CEO 06-7 -- June 14, 2006

DONATIONS TO THE DEPARTMENT OF AGRICULTURE AND CONSUMER SERVICES AND ITS DIRECT-SUPPORT ORGANIZATION GIVEN BY PRINCIPALS OF LOBBYISTS

The Department of Agriculture and Consumer Services asks a series of questions involving Section 112.3125, Florida Statutes, as amended by Chapter 2005-359, Laws of Florida. Section 112.3125(6)(a) would not be violated where the Department accepts donations from donors who have hired or retained a lobbyist because Section 112.3125(6)(a) does not prohibit donations to Executive Branch agencies. Similarly, direct-support organizations approved by the Department that operate for its benefit may accept donations from organizations that retain Executive Branch agency lobbyists. Under the specific facts presented, Section 112.3125(6)(a) would not be violated where the Department's Bureau of Food Distribution in the Division of Marketing and Development is given nominal quantities of food products by processors in order to evaluate their suitability for distribution through programs administered by the Department. Section 112.3125(6)(a) would not prohibit the Department's employees from participating in a food safety seminar underwritten with direct and in-kind contributions from organizations which may be principals of Executive Branch lobbyists, where only a small percentage of conference attendees are from the Department, where attendees pay a registration fee that covers most costs associated with the conference, and where Department attendees do not receive any benefit not enjoyed by other attendees. Finally, Section 112.3125(6)(a) would not prohibit the Commissioner, in his capacity as a member of the board of directors of the Florida Cattlemen's Association, from consuming food and beverages paid for by the Association at board meetings even though it is the principal of Executive Branch lobbyists.

Would Section 112.3125(6)(a), Florida Statutes, as amended by Chapter 2005-359, Laws of Florida, be violated where the Department accepts donations from donors who have hired or retained a lobbyist who lobbies Executive Branch agencies?

Under the specific circumstances presented, Question 1 is answered in the negative.

You write that you seek this opinion on behalf of Commissioner Charles H. Bronson of the Florida Department of Agriculture and Consumer Services (FDACS), concerning the applicability of Section 112.3125(6)(a), Florida Statutes, as amended by Chapter 2005-359, Laws of Florida, to a variety of situations. In relation to your first question, you acknowledge that agency officials and employees are prohibited from directly or indirectly accepting an expenditure, but you ask whether the prohibition in Section 112.3125(6)(a) would extend to donations made to the Department by donors who have hired or retained an Executive Branch agency lobbyist. In follow-up correspondence with our staff, you advise that the Department has received scientific equipment, all-terrain vehicles, and various motor vehicles, and has been granted the use of experimental, alternative fuel vehicles such as propane-powered passenger cars and trucks. You further relate that the Department has received donations to be used as "door prizes" for employees at the Department's annual Florida State Employees' Charitable Campaign/United Way kick-off and, in the area of agricultural marketing, donations have included produce such as strawberries, citrus, and tomatoes. These donations were made by principals of lobbyists who lobby the Executive Branch.

Section 112.3125(6)(a), Florida Statutes, as amended by Chapter 2005-359, Laws of Florida, provides:

Notwithstanding s. 112.3148, s. 112.3149, or any other provision of law to the contrary, no lobbyist or principal shall make, directly or indirectly, and no agency official, member, or employee shall knowingly accept, directly or indirectly, any expenditure.

Section 112.3125(1)(d), Florida Statutes, as amended by Chapter 2005-359, Laws of Florida, defines "expenditure" to mean

a payment, distribution, loan, advance, reimbursement, deposit, or anything of value made by a lobbyist or principal for the purpose of lobbying. A contribution made to a political party regulated under chapter 103 is not deemed an expenditure for purposes of this section.

The definition of "lobbies" in Section 112.3125(1)(f), Florida Statutes, includes "an attempt to obtain the goodwill of any agency official or employee." An "agency official or employee" would be an officer or employee of the Department who is required to file financial disclosure. Section 112.3125(1)(b), Florida Statutes.¹

Our rules contain guidance on the issue of "engendering goodwill." Rule 34-12.180(1), Florida Administrative Code, provides:

Activities by a lobbyist which do not involve directly attempting to influence a specific decision of an agency in the area of policy or procurement may nonetheless be considered "lobbying" pursuant to Section 112.3125, Florida Statutes, and this Rule Chapter, where an expenditure is made by a lobbyist or principal for the personal benefit of an agency official or employee. Such expenditures will be considered to have been for the purpose of engendering goodwill, unless the agency official or employee is a relative of the lobbyist or principal paying for the expenditure.

With the exception of the food gifts and door prizes, which we will discuss separately, where donors make donations to the Department and not to any individual officer or employee, such donations would not be considered expenditures made for the purpose of lobbying because they were not made for the personal benefit of an agency official or employee. In addition, we construe the language in Section 112.3125(6)(a) to mean that the use of the conjunctive "and" in the statute makes clear the prohibition extends only to expenditures made and accepted. Just as we have construed Section 112.3148(4), Florida Statutes (the Gift Law), as not prohibiting the giving of gifts to governmental entities if the gifts were intended to be transferred to a governmental entity (see CEO 91-21, CEO 91-71, and CEO 92-12), we do not construe Section 112.3125(6)(a) as prohibiting donations to Executive Branch agencies, as long as the donations are not intended for any specific agency official or employee and are transferred to the Department for final disposition. We further note that donations to the Department are expressly authorized by Section 570.07(32), Florida Statutes, which allows the Department to accept grants, gifts, and donations to further the mission of the Department.

As for the food items, we do not view these as gifts to the Department because they are given with the intent that individuals will consume them. For this reason, we do not believe that food gifts should be accepted or consumed by "agency officials and employees." We note that the Legislative Guidelines, p. 19, suggests that candy left in a legislator's office by a lobbyist or principal should be either sent back to the donor or delivered to the Sergeant-at-Arms for disposal. The Department may want to consider developing its own policy for the disposition of food gifts donated to it by lobbyists or principals of lobbyists.

Regarding the door prizes, you have advised that, typically, these are items like gift certificates to local restaurants, car washes, bookstores, driving ranges, bowling alleys, and day spas. If agency officers or employees (those who file financial disclosure) receive a door prize that was provided to the Department by a lobbyist or the principal of a lobbyist, it must be considered whether the gift was a prohibited "indirect expenditure." In our proposed rules, which are scheduled to become effective on June 15, 2006, we have listed factors that should be weighed in determining whether an expenditure is an "indirect expenditure." Proposed Rule 34-12.190 states:

34-12.190 Indirect Expenditures.
(1) Where an expenditure is made to a person other than the agency official or employee by a lobbyist or principal, where the expenditure or the benefit of the expenditure ultimately is received by the agency official or employee, and where the expenditure is provided with the intent to benefit the agency official or employee, such expenditure will be considered a prohibited indirect expenditure to the agency official or employee.
(2) Where an expenditure or the benefit of an expenditure is made to an agency official or employee by someone other than a lobbyist or principal, but the expenditure has been provided by or paid for by a lobbyist or principal who intends thereby to benefit the agency official or employee, such expenditure will be considered a prohibited indirect expenditure to the agency official or employee.
(3) Factors which the Commission will consider in determining whether a prohibited indirect expenditure has been made include but are not limited to:
(a) The existence or nonexistence of communications by the lobbyist or principal, or by the intervening third person, indicating the lobbyist's or principal's intent to make or convey the expenditure to the agency official or employee rather than to the intervening third person;
(b) The existence or nonexistence of any relationship between the lobbyist or principal and the third person, independent of the relationship between the lobbyist or principal and the agency official or employee, that would motivate an expenditure to the third person;
(c) The existence or nonexistence of any relationship between the third person and the agency official or employee that would motivate the expenditure;
(d) Whether the same or similar expenditures have been or are being provided to other persons having the same relationship to the lobbyist or principal as the third person;
(e) Whether, under the circumstances, the third person had full and independent decision-making authority to determine whether the agency official or employee, or another, would receive the benefit of the expenditure;
(f) Whether the third person was acting with the knowledge or consent of, or under the direction of, the lobbyist or principal;
(g) Whether there were or were intended any payments or bookkeeping transactions between the third person and the lobbyist or principal reimbursing the third person for the expenditure; and
(h) The degree of ownership or control the lobbyist or principal has over the third person.
(4) The provisions of this rule may be illustrated by the following examples:
EXAMPLE 1: A law firm which lobbies the agency of Agency Employee A ("A") invites all of its attorneys to attend a weekend retreat. The attorneys are encouraged to bring their spouses or significant others at the firm's expense. A is married to an attorney in the firm and has been asked by her spouse to attend the retreat. The lodging, meals, and entertainment provided to A for the weekend retreat would not be considered a prohibited indirect expenditure to A because the firm's invitation was to A's spouse through his employment with the firm.
EXAMPLE 2: Agency Official B ("B") hosts a turkey shoot attended by other agency officials and employees. Lobbyists who lobby the agency of B give money to a third person, who is not an agency official or employee, to pay for the food and beverages which will be served at the turkey shoot. B orders and prepares the food and beverages. The money provided to the third person by the lobbyists would be a prohibited indirect expenditure to B, because it was given with the intent of benefiting B and his guests at the turkey shoot.
EXAMPLE 3: Agency Official C ("C") and C's spouse have arranged to take a trip to New York City. A lobbyist who lobbies C's agency meets with the spouse and offers her theater tickets. The lobbyist and C's spouse know each other only through the lobbyist's involvement with C. The theater tickets would be a prohibited indirect expenditure to C.

Because we do not have any particular facts before us to gauge the intent of any of these donations, we cannot determine whether they would be prohibited. Alternatively, if all "agency officials and employees" are ineligible to receive door prizes that have been donated by lobbyists or their principals, there would be no issue as to whether the door prizes were prohibited indirect expenditures.

Would Section 112.3125(6)(a), Florida Statutes, as amended by Chapter 2005-359, Laws of Florida, be violated where the Department's direct-support organization (DSO) accepts contributions from donors who have hired or retained Executive Branch agency lobbyists?

You have advised that the Department's direct-support organization has received donations of cash, construction and fence materials, an all-terrain vehicle, volunteer labor, and food and beverages for training events and meetings from principals of lobbyists who lobby the Department. Section 570.902(2), Florida Statutes, defines the terms "direct-support organization" and "organization" to mean

an organization which is a Florida corporation not for profit incorporated under the provisions of chapter 617 and approved by the department to operate for the benefit of a museum or a specific departmental program.

Section 570.903(2)(a), Florida Statutes, empowers the Department's direct-support organization to

conduct programs and activities; raise funds; request and receive grants, gifts, and bequests of money; acquire, receive, hold, invest, and administer, in its own name, securities, funds, objects of value, or other property, real or personal; and make expenditures to or for the direct or indirect benefit of the museum or designated program.

Consistent with our response to Question 1, we do not believe that Section 112.3125(6)(a), Florida Statutes, as amended by Chapter 2005-359, Laws of Florida, would be violated where the Department's direct-support organization accepts donations of cash, construction and fence materials, an all-terrain vehicle, volunteer labor, and items of this nature in the DSO's name from organizations which are principals of Executive Branch lobbyists as long as the donations are not intended for the personal benefit of any specific agency official or employee. Concerning the provision of food and beverages for training events and meetings, as discussed in Question 1, items of this nature are intended to be consumed by individuals. Unless the Department is certain, after evaluating the indirect expenditure factors listed in Rule 34-12.190, F.A.C., the better policy may be for agency officials and employees (those who file financial disclosure) to not partake of food and beverages provided to the DSO by lobbyists and their principals.

Would Section 112.3125(6)(a), Florida Statutes, as amended by Chapter 2005-359, Laws of Florida, be violated where a processor sends food items to State Commodity Distribution officers for testing and feedback of suitability for distribution, where the processor has hired or retained a lobbyist to lobby Executive Branch agencies?

Based upon the specific circumstances presented, Question 3 is answered in the negative.

According to the Department's website², its Bureau of Food Distribution in the Division of Marketing and Development administers the U.S. Department of Agriculture (USDA) Food Distribution Program for the National School Lunch Program, the Summer Food Service Program, the Emergency Food Assistance Program, and disaster feeding program. Pursuant to these programs, the Bureau distributes approximately 85 million pounds of USDA-commodity food annually to schools, emergency feeding organizations and other eligible recipient agencies. You have asked whether samples sent to the Department would be considered prohibited expenditures where the manufacturers are the principals of lobbyists.

The Department was asked to provide additional information about its method for evaluating food processors, as it initially was not clear whether the processors were sending food items to influence the Department's decisionmaking to certify them or purchase food items from them. In responding, you advised that food processors either have an agreement with USDA and subsequently enter into a State Participating Agreement (SPA) with the Department, or they enter into an agreement and post security directly with the Department. Under either scheme they are then eligible to participate in the state processing of commodities and compete in Florida to sell processed items or services to food services authorities. The Department puts together a list of all the processors who have fulfilled the regulatory requirements for participation in the commodity program and provides the information to food service authorities, who then comply with federal, state, and local procurement rules in order to determine which processor will process their commodities. You advised that the Department itself does not actually purchase food from participating processors but, instead, places orders with USDA based on what the food service authorities requisition. When placing their requisition for USDA commodities, if a food service authority wishes to have a commodity item processed, it must indicate which processor they have contracted with for processing. When asked whether food processors are sending their products to the Department to influence its decisionmaking, you advise that the Department has no input as to which manufacturers USDA purchases commodities from; nor does it make any decision as to which processors food service authorities choose to do business with or which processed items they choose to purchase.

The two ways in which the Department receives sample products are from a manufacturer who sells products to the USDA, or from a processor that uses a commodity product to make other end products (brown and serve, ready-to-eat, or further processed items). You write that sometimes when USDA is offering a new product, the processor will send samples to states so that they can see and taste it and be in a better position to answer questions from purchasing authorities when they are placing their requisition for commodities. As an example, you write that a processor may provide the Department with a can of sun butter (peanut butter alternative made from sunflower seeds) or cans of pudding made with non-fat dry milk. Other times, processors offering a new product made with USDA commodities will send samples to the states for taste-testing, i.e., cases of flavored shelf-stable milk made with non-fat dry milk, crustless peanut butter and jelly sandwiches, a two-pound turkey ham, servings of taco meat, or a jar of salsa. You explain that the Department does not receive products from manufacturers or processors very often—less than once a year—and then, in small quantities. Since quantities are small, they usually have been kept in the office, tried by staff, and their comments noted. If requested by USDA, staff provides feedback on the item's taste, consistency, appeal, etc. When the Department receives enough product and a teacher or food service authority requests it, the item may be taken to a school to have children taste the product.

Limited to these facts only, where processors infrequently send token amounts of food items to the Department so that the Department can determine whether the food products are suitable for distribution, we would not consider the food items to be expenditures made for the purpose of lobbying and prohibited by Section 112.3125(6)(a).

Would Section 112.3125(6)(a), Florida Statutes, as amended by Chapter 2005-359, Laws of Florida, be violated where Department employees participate in a scientific seminar underwritten by organizations who are principals of Executive Branch agency lobbyists?

Under the specific circumstances presented, Question 4 is answered in the negative.

You write that, historically, the Department has hosted an annual seminar--the Foodborne Pathogen Analysis Conference--in conjunction with the Florida Pesticide Residue Workshop. In 2005, this multi-day conference was attended by approximately 200 national and international food scientists, and the 2006 Conference will be held in Orlando in July. You estimate that between 20 to 30 employees of the Department will attend the conference and, of those, perhaps 5 to 10 are subject to the financial disclosure requirement, making them "agency officials or employees" for purposes of the Executive Branch Lobbying law. In addition to the registration fee that all attendees pay, exhibitors can pay a separate fee and have a display table in the exhibition hall. Venders are also given an opportunity to participate as "sponsors" at different levels of sponsorship,³ and their sponsorships have been used to help defray the travel and lodging expenses for non-FDACS presenters, as well as to provide some food and beverages at coffee breaks and receptions during the conference. Some venders also make in-kind contributions to assist with the production and copying of registration materials, handouts, notebooks, flyers, banners, etc. You question whether Section 112.3125(6)(a) would be violated if some venders happen to be principals of lobbyists who lobby Executive Branch agencies.

As discussed in our response to Question 1, the definition of "expenditure" includes

Section 112.3125(1)(d), Florida Statutes, as amended by Chapter 2005-359, Laws of Florida. However, here, where only a small percentage of conference attendees are "agency officials or employees" subject to the expenditure prohibition in Section 112.3125, where attendees pay a registration fee that covers most costs associated with the conference, and where FDACS attendees do not receive any benefit not enjoyed by other attendees, we conclude that the sponsorships and in-kind contributions provided by exhibitors are not given for the purpose of lobbying and consequently are not prohibited "expenditures" for purposes of Section 112.3125, Florida Statutes, as amended by Chapter 2005-359, Laws of Florida. Similarly, we find that these conference donations would not constitute indirect expenditures. Therefore, DACS employees may attend and participate in the conference, based on the specific facts presented.

Would Section 112.3125(6)(a), Florida Statutes, as amended by Chapter 2005-359, Laws of Florida, be violated where the Commissioner is a member of the board of directors of the Florida Cattlemen's Association and, in that capacity, consumes food and beverages provided by the Association when the Association is the principal of an Executive Branch agency lobbyist?

Your final question asks whether the Commissioner of Agriculture can accept food and beverages provided to him in connection with his service as a member of the board of directors of the Florida Cattlemen's Association. The Association is listed as the principal of lobbyists before both the Executive and Legislative branches, and you state that the food and beverages would be provided to the board members by the Association as part of their attendance at the board meeting.

As discussed previously, Section 112.3125(6)(a) prohibits an agency official from knowingly accepting, directly or indirectly, any expenditure made by a lobbyist or principal. An expenditure is defined in Section 112.3125(1)(d) to include "anything of value made by a lobbyist or principal for the purpose of lobbying."

The Interim Lobbying Guidelines for the House and Senate issued on January 20, 2006, consider employment-related compensation and benefits to be an exception to the expenditure prohibition. In Paragraph 1.g)2. (page 9), the Guidelines state:

Salary, benefits, services, fees, commissions, gifts, or expenses associated primarily with the recipient's employment, business, or service as an officer or director of a corporation or organization are not prohibited expenditures so long as they are given in an amount commensurate with other similarly situated employees, officers, and directors.

Example: A legislator who is on the board of directors of an organization that has a lobbyist is nevertheless permitted to partake of food and beverage provided to the board members by the organization at its board meetings.

This language is similar to the exclusion from the definition of "gift" in Section 112.312(12)(b)1., Florida Statutes. Notwithstanding the fact that this language is not part of Section 112.3125, on the particular circumstances presented we concur with the guidance contained in the Interim Lobbying Guidelines, and conclude that food and beverages provided to the Commissioner by the Association as a member of the board of directors of the Florida Cattlemen's Association as part of the board's meeting would not be given for the purpose of lobbying and would not be a prohibited expenditure, even though the Florida Cattlemen's Association is the principal of lobbyists, as long as it is given in an amount commensurate with other similarly situated board members.

ORDERED by the State of Florida Commission on Ethics meeting in public session on June 9, 2006 and RENDERED this 14th day of June, 2006.

^[1] In our view, the language "agency official, member, or employee" in Section 112.3125(6)(a) covers only those persons who are defined specifically as an "agency official or employee" in Section 112.3125(1)(b), and not the much broader, and legally undefined, groups of persons who might be considered a "member" of an agency.

^[2] http://www.florida-agriculture.com/vantreese.htm

^[3] "Platinum" Beaker sponsors pay $2,500; "Gold" Beaker sponsors pay $1,500; "Silver" Beaker sponsors pay $1,000, and "Bronze" Beaker sponsors pay $500.