Ethics Advisory Opinion No. 2008-10
December 16, 2008
Issued By: City Attorney’s Office
May a city employee attend holiday events hosted by entities that contract with the city?
A group of employees has received an invitation to attend a holiday party hosted by an entity that contracts with the city. The entity has extended this invitation to many other entities and individuals who are involved in similar professions or line of work. The employees have inquired whether they may accept this invitation.
III. The Ethics Code - Gifts
A. Receipt of Gifts or Benefits
The Ethics Code contains two rules which regulate the acceptance of gifts by city employees. The first restricts gifts given with the intent to influence or reward a city official or employee for official action:
A city official or employee shall not solicit, accept, or agree to accept any gift or benefit for himself or herself or his or her business:
(A) that reasonably tends to influence or reward official conduct; or
(B) that the official or employee knows or should know is being offered with the intent to influence or reward official conduct.
Ethics Code, Section 2-45(a)(1).
The second rule restricts gifts from specific sources, regardless of the motivation for the gift:
A city official or employee shall not solicit, accept, or agree to accept any gift or benefit, from:
(A) any individual or business entity doing or seeking to do business with the City; or
(B) any registered lobbyist or public relations firm; or
(C) any person seeking action or advocating on zoning or platting matters before a city body,
save and except for
i) items received that are of nominal value; or
ii) meals in an individual expense of $50 or less at any occurrence and no more than a cumulative value of $500 in a single calendar year from a single source.
Ethics Code, Section 2-45(a)(2).
In this inquiry, there is no indication that city employees have been invited to the holiday event for the purpose of influencing or persuading the city employee in matters of contract selection. Accordingly, the prohibition in Section 2-45(a)(1) would not apply.
Section 2-45(a)(2), however, restricts employees from accepting gifts from city vendors regardless of the intent of the gift donor. Because this benefit is being provided by a city vendor, the employee is subject to the restrictions.
There are two exceptions regarding gifts from these restricted sources, located in Section 2-45(a)(2), which is described above, and in Section 2-45(b)(12). Section 2-45(a)(2) would allow the employees to accept meals in an individual expense of up to $50. If a meal is provided at the event, the employees could accept that benefit up to a value of $50.
Section 2-45(b)(12) provides exception for gifts of entertainment:
Lodging, transportation, or entertainment that the official or employee accepts as a guest and, if the donee is required by law to report those items, reported by the donee in accordance with that law, up to $500 from a single source in a calendar year.
This provision allows a city employee to accept lodging, transportation and entertainment accepted as a guest of the vendor up to a value of $500. The phrase “as a guest” requires the donor to be physically present at the event, which the invitation indicates would be the case in this instance. Accordingly, the employees could accept the invitation to the social event so long as the value of the event does not exceed $500 in value. It should be noted that the $500 limit is cumulative, meaning that the total value of this and other gifts of entertainment received by the employees from the vendor during a calendar year could not exceed this limit.
Therefore, the employees may accept the invitation to the holiday event under Section 2- 2-45(b)(12), so long as the value of the event for any of the employees does not exceed $500. It is the responsibility of the employee to inquire about the fair market value of the gift. If the value does not exceed $500 and the employee chooses to accept the gift, the employee must comply with any applicable gift reporting requirements.
B. Reporting Gifts and Benefits
The Ethics Code not only regulates the receipt of gifts from certain sources, but also whether the benefit must be reported. These are separate requirements. A city employee may be authorized to receive a gift, but may or may not be required to disclose it.
There are two disclosure provisions. First, all officials, including board members, and executive-level staff are required to submit a full annual financial disclosure report. Ethics Code, Section 2-73. Some other designated staff members, the “specified employees,” are required to submit a one-page annual gift report. Ethics Code, Section 2-78. The remaining employees are not subject to financial disclosure requirements. For individuals who file financial disclosure or gift reports, they must report the receipt of gifts worth more than $100, regardless of their source.
There are exceptions, though, for the types of gifts or benefits that must be included in the report:
(1) lawful campaign contributions which are reported as required by state statute or local ordinance;
(2) gifts received from family members within the second degree of affinity or consanguinity;
(3) gifts from an individual based on personal friendship who during the preceding three calendar years: a) has not done or sought to do business with the city; b) has not sought city action on any issue before the City Council or any city board or commission; c) is not associated with any business or entity that has done or sought to do business with the city; and d) is not associated with any business or entity that has sought city action on any issue before the City Council or a city board or commission;
4) gifts received among and between fellow city employees and city officials;
5) admission to events in which the reporting party participated in connection with official duties; and
6) payment of or reimbursement of travel and accommodation expenses accepted in connection with official duties which have been reported [on a travel report];
Ethics Code, Sections 2-74(n) and 2-78. As discussed in the preceding section, under the circumstances of this inquiry, the gift would not be treated as a gift from a personal friend. Accordingly, if the value is greater than $100 and the employee is subject to either of these reporting requirements, the gift must be listed on the employee’s disclosure reports.
Under the circumstances of this inquiry, the employee may accept the invitation to attend the holiday event so long as the value to the employee of the event does not exceed $500 and the vendor’s representatives are present as hosts. They must also comply with any applicable gift disclosure requirements.