HomeMy WebLinkAbout15-1001 McCormick
OPINION OF THE COMMISSION
Before: Nicholas A. Colafella, Chair
Mark R. Corrigan, Vice Chair
Roger Nick
Kathryn Streeter Lewis
Maria Feeley
Melanie DePalma
DATE DECIDED: 5/6/15
DATE MAILED: 5/11/15
Tracy McCormick, RESA Executive Director
c/o Amy Kaminski
Duane Morris Government Strategies LLC
600 Grant Street, Suite 5010
Pittsburgh, PA 15219
15-1001
Dear Ms. McCormick:
This Opinion is issued in response to your advisory request letter dated January 28,
2015, for which you established standing by letter of March 13, 2015.
I. ISSUE:
Whether the activities of the Retail Energy Supply Association (“RESA”) in hosting
an energy symposium (“the Symposium”) to educate its members and interested parties on
various topics would constitute “lobbying” as that term is defined at Section 13A03 of
Pennsylvania’s lobbying disclosure law (“Lobbying Disclosure Law”), 65 Pa.C.S. § 13A03,
where certain State officials and employees would be invited to speak regarding energy
policy and regulation in the Commonwealth of Pennsylvania, and a targeted list of State
officials and employees would be invited to attend; and
(1) If members of the general public would be charged $200 for attending the
Symposium, whether RESA would be permitted to provide State officials or
employees a discounted rate of $25 for attending the Symposium;
(2) Whether RESA would be required to report expenses associated with the
Symposium on its quarterly expense report, and if so, whether RESA’s full
cost of hosting the Symposium or the difference between the general public
rate and the discounted rate for State officials or employees would be a
reportable expense;
(3) Whether RESA would be required to report staff time and expenses incurred
in planning the event; and
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May 11, 2015
Page 2
(4) Whether reportable expenses should be reported as direct communication,
indirect communication, gifts or hospitality.
II. FACTUAL BASIS FOR DETERMINATION:
As the Executive Director of RESA, you have been authorized to request an
advisory Opinion from this Commission on behalf of RESA. You have submitted facts that
may be fairly summarized as follows.
RESA is registered as a “principal” pursuant to the Lobbying Disclosure Law. RESA
is hosting the Symposium to educate its members and interested parties on various topics
such as the future of energy markets, product innovations, and enhancements to retail
customers’ shopping experience. RESA will invite certain State officials and employees to
speak at the Symposium regarding energy policy and regulation in the Commonwealth of
Pennsylvania. RESA will invite a targeted list of State officials and employees to attend
the Symposium. RESA is considering providing State officials or employees a discounted
rate of $25 for attendance at the Symposium, as opposed to the rate of $200 that members
of the general public would be required to pay. There will be a reception following the
Symposium.
You ask whether the Symposium would constitute “lobbying” as that term is defined
at Section 13A03 of the Lobbying Disclosure Law, 65 Pa.C.S. § 13A03. You pose the
following additional questions:
(1) If members of the general public would be charged $200 for attending the
Symposium, whether RESA would be permitted to provide State officials or
employees a discounted rate of $25 for attending the Symposium;
(2) Whether RESA would be required to report expenses associated with the
Symposium on its quarterly expense report, and if so, whether RESA’s full
cost of hosting the Symposium or the difference between the general public
rate and the discounted rate for State officials or employees would be a
reportable expense;
(3) Whether RESA would be required to report staff time and expenses incurred
in planning the event; and
(4) Whether reportable expenses should be reported as direct communication,
indirect communication, gifts or hospitality.
By letter dated April 6, 2015, you were notified of the date, time and location of the
public meeting at which your request would be considered.
III. DISCUSSION:
It is initially noted that pursuant to Section 13A08(a) of the Lobbying Disclosure
Law, 65 Pa.C.S. § 13A08(a), in conjunction with Sections 1107(10) and 1107(11) of the
Public Official and Employee Ethics Act (“Ethics Act”), 65 Pa.C.S. §§ 1107(10), (11),
advisories are issued to the requester based upon the facts that the requester has
submitted. In issuing the advisory based upon the facts that the requester has submitted,
this Commission does not engage in an independent investigation of the facts, nor does it
speculate as to facts that have not been submitted. It is the burden of the requester to
truthfully disclose all of the material facts relevant to the inquiry. 65 Pa.C.S. §§ 1107(10),
(11). An advisory only affords a defense to the extent the requester has truthfully
disclosed all of the material facts.
McCormick, 15-1001
May 11, 2015
Page 3
As a registered principal in Pennsylvania, RESA is subject to the prohibitions,
restrictions, and requirements imposed upon principals by the Lobbying Disclosure Law.
The following terms pertinent to your request are defined in the Lobbying Disclosure
Law as follows:
§ 13A03. Definitions.
"Lobbying."
An effort to influence legislative action or
administrative action in this Commonwealth. The term
includes:
(1) direct or indirect communication;
(2) office expenses; and
(3) providing any gift, hospitality, transportation or lodging
to a State official or employee for the purpose of
advancing the interest of the lobbyist or principal.
"Legislative action."
An action taken by a State official or
employee involving the preparation, research, drafting,
introduction, consideration, modification, amendment,
approval, passage, enactment, tabling, postponement, defeat
or rejection of:
(1) legislation;
(2) legislative motions;
(3) a veto by the Governor; or
(4) confirmation of appointments by the Governor or
appointments to public boards or commissions by a
member of the General Assembly.
"Administrative action."
Any of the following:
(1) An agency’s:
(i) proposal, consideration, promulgation or
rescission of a regulation;
(ii) development or modification of a statement of
policy;
(iii) approval or rejection of a regulation; or
(iv) procurement of supplies, services and
construction under 62 Pa.C.S. (relating to
procurement).
(2) The review, revision, approval or disapproval of a
regulation under the act of June 25, 1982 (P.L.633, No.
181), known as the Regulatory Review Act.
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May 11, 2015
Page 4
(3) The Governor’s approval or veto of legislation.
(4) The nomination or appointment of an individual as an
officer or employee of the Commonwealth.
(5) The proposal, consideration, promulgation or rescission
of an executive order.
"Direct communication."
An effort, whether written, oral or by
any other medium, made by a lobbyist or principal, directed to
a State official or employee, the purpose or foreseeable effect
of which is to influence legislative action or administrative
action. The term may include personnel expenses and office
expenses.
"Indirect communication."
An effort, whether written, oral or
by any other medium, to encourage others, including the
general public, to take action, the purpose or foreseeable
effect of which is to directly influence legislative action or
administrative action.
(1) The term includes letter-writing campaigns, mailings,
telephone banks, print and electronic media
advertising, billboards, publications and educational
campaigns on public issues.
(2) The term does not include regularly published periodic
newsletters primarily designed for and distributed to
members of a bona fide association or charitable or
fraternal nonprofit corporation.
(3) The term may include personnel expenses and office
expenses.
"State official or employee."
An individual elected or
appointed to a position in State government or employed by
State government, whether compensated or uncompensated,
who is involved in legislative action or administrative action.
"Gift."
Anything which is received without consideration of
equal or greater value. The term shall not include a political
contribution otherwise reportable as required by law or a
commercially reasonable loan made in the ordinary course of
business. The term shall not include hospitality, transportation
or lodging.
"Hospitality."
Includes all of the following:
(1) Meals.
(2) Beverages.
(3) Recreation and entertainment.
The term shall not include gifts, transportation or lodging.
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May 11, 2015
Page 5
"Office expense."
An expenditure for an office, equipment or
supplies, utilized for lobbying.
"Personnel expense."
An expenditure for salaries or other
forms of compensation, benefits, vehicle allowances, bonuses
and reimbursable expenses paid to lobbyists, lobbying staff,
research and monitoring staff, consultants, publications and
public relations staff, technical staff, clerical and administrative
support staff and includes individuals who engage in lobbying
but are exempt from reporting under section 13A06 (relating to
exemption from registration and reporting). For an individual
for whom lobbying is incidental to regular employment, the
term means a good faith prorated estimate based on the value
of the time devoted to lobbying.
65 Pa.C.S. § 13A03.
Section 13A05 of the Lobbying Disclosure Law, pertaining to expense reporting,
provides in part:
§ 13A05. Reporting.
(a) General rule.--
A registered principal shall, under oath
or affirmation, file quarterly expense reports with the
department no later than 30 days after the last day of
the quarter.
(b) Content.--
(1) Each expense report must list the names and
registration numbers when available of all lobbyists by
whom lobbying is conducted on behalf of the principal
and the general subject matter or issue being lobbied.
(2) Each expense report shall include the total costs of all
lobbying for the period. The total shall include all office
expenses, personnel expenses, expenditures related to
gifts, hospitality, transportation and lodging to State
officials or employees, and any other lobbying costs.
The total amount reported under this paragraph shall
be allocated in its entirety among the following
categories:
(i) The costs for gifts, hospitality, transportation and
lodging given to or provided to State officials or
employees or their immediate families.
(ii) The costs for direct communication.
(iii) The costs for indirect communication.
(iv) Expenses required to be reported under this
subsection shall be allocated to one of the three
categories listed under this section and shall not
be included in more than one category.
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May 11, 2015
Page 6
(2.1) For purposes of filing an expense report under this
subsection, a registrant may use any reasonable
methods of estimation and allocation.
(3) The following apply:
(i) In addition to reporting the totals required under
this subsection, the expense report must identify,
by name, position and each occurrence, a State
official or employee who receives from a
principal or lobbyist anything of value which
must be included in the statement under section
1105(b)(6) or (7) (relating to statement of
financial interests) as implemented by section
1105(d).
(ii) For purposes of this chapter, the amount
referred to in section 1105(b)(7) shall be
considered an aggregate amount per year.
(iii) For purposes of this chapter, the amount
referred to in section 1105(b)(7) shall not include
the cost of a reception which the State official or
employee attends in connection with public
office or employment.
(iv) Written notice must be given to each State
official or employee who is listed in an expense
report under this paragraph at least seven days
prior to the report’s submission to the
department. Notice under this subparagraph
shall include the information which will enable
the State official or employee to comply with
section 1105(b)(6) and (7). For purposes of this
chapter and Chapter 11 (relating to ethics
standards and financial disclosure), section
1105(b)(6) and (7) shall constitute mutually
exclusive categories. For each category
enumerated in paragraph (2)(i), each notice
shall include both the amount incurred during
the quarter and the cumulative amount incurred
from January 1 through the end of the applicable
quarter.
….
65 Pa.C.S. § 13A05(a)-(b)(3)(iv).
In applying the above provisions to the submitted facts, you are advised as follows.
Lobbying is an effort to influence “legislative action” or “administrative action” as
those terms are defined by the Lobbying Disclosure Law, Bochetto, Opinion 09-1001, and
by definition, State officials or employees are individuals elected or appointed to positions
in State government or employed by State government who are involved in legislative
action or administrative action. 65 Pa.C.S. § 13A03.
McCormick, 15-1001
May 11, 2015
Page 7
In hosting the Symposium, RESA would be engaged in lobbying if the Symposium
would include effort(s) to influence legislative action or administrative action in
Pennsylvania through: (1) direct communication with State official(s) or employee(s)
speaking at or otherwise attending the Symposium; (2) indirect communication, such as
where attendees at the Symposium would be encouraged to take action, the purpose or
foreseeable effect of which would be to directly influence legislative action or
administrative action; and/or (3) the provision of gift(s), hospitality, transportation or
lodging to State official(s) or employee(s).
As a registered principal, RESA’s provision of a discount to State official(s) or
employee(s) to attend the Symposium would constitute lobbying and would be reportable
as gift(s)/hospitality provided to State officials or employees. The amount of the discount
attributable to attendance at the Symposium itself would be considered a “gift,” and any
portion of the discount attributable to attendance at the reception would constitute
“hospitality.”
RESA would be required to report all lobbying expenses associated with the
Symposium on the appropriate quarterly expense report(s). If the Symposium would not
include lobbying other than the provision of gifts, hospitality, transportation or lodging to
State officials or employees, then RESA would be required to report the total costs of such
as its lobbying costs for the Symposium. If the Symposium would include lobbying in the
form of direct communication or indirect communication, the full cost of the Symposium
would be reportable.
RESA’s expense report(s) must include the total costs of all lobbying for the
applicable period and allocate such total amount among the three “breakout” categories of:
(1) costs for gifts, hospitality, transportation, and lodging given to or provided to State
officials or employees or their immediate families; (2) costs for direct communication; and
(3) costs for indirect communication. 65 Pa.C.S. § 13A05(b)(2).
Discount(s) and any other gifts, hospitality, transportation or lodging provided to
State officials or employees to attend the Symposium would be allocated to the category
for reporting costs for gifts, hospitality, transportation, and lodging given to or provided to
State officials or employees or their immediate families. Other costs of the Symposium,
including but not limited to RESA’s staff time and expenses incurred in planning the
Symposium, would be reported as either direct or indirect communication. See, the
Lobbying Disclosure Regulations Committee’s Manual for Accounting and Reporting. We
agree with the statement in the Manual for Accounting and Reporting that the primary goal
of the Lobbying Disclosure Law is to ensure that all lobbying expenses are reported, and
determination of whether a particular expense falls within direct or indirect communications
is secondary.
The request for an advisory has only been addressed under the Lobbying
Disclosure Law and, derivatively, the Ethics Act to the extent applicable.
IV. CONCLUSION:
As a registered principal in Pennsylvania, the Retail Energy Supply Association
(“RESA”) is subject to the prohibitions, restrictions, and requirements imposed upon
principals by Pennsylvania’s lobbying disclosure law (“Lobbying Disclosure Law”), 65
Pa.C.S. § 13A01 et seq. Based upon the submitted facts that: (1) RESA will be hosting an
energy symposium (“the Symposium”) to educate its members and interested parties on
various topics such as the future of energy markets, product innovations, and
enhancements to retail customers’ shopping experience; (2) RESA will invite certain State
officials and employees to speak at the Symposium regarding energy policy and regulation
in the Commonwealth of Pennsylvania; (3) RESA will invite a targeted list of State officials
and employees to attend the Symposium; (4) RESA is considering providing State officials
McCormick, 15-1001
May 11, 2015
Page 8
or employees a discounted rate of $25 for attendance at the Symposium, as opposed to
the rate of $200 that members of the general public would be required to pay; and (5) there
will be a reception following the Symposium, you are advised as follows.
In hosting the Symposium, RESA would be engaged in lobbying if the Symposium
would include effort(s) to influence legislative action or administrative action in
Pennsylvania through: (1) direct communication with State official(s) or employee(s)
speaking at or otherwise attending the Symposium; (2) indirect communication, such as
where attendees at the Symposium would be encouraged to take action, the purpose or
foreseeable effect of which would be to directly influence legislative action or
administrative action; and/or (3) the provision of gift(s), hospitality, transportation or
lodging to State official(s) or employee(s).
As a registered principal, RESA’s provision of a discount to State official(s) or
employee(s) to attend the Symposium would constitute lobbying and would be reportable
as gift(s)/hospitality provided to State officials or employees. The amount of the discount
attributable to attendance at the Symposium itself would be considered a “gift,” and any
portion of the discount attributable to attendance at the reception would constitute
“hospitality.”
RESA would be required to report all lobbying expenses associated with the
Symposium on the appropriate quarterly expense report(s). If the Symposium would not
include lobbying other than the provision of gifts, hospitality, transportation or lodging to
State officials or employees, then RESA would be required to report the total costs of such
as its lobbying costs for the Symposium. If the Symposium would include lobbying in the
form of direct communication or indirect communication, the full cost of the Symposium
would be reportable.
RESA’s expense report(s) must include the total costs of all lobbying for the
applicable period and allocate such total amount among the three “breakout” categories of:
(1) costs for gifts, hospitality, transportation, and lodging given to or provided to State
officials or employees or their immediate families; (2) costs for direct communication; and
(3) costs for indirect communication. 65 Pa.C.S. § 13A05(b)(2).
Discount(s) and any other gifts, hospitality, transportation or lodging provided to
State officials or employees to attend the Symposium would be allocated to the category
for reporting costs for gifts, hospitality, transportation, and lodging given to or provided to
State officials or employees or their immediate families. Other costs of the Symposium,
including but not limited to RESA’s staff time and expenses incurred in planning the
Symposium, would be reported as either direct or indirect communication. The primary
goal of the Lobbying Disclosure Law is to ensure that all lobbying expenses are reported,
and determination of whether a particular expense falls within direct or indirect
communications is secondary.
Pursuant to Section 13A08(a) of the Lobbying Disclosure Law, 65 Pa.C.S. §
13A08(a), a requester who truthfully discloses all material facts in a request for an advisory
and who acts in good faith based upon a written Opinion of this Commission issued to the
The
requester shall not be held liable for a violation of the Lobbying Disclosure Law.
protection afforded for reliance upon this Opinion will remain in effect until such
time as any regulation, statutory enactment, or ruling precludes further reliance
upon this Opinion.
This letter is a public record and will be made available as such.
By the Commission,
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May 11, 2015
Page 9
Nicholas A. Colafella
Chair