All is quiet in the Russell Senate Office Building as Katherine Lugar stands and smiles for the camera. Today is the eighth day of the government shutdown and everything on Capitol Hill has ground to a halt, while across the country national parks are closed and Blue Angels are grounded. On any other day, dozens of young men and women in suits would be rushing through the halls of this building, urgently pursuing the agendas of their congressional masters, while the members of Congress hold closed-door meetings and meet with constituents. Instead, a handful of TV production guys sit in the rotunda, hunching over their monitors while they wait for something to happen. Today, the only signs of life come when a member of Congress steps in front of a TV camera to rant about how the opposition is destroying the country.
And while the highest lawmaking body in the land spends its time grandstanding and pointing fingers, government workers all over town are putting in place rules and regulations that may fundamentally alter the way you run your business. “Even though we’re in a very dysfunctional period in Washington and you may feel like everything is at a stalemate, it’s not,” says Lugar, president and CEO of AH&LA. “There are still decisions being made every day that will affect your bottom line.” In other words, don’t let the antics in Congress distract you from the policies being put in place by agencies and administration officials. More is happening in this town through the regulation process than ever before.
A good example of this is the health care mandate being put in place through the Affordable Care Act. “Those regulations are being written as we speak,” says Lugar. “We have to engage in the regulatory process and talk to members of Congress so they put in place proper oversight.” These policies will potentially have a major impact on the workforce of the entire lodging industry and Lugar says they address the issues that are unique to hotel operations. “There’s how we determine who is a seasonal worker, how we determine who is a full-time worker, with variable hours from week to week and month to month,” she says. “We’re hopeful that we can make some targeted changes to this very onerous health care law.”
LIFE IN WASHINGTON
Lugar knows her way around D.C., having worked on the Hill and on K Street since 1993. She began her career as a member of Indiana congressman Tim Roemer’s staff and then transitioned to the National Retail Federation, where she supervised political and grassroots programs. Most recently, Lugar oversaw the public affairs efforts of the Retail Industry Leaders Association. At RILA, she helped rebrand and refocus the organization on advocacy efforts and even scored a major victory in the retailers’ long battle against debit swipe fees. This led to the Federal Reserve instituting a lower cap on the fees that banks charge retail stores for each debit card transaction. “The banks never lose,” says Kent Knutson, VP of government relations at Home Depot. “They’ve been playing this game for years, and they have a huge lobbyist presence and an almost unlimited amount of cash. And Katherine showed them how to lose.”
Lugar has only been with AH&LA since April and has spent much of that time putting in place a new organizational structure (see “The New AH&LA” sidebar) and helping to roll out a new membership model that allows the association to foster direct engagement from every segment of this industry. “We want brands, owners, REITs, management companies, independents, and partner state associations all around the table and then working on the key areas that most directly affect their bottom lines.” So starting in January an equal number of board seats at AH&LA will be given to the owners, the brands, the management companies, the independents, and to the state associations. It’s important to ensure that one segment of the industry doesn’t feel like another one has a leg up on them, she says. “The new model is going to help the lodging industry speak with one voice and ultimately boost our presence in Washington so that our influence will match our tremendous economic footprint.”
That’s a good thing because, according to Knutson, “When the folks in D.C. are deciding how policies are affecting different people, you never hear them ask, ‘What will this do to the hotel industry?’ Compared to the piece of the economy that the lodging industry occupies, its voice in Washington is [underrepresented]. Katherine [Lugar] will make AH&LA a force to be reckoned with instead of an afterthought.”