A Hospital District Board member who is also a member of the board of directors of the Hospital District's direct support organization does not receive a "gift," as the term is defined in Section 112.313(12), Florida Statutes, when he or she receives free admission to an event sponsored by the direct support organization. A Hospital District Board member who is not a member of the board of directors of the direct support organization does receive a "gift," when he or she receives free admission to an event sponsored by the direct support organization. Pursuant to Section 112.3148(6), Florida Statutes, such gifts may be accepted by the Hospital District Board member, but must be reported annually on a CE Form 10.
QUESTION:
Is a member of the North Broward Hospital District who serves on the board of the District's direct support organization required to report free admission to an event sponsored by the direct support organization as a gift?
Your question is answered in the negative.
You write on behalf of the members of the Board of Commissioners of the North Broward Hospital District ("District") and inquire about the application of Section 112.3148, Florida Statutes, to two different scenarios.
The District is authorized pursuant to its enabling legislation1 to create not-for-profit affiliates and subsidiaries "for the furtherance and assistance of the district's fulfilling its purpose of provision for the health care needs of the people of the district." In 1998, you advise, the District created a direct support organization—the North Broward Hospital District Charitable Foundation2 ("Foundation"). You relate that the Foundation is a 501(c)(3) corporation serving as the "primary fundraising arm" of the District and is recognized by the Internal Revenue Service as a direct support organization (DSO) pursuant to Section 501(a)(3) of the Internal Revenue Code. The District must approve the Foundation's by-laws, you write, and at least one member of the District Board serves on the Foundation's board of directors.
You advise that the Foundation hosts various events and programs, and that District Board members are not generally expected to pay, "since their appearance and participation helps to promote the District and further bolsters the Foundation's fundraising efforts" and the ultimate purpose of those efforts is "to promote and enhance the healthcare services provided by the District."
You first inquire whether a District Board member who also serves on the Foundation's board of directors is required, pursuant to Section 112.3148(8), Florida Statutes, to report the price of admission to a Foundation-sponsored event as a gift on a CE Form 9—Quarterly Gift Disclosure. Section 112.3148(8) provides:
Each reporting individual or procurement employee shall file a statement with the Commission on Ethics on the last day of each calendar quarter, for the previous calendar quarter, containing a list of gifts which he or she believes to be in excess of $100 in value, if any, accepted by him or her, for which compensation was not provided by the donee to the donor within 90 days of receipt of the gift to reduce the value to $100 or less, except the following:
1. Gifts from relatives.
2. Gifts prohibited by subsection (4) or s. 112.313(4).
3. Gifts otherwise required to be disclosed by this section.
The definition of "gift," is found in Section 112.312(12), Florida Statutes. Section 112.312(12)(b), Florida Statutes, states:
"Gift" does not include:
1. Salary, benefits, services, fees, commissions, gifts, or expenses associated primarily with the donee's employment, business, or service as an officer or director of a corporation or organization.
In CEO 06-11, at footnote 1, we found that travel expenses, lodging, meals, and other expenses related to a trade mission by the Governor in his ex officio capacity as Chairman of the Board of Directors and Chief Executive Officer of Enterprise Florida, Inc., and paid for by Enterprise Florida, would not be a "gift" for purposes of Section 112.3148, because Section 112.312(12)(b)1 excludes expenses associated with the donee's service as an officer or director of a corporation from the definition of "gift." In CEO 06-7, Question 5, we examined a similar question—whether Section 112.3215(6)(a), Florida Statutes, would be violated were the Commissioner of Agriculture, who was a member of the board of directors of the Florida Cattlemen's Association, to consume food and beverages provided by the Association while attending a board meeting.3 Interpreting Section 112.3215 consistent with Section 112.3148 and Interim Lobbying Guidelines for the House and Senate issued on January 20, 2006, we found that there would be no violation. Similarly, in CEO 09-1, we found that compensation received by the Chairman of the Board of Governors of Citizens Property Insurance Corporation for his service on the board of directors of two financial institutions was not a prohibited "gift" under Section 112.3148(4).
Accordingly, we find that free admission to Foundation-sponsored events given by the Foundation to a District Board member who is also a member of the Foundation's board of directors would be excluded from the definition of "gift" pursuant to Section 112.312(12)(b)1, Florida Statutes, and the member would therefore not be required to report the free admission as a gift on the CE Form 9—Quarterly Gift Disclosure.
QUESTION 2:
Is a member of the North Broward Hospital District who does not serve on the board of the District's direct support organization required to report free admission to an event sponsored by the direct support organization as a gift?
Your question is answered in the affirmative.
Section 112.3148(6), Florida Statutes, provides, in pertinent part:
(b) Notwithstanding the provisions of subsection (4), . . . a reporting individual or procurement employee who is an officer or employee of a governmental entity supported by a direct-support organization specifically authorized by law to support such governmental entity may accept such a gift from such direct-support organization.
(c) No later than March 1 of each year, each governmental entity or direct-support organization specifically authorized by law to support a governmental entity which has given a gift to a reporting individual or procurement employee under paragraph (a) shall provide the reporting individual or procurement employee with a statement of each gift having a value in excess of $100 given to such reporting individual or procurement employee by the governmental entity or direct-support organization during the preceding calendar year. Such report shall contain a description of each gift, the date on which the gift was given, and the value of the total gifts given by the governmental entity or direct-support organization to the reporting individual or procurement employee during the calendar year for which the report is made. A governmental entity may provide a single report to the reporting individual or procurement employee of gifts provided by the governmental entity and any direct-support organization specifically authorized by law to support such governmental entity.
(d) No later than July 1 of each year, each reporting individual or procurement employee shall file a statement listing each gift having a value in excess of $100 received by the reporting individual or procurement employee, either directly or indirectly, from a governmental entity or a direct-support organization specifically authorized by law to support a governmental entity. The statement shall list the name of the person providing the gift, a description of the gift, the date or dates on which the gift was given, and the value of the total gifts given during the calendar year for which the report is made. The reporting individual or procurement employee shall attach to the statement any report received by him or her in accordance with paragraph (c), which report shall become a public record when filed with the statement of the reporting individual or procurement employee. The reporting individual or procurement employee may explain any differences between the report of the reporting individual or procurement employee and the attached reports. The annual report filed by a reporting individual shall be filed with the financial disclosure statement required by either s. 8, Art. II of the State Constitution or s. 112.3145, as applicable to the reporting individual. The annual report filed by a procurement employee shall be filed with the Commission on Ethics. The report filed by a reporting individual or procurement employee who left office or employment during the calendar year covered by the report shall be filed by July 1 of the year after leaving office or employment at the same location as his or her final financial disclosure statement or, in the case of a former procurement employee, with the Commission on Ethics.
This statute permits DSO's to provide gifts valued in excess of $100 to reporting individuals who are officers or employees of the governmental entity supported by the DSO. See, CEO 92-14. Further, Rule 34-13.320(3), F.A.C., states:
A direct-support organization specifically authorized by law to support a governmental entity may give, and the reporting individual or procurement employee may accept, a gift valued in excess of $100 if the reporting individual or procurement employee is an officer or employee of the governmental entity supported by the organization.
Accordingly, members of the District Board who are not also members of the Foundation board may accept gifts worth more than $100 from the Foundation.
Section 112.3148(6)(b), Florida Statutes, requires that the DSO, no later than March 1 of each year, provide the reporting individual with a statement of each gift having a value in excess of $100 given by the DSO during the preceding calendar year. The report must contain a description of each gift, the date on which the gift was given, and the value of the total gifts given by the DSO to the reporting individual during the calendar year for which the report is made. See also, Rule 34-13.430, F.A.C.
Finally, Section 112.3148(6)(c), Florida Statutes, provides that by July 1 of each year, the reporting individual shall file a statement listing each gift having a value in excess of $100 received from a DSO. The statement must list the name of the person providing the gift, a description of the gift, the date or dates on which the gift was given, and the value of the total gifts given during the calendar year for which the report is made. The reporting individual or procurement employee must attach to the statement any report received by him or her from the DSO. See also, Rule 34-13.410, F.A.C. We promulgate CE Form 10, Annual Disclosure of Gifts from Governmental Entities and Direct Support Organizations and Honorarium Event Related Expenses, for this purpose.
Accordingly, District Board members who are not also members of the Foundation's board may accept, from the Foundation, free admission to an event sponsored by the Foundation. If the value of the admission is more than $100, the gift should be reported on a CE Form 10..
Your question is answered accordingly.
ORDERED by the State of Florida Commission on Ethics meeting in public session on April 16, 2010 and RENDERED this 21st day of April, 2010.
__________________________
Roy Rogers
Chairman
[1] Section 6 of Chapters 86-369 and 2006-347, Laws of Florida.
[2] Renamed Broward Health Foundation in 2007.
[3] Section 112.3215(6)(a) prohibits the acceptance of "expenditures" provided to reporting agency officials by executive branch lobbyists and their principals, and the Cattlemen's Association was the principal of an executive branch agency lobbyist.