In mid-March, a commercial laundry machine supplier hired a Trump-connected lobbying firm and gave it a very specific job: The company wanted to be added to the federal government’s list of “critical” industries amid the coronavirus outbreak.
The Long Island-based company Laundrylux inked a lobbying deal on March 21 with the firm Ballard Partners. The firm pleaded the company’s case with the Department of Homeland Security. A week after Ballard’s work began, DHS came out with a new list of such industries, and it included “laundromats, laundry services, and dry cleaners.”
What constitutes a “critical” industry during the coronavirus pandemic is not entirely clear, and the federal government’s somewhat arbitrary and ad hoc treatment of the question is driving companies to staff up with high-powered Washington lobbyists to help get them on the list.
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DHS’s Cybersecurity and Infrastructure Security Agency has been tasked with determining which industries are considered “critical infrastructure” during the coronavirus pandemic. While the list is purely advisory, it’s designed to guide state and local decisions about which businesses to keep open as more governments issue blanket stay-at-home orders to combat the virus.
Getting the official sign off to stay open amid the outbreak can be the difference between survival and insolvency for many businesses. So a spot on DHS’s list is extremely valuable. But it’s not entirely clear how the department is deciding which industries make the cut.
The list is designed to ensure “continuity of functions critical to public health and safety, as well as economic and national security,” according to DHS. It “is intended to be overly inclusive reflecting the diversity of industries across the United States.”
Industry groups have raised concerns about the lack of clear standards for inclusion on the list. “It is imperative that the federal, state and local governments come together with uniform definitions of ‘critical infrastructure,’” wrote 111 different trade groups in a joint letter to federal, state, and local policymakers last week.
Absent clear guidance, K Street has stepped into the void. For a fee, some of Washington’s premier power brokers can work to get your company deemed “critical.” Already, a fair number of companies are making the investment, including some that don’t appear to fit as neatly into any of the categories DHS has outlined. Battery manufacturer Energizer, for example, hired the firm Holland & Knight on March 20 to secure the company a “designation as critical industry/infrastructure on coronavirus relief packages.”
It’s not clear that Energizer’s commercial batteries qualify under the guidelines in DHS’s most recent critical industry memo. The company didn’t respond to requests for comment or questions about whether it feels it meets the government’s most recent criteria.
Hiring the right firm can be the difference between getting the designation and missing out. And few lobbying shops have as much cachet these days as Ballard Partners. The firm has cashed in on its strong ties to the Trump White House, and it’s signed a pair of clients since last week looking to affect Washington policymaking on coronavirus-related matters. Its other new account, NanoPure, LLC, manufactures fog machines that disinfect air and surfaces, and Ballard reported it will lobby on its behalf on issues related to “environmental safety in response to the COVID-19 virus.”
The firm’s work for Laundrylux was more specific. Ballard reported that it would work to secure Laundrylux a “designation as essential business in response to COVID-19 virus.” Working on the account are Brian Ballard, the firm’s eponymous principal, and Dan McFaul, a former chief of staff to Rep. Matt Gaetz (R-FL), a high-profile ally of President Donald Trump.
The firm sent a letter to DHS pleading its client’s case. The key issue that it hoped DHS would address, McFaul told The Daily Beast in an interview, was the patchwork of essential industry designations across the country—some states had already included laundry services, while others had not.
Inclusion on DHS’s list of critical industries was “a way to standardize” the industry’s—and Laundrylux’s—position during the outbreak. “In rural communities and suburban communities it’s an economic issue. A lot of the folks that are not upper middle class don't have access to in-home laundry services,” McFaul said of his client’s work. “So there’s an equity issue, and there’s a sanitation issue. The doctors and nurses and first responders that we ask to work during this time, they’ve got to clean scrubs or clothes or anything else you wear... We’ve got to give them facilities” to do so.
This week, Laundrylux added an “important update” to that page noting that its industry, initially absent from DHS’s critical industry guidance, had secured a coveted spot on the list.
At least 16 lobbying firms have reported working on issues related to “coronavirus” or “COVID-19” specifically, though numerous others have couched similar activity in more generic language. The firm Marshall & Popp, for instance, reported working on behalf of industrial supply giant 3M to limit its legal liability from the personal protective equipment it’s manufacturing to address the outbreak. The $2 trillion economic stabilization legislation that was recently passed and signed into law included a provision that granted that legal liability.
While there are a host of K Street targets in Washington’s sprawling efforts to address the virus, DHS’s critical industries designation presents a host of opportunities for the D.C. influence industry precisely due to the vagueness of the criteria for inclusion.
The company Elevate Textiles hired the firm Sandler, Travis & Rosenberg this month to lobby on “essential facility designations in any Shelter in Place orders.” The DHS guidance issued on Friday does not include the textile industry generally. But it does classify as “essential” any company that produces “materials and products needed to manufacture medical equipment and personal protective equipment.” According to its website, the Elevate company Burlington Fabrics is manufacturing “medical barrier fabrics” for such products.
Power station transformer manufacturer Energy Star undoubtedly falls under a DHS critical industry heading that includes “the generation, transmission, and distribution of electric power.” The company tasked its lobbyists at the JMH Group with ensuring that policymakers abide by that guidance, including “DHS Guidelines on ‘essential businesses’ maintaining operations.”
DHS’s efforts to detail America’s critical industrial sectors have been rushed by necessity. And the vagueness of the resulting standards has resulted in some confusion. But those working to affect the department’s decisions on the matter say it’s unavoidable in a crisis as unique as the one caused by the coronavirus.
“It’s a pretty thankless thing to have to come up with this list,” McFaul said. Comparable standards are “pretty well established for earthquakes and hurricanes and wildfires and those types of crises. But this is pretty unprecedented territory, at least for our generation.”
