GIFT PROHIBITIONS AND DISCLOSURE

DISTRICT SCHOOL BOARD MEMBER EXCHANGING GIFTS AND TRAVELING
WITH FRIEND WHOSE FIRM PROVIDES BOND COUNSEL TO DISTRICT

To: Name withheld at person’s request (Tallahassee)

SUMMARY:

A District School Board member may not accept a gift valued at more than $100 from a friend who is a partner in a law firm that provides bond counsel to the School District, because partners and firms of lobbyists, and vendors, are prohibited donors under Section 112.3148, Florida Statutes. The friend or firm must disclose any gifts to the member valued between $25 and $100 on CE Form 30. However, if the member and friend equally share the costs of travel, meals, lodging and entertainment, the member has not received a gift. CEOs 91-43, and 08-19, are referenced.¹

QUESTION:

Does a member of a District School Board receive a prohibited or reportable gift, under Section 112.3148, Florida Statutes, if the member travels and exchanges gifts with a friend who is a partner in a law firm that provides counsel to the School District?

Under the circumstances presented, guidance is provided as set forth below.

In this inquiry, a District School Board member asks whether she is subject to any prohibitions or disclosure requirements if she travels and exchanges gifts with her boyfriend, who is a partner in a law firm that provides bond counsel to the School District. The member asks about application of the gifts law in Section 112.3148, Florida Statutes, if the couple shares equally the cost of lodging, transportation, and meals while traveling. She also asks whether she may accompany her boyfriend on his business trips, if she pays half of the expenses. And she seeks guidance regarding personal gifts exchanged for special occasions, like Christmas and birthdays.²

As a public officer required to file financial disclosure, the member is a “reporting individual” subject to the restrictions and disclosure requirements of Section 112.3148. For the purposes of Section 112.3148, a “gift” is defined in Section 112.312(12)(a), Florida Statutes, as anything accepted by the donee, or by another on the donee’s behalf, or anything paid or given to another on behalf of the donee or for the donee’s benefit, for which equal or greater consideration is not given within 90 days. This definition includes the use of real property, transportation, food or beverage, as well as admission fees or tickets to events, plants or flowers or floral arrangements, or any similar service or thing having an attributable value.

A threshold issue is whether the member’s boyfriend is a prohibited donor for purposes of Sections 112.3148(3), 112.3148(4) and 112.3148(5), Florida Statutes.³ Under Section 112.3148(3), the member is prohibited from soliciting any gift from a vendor doing business with her agency, a lobbyist of her agency, or the partner, firm, employer, or principal of such a lobbyist. This section provides:

A reporting individual or procurement employee is prohibited from soliciting any gift from a vendor doing business with the reporting individual’s or procurement employee’s agency, a political committee as defined in s. 106.011, or a lobbyist who lobbies the reporting individual’s or procurement employee’s agency, or the partner, firm, employer, or principal of such lobbyist, where such gift is for the personal benefit of the reporting individual or procurement employee, another reporting individual or procurement employee, or any member of the immediate family of a reporting individual or procurement employee.

Section 112.3148(4) prohibits gifts valued in excess of $100 from any of the persons or entities listed above. This section provides, in pertinent part:

A reporting individual or procurement employee or any other person on his or her behalf is prohibited from knowingly accepting, directly or indirectly, a gift from a vendor doing business with the reporting individual’s or procurement employee’s agency, a political committee as defined in s. 106.011, or a lobbyist who lobbies the reporting individual’s or procurement employee’s agency, or directly or indirectly on behalf of the partner, firm, employer, or principal of a lobbyist, if he or she knows or reasonably believes that the gift has a value in excess of $100 … .

Further, Section 112.3148(5) prohibits the listed persons or entities from giving, either directly or indirectly, a gift valued in excess of $100 to the member. This section provides, in pertinent part:

A vendor doing business with the reporting individual’s or procurement employee’s agency; a political committee as defined in s. 106.011; a lobbyist who lobbies a reporting individual’s or procurement employee’s agency; the partner, firm, employer, or principal of a lobbyist; or another on behalf of the lobbyist or partner, firm, principal, or employer of the lobbyist is prohibited from giving, either directly or indirectly, a gift that has a value in excess of $100 to the reporting individual or procurement employee or any other person on his or her behalf ... .

The term “lobbyist” is defined to mean:

any natural person who, for compensation, seeks, or sought during the preceding 12 months, to influence the governmental decisionmaking of a reporting individual or procurement employee or his or her agency or seeks, or sought during the preceding 12 months, to encourage the passage, defeat, or modification of any proposal or recommendation by the reporting individual or procurement employee or his or her agency. [Section 112.3148(2)(b)1, Florida Statutes.]

The term “vendor” is defined to mean:

a business entity doing business directly with an agency, such as renting, leasing, or selling any realty, goods, or services. [Section 112.3148(f), Florida Statutes.]

As a provider of legal services to the District, the law firm of the member’s boyfriend is a vendor.⁴ Having negotiated a contract for legal services with the District within the last 12 months, it is also the firm or principal of a lobbyist. Although the member’s boyfriend does not currently lobby the District, at least one of his partners does, and Section 112.3148(4) extends the list of prohibited donors of gifts in excess of $100 to the partner, firm, employer, or principal of a lobbyist. Because the member’s boyfriend is a partner of a lobbyist, the member is prohibited from accepting a gift from him with a value greater than $100,⁵ and because the firm is the firm or principal of a lobbyist, she is prohibited from accepting a gift worth more than $100 from the firm.

The next issue is whether the member receives a gift if she pays half of the costs of any personal travel, lodging, or meals. As stated, a gift includes anything for which equal or greater consideration is not given within 90 days. If the member and her boyfriend take a personal trip, and share expenses equally, the member has provided consideration equal to her costs, and therefore has not received a gift within the meaning of Section 112.3148. However, because he is a prohibited donor, the member’s boyfriend may not pay a larger-than-equal share of the travel expenses, if that contribution amounts to a benefit of more than $100 to the member.

If the member accompanies her boyfriend on a business trip and her travel expenses are paid by the firm, she will have received a prohibited gift if the expenses are valued at more than $100.⁶ Pursuant to Section 112.3148(7)(b), Florida Statutes, the member can provide compensation within 90 days to pay for the gift or reduce its value to $100 or less, to avoid the prohibitions found in Sections 112.3148(4) and 112.3148(5).⁷ If the value of the gift is between $25 and $100, the donor must disclose the gift on CE Form 30.

Section 112.3148 and Rule 34-13.500, Florida Administrative Code, provide guidance as to the value to be placed on a gift. Transportation is valued on a round-trip basis, unless only one-way transportation is provided. Section 112.3148(7)(d), Florida Statutes. Lodging provided on consecutive days is considered a single gift. Section 112.3148(7)(e), Florida Statutes. Lodging in a private residence is valued at the per diem rate provided in Section 112.061(6)(a)(1), Florida Statutes, less the meal allowance rate provided in Section 112.061(6)(b), Florida Statutes. Food and beverages consumed in a single sitting or meal are a single gift. Section 112.3148(7)(f), Florida Statutes. If a trip includes transportation, lodging, recreational or entertainment expenses paid by the donor, the value of the gift is equal to the total value of the various aspects of the trip minus any consideration paid by the donee. Rule 34-13.500(3), Florida Administrative Code. Where no more specific valuation method is provided, the gift should be valued based on the actual cost to the donor, less taxes and gratuities. Section 112.3148(7)(a), Florida Statutes.

In sum, due to the lobbying/vendor relationship between the boyfriend’s law firm and the District, the member may not solicit gifts of any value from her boyfriend, and may not accept any gift from him, his firm, or his law partners that is valued at more than $100. The member’s boyfriend must report any gift to the member that is valued between $25 and $100. If the couple shares the cost of travel, meals, lodging, or other entertainment equally, the member has provided adequate consideration and has not received a gift.

Your question is answered accordingly.

ORDERED by the State of Florida Commission on Ethics meeting in public session on January 22, 2016 and RENDERED this 27th day of January, 2016.

____________________________________

Stanley M. Weston, Chair

^[1]Prior opinions of the Commission on Ethics can be viewed at www.ethics.state.fl.us.

^[2]The member mentions Section 1001.421, Florida Statutes, which prohibits school board members and their relatives from directly or indirectly soliciting or accepting any gift, as defined in Section 112.312(12), Florida Statutes, if the value of that gift exceeds $50 and is received from any person, vendor, potential vendor or other entity doing business with the District. Our jurisdiction does not extend to interpretation of the Education Code, which contains Section 1001.421, therefore this opinion is limited to gift prohibitions and disclosures found in Section 112.3148.

^[3]Gifts from political committees, which are prohibited by Section 112.31485(2)(a), Florida Statutes, do not appear to be at issue here, and Section 112.3215, Florida Statutes, which prohibits "expenditures" from lobbyists, does not apply to school districts. CEO 08-19. CEO 08-19.

^[4]According to a biography posted on the law firm’s website, the member’s boyfriend has provided bond counsel to the District and many other local agencies. In April 2015, when the couple began a serious relationship, the law firm removed him from any work involving the District, to guard against any conflict of interest, according to Commission on Ethics staff communications with the Board member’s attorney. On December 8, 2015, the Board hired the law firm and a financial advisor; these consultants are expected to secure underwriters to refinance $57 million in outstanding debt at a lower interest rate. The law firm has a longstanding relationship with the District and negotiates an engagement letter each time counsel is required, according to the member’s attorney.

^[5]Although gifts from relatives may be exempt, even if that relative is a lobbyist, the member’s boyfriend is not a "relative" as that term is defined in Section 112.312(21), Florida Statutes. The definition extends to persons who are engaged to be married, or who have announced their intention to marry, or who share a household, but not to friends, boyfriends, or girlfriends.

^[6] If the firm pays the member’s expenses directly, she has received a gift from the firm. If the firm allows the member’s boyfriend to take any guest on a trip and pays the costs of the guest, the member has received a gift from her boyfriend. See CEO 91-43.

^[7]A gift given by the member to her boyfriend would not be "compensation," which is defined in Rule 34-13.500(3), Florida Administrative Code, as "payment provided by the donee to the donor within 90 days after receipt of the gift."