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HomeMy WebLinkAbout16-003 ConfidentialOPINION OF THE COMMISSION Before: Nicholas A. Colafella, Chair Mark R. Corrigan, Vice Chair Roger Nick Kathryn Streeter Lewis Maria Feeleyy Melanie De alma DATE DECIDED: 6/22/16 DATE MAILED: 6/29/16 16 -003 This responds to your letter of January 19, 2016, by which you requested a confidential advisory from the State Ethics Commission. ISSUE: Whether, pursuant to the Public Official and Employee Ethics Act S,to Ethics Act "), 65 Pa.C.S. § 1101 et sec., certain employees of the A would be require report on their respective Statements of Financial Interests filed pursuant to the Ethics Act various gifts transportation, lodging and /or hospitality received from or through registered lobbyists with whom they have personal romantic relationships. II. FACTUAL BASIS FOR DETERMINATION: In your capacity as B, you have been authorized by certain employees of the A, collectively referred to herein as "the Employees," to request a confidential advisory from this Commission on their behalf. You have submitted facts, the material portion of which may be fairly summarized as follows. The Employees are Cs for particular Ds within the E of the F. The Employees also serve in various other roles with the A. You have not provided the official position descriptions for the Employees, but in addition to summarizing their duties, you acknowledge that the Employees are public employees subject to the Ethics Act, and this Opinion considers them to be such. The Employees are involved in personal romantic relationships with registered lobbyists. You state that the registered lobbyist with whom one of the Employees shares a personal romantic relationship conducts lobbying activities in an industry which routinely appears before the D to which the Employee is assigned and does, at times, directly lobby that Employee. The registered lobbyist with whom another of the Employees shares a personal romantic relationship does not conduct lobbying activities in an industry which routinely appears before the D to which that Employee is assigned, and that Employee is not directly or indirectly lobbied by the registered lobbyist with whom the Employee shares a personal romantic relationship. The Employees and the lobbyists with whom they share personal romantic relationships —the latter also being referred to herein as the "significant others" of the Confidential Opinion, 16 -003 June 29, 2016 Page 2 Employees —may at times attend events where lodging and /or hospitality is provided to the Employees because of their public positions and /or because they are the "plus one" of the registered lobbyists with whom they are romantically involved. Additionally, the Employees and their significant others recently exchanged holiday gifts, and one couple recently purchased a household pet and related accessories, with the Employee paying the adoption fee of $145.00 and the registered lobbyist purchasing the related accessories and veterinary services at a cost of $293.00. You pose the following specific questions: (1) Whether the Employees would be required to report gifts received from registered lobbyists in connection with a personal romantic relationship; (2) Whether the reporting requirement for gifts changes in any way if the personal romantic relationship existed prior to the commencement of public employment or lobbying; (3) Whether the Employees would be required to report transportation, lodging or hospitality received from registered lobbyists in connection with a personal romantic relationship; (4) Whether the reporting requirements for transportation, lodging and hospitality would change in any way if the registered lobbyist would engage in lobbying before the D for which the Employee serves as C; (5) If the Employees would attend G events with their registered lobbyist significant others, what the reporting requirements for transportation, lodging or hospitality would be if: (a) the registered lobbyist engages in lobbying activities before the D for which the Employee serves as C; or (b) the registered lobbyist does not enggage in lobbying activities before the D for which the Employee serves as C; (6) If the registered lobbyist received a hotel room as part of the lobbying firm's discounted block of rooms for G, and the Employee would share that room, whether the Employee would have to report as a gift the discount between what the room rate would have been for the general public and the discounted room block rate that the firm received; (7) If the Employee and the significant other registered lobbyist purchase a household pet and related accessories, but the couple's finances are not commingled, whether the pet must be reported as a gift; and (8) Whether it is possible to offset the gift received from a significant other registered lobbyist by a similarly valued gift given by the Employee to the registered lobbyist. You note that payments for transportation, lodging and hospitality are reportable only if received in connection with public office or employment. You contend that gifts, hospitality, transportation and lodging received solely in connection with a couple's personal romantic relationship are that couple's private affair and should not have to be reported under the Ethics Act or Pennsylvania's lobbying disclosure law ( "Lobbying Disclosure Law "), 65 Pa.C.S. § 13A01 et seg. You assert that any concerns that the Ethics Act would be subverted by lobbyists disguising lobbying activities as gifts or hospitality related to the personal romantic relationship are negated by the fact that the Confidential Opinion, 16 -003 June 29, 2016 Page 3 conflict of interest provisions of the Ethics Act remain intact. Finally, you argue that because the applicable portion of the definition of the term "gift" is "[anything which is received without consideration of equal or greater value," 65 Pa.( § 1102, 13A03, items exchanged of equal value should offset each other so as to not have to be reported as gifts under the Ethics Act and Lobbying Disclosure Law. You cite Confidential Advice, 02 -602 in support of your position that dating and M/13-1500 romantic relationships occur in a private capacity, and Grp er, Advice 13- 501/13 -1500 in support of your position that attendance as a lobbyist's `plus one" at an event not connected with a public official's or public employee's public office /employment is not a reportable event. By letter dated April 29, 2016, you indicated that in order to timely comply with the filing requirements for their calendar year 2015 Statements of Financial Interests without rendering the advisory request moot, the Employees would file their forms without disclosing the items /amounts at issue. You stated that once this Commission reaches a determination as to your advisory request, the Employees will amend their forms if necessary. By letters dated March 3, 2016, and May 16, 2016 you were notified of the dates, times and location of the executive meetings at which your request would be considered. III. DISCUSSION: It is initially noted that pursuant to Sections 1107(10) and 1107(11) of the 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. We further initially note that this Opinion does not address reporting requirements of the Lobbying Disclosure Law in that your request is for an advisory pursuant to the Ethics Act, you have not established standing to request an advisory on behalf of any person seeking to comply with the Lobbying Disclosure Law, and you have not posed any questions under the Lobbying Disclosure Law. The Employees are public employees subject to the Ethics Act, and in particular, the requirements for filing Statements of Financial Interests pursuant to the Ethics Act. The governmental body with which the Employees are associated is the F in its entirety, and not merely the various Ds or other units within the F to which they are respectively assigned. This is because the "governmental body with which a public official /public employee is or has been associated" is not limited to the particular subdivision of the agency or other governmental body where the public official /public employee has /had influence or control but extends to the entire body. See Legislative Journal of House, 1989 Session, No. 15 at 290, 291; Sirolli, Opinion 90-bO6 Sharp, pinion 90- 009 -R. Section 1105(b)(6) -(7) of the Ethics Act provides as follows: § 1105. Statement of financial interests (b) Required information. - -The statement shall include the following information for the prior calendar year Confidential Opinion, 16 -003 June 29, 2016 Page 4 with regard to the person required to file the statement: (6) The name and address of the source and the amount of any gift or gifts valued in the aggregate at $250 or more and the circumstances of each gift. This paragraph shall not apply to a gift or gifts received from a spouse, parent, parent by marriage, sibling, child, grandchild, other family member or friend when the circumstances make it clear that the motivation for the action was a personal or family relationship. However, for the purposes of this paragraph, the term "friend" shall not include a registered lobbyist or an employee of a registered lobbyist. (7) The name and address of the source and the amount of any payment for or reimbursement of actual expenses for transportation and lodging or hospitality received in connection with public office or employment where such actual expenses for transportation and lodging or hospitality exceed $650 in an aggregate amount per year. This paragraph shall not apply to expenses reimbursed by a governmental body or to expenses reimbursed by an organization or association of public officials or employees of political subdivisions which the public official or employee serves in an official capacity. 65 Pa.C.S. § 1105(b)(6) -(7) (Emphasis added). The Ethics Act defines the terms "gift" and "hospitality" as those terms are defined in Section 13A03 of the Lobbying Disclosure Law, 65 Pa.C.S. § 13A03 (see, 65 Pa.C.S. § 1102): § 13A03. Definitions. "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. Confidential Opinion, 16 -003 June 29, 2016 Page 5 65 Pa.C.S. § 13A03. A straightforward application of the plain terms of Section 1105(b)(6) of the Ethics Act - -as promulgated by the General Assembly -- establishes that registered lobbyists who are involved in romantic relationships with public officials /public employees are not to be considered "friends" for purposes of the gift reporting exclusion contained within Section 1105(b)(6) of the Ethics Act. Pursuant to the express statutory language, the gift reporting exclusion simply does not apply where a filer receives gift(s) from a registered lobbyist or employee of a registered lobbyist with whom the filer does not share an actual familial relationship. We note that this Commission does not have the authority to legislate exclusions to the gift reporting requirements of the Ethics Act, whether based upon romantic relationships with registered lobbyists, a erceived invasion of privacy, or an asserted exchange of gifts of similar value. Cf., Metz ar Opinion 06 -002; McCain, Opinion 02- 009; Yatron. Opinion 02 -008; Rubenstein Opinion 01 -007; Ziegler Opinion 98 -001; Long pinions 97 -010 and 97- 010 -R; Richardson, Opinion 93-006. With regard to privacy interests, we note that the Pennsylvania Supreme Court has long recognized that persons who hold public positions abdicate some measure of their privacy interests as to requirements for filing Statements of Financial Interests. Snider v. Thornburgh, 496 Pa. 159, 436 A.2d 593 (1981). With regard to the exchange of gifts, we reject the argument that an exchange of gifts is a "quid pro quo" scenario involving legal "consideration." As for the advisory request's citations to Confidential Advice, 02 -602 and Granger, Advice 13- 501/13 -1500, we note that this Commission is not bound by Advices of Counsel, and in any event, the cited Advices are inapposite. Confidential Advice, 02 -602 did not address the Statement of Financial Interests reporting requirements at all, let alone items of value provided by a registered lobbyist or employer of same. Granger, Advice 13- 501/13 -1500 involved transportation /lodging/ hospitality received through a fiancee's affiliation with an association that lobbied a different governmental body in a different branch of government than that served by the subject public employee. In contrast, in the instant matter the "significant other" registered lobbyists do lobby the governmental body served by the Employees, namely, the F, and one of the Employees is directly lobbied by his /her "significant other" registered lobbyist. We shall now address your specific questions. In response to your first and second specific questions, you are advised that, assuming the reporting threshold ($250 in the aggregate for the calendar year) would be met, the Employees would be required to report the gifts received from their respective "significant others" who are registered lobbyists, regardless of whether such gifts were received in connection with the personal romantic relationship. The reporting requirement for gifts would not change if the personal romantic relationship existed prior to the commencement of public employment or lobbying. In response to your third, fourth, and fifth specific questions, you are advised that each of the Employees would not be required to report transportation, lodging or hospitality that would be paid from his /her respective "significant other' registered lobbyist's own personal funds -- without reimbursement by the registered lobbyist's lobbying firm /client(s)- -and solely based upon the personal romantic relationship. Funds would be considered personal funds for this purpose if they would be considered personal funds for tax purposes. Cf., Confidential Opinion, 16 -001. Otherwise, assuming the reporting threshold for the transportation /lodging /hospitality category (in excess of $650 in the aggregate for the calendar year) would be met, the Employees Confidential Opinion, 16 -003 June 29, 2016 Page 6 would be required to report transportation, lodging and /or hospitality received from or through a "significant other" registered lobbyist because such would be considered to have been received in connection with public office /employment. The fact that the registered lobbyist either would or would not engage in lobbying before the particular D for which the Employee serves as C would not alter the aforesaid reporting requirements. In response to your sixth specific question, you are advised as follows. The reporting categories for "gifts" and"transportation, lodging and /or hospitality" are b law, mutual) exclusive. See, definitions of "gift" and "hos italicy" above, 65 Pa.C.S. 13A03. Therefore, sharing a hotel room would be "lodging" and would not constitute a "gift" as that term is defined under the Ethics Act. For shared lodging provided by the "significant other" registered lobbyist's lobbying firm under a discounted block room rate, assuming the lobbying firm's discounted block room rate was obtained in an arms - length, marketplace transaction, the cost of the lodging to be reported on the Employee's Statement of Financial Interests —if the reporting threshold would be met — would be no less than one -half the total cost of the lodging at the discounted rate. In response to your seventh specific question, you are advised that assuming the reporting threshold ($250 in the aggregate for the calendar year) would be met, the pet would have to be reported as a gift if the amount paid by the "significant other" registered lobbyist to purchase the pet would exceed his or her proportional share of the expense based upon percentage of ownership. If the registered lobbyist would not contribute toward the purchase of the pet itself but would purchase other items, such as related accessories and veterinary services, such other items would have to be reported as gifts if the reporting threshold would be met based upon the proportional share of the pet owned by the Employee. In response to your eighth specific question, you are advised that under the Ethics Act as promulgated, it is not possible to offset the gift received from a significant other registered lobbyist by a similarly valued gift given by the Employee to the registered lobbyist. The propriety of the proposed conduct has only been addressed under the Ethics Act; the applicability of any other statute, code, ordinance, regulation or other code of conduct other than the Ethics Act has not been considered in that they do not involve an interpretation of the Ethics Act. IV. CONCLUSION: The employees of the A on whose behalf you have inquired, collectively referred to herein as "the Employees," are public employees subject to the Public Official and Employee Ethics Act C'Ethics Act "), 65 Pa.C.S. § 1101 et seq., and in particular, the requirements for filing Statements of Financial Interests pursuant to the Ethics Act. The governmental body with which the Employees are associated is the F in its entirety, and not merely the various Ds or other units within the F to which they are respectively assigned. A straightforward application of the plain terms of Section 1105(b)(6) of the Ethics Act - -as promulgated by the General Assembly -- establishes that registered lobbyists who are involved in romantic relationships with public officials /public employees are not to be considered "friends" for purposes of the gift reporting exclusion contained within Section 1105(b)(6) of the Ethics Act. Assuming the reporting threshold ($250 in the aggregate for the calendar year) would be met, the Employees would be required to report the gifts received from their respective "significant others" who are registered lobbyists, regardless of whether such gifts were received in connection with the personal romantic relationship. The reporting requirement for gifts would not Confidential Opinion, 16 -003 June 29, 2016 Page 7 change if the personal romantic relationship existed prior to the commencement of public employment or lobbying. Each of the Employees would not be required to report transportation, lodging or hospitality that would be paid from his /her respective "significant other' registered lobbyist's own personal funds -- without reimbursement by the registered lobbyist's lobbying firm /client(s)- -and solely based upon the personal romantic relationship. Funds would be considered personal funds for this purpose if they would be considered personal funds for tax purposes. Cf., Confidential Opinion, 16 -001. Otherwise, assuming the reporting threshold for the transportation /lodging /hospitality category (in excess of $650 in the aggregate for the calendar year) would be met, the Employees would be required to report transportation, lodging and /or hospitality received from or through a "significant other" registered lobbyist because such would be considered to have been received in connection with public office /employment. The fact that the registered lobbyist either would or would not engage in lobbying before the particular D for which the Employee serves as C would not alter the aforesaid reporting requirements. The reporting categories for "gifts" and "transportation, lodging and /or hospitality" are, by law, mutually exclusive. See, definitions of "gift" and "hospitality," 65 Pa.C.S. § 13A03. Therefore, sharing a hotel room would be "lodging" and would not constitute a "gift" as that term is defined under the Ethics Act. For shared lodging provided by the "significant other" registered lobbyist's lobbying firm under a discounted block room rate, assuming the lobbying firm's discounted block room rate was obtained in an arms - length, marketplace transaction, the cost of the lodging to be reported on the Employee's Statement of Financial Interests —if the reporting threshold would be met — would be no less than one -half the total cost of the lodging at the discounted rate. Assuming the reporting threshold ($250 in the aggregate for the calendar year) would be met, a household pet would have to be reported as a gift if the amount paid by the "significant other" registered lobbyist to purchase the pet would exceed his or her proportional share of the expense based upon percentage of ownership. If the registered lobbyist would not contribute toward the purchase of the pet itself but would purchase other items, such as related accessories and veterinary services, such other items would have to be reported as gifts if the reporting threshold would be met based upon the proportional share of the pet owned by the Employee. Under the Ethics Act as promulgated, it is not possible to offset the gift received from a significant other registered lobbyist by a similarly valued gift given by the Employee to the registered lobbyist. The propriety of the proposed conduct has only been addressed under the Ethics Act. Pursuant to Section 1107 10) of the Ethics Act the person who acts in good faith on this Opinion issued to him not be subject to criminal or civil penalties for so acting provided the material facts are as stated in the request. This letter is a public record and will be made available as such By the Commission, Nicholas A. Colafella Chair