In 2004, SBC Communications supported a bill that would have redefined competition between land-line telephone companies and their wireless and cable-based rivals. Senate Bill 1069 also would have given companies, including SBC, the opportunity to change their rates more quickly. After some debate, the bill died.
A year later, with a newly elected Republican sitting in the governor's mansion, the Legislature revived the bill. Senate Bill 237 stated that if a market has two telephone service providers in addition to its local land-line phone company, the market would be considered competitive. That designation would relax state regulation of the rates SBC could charge its customers in those markets.
This time around, SBC received the competitive boost it was looking for. Gov. Matt Blunt signed the bill into law July 14. And in September, the Missouri Public Service Commission, whose members are appointed by the governor, granted competitive classification to 26 of 160 residential markets and 45 of 160 business markets.
Working for SBC behind the scenes was Andrew Blunt, the governor's younger brother and son of U.S. House Majority Leader Roy Blunt.
"Andy Blunt has great political instincts and is very knowledgeable about our issues," said Ellen Bogard, a Fleishman-Hillard spokeswoman for AT&T Inc., which was formed last November when SBC acquired AT&T Corp. "He's a guy who learned politics around the family dinner table. He's a natural. Apparently it runs in the family."
Blunt, 29, graduated from law school at the University of Missouri in 2001. Since then he's built a list of clients that include such heavyweights as AmerenUE, Burlington Northern Santa Fe Railway, Altria Group's Phillip Morris and United Parcel Service. Many of his biggest clients have been substantial contributors to his father and brother's political campaigns.
A member of the Schreimann, Rackers, Francka & Blunt LLC law firm in Jefferson City, Blunt is only registered to lobby the Missouri general assembly and the judiciary. When Matt Blunt was elected governor, he and Andy Blunt emphasized that Andy does not personally work with the governor's office or lobby the executive branch on behalf of his clients.
"I've gone above and beyond anything that is required of me," Andy Blunt said in a recent interview with the Business Journal. "I made it very clear that if Matt were elected governor I wouldn't lobby the executive branch. That decision was not required by law. It seemed like the right thing to do."
On Dec. 9. 2004, a month before Matt Blunt was sworn in as governor, Andy Blunt's firm hired Jay Reichard, who is registered to lobby all branches of state government, including the executive. Reichard and Andy Blunt share 17 clients, 13 of which Reichard picked up within days of Gov. Blunt's inauguration, according to lobbyist registrations filed with the Missouri Ethics Commission.
"We didn't hire Jay to lobby the executive branch, but to assist with my clients," Andy Blunt said. "He does an excellent job serving our clients wherever they need to be serviced. Jay Reichard is not related to the governor and is free to lobby anybody he wants."
The scenario allows the Blunts to say their political relationship remains at arm's length, at least technically. Yet the practical reality of their sibling relationship and political alignment -- Andy was chairman of Matt's gubernatorial campaign and his inauguration -- hangs over Andy Blunt constantly and is acknowledged by both Republicans and Democrats.
"He's the governor's brother," said a veteran Jefferson City lobbyist who spoke on condition of anonymity. "It's like having the governor's wife saying, 'I'm not going to talk to the governor.' Nobody believes it. He (Andy Blunt) has landed some big accounts, and I'd be lying to you if I didn't say there was some resentment. A lot of guys lost accounts to Andy, and it's not because the other guys didn't do a good job."
Roy Temple, former executive director of the state Democratic Party and former chief of staff to Gov. Mel Carnahan and Sen. Jean Carnahan, said any transaction involving Andy Blunt is cause for "heightened scrutiny. There is a level of coziness that moves way past the comfort level."
Political insiders and lobbyists on each side of the aisle said Andy Blunt has a reputation for being a nice guy who hustles for the interests he represents.
"He is extremely aggressive working on behalf of his clients, gaining new clients and fund raising," Temple said. "He's less reliant on fancy dinners. He uses political capital in a different form."
Ray Wagner, legal and legislative vice president for Enterprise Rent-A-Car and a friend of Andy Blunt, disagrees with detractors who say Blunt's practice has been enhanced by his name. "In perception that may be true, but in reality he works hard, he's there working the halls, he went to law school, he grew up in that environment and knows how the Legislature works."
Nearly all reached by the Business Journal agreed, however, that Blunt's family relationships have been a key ingredient to his success. "In politics, perception is reality," the veteran lobbyist said. "The conventional wisdom is that he talks to his brother. Whether he does or not, he benefits from that perception."
Having the governor's ear may be particularly valuable when both houses of Congress also are controlled by the administration's party. If Andy Blunt can get the House and Senate to support his clients' interests, one can usually expect he'll have the governor's support as well, lobbyists said.
Andy Blunt said being raised in the political process and building relationships with various people in government has "definitely contributed to our success as a lobbying firm," but he stressed his work is with legislators, not members of the executive branch.
Helping hand
AmerenUE, which employs both Andy Blunt and Reichard as lobbyists, benefited from SB 179, a bill passed last year that permits the Public Service Commission to allow electrical, gas and water utilities the opportunity to adjust their rates to recover added fuel, purchased power and environmental compliance costs. Gov. Blunt also signed that bill into law on July 14. A group of Ameren lobbyists worked on the bill, and Sen. John Greisheimer (R-Washington), the bill's sponsor, said Andy Blunt was not among those who worked directly with him on the legislation.
AmerenUE spokesman Mike Cleary said the company does not comment on its lobbying efforts or who it hires to represent its interests. Blunt's supporters point out that in recent weeks Gov. Blunt has called for Attorney General Jay Nixon to file "appropriate civil or criminal litigation" against AmerenUE in connection with the Dec. 14 dam breach of its Taum Sauk hydroelectric facility near Lesterville, Mo.
In the current session, Greisheimer has introduced a bill that would help AT&T swiftly provide cable television service to compete with the likes of Charter Communications, Comcast Corp. and Time Warner Cable. The bill, SB 816, would give companies entering the cable market the ability to negotiate one franchise deal with the state as opposed to negotiating with each city where they would offer service. That bill is just beginning to work its way through the senate, but observers expect it will get its due, especially because Andy Blunt remains among AT&T's lobbyists.
Even though Andy Blunt said he is not lobbying his brother directly, the leadership of both the House and Senate speak with the governor's office on a daily basis, said former Gov. Bob Holden, a Democrat. "Anytime someone hires a lobbyist, they are looking to have access or influence," Holden said. "Any family or close personal friend is going to have more access than someone the governor doesn't know. That's human nature. It comes down to the integrity of the individual and whether they will take advantage of that or not."
Lobbyist John Bardgett Jr. said, "If somebody thinks he gets a leg up because of his name, that may help him get clients. I think Andy does a great job for his clients, but I think perceptions are important." Bardgett's clients include Bank of America, the Missouri Cable Telecommunications Association, Pinnacle Entertainment, and the St. Louis Cardinals.
Matt and Andy Blunt are politically bonded by more than their last name. In its most recent campaign finance disclosures, filed Jan. 17, Gov. Blunt's re-election campaign committee reported contributions from Andy Blunt clients Burlington Northern Santa Fee Railway ($1,200) and UPS ($500). Duane Schreimann, a partner in Blunt's firm and a former mayor of Jefferson City, was appointed by Gov. Blunt last May to serve on the state's Coordinating Board for Higher Education.
Wide net
Andy Blunt's work is limited to the state level and does not come directly before his father in Washington. Yet many in Jefferson City point out that several of Blunt's clients have been significant contributors to Roy and Matt Blunt's political campaigns.
For example, SBC was the largest single contributor to Roy Blunt's Rely On Your Beliefs Fund (R.O.Y.B.) political action committee, which raised $1.7 million during the 2002 election cycle. SBC contributed $125,540 to the fund, according to campaign finance reports compiled by The Center for Public Integrity, a Washington-based non-partisan, not-for-profit organization.
During the same cycle, Altria Group, parent company of Philip Morris, Kraft Foods and former owner of Miller Brewing Co., contributed $114,882 to the fund, second only to SBC. Roy Blunt's wife, Abigail Perlman, is a federal lobbyist for Altria Group. Burlington Northern Santa Fe gave $50,000, and UPS contributed $31,200. Perlman is not the mother of Andy and Matt Blunt.
The Missouri Republican State Committee was the largest recipient of R.O.Y.B. money during the 2002 cycle, taking in $661,000. Much of that money supported Matt Blunt's successful gubernatorial race. Another $1,175 from the fund went directly to Missourians for Matt Blunt.
The Blunt brothers have clearly benefited in their own careers from their father's political supporters. Now if Roy Blunt can secure his role as House Majority Leader, replacing U.S. Rep. Tom DeLay (R-Texas), both Matt and Andy Blunt stand to gain some more.
Roy Blunt, known for his close ties with federal lobbyists and his effectiveness in raising funds for himself and other Republican politicians, would have even greater ability to direct money to support Matt Blunt's political aspirations, insiders said. Companies and interest groups wanting to gain favor with Roy Blunt probably would keep sending money or business to Matt and Andy Blunt, observers said.
But the tail wags both ways. If Roy Blunt loses his majority leader position to a rival Congressman or is implicated in the Jack Abramoff corruption scandal, Matt and Andy Blunt are likely to feel it as well, insiders said.
Roy Blunt has been DeLay's right-hand-man in the House. Together they developed extensive connections with Washington lobbyists to drive support for their political agenda and generate funds that helped fellow Republicans get elected to office. Blunt and DeLay also exchanged money from their own war chests that was directed to support Matt Blunt's campaigns.
DeLay was forced to give up his role as majority leader last year, however, after he was charged in his home state of Texas with felonies in a money laundering investigation.
Many Republicans also are concerned about what may come out of the public corruption investigation surrounding former lobbyist Abramoff, who pled guilty Jan. 3 to fraud, tax evasion and conspiracy to bribe public officials. Abramoff must provide federal investigators with evidence about members of Congress as a condition of his plea bargain.
Roy Blunt has said he would lead reforms to ensure ethical dealings between politicians and lobbyists, but several members of Congress question whether his ties to lobbyists can be overlooked.
"If something taints Roy Blunt, it could hurt Matt Blunt," said a former staffer for a Missouri Democratic official who spoke on condition of anonymity.
Others said they don't think the Blunt brothers would be affected much by their father's fortune. "I really think that the governor and Andy are two individuals who stand on their own credentials," Bardgett said. "Maybe their father's position helped them get their foot in the door, but then they had to make it on their own."
Andy Blunt said he does not expect his father's fate will have an impact in Jefferson City. "Folks have elected Matt Blunt to be governor not because of who his father is. This is not going to affect the governor in the least. It's not going to affect me."
ctritto@bizjournals.com