CEO 92-12 -- March 6, 1992

GIFTS AND HONORARIA

GIFT AND HONORARIA ACCEPTANCE/DISCLOSURE

To: Thomas M. Beard, Chairman, Florida Public Service Commission, (Tallahassee)

SUMMARY:

Where a Public Service Commission employee travels to audit the records of a utility company, where the employee is reimbursed for his travel expense by his agency, and where the utility then reimburses the agency for the employee's expense, the employee has not received a gift under Section 112.3148, Florida Statutes. Similarly, where an employee travels to a meeting sponsored by a Federal or another State agency, where the employee is reimbursed for his travel expense by the agency, and where the agency is then reimbursed for the employee's expense by the Federal or other State agency, the employee has not received a gift which must be disclosed pursuant to Section 112.3148, Florida Statutes. Where a Public Service Commission Commissioner or employee is invited to speak at a function not sponsored by a utility or party to a pending proceeding, where the Commissioner or employee is reimbursed by the agency for his or her travel expense in accordance with Section 112.061, Florida Statutes, and where the agency then seeks reimbursement for this expense from the event's host, neither the Commissioner nor the employee has received an honorarium or expenses related to an honorarium event pursuant to Section 112.3149, Florida Statutes. Where a Public Service Commission Commissioner serves on the advisory council of a nonprofit corporation funded by electric utilities to direct research, development, and demonstration of new technology, and where the Commissioner accepts reimbursement from the nonprofit corporation for travel expenses incurred in attending advisory council meetings, such reimbursement may be accepted by the Commissioner and disclosed as a gift pursuant to Section 112.3148, Florida Statutes. Where the Commissioner travels to advisory council meetings at public expense and is reimbursed by the Commission in accordance with Section112.061, Florida Statutes, and where the nonprofit corporation reimburses the Commission for this expense, such reimbursement does not constitute a gift to the Commissioner which must be disclosed. As the nonprofit corporation neither directly nor indirectly owns or controls any utility regulated by the agency, nor is either an affiliate or subsidiary of any utility regulated by the agency, Section 350.041, Florida Statutes, is not violated where a Commissioner serves on the nonprofit corporation's advisory council and is reimbursed for his travel expense in attending advisory council meetings. CEO's 91-57, 91-46, 91-33, and 91-21, are referenced.

QUESTION 1:

Where a Florida utility reimburses the Florida Public Service Commission (PSC) for the cost of a PSC employee's travel and lodging expenses, where the employee is performing an audit of the utility's out-of-state records, and where PSC rules authorize a utility to reimburse the PSC under such circumstances, does such reimbursement constitute a gift which must be reported by the employee?

Question 1 is answered in the negative.

In your letter of inquiry you advise that when a PSC employee performs an audit on a Florida utility whose records are kept out-of-state, the employee pays his own way, submits a travel voucher to the agency, and is paid by the State in accordance with the provisions of Section 112.061, Florida Statutes. Thereafter, the PSC's Division of Administration bills the utility for the amount expended on behalf of the employee. You question whether this situation implicates the provisions governing gifts contained in Section 112.3148, Florida Statutes.

You further relate that the PSC's Location and Preservation of Records rules authorize this process, and you reference Florida Administrative Code Rules 25-4.020 (telephone), 25-6.015 (electricity), and 25-7.015 (gas). For example, Rule 25-6.015(2), F.A.C., states:

Any utility authorized to keep its records outside of the state shall reimburse the Commission for the reasonable travel expense of the Commission's representative during any out-of-state audit.

While we acknowledge the existence of these regulations, we recognize that we do not have the authority to determine the legality or appropriateness of the Public Service Commission's rules in this regard. Nonetheless, we are able to render an opinion concerning whether or not the employee has received a gift in this situation.

Although not stated in your letter, we will assume for purposes of this opinion that the PSC employee discussed herein is considered a "specified state employee" pursuant to Section 112.3145(1)(b)6, Florida Statutes, and thus, is a "reporting individual" for purposes of Section 112.3148, Florida Statutes.

Section 112.3148(4), Florida Statutes, provides in relevant part:

A reporting individual or procurement employee or any other person on his behalf is prohibited from knowingly accepting, directly or indirectly, a gift from a political committee or committee of continuous existence, as defined in s. 106.011, or from 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 knows or reasonably believes that the gift has a value in excess of $100; however, such a gift may be accepted by such person on behalf of a governmental entity or a charitable organization. If the gift is accepted on behalf of a governmental entity or charitable organization, the person receiving the gift shall not maintain custody of the gift for any period of time beyond that reasonably necessary to arrange for the transfer of custody and ownership of the gift.

This section would prohibit acceptance by the employee of a gift valued in excess of $100 from a lobbyist or a principal or employer of a lobbyist, unless accepted on behalf of a governmental entity or charitable organization.

Section 112.3148(2)(b), Florida Statutes, provides:

'Lobbyist' means 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 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 agency. With respect to an agency that has established, by rule, ordinance, or law, a registration or other designation process for persons seeking to influence decisionmaking or to encourage the passage, defeat, or modification of any proposal or recommendation by such agency or an employee or official of the agency, the term "lobbyist" includes only a person who is required to be registered or otherwise designated as a lobbyist in accordance with such rule, ordinance, or law or who was during the preceding 12 months required to be registered or otherwise designated as a lobbyist in accordance with such rule, ordinance, or law.

With regard to the utility company, although you have not indicated whether it employs a lobbyist who lobbies the PSC, we presume for purposes of this opinion that the utility is considered to be the principal of a "lobbyist" as defined in Section 112.3148(2)(b), Florida Statutes.

Section 112.312(12)(a), Florida Statutes, provides the following definition of a "gift":

'Gift,' for purposes of ethics in government and financial disclosure required by law, means that which is accepted by a donee or by another on the donee's behalf, or that which is paid or given to another for or on behalf of a donee, directly, indirectly, or in trust for his benefit or by any other means, for which equal or greater consideration is not given, including:

7. Transportation, lodging, or parking.

8. Food or beverage, other than that consumed at a single sitting or event.

Gift does not include:

1. Salary, benefits, services, fees, commissions, or expenses associated with the recipient's employment.

2. Food or beverage consumed at a single sitting or event.

Section 112.3148(5), Florida Statutes, provides:

A political committee or a committee of continuous existence, 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 behalf; however, such person may give a gift having a value in excess of $100 to a reporting individual or procurement employee if the gift is intended to be transferred to a governmental entity or a charitable organization.

In CEO 91-46, we opined that where a public officer's travel is paid for by his own agency, he has not received a gift where a valid public purpose exists for the gift. However, in CEO 91-21, we opined that a supervisor of elections had received a gift which could be accepted on behalf of a governmental entity where she traveled at public expense to view the factory of a voting machine manufacturer, and where the manufacturer then reimbursed the public agency which paid for the trip. Here, where the PSC employee travels at public expense to perform an audit on a utility company's records, and where the utility company reimburses the PSC for the employee's expense, we are of the view that the PSC, not the employee, has received a gift. Further, as the gift statute imposes no reporting requirement on governmental entities which receive gifts from lobbyists, the PSC would not be required to disclose as a gift pursuant to Section 112.3148, Florida Statutes, those funds it receives from utility companies who reimburse the PSC for audit expenses.

Question 1 is answered accordingly.

QUESTION 2:

Where a PSC employee travels to a meeting sponsored by a Federal or other State agency, where the employee is reimbursed by the PSC for his travel expenses pursuant to Section 112.061, Florida Statutes, and where the PSC seeks reimbursement from the Federal or State agency for its employee's travel expenses, has the employee received a gift which must be disclosed pursuant to Section 112.3148, Florida Statutes?

Question 2 is answered in the negative.

In your letter of inquiry you advise that where a PSC employee travels to a meeting sponsored by a Federal agency or another State agency, the employee pays his own way, submits a travel voucher to the PSC in accordance with Section 112.061, Florida Statutes, and is then reimbursed by the agency for his travel expenses. Thereafter, you advise, the PSC's Division of Administration may seek reimbursement for the employee's expenses from the Federal or State agency which sponsored the meeting. You question whether this situation constitutes a gift to the PSC employee which must be disclosed pursuant to Section 112.3148, Florida Statutes?

Under the rationale contained in our response to Question 1, the employee has not received a gift which must be disclosed pursuant to Section 112.3148, Florida Statutes. Although the PSC may have received a gift from the Federal or other State agency, Section 112.3148, Florida Statutes, does not impose a reporting requirement on public agencies which receive gifts.

Question 2 is answered accordingly.

QUESTION 3:

Where a PSC Commissioner or employee is invited to be a speaker at an event which is not sponsored by a utility or a party to a pending proceeding, where the Commissioner or employee pays his or her own expenses, submits a travel voucher to the PSC for reimbursement, and where the PSC then seeks reimbursement from the event's host, has the Commissioner or employee received an honorarium or expenses related to an honorarium event pursuant to Section 112.3149, Florida Statutes?

Under the facts presented, Question 3 is answered in the negative.

You have questioned whether a PSC Commissioner or employee has received an honorarium or expenses related to an honorarium event where they are invited to speak at an event which is not sponsored by a utility or a party to a proceeding pending before the PSC, where they travel at their own expense, submit a travel voucher to the PSC in accordance with Section 112.061, Florida Statutes, are thereafter reimbursed by the PSC, and where the PSC's Division of Administration then seeks reimbursement from the host of the event.

Section 112.3149(1)(a), Florida Statutes, defines "honorarium" as

a payment of money or anything of value, directly or indirectly, to a reporting individual or procurement employee, or to any other person on his behalf, as consideration for:

1. A speech, address, oration, or other oral presentation by the reporting individual or procurement employee, regardless of whether presented in person, recorded, or broadcast over the media.

2. A writing by the reporting individual or procurement employee, other than a book, which has been or is intended to be published.

The term 'honorarium' does not include the payment for services related to employment held outside the reporting individual's or procurement employee's public position which resulted in the person becoming a reporting individual or procurement employee, any ordinary payment or salary received in consideration for services related to the reporting individual's or procurement employee's public duties, a campaign contribution reported pursuant to chapter 106, or the payment or provision of actual and reasonable transportation, lodging, and food and beverage expenses related to the honorarium event for a reporting individual or procurement employee and spouse.

The issue then, is whether the reimbursement that the PSC seeks from the event's host constitutes an indirect honorarium to the PSC Commissioner or employee. It is our view that under the circumstances presented, the PSC Commissioner or employee has received neither an honorarium nor expenses related to an honorarium event. Instead, the PSC Commissioner or employee has been reimbursed for his or her travel by the PSC. Although the PSC's Division of Administration may later seek reimbursement of this expense from the host, Section 112.3149, Florida Statutes, governs honoraria or honorarium event related expenses received by reporting individuals or procurement employees. It does not address situations where a State agency, in this case the Public Service Commission, is reimbursed by the sponsor of an event for the expense that the State agency incurred in sending one of its officers or employees to speak at a function. Thus, neither the PSC Commissioner nor the PSC employee has received an honorarium or honorarium event related expenses which must be disclosed pursuant to Section 112.3149, Florida Statutes.

Question 3 is answered accordingly.

QUESTION 4:

Where a PSC Commissioner serves as a member of an advisory council to a National nonprofit organization that is funded by electric utilities, and where the advisory council pays for the Commissioner's travel expenses when he or she travels to a meeting of the advisory council, has the Commissioner received a gift which is subject to the provisions of Section 112.3148 or Section 350.041, Florida Statutes?

Your question is answered in the affirmative as to a gift which must be disclosed, and in the negative as to a violation of Section 350.041, Florida Statutes.

We are advised that the Electric Power Research Institute (EPRI) is an independent, private, nonprofit corporation which is supported financially by approximately 660 U.S. electric utilities through voluntary contributions. The EPRI plans and manages a program of research, development, and demonstration that assists member utilities and benefits their customers in meeting future electricity needs in the most cost-effective and environmentally acceptable way. This research is carried out by hundreds of individual organizations, primarily industrial and commercial firms, universities, utilities, and government laboratories. You advise that according to EPRI staff, EPRI does not take positions on policy issues and does not try to influence any regulatory body regarding the merits of its research.

We are further advised that the EPRI Advisory Council, which consists of twenty-five individuals representing government, labor, education, science, environmental, and business concerns, provides a link between the EPRI Board of Directors and the general public. Seven members of the Advisory Council are state utility regulators appointed by the president of the National Association of Regulatory Utility Commissioners, and the other members are appointed by the EPRI. Members of the Advisory Council are reimbursed by the EPRI for the travel expenses they incur in attending meetings of the Advisory Council. Where a PSC Commissioner has been appointed to serve as a member of the EPRI Advisory Council and is reimbursed by the EPRI for his travel expenses, you question whether any provision contained in Section 112.3148, or Section 350.041, Florida Statutes, is implicated.

With regard to Section 112.3148, Florida Statutes, we are of the view that the PSC Commissioner has received a gift where he or she is reimbursed by the EPRI for the travel expenses incurred when attending Advisory Council meetings. In CEO 91-57, Question 3, we stated:

Notwithstanding the 'quid pro quo' concept contained in the definition of 'gift' . . . we are of the view that at a minimum, disclosure should be the goal for the reporting official who receives any of the listed items contained in the definition of 'gift.' . . . If it is included in that list, then our next question will be whether it is one that can be accepted by the reporting individual.

Therefore, based upon CEO 91-57, we find that the travel expenses which the PSC Commissioner receives from the EPRI constitute a gift. However, although the EPRI is funded by electric utilities, including, presumably, electric utilities which are regulated by the PSC and which employ lobbyists to lobby the PSC, we do not consider the travel reimbursement received by the Commissioner to be prohibited pursuant to Section 112.3148(4), Florida Statutes. Based upon the facts before us, there is no basis to conclude that the travel expenses paid by EPRI are an indirect gift from a lobbyist or the employer or principal of a lobbyist who lobbies the PSC. As a gift which may be accepted, those travel expenses received by the PSC Commissioners from the EPRI as a member of the EPRI Advisory Council would be required to be disclosed quarterly. We have promulgated CE Form 9 for this purpose.

Alternatively, where the PSC Commissioner travels to the Advisory Council meeting at public expense pursuant to Section 112.061, Florida Statutes, and where the PSC then seeks reimbursement from the EPRI for the expenses incurred by the Commissioner, the reimbursement would constitute a gift to the PSC, not to the Commissioner, and under the rationale contained in Questions 1 and 2 above would not have to be disclosed by the Commissioner as a gift.

Turning now to Section 350.041, Florida Statutes, this statute includes a code of conduct applicable to members of the Public Service Commission and is in addition to the provisions contained in Chapter 112, Part III, Florida Statutes. This Commission has previously had the opportunity to render an advisory opinion involving Chapter 350, Florida Statutes. See CEO 91-33. You question whether a PSC Commissioner's service on the EPRI Advisory Council and the reimbursement for travel expenses in attending meetings of the Council, conflict with any provision contained in Section 350.041, Florida Statutes.

Section 350.041, Florida Statutes, provides in relevant part:

(a) A commissioner may not accept anything from any business entity which, either directly or indirectly, owns or controls any public utility regulated by the commission, from any public utility regulated by the commission, or from any business entity which, either directly or indirectly, is an affiliate or subsidiary of any public utility regulated by the commission.

(b) A commissioner may not accept any form of employment with or engage in any business activity with any business entity which, either directly or indirectly, owns or controls any public utility regulated by the commission, any public utility regulated by the commission, or any business entity which, either directly or indirectly, is an affiliate or subsidiary of any public utility regulated by the commission.

(d) A commissioner may not accept anything from a party in a proceeding currently pending before the commission.

There is no indication that by serving on the Advisory Council and accepting reimbursement for travel expenses incurred in attending meetings of the Council the Commissioner has contravened the provisions contained in Section 350.041, Florida Statutes. From the information you have provided, there is no indication that the EPRI either directly or indirectly owns any public utility regulated by the PSC or is an affiliate or subsidiary of any utility regulated by the PSC. Rather, the EPRI is an independent, nonprofit corporation supported by approximately 660 U.S. utilities, including investor-owned companies operated in Florida. We do not view this situation as a subterfuge which permits utility companies regulated by the PSC to indirectly provide gifts, employment, or a business activity to PSC Commissioners.

Question 4 is answered accordingly.