population of at least 5,000, during the period from 2006 to 2015. State lobbying is where the majority of city advocacy efforts take place, but the dynamics of intergovernmental lobbying play out in a similar manner at the federal level. To understand what cities get in exchange for retaining lobbying services, I examined data on state transfers to determine whether cities secure more funding after they hire a lobbyist.

Of course, cities that lobby likely differ from their neighbors in a variety of ways. They might be larger, for example, or face greater fiscal stress. To account for these kinds of differences, I tracked the same cities over time and examined how much state funding they received in the years when they actively lobbied, as compared to the years when they didn’t. Maybe not surprisingly, what I found is that municipalities successfully collect more revenue from the state once they begin to lobby.

But not all cities benefit equally. One reason why Americans often view the lobbying industry with suspicion is the concern that the wealthiest interest groups and corporations will wield disproportionate political influence. I examined how the returns to lobbying vary by city income level. Sure enough, as the median income in a city increased, communities could expect to receive more funding per capita after they started lobbying.

Why do the lobbying efforts of richer cities yield more successful results? One contributing factor is that higher-income places tend to be home to politically active residents who pay close attention to whether state legislators are responsive to local demands. These cities also tend to lobby on behalf of more bills and to spend more money on their advocacy.

However, cities don’t just lobby for funding. They also rely on lobbyists to communicate local priorities with their elected officials in other levels of government and to fight for policies that will benefit their residents. Cities are more likely to hire lobbyists when redistricting leads them to clash ideologically with their state delegation. They also lobby in response to pre-emption efforts by state legislatures that seek to limit the ability of cities to raise their minimum wages, regulate the sharing economy or protect civil rights.

The ability to lobby represents a double-edged sword for cities, in my view. Lobbying provides an essential tool for local leaders seeking to amplify their voices in other levels of government, but it also provides another channel through which economically powerful communities can exercise political influence.

To address these concerns, government agencies should establish clear and transparent criteria for grant proposals. They should also consider tracking which cities retained lobbyists and also releasing this information along with the funding decisions.

Otherwise, it’s likely that cash will continue to flow disproportionately to the places with the biggest hired guns.

Julia Payson is a political scientist at UCLA.

Governing’s opinion columns reflect the views of their authors and not necessarily those of Governing’s editors or management.
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