HomeMy WebLinkAbout04.a. Receive memo from District Counsel regarding travel paid for by outside organizations Page 1 of 5
Item 4.a.
CENTRAL SAN
Y-109-ITMEN ME
January 30, 2019
TO: ADMINISTRATION COMMITTEE
FROM: KATIE YOUNG, SECRETARYOF THE DISTRICT
REVIEWED BY: KENTALM, DISTRICT LEGAL COUNSEL
SUBJECT: RECEIVE MEMO FROM DISTRICT COUNSEL REGARDING TRAVEL PAID
FOR BYOUTSIDE ORGANIZATIONS
Attached is a memo from District Counsel Kent Alm regarding travel paid for by outside organizations. Mr.
Alm will be available to answer any additional questions you may have at the Committee meeting.
Strategic Plan re-In
GOAL ONE: Provide Exceptional Customer Service
Strategy 3- Maintain a strong reputation in the community
GOAL TWO: Strive to Meet Regulatory Requirements
Strategy 3- Comply with all federal, state, and local regulations related to District administration
ATTACHMENTS:
1. Memo from District Legal Counsel
January 30, 2019 Special ADMIN Committee Meeting Agenda Packet- Page 10 of 20
Page 2 of 5
555 12th Street,Suite 1500 Thomas L.Smith
Oakland,California 94607 tlsmith@meyersnave.com
tel(510)808-2000
fax(510)444-1108
www.meyersnave.com
MEMORANDUM
ATTORNEY-CLIENT PRIVILEGED
DATE: January 25, 2019
TO: Board of Directors, Central Contra Costa Sanitary District
FROM: Kenton Alm, District Counsel
BY: Thomas Lloyd Smith, Esq.
RE: Reporting Requirements for Travel Paid for by Outside Organizations
I. QUESTIONS PRESENTED
1. Under what circumstances is it permissible for a public official to accept funding
from an outside organization for a conference, associated travel and accommodation
expenses?
2. When outside funding is provided to public official for a conference, travel and/or
accommodations, is the public official required to report it on his or her statement of
economic interests?
II. BRIEF ANSWERS
1. Even though a payment for transportation, lodging, and subsistence may be a
reportable gift under the Act,under certain circumstances, the gift is not subject to the
Act's current$500 gift limit.
2. Whether or not the travel payments are exempt under Section 89506 of the
Political Reform Act, a public official must report such payments on his or her
statement of economic interests.
January 30, 2019 Special ADMIN Committee Meeting Agenda Packet- Page 11 of 20
Page 3 of 5
To: Board of Directors,Central Contra Costa Sanitary District
From: Kenton Alm,General Counsel
Re: Reporting Requirements for Travel Paid for by Outside Organizations
Date: January 25,2019
Page: 2
III. ANALYSIS
A. Gifts, Generally
A gift is defined under Section 82028(a) as "any payment that confers a personal benefit on
the recipient, to the extent that consideration of equal or greater value is not received and
includes a rebate or discount in the price of anything of value unless the rebate or discount is
made in the regular course of business to members of the public without regard to official
status."
The Political Reform Act works to reduce improper influences on public officials by
regulating the receipt of gifts by local public officials in three core ways: First, the Act places
limitations on the acceptance of gifts by certain public officials. The current limit is $500
from a single source in a calendar year. (Section 89503.) Second, the Act imposes reporting
obligations on certain public officials requiring that any gift of $50 or more (or gifts that
aggregate to $50 or more from the same source) received during the calendar year are
disclosed on the officials' statements of economic interests. (Sections 87200 - 87210.) Third,
the Act prohibits any public official from making, participating in making, or using his or her
position to influence the outcome of a governmental decision involving the donor of a gift or
gifts with an aggregate value of$500 or more provided to, received by, or promised to the
official within the 12 months prior to the date of the decision. (Sections 87100 and
87103(e).)
The Act generally presumes any travel confers a personal benefit on a public official.
Consequently, travel costs paid for by a third party are generally reportable gifts. Therefore,
absent an exception, the value of all travel-related expenses would be considered a reportable
gift to each of the public officials. (Section 82028.)
B. Certain Exceptions to the General Rule for Gifts
Even though a payment for transportation, lodging, and subsistence may be a reportable gift
under the Act, under certain circumstances, the gift is not subject to the Act's current $500
gift limit.
The Act provides that payments, advances, or reimbursements, for travel, including actual
transportation and related lodging and subsistence that is reasonably related to a legislative or
governmental purpose, or to an issue of state, national, or international public policy, are not
prohibited or limited by this chapter if the travel is in connection with a speech given by a
designated employee of a local government agency, the lodging and subsistence expenses are
limited to the day immediately preceding, the day of, and the day immediately following the
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January 30, 2019 Special ADMIN Committee Meeting Agenda Packet- Page 12 of 20
Page 4 of 5
To: Board of Directors,Central Contra Costa Sanitary District
From: Kenton Alm,General Counsel
Re: Reporting Requirements for Travel Paid for by Outside Organizations
Date: January 25,2019
Page: 3
speech, and the travel is within the United States. (Section 89506(a)) For example, meals
provided on any day where the public official gives a speech, participates in a panel or
seminar, or provides a similar service are allowable and not reportable. (Regulation
18950.3.)
The words "speech given" mean a public address, oration, or other form of oral presentation,
and includes participation in a panel, seminar, or debate. (Regulation 18931.1) Merely being
involved in a discussion at a conference does not qualify as giving a speech or oral
presentation as required by the regulation. (Hoehn Advice Letter, No. I-92-392.) Similarly,
holding informal meetings with constituents or a few individuals who are members of a
particular group would not qualify. (Williams Advice Letter,No. I-95-405.) Careful analysis
of multiday conferences may also be required to determine whether the exception for travel
applies in connection with the entire event.
As for travel outside the United States, it is reportable and subject to the limits unless the
"travel is provided by a government, a governmental agency, a foreign government, a
governmental authority, a bona fide public or private educational institution, as defined in
Section 203 of the Revenue and Taxation Code, a nonprofit charitable or religious
organization which is exempt from taxation under Section 501(c)(3) of the Internal Revenue
Code, or by a person domiciled outside the United States which substantially satisfies the
requirements for tax-exempt status under Section 501(c)(3) of the Internal Revenue Code."
(Section 89506(a)(2).)
C. Additional Considerations
Even in cases where an exception applies, the payments will still be reportable and could
form the basis for a conflict of interest where the effect of a governmental decision by a
public official will have a financial effect on the public officials agency.
Moreover, payments made for items other than necessary travel and related lodging and
subsistence, such as expenses paid for entertainment purposes, may be considered a
reportable gift subject to the $500 gift limit because those items would not be related to a
legislative or governmental purpose.
Finally, if a non-profit organization is merely an intermediary for other donors, the gifts
could be attributed to the true source, and Section 89506 may not apply. To this end,
Regulation 18945(a) provides: "The person who makes the gift to the official(s) is the source
of the gift unless that person is acting as an intermediary. The person is acting as an
intermediary for the source of the gift when the gift to the official was provided under any of
the following conditions: (1) the person receives a payment from a source and the payment is
made to the official after the source identifies the official as the intended recipient of the gift;
A PROFESSIONAL LAW CORPORATION OAKLAND LOS ANGELES SACRAMENTO SANTA ROSA SAN DIEGO
January 30, 2019 Special ADMIN Committee Meeting Agenda Packet- Page 13 of 20
Page 5 of 5
To: Board of Directors,Central Contra Costa Sanitary District
From: Kenton Alm,General Counsel
Re: Reporting Requirements for Travel Paid for by Outside Organizations
Date: January 25,2019
Page: 4
(2) the person receives a payment from a source after soliciting the payment with the
understanding that the payment will be used for the sole or primary purpose of making a gift
to an official; or (3) the person receives a payment from a source after the payment was
solicited by the official or the official's agent for the purpose of making a gift to the official."
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January 30, 2019 Special ADMIN Committee Meeting Agenda Packet- Page 14 of 20