Lobbying expenses are not deductible from the federal income tax.

As noted previously, former lobbyist Don Beason is being investigated by the N.C. Secretary of State over the amount of income he reported as lobbying related. (Instead, he may have considered some of his pay for consulting.)

Raleigh attorney Michael Weisel, who is working for some of Beason's former clients, tells Dome that there is a "natural tension" on the issue.

"Any costs/expenses characterized as lobbying are not deductible as a business expense," he writes in an e-mail. "Therefore, a business seeks to minimize the amount attributable to lobbying as defined by the IRS."

On the other hand, state law clearly outlines lobbying expenses. 

Weisel took issue with Dome's use of the word "underreporting" for lobbyists who do not report income for consulting expenses.

"There is no 'underreporting' of compensation despite the investigators characterization," he wrote.

Why would a lobbyist underreport?

Former top lobbyist Don Beason is being investigated by the N.C. Secretary of State for potentially underreporting his lobbying income.

That's led some Dome readers to ask why a lobbyist would do that.

Here are a few possible reasons:

EVERYONE DOES IT. Clients seek advice on political ads, who to support in elections and how to frame an issue for the public. Some of that is legitimately considered consulting.

TO HELP THE CLIENT. To much of the public, "lobbying" is a dirty word. If a lobbyist reported earning a lot, the client's opponents could use that as an attack.

COMPETITIVE SECRETS. If you told the state how much you earned for a given client, another firm could come in and offer to do the same job for less.

JUST BECAUSE. Some lobbyists make a career out of pushing the legal limits. If the state has a loophole that allows them to underreport, they're going to use it.

Have another theory? Post it below or e-mail dome@newsobserver.com.

Former lobbyist Don Beason is being investigated.

In a four-page statement filed in Wake County Superior Court, a special agent with the N.C. Secretary of State's lobbying compliance division wrote that he thinks Beason directed some of the 24 groups and companies for which he and his son lobbied in 2007 to include inaccurate information on disclosure forms.

"I have discovered a pattern of under reporting of the lobbyist compensation," agent John M. Lynch wrote. "This under reporting is often done at the instruction of the lobbyist without any written or substantial justification."

The agent said Beason made one request of the Albemarle Mental Health Center, a regional facility in Elizabeth City.

State law treats many reporting violations as misdemeanors.

The affidavit was filed in mid-March in Wake County seeking a judge's help in getting records about Beason from Progress Energy, one of his requests. (N&O)

Garrett Perdue has never registered as a lobbyist.

A search of state lobbying databases back to 1993 found no record of the son of Gov. Beverly Perdue having registered.

Two online biographies note that Perdue worked as an "associate" and a "government relations liaison" in 1998 for Zeb Alley, a Raleigh lobbyist who is regularly ranked among the five most effective in the state.

He was a senior in college at the time.

Liz Proctor, a spokeswoman for the N.C. Secretary of State's office, said that a person has to register as a lobbyist if they have a client and are paid for their work. She said she could not comment on any specific cases without knowing the details.

"It would be hard to say just based on a title whether or not they should be registered," she said.

State law allows some economic development lobbyists to register without their records being made public until the project is announced, but Proctor said no one is currently registered under that provision.

Garrett Perdue is out and about again.

The son of Gov. Beverly Perdue was spotted at the Sheraton Imperial Hotel in Durham today for the N.C. Chamber's annual meeting. He was seated at the Womble Carlyle table.

Among the speakers at the event was his mother. Former Gov. Mike Easley was on hand to receive an award, and Lt. Gov. Walter Dalton was also at the event.

No members of the Congressional delegation were on hand.

In mid-February, the younger Perdue was hired by Womble Carlyle, the state's largest law firm, to work with former Gov. Jim Hunt on economic development and government relations strategy.

The firm was insistent that he would not be doing any lobbying in Raleigh, though Perdue was recently spotted at the legislature for unexplained reasons.

He is not currently registered as a lobbyist with the N.C. Secretary of State or the U.S. Senate.

Have you seen Garrett Perdue at a state political event? E-mail dome@newsobserver.com.

Cabinet members oversee more money than the Council of State.

A review of the 2007-08 budgets for the 10 appointed members of the governor's Cabinet show that they typically oversee larger budgets than the 10 statewide elected officials.

Only the departments of Public Instruction, Justice and Agriculture come close, and the superintendent of public instruction does not have similar authority over that department as a Cabinet official.

The smallest Cabinet budget was larger than all but three of the Council of State budgets.

Public Instruction: $9.5 billion

Justice: $121.7 million

Agriculture: $98.4 million

Treasurer: $38.5 million

Insurance: $36.2 million

Labor: $25.3 million

Auditor: $15.9 million

Secretary of State: $11.9 million

Governor: $6.7 million

Lieutenant Governor: $914,122

As before, the figures include money received from both state and federal sources. As a major player in the state budget, it goes without saying that the governor has more authority over state spending than these numbers indicate.

The revised numbers for 2008-09 are not yet available.

Someone at the N.C. Secretary of State's office may be a fan of David Chase.

A fake lobbyist created by the department apparently to test its software was given the last name of a popular HBO series.

"Lobbyist A Soprano A," listed here on the department's Web site, was given an imaginary address at 1234 Utopia Lane in Raleigh.

It's not clear whether the fake name is a tribute to "The Sopranos" or, say, Kiri Te Kanawa, but lobbyists would probably prefer the latter.

The phone number is real, though. It belongs to a staffer at the Secretary of State.

Only one out of eight state lobbyists reported any expenses in 2007.

According to a compilation of lobbyist expense forms, only 78 lobbyists reported spending any money on transportation, entertainment, dining, meetings or gifts last year. Another 526 lobbyists reported zero expenses during the same time.

Under lobbying laws effective Jan. 1, 2007, lobbyists must file reports with the N.C. Secretary of State on a quarterly basis noting the "fair market value" of any money spent on behalf of a client.

However, few lobbyists write much on the forms, which are filed separately for each client. Of the 93 expense forms with anything listed, 33 were for $100 or less. Only 15 forms listed more than $500 in expenses.

In all, the lobbyists reported spending $46,091, with roughly 60 percent of the money going toward transportation and lodging. Another $13,353 was reported as spent on food and beverages.

The single largest expense was $9,206 by lobbyist Gordon Myers for The Facility Group. He reported spending the money on travel and a conference.

Lobbyist Peter Gilmore reported spending $7,500 on behalf of the Dole Food Co. to sponsor a Farm Day.

And lobbyist Roger Bone reported spending $500 a piece for nine clients on the N.C. Beer and Wine Wholesalers Association's annual "Rush the Growler" party for legislators, Council of State members and their staffs.

Nine groups spent $757,926 soliciting state legislators last year.

According to a compilation of reports filed with the N.C. Secretary of State, three-fourths of the money was spent by the Partnership for North Carolina's Future.

Launched in May of 2007, the group spent $588,441 advocating on growth issues such as open space, water and sewer needs, traffic congestion and housing.

Solicitation is different from lobbying in that it seeks to connect members of the public with lawmakers to influence their votes using such things as Web sites and direct-mail campaigns.

Major spenders included groups that work on growth issues.

The Home Builders Association of Raleigh-Wake County, an industry group, spent $71,340 on solicitation. N.C. Go, which works on transportation issues, spent $32,927. The N.C. Homeowners Alliance, which opposed the transfer tax, spent $19,554.

The remaining groups worked on a variety of issues.

The Coalition for Persons Disabled by Mental Illness spent $19,698. The Alliance for Digital Equality, which advocates for minorities on telecommunications issues, spent $14,676. Dix 306, a group of business and community leaders advocating for the Dorothea Dix hospital property in Raleigh to become a major urban park, spent $8,068.

And Return America, a Judeo-Christian group that opposes same-sex marriage and abortion, spent $3,219.

Other groups may also have spent money. Under state law, advocacy groups only have to file solicitation reports if they spend more than $3,000 on it in a 90-day period.