In early February, an organization calling itself Connect Illinois convened a news conference in the state Capitol pressroom to brief reporters on telecommunications issues. The event drew a large crowd of speakers. There were three state lawmakers, two chamber of commerce presidents and members of three community organizations. Oddly, there were no official representatives of telecommunications companies.
Nevertheless, each speaker stressed a critical need to update Illinois' telecommunications laws, many of which date from 1985. And each endorsed a plan outlined by Connect Illinois Executive Director Eric Robinson that promotes greatly reduced regulation by the Illinois Commerce Commission of phone giant Ameritech.
During the conference, a reporter asked Robinson if the plan had been drafted by SBC/Ameritech, the company that supplies most local telephone service in Illinois. "I think it's safe to say Ameritech would go along with the tenets of this bill, but I'm not going to stand here and speak for Ameritech," he said. In a later interview, though, Robinson allowed that Ameritech is "a founding member" of Connect Illinois. "A significant portion of [Connect Illinois'] financing comes from Ameritech."
Critics have branded Connect Illinois a front organization for the telephone giant. Front group also is the term Ameritech uses to describe the Illinois Coalition for Competitive Telecommunications, an organization whose major player is AT&T, an Ameritech competitor and critic.
In fact, these two groups and their member companies, along with their battalions of lobbyists and media consultants, will constitute the frontline troops in this spring's legislative debate over how, or even whether, to rewrite state laws that regulate telecommunications companies.
There's plenty at stake. The battle over Illinois' $3.6 billion local telecommunications market, which Ameritech now dominates, could reconfigure competition in this era of rapid technological change. The combatants range from such industry behemoths as SBC/Ameritech, AT&T, MCI and Sprint to tiny regional phone companies and even Internet service providers.
These companies hope to win over lawmakers, who must decide by July 1 whether to recast or simply extend regulation of the industry, as well as consumers, who could see changes in their phone services and the prices they pay for those services.
Thus, coalition members have enlisted dozens of high-powered lobbyists, advertising firms and "grassroots" support groups in their efforts to win this war. "They're lobbying hard," says Rep. Art Tenhouse, a Liberty Republican and a co-sponsor of Ameritech's rewrite proposal. "I think this is one of those issues that will provide for full employment of lobbyists."
"This is one of the bigger ones," agrees Sen. Dave Sullivan, a Republican from Park Ridge and the Senate GOP point man on the telecommunications issue. "All members are getting information virtually daily at this point in time," he says. "It takes several [of my] hours of each day and that will only increase."
Given the industry's firepower, it's not surprising a great deal of lawmakers' time is being consumed by the telecommunications issue.
The major companies, such as Ameritech, AT&T and MCI, all have their own in-house lobbyists. But they've been bulking up for this battle.
Ameritech employs the powerhouse Chicago law firm of Winston and Strawn, one of whose partners is former Gov. James Thompson. Thompson said last fall he would be tackling the telecommunications issue. That company also has retained the services of Fletcher, Topol & O'Brien of Chicago, whose partners include James Fletcher, a former aide to Thompson. Dorgan-McPike and Associates is another Ameritech hire. James McPike once served as majority leader for Madigan, while Dorgan is a former deputy chief of staff to House Republican Leader Lee Daniels. James Owen, a former top aide to Senate President James "Pate" Philip, also is on board.
Ameritech spokesman Michael King says not all of the lobbyists are working exclusively on the telecommunications rewrite. "There are many different issues we are involved with." Nevertheless, that company is well-positioned for the fight that could mean most to that company's bottomline.
Meanwhile, Ameritech's adversaries have their own roster of lobbyists. Former Madigan staffer John McCabe of Legislative Consultants of Illinois is part of AT&T's team. So is Shea, Paige and Rogal, whose principals include former House Democratic Majority Leader Gerald Shea and Billie Paige, who served as campaign treasurer for former U.S. Sen. Carol Moseley-Braun.
AT&T also has retained the public affairs consulting firms of Jasculca/Terman & Associates and Axelrod & Associates, which have experience in political campaigns and issue-oriented advertising campaigns. However, AT&T spokesman Eric Sedler says their role in the effort is still being formulated, including whether they will be doing issue advertising.
"That's yet to be determined," Sedler says. "They're certainly very qualified when it comes to public issues in Illinois."
MCI's lobbyists include Roger Marquardt, an administration official under former Gov. Jim Edgar, and Paul Williams, a former state representative from Chicago.
Sprint has retained the Springfield law firm of Sorling, Northrup, Hanna, Cullen and Cochran whose team includes former Madigan staffer James Morphew and Craig Burkhardt, once a legal counsel to House GOP Leader Daniels.
A number of companies, including McLeod Communications and Focal Communications, that want to provide an alternative to Ameritech for local telephone service have banded together as the Competitive Local Exchange Companies of Illinois. They've hired lobbyist Larry Suffredin, whose clients include Abbott Labs and the Chicago Bar Association. The group also employs Zack Stamp, who has held a number of state government posts, including a stint as Thompson's legislative liaison, and John O'Connell, a former Democratic state representative. "In this issue, every legislator is going to know some lawyers and lobbyists involved," Suffredin says.
But the lines have gotten blurred. Most of the members in Suffredin's group also are members of the AT&T-backed Illinois Coalition for Competitive Telecommunications, whose executive director is Gary Mack, once a spokesman for former Gov. Jim Edgar. In addition to AT&T, Mack's group represents a number of smaller communications companies, including some Internet service providers. The Cable Television and Communications Association also is a member. And earlier this spring, Mack hired Jim Howard to be that group's full-time Springfield representative. Howard had been executive director of Illinois Common Cause, the government watchdog group.
It generally pays to hire so many longtime Springfield insiders. "It's a huge advantage to hire people who have relationships and access," says Kent Redfield, a political science professor at the University of Illinois at Springfield and author of books about the role of money in politics. But, he adds, "It doesn't come cheap."
Although lobbyists are required to report money spent to influence state officials, they are not required to disclose fees they collect from their employers. The price tag for the telecommunications effort will be in the millions, but precisely how many millions will not be made public.
"We're not required to disclose any of that specifically so I'm not going to tell you what it is," Mack says of the budget for his organization. He does agree the amount is at least "seven figures."
"They [Ameritech] can easily outgun whatever we do," Mack says. "I guarantee you they are spending more than we are."
"I don't know how he could guarantee that," Ameritech's King responds. "I'd be shocked if it were more than Gary's budget." Still, King won't say how much Ameritech expects to spend this spring.
Though many lobbying costs do not have to be reported, campaign contributions must be disclosed. And many of the major companies with an interest in the telecommunications rewrite have been active contributors to legislative campaign funds.
Redfield analyzes campaign contributions based on election cycles, the two-year period leading up to each state general election, and according to his assessments, since the 1993-94 cycle, Ameritech has never dropped out of the top 20 companies and interest groups making contributions. In the 1997-98 cycle, Ameritech ranked 12th with contributions of $427,000. Everyone who gave more than Ameritech in that cycle was an association representing a group of related interests rather than an individual company.
In the most recent cycle, Ameritech contributed nearly $600,000 to state political candidates and officials, according to Redfield. Other telecommunications companies also were active. AT&T contributed nearly $198,000 and MCI contributed about $159,999. Verizon/GTE donated $170,000.
Madigan formed a special Telecommunications Rewrite Committee to hear testimony about telecommunications issues. There are 18 representatives on the committee and all but one of them received contributions from Ameritech in the last year. Virtually every one of them also received contributions from one or more of the companies arrayed against Ameritech.
Redfield doesn't believe campaign contributions necessarily buy legislation. "A quid pro quo is almost impossible to prove," he says. "It's part of the total package of lobbying. Clearly, these groups are trying to position themselves so they have access and a little bit more [say] in the rewrite process."
Tenhouse, for one, doesn't think campaign contributions will play a significant role in the outcome of a rewrite. "The thing is I don't think you're going to find hardly anyone here [in the legislature] who hasn't been impacted by it in terms of contributions," he says. "In some cases, by the time you take Ameritech versus the others, it's almost a 50-50 wash."
"I have received contributions from both sides of the issue," says Rep. Dan Rutherford, a Chenoa Republican and a member of the telecommunications committee. "I guess, if anything, it will give people mixed signals from me."
Although both sides have hired high-priced lobbyists to press their cases with lawmakers, they also are making an effort to reach the public. Under the auspices of the Coalition for Competitive Telecommunications, Mack visits newspaper editorial boards and speaks to organizations about that group's positions.
Ameritech hired additional people for the "external affairs team," including Mark Gordon, a former press secretary to Philip, and Jill Rock, a former top aide to Senate Democratic Leader Emil Jones. They and a dozen other staffers are registered as lobbyists for Ameritech, though King says they are not really lobbyists as most people think of lobbyists. "They do corporate giving and community relations." Having them register as lobbyists. King says, is simply a matter of being cautious in case they discuss telecommunications with a state official.
Eric Robinson's job through Connect Illinois also involves meeting with business and community groups to discuss telecommunications. "It's a grass-roots organization of more than 3,500 individuals, concerned citizens, business organizations, economic development groups and senior citizens' groups," he says.
That's not the way others see it. "It's almost an insult to the General Assembly that they wouldn't see through this almost immediately," says Martin Cohen, executive director of the Citizens Utility Board. "It doesn't bode well when Ameritech starts out by hiding behind a phony consumer group. It's Astroturf lobbying instead of grass-roots."
With all of this pressure being brought to bear on the telecommunications issue, there is fear of a potential backlash. "That's really one of the fears of Connect Illinois, that this important issue might get bogged down to look like an insider issue in Springfield," Robinson says. It may be too late to avoid that impression. When the state rewrote the laws governing electric power companies a couple of years ago, the law was hammered out with dozens of people sitting around a negotiating table until an acceptable compromise was reached.
"I don't know if we are going to see a process like that," Cohen says. "This looks more like a lobbying free for all."
Doug Finke is a Statehouse reporter for The State Journal-Register of Springfield, a Copley News Service newspaper.
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Later this spring, Illinois Issues will examine what the telecommunications companies want, and why. We'll also assess the relationship of Illinois' regulatory laws to the federal deregulation of the telecommunications industry. To read up on that subject, see Illinois Issues, May 1996, page 12.
