The Honolulu Charter Commission is considering a proposal today to clarify conflict-of-interest provisions for city employees and officials. Current charter provisions prohibit employees and officials from soliciting or accepting any gift, directly or indirectly, if it can reasonably be inferred the gift is intended to influence the officer or employee in the performance of official duties. The new proposal would prohibit only those gifts intended to influence an officer or employee in the performance of official duties and benefiting the official, his or her family, or individuals or organizations with which he or she has a past, present, or future connection.

Proponents argue the proposal creates a clear standard of conduct, while opponents claim the changes would make it more difficult to enforce gift restrictions in the future. It is inherently difficult to prove the intent behind a gift or the existence of a connection with the recipient. The proposal, therefore, will likely result in individuals, namely lobbyists, avoiding penalties. Interestingly enough, several commission members are current or former lobbyists, or work for organizations employing lobbyists.

Gov. Tom Wolf is pushing to extend the range of the gift ban he imposed on executive branch employees after taking office. His plan is to make his executive order a permanent, statutory prohibition and create a similar restriction on gifts to legislators.

While the reception he has received from Democratic lawmakers has been positive, Republicans, who control both houses of the General Assembly, are less eager to make a change. Gov. Wolf has stated he would prefer a complete ban, but is willing to work with legislators on a compromise. With ongoing budget issues, however, ethics reform appears to be taking a back seat for the time being.

The Alexandria City Council enacted a resolution over the weekend to promote greater transparency and ethics guidelines for city officials. The resolution, in part, creates a nine-member committee to draft a code of conduct and ethics pledge for elected and appointed city officials as well as seeks authority from the General Assembly to enact limits, or a complete ban, on gifts to elected officials. As a Dillon Rule state, it is unclear whether the legislature will grant such lawmaking power to the city.

The city attorney’s office must finalize the language of the resolution before the text will be made available to the public.

Photo of Old Town Alexandria, Virginia by ShuminWeb on Wikimedia Commons.

Four ethics bills have passed out of the House Government Oversight and Accountability Committee and now move to consideration by the entire House.

These bills include banning statewide elected officials or legislators from working as political consultants while in office, creating a “cooling off” period of at least a full legislative session before elected officials or officials in jobs subject to Senate confirmation may work as lobbyists, requiring public officials to file semiannual reports detailing their personal finances, and reporting any out-of-state travel for official business when paid for by a third party.

Rep. Gina Mitten questioned the effectiveness of the revolving door bill during the committee hearing, asking if the cooling off period was long enough. She advocated having the measure cover legislative staff, requiring elected officials who leave office early to be prohibited from acting as lobbyists until the end of the term, and making the measure become effective as quickly as possible.

Hearings for bills regulating how to handle surplus campaign funds once an official leaves office and the banning of gifts from lobbyists have been delayed due to issues with the drafting of the bills. The committee will take those bills up next week.

Photo of the Missouri Capitol courtesy of RebelAt on Wikimedia Commons.

Columbus Mayor Andrew Ginther has proposed three new ordinances providing for an increase in lobbying oversight and gift disclosure, additional campaign finance disclosure, and the hiring of an inspector general. Columbus City Council is expected to hold a public hearing on the proposals in the coming weeks and to vote on them by late February.

With the lobbying proposal, Ginther wants the city to establish a new lobbyist registry to track the activity of lobbyist vendors seeking contracts with the city. Additionally, lobbyists would be required to disclose expenditures made on elected officials and department directors.

Photo of Mayor Ginther by David Paul on Wikimedia Commons.

On December 17, 2015, the Fair Political Practices Commission amended its regulations related to agency provided tickets or passes. Currently, tickets and passes an agency provides to agency officials for entertainment, amusement, or recreational events are treated as gifts.

Regulation 18944.1 creates an exception from the statutory definition of “gift” for tickets or passes provided by an agency to certain agency officials under specified circumstances, allowing agency officials to use tickets and passes without violating the state’s gift law.

The proposed regulation was adopted with a vote of 5-0. It will go into effect 30 days after filing with the Secretary of State.

The Legislative Ethics Board in Washington clarified its rule on free meals for legislators, which became effective January 1, 2015. At its December meeting, the board considered whether the rule should have more flexibility in its application in certain circumstances.

The board determined the following based on its discussion: annual, sit-down complimentary dinners to which all legislators are invited during a legislative session are not the type of dinners sought to be limited by the rule; when complimentary lunch is served at a city council meeting that is open to the public, such meal does not count toward the 12 free meals permitted under the rule; annual, sit down lunches hosted by business associations who employ lobbyists do not count against the 12 free meals permitted under the rule because such lunches are permissible under a separate exemption to the state gift ban; and potluck meals held as a result of a social relationship between a legislator and a lobbyist where the purpose of the meal is not to discuss legislative business do not count against the 12 free meals permitted under the rule.

Photo of the Washington State Capitol building by Nikopoley on Wikimedia Commons.

Commissioners, by a count of 5-4, voted to loosen the strict gift limits imposed by the county ethics ordinance. Enacted in 2010, the ordinance created a no-gift rule, prohibiting city and county officials from accepting even a bottle of water at an event.

The new rules allow gifts, including non-alcoholic beverages, worth less than $5 and create an exception for gifts of sympathy. Other changes include the burden of reporting lobbying contact shifting away from the public official to the lobbyist and immediate family members may now act as government vendors.

Proponents lauded the changes, stating the zero-tolerance rules created a trap whereby government officials and employees could inadvertently violate the code.

State Rep. Caleb Rowden pre-filed a four-point ethics reform package this week, hoping to increase accountability and transparency in government. The first change would prohibit gifts from lobbyists to any state or local elected officials as well as to their families and staff members.

The second change would institute a revolving door provision for state legislators and statewide elected officials up for election during the presidential campaign cycle. Such individuals would be barred from lobbying for one session after leaving office beginning in 2016. Elected officials up for election during the midterm elections would be barred from lobbying for one session after leaving office beginning in 2018. After 2018, the revolving door rule would apply to all state elected officials.

A third change would prohibit individuals with open candidate committees from registering as lobbyists.

The final proposed change would require elected officials to publically disclose travel expenses paid for by a third party within 30 days of receipt or within 30 days of the trip, whichever is sooner.

Speaker of the House Todd Richardson has vowed to make ethics reform a top priority when the session begins in January.

Photo of the Missouri State Capitol by RebelAt on Wikimedia Commons.

On December 1, 2015, new revisions to Canada’s Lobbyists’ Code of Conduct will take effect.  The updates to the Code of Conduct, which has not been updated since 1997, are designed to clarify the rules and restrictions on lobbying in the country.

New rules will prohibit a lobbyist from lobbying a public official if the lobbyist has campaigned for or has business interests with the public official.  New regulations addressing gifts will hold a lobbyist responsible for giving a gift the public official is not allowed to accept.

State Sen. John Schickel filed a federal lawsuit against the Kentucky Registry of Election Finance and the Legislative Ethics Board aimed at eliminating the state’s campaign contribution limits. The suit claims the $1,000 limit to individual candidates and the ban on corporate contributions are violations of free speech.

The suit also asks the court to strike down ethics rules prohibiting lobbyists from making contributions, prohibiting employers of lobbyists from making contributions while the Legislature is in session, and banning gifts from lobbyists to legislators.

Kentucky House candidate David Watson and Pendleton County judge candidate Ken Moellman Jr. have joined the suit. The state agencies have until October 6 to respond.

On September 10, a bill requiring disclosure of funding for California government officials’ travel was sent by the Legislature to the Governor. Senate Bill 21 requires a nonprofit organization paying for the actual costs of travel for an elected state officer or local elected officeholder to disclose the names of donors responsible for funding the payments. The legislation also requires a person who receives a gift of a travel payment from any source to report the travel destination on his or her statement of economic interests.

On September 2, the Municipal Securities Rulemaking Board (MSRB) requested approval from the Securities and Exchange Commission (SEC) for amendments to MSRB Rule G-20, a conflict-of-interest rule concerning gifts and gratuities. The proposed amendments include limiting gifts to $100 for municipal advisors giving gifts to employees of entities engaged in municipal securities activities. The new rules for municipal advisors also would prohibit receiving reimbursement of entertainment expenses from the proceeds of an offering of municipal securities.

“Amending the MSRB’s existing gifts rule would ensure common standards for dealers and municipal advisors that all operate in the municipal securities market,” said MSRB Executive Director Lynnette Kelly in a press release.

Q. I will be attending several upcoming conferences where legislators and other public officials will be present.   I’m not a registered lobbyist at the state level—do I still need to worry about gift limits?

A. Even if you are not a registered lobbyist, you will still need to be mindful of the various gift limits applicable to legislators and public officials you engage at these conferences.  Depending on your company’s status as a lobbyist employer, you may be subject to more stringent limits in certain jurisdictions.  It’s important to remember there is no one-size-fits-all approach to determining permissibility.  Each state addresses gift limits differently, and what will be permissible in one jurisdiction will not be permissible in another.   Further, you should not depend on the legislator or public official to know applicable gift limits.  Because gift limits may vary depending on your company’s status as a lobbyist employer, officials may not be aware of which limit to apply when accepting gifts and benefits.

Numerous states have gift exceptions specifically applicable to expenditures at national conferences to which all members of the legislature are invited (such as NCSL) as long as the expenditures are part of the conference agenda.  Examples of this include lunch/dinner events, or a sponsored state night.  However, for private dinners and events and other expenditures not included on the official agenda, you will still be subject to a state’s regular gift limits and restrictions.

In some cases, your expenditures on behalf of these individuals will need to be disclosed on a lobbyist employer report.  You will need to coordinate closely with your company’s government affairs or legal department to not only determine permissibility, but to determine whether the expense is reportable. For jurisdictions requiring disclosure, you may need to report the date of the expense, the name of the individual(s) receiving the benefit, a brief description, and the value of the expense.   Make sure to save itemized receipts.  Some jurisdictions require you to report the name and address of the vendor (such as a restaurant or catering company) and may additionally require you to determine the reportable amount by specific benefit received.  Some states do not permit meal expenditures to be calculated on a prorated basis (i.e., a dinner valued at $375, divided by the number of attendees) but instead require disclosure of a specific amount attributed to a particular legislative official or employee (i.e., $15.75 for the salmon entrée).

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(We are always available to answer questions from clients that are specific to your needs, and we encourage you to continue to call or e-mail us with questions about your particular company or organization. As always, we will confidentially and directly provide answers or information you need.) Our replies to your questions are not legal advice. Instead, these replies represent our analysis of laws, rules, and regulations.