The Star-Ledger

Verizon Changes Channels After Big-Money Battle

The Star-Ledger — Wednesday, February 28, 2007

BY JOE DONOHUE AND DUNSTAN McNICHOL
Star-Ledger Staff

The battle over legislation letting Verizon New Jersey compete with cable television companies cost nearly $10 million last year as both sides used massive ad campaigns to try to sway the public and lawmakers, according to industry officials and lobbying reports.

Verizon alone spent $4.7 million on its successful campaign for the right to provide TV service throughout the state without seeking local franchises. That's the most a single firm has ever reported spending on a lobbying push. A new law this year required companies to include advertising expenses in their lobbying reports for the first time.

Rich Young, a Verizon spokesman, said most of the spending – about $3.6 million – went to print and network television advertising.

Reports made available yesterday by the Election Law Enforcement Commission showed cable companies spent at least $1 million on their counter-lobbying. Mark Nevins, spokesman for the New Jersey Cable Telecommunications Association, said they also devoted about $4 million worth of TV time to their own ads -- an expense they did not have to report because they used their own channels.

Verizon and the cable industry topped all lobbying two years ago as well, spending a combined $2.2 million on early skirmishing. The lobbying expenses are just a fraction of the $1.5 billion Verizon is now investing to build its own television system.

While Verizon dwarfed them all, others also spent heavily to influence the Legislature last year.

ProtectingAmerica.org, a coalition of insurance companies, Realtors, law enforcement and emergency providers and others, paid $491,449 to two lobbying firms to press for creation of a $20 billion insurance fund to help cover losses if a catastrophic storm hits the state. The bill was the subject of a January hearing, but has yet to be put to a committee vote, and lobbyists do not expect much action before this fall's elections.

AARP more than doubled its spending, from $624,469 to $1,440,852, last year. Douglas Johnston, who manages the group's lobbying team, said it added staff last year and lobbied on issues including property tax reforms, long-term care reforms and prescription drug pricing.

Another expensive lobbying blitz was mounted by the North Carolina firm attempting to build a billion-dollar array of golf courses and homes atop former landfills in the Hackensack Meadowlands.

ENCAP, seeking state approval for $335 million in advance funding for the project, paid three lobbying firms a total of $324,478 last year. ENCAP also needs an array of state environmental and community development approvals.

Cherokee Investment Partners, ENCAP's parent company, which is working on a controversial redevelopment project n Camden's Cramer Hill neighborhood, spent another $405,697 lobbying state government, bringing the development firm's total tab to $730,175.

Frederick Herrmann, executive director of ELEC, said that under new rules that broadened the definition of lobbyists, more than 1,000 individuals and groups filed annual reports listing 2006 fees – more than twice the previous total. ELEC will be summarizing the reports and giving a total of all fees next Thursday. In 2005, groups spent a record $28.5 million.

Herrmann said that making more individuals and groups declare themselves as lobbyists, and requiring them to divulge expenses like advertising, brings "another major level of transparency to the lobbying process" and a "'great improvement."

One of those reporting for the first time was Eric Shuffler, former counselor to the governor under James E. McGreevey and Richard Codey. Shuffler received $166,000 in fees in his first year as a lobbyist, including $40,000 to defend auto insurer Geico against discrimination charges because it uses occupation and education as rate-setting factors. New Jersey Citizen Action today will unveil a new report that repeats those charges and will urge passage of legislation to ban the practice.

Joe Donohue covers state government and politics.

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