ADVISORY OPINION #197
Subject: Lobbying/Donations to underwrite an event
Requested By: Mike Flood, Speaker of the Legislature and DiAnna Schimek, State Senator
Questions Presented: 1) Are donations by lobbyists and principals to underwrite an event reportable expenditures? 2) If so, how and when should these expenditures be reported?
Conclusion: See analysis.
Facts: The Council of State Governments (CSG) is holding its annual Legislator's Conference in Omaha in December of 2008. The conference will be attended by legislators from other states and U.S. Territories, including a number of Nebraska State Legislators. International dignitaries, academicians and business executives are also expected attend. It is estimated that approximately 700 to 1,000 individuals will attend. It is also estimated that approximately seven to twelve Nebraska Legislators will attend.
CSG is a national association serving state officials in all three branches of government. It is a nonpartisan, nonprofit organization that alerts state elected and appointed officials to emerging social, economic, and political trends, offers innovative state policy responses and advocates regional and multi-state problem-solving to maximize resources and competitiveness. The CSG Governing Board includes the governors and two legislators for each of the 50 states, U.S. territories and the Commonwealth of Puerto Rico. The State of Nebraska is a dues paying member of CSG. The annual dues for Nebraska are paid from the funds of the Nebraska State Legislature.
A committee, which includes Nebraska State Senators and others, is in the process of soliciting funds to be used by CSG to underwrite the costs of the conference. Donors' checks are collected locally, but are forwarded to CSG. They are made payable to the Council of State Governments. We are advised that CSG is a 501(c)(3) organization and donors have the expectation that donations are tax deductible.
If a lobbyist or a principal of a lobbyist were to make a donation to CSG to assist in underwriting the Omaha event, Speaker Flood and Senator Schimek wish to know if all or any part of the donation would be reportable as a lobbying expense. If the Commission concludes that any part of the donation is a lobbying expense, the Senators wish to know how and when the expenditure should be reported by a lobbyist or a principal. It is the intent of Speaker Flood and Senator Schimek to communicate the Commission's position on these issues to potential donors so as to ensure compliance with the Nebraska Political Accountability and Disclosure Act (NPADA).
Analysis: The term lobbying is defined in §49-1433 of the Nebraska Political Accountability and Disclosure Act (NPADA) as follows:
Lobbying shall mean the practice of promoting or opposing for another person, as defined in section 49-1438, the introduction or enactment of legislation or resolutions before the Legislature or the committees or the members thereof, and shall also include the practice of promoting or opposing executive approval of legislation or resolutions.
The term influencing is defined in §49-1429 as follows:
Influencing shall mean promoting, supporting, affecting, modifying, opposing, or delaying by any means, including the providing of or use of information, statistics, studies, or analyses.
The terms lobbyist and principal are defined in §49-1434 of the NPADA in part as follows:
Section 49-1423 of the NPADA defines the term gift as:
Gift shall mean a payment, subscription, advance, forbearance, rendering, or deposit of money, services, or anything of value, unless consideration of equal or greater value is given therefor. Gift shall not include a campaign contribution otherwise reported as required by law, a commercially reasonable loan made in the ordinary course of business, a gift received from a relative, a breakfast, luncheon, dinner, or other refreshments consisting of food and beverage provided for immediate consumption, or the occasional provision of transportation within the State of Nebraska.
Section 49-1490 prohibits a lobbyist, a principal of a lobbyist or someone acting on behalf of either from giving a gift with a value of more than $50 in a calendar month to a member of the Legislature.
Lobbyists and principals are required to file quarterly reports. The contents of these reports are established by §49-1483. Generally §49-1483 requires the reporting of total amounts received or expended directly or indirectly for the purpose of carrying out lobbying activity. The Commission has taken a broad view of this provision. It recognizes that some expenditures by lobbyists and principals for the benefit of legislators may not be an occasion for discussion legislation, but instead are intended to show that the lobbyist or principal is a resource for the legislator. With a few exceptions based upon statute (such as reportable campaign contributions), expenditures by lobbyists and principals for the benefit of members of the Legislature are considered lobbyist expenditures.
In Advisory Opinion #104 (1987) the Commission considered a question from the Director of Research of the Nebraska Legislature. The Legislature intended to solicit funds for the purpose of underwriting a Legislative Symposium. Nothing was to be given directly to any Nebraska Legislator. Instead, donations were to be given to the State. However, the Commission took the position that the donations to the event were for the benefit of Nebraska Legislators and were lobbying expenditures reportable as such if made by a lobbyist or principal. The opinion provided considerable detail as to how to the donations could be made so as to comply with the gift limitations of the law.
In Advisory Opinion #157 (1995) the Commission considered an issue of donations being made to a national organization. In that situation the donations were earmarked for "scholarships" to underwrite the cost of Nebraska State Senators attending the conferences of the national organization. The Commission took the position that donations by lobbyists and principals earmarked for Nebraska Senators were gifts as defined and subject to the $50 per month gift limitation. In the opinion the Commission stated that it would be permissible for lobbyists and principals to donate to the national organization's general fund without running afoul of the gift restriction as long as the donations were not earmarked for use by Nebraska Senators.
Over the years, the Commission staff issued a number of staff opinions regarding donations to underwrite events to be attended by Members of the Legislature. These staff opinions were consistent with Advisory Opinions #104 and #157. Each examined whether there was compliance with the gift limitation law and each assumed that donations by lobbyists and principals were reportable at least in part under the NPADA. However, we believe the situation presented here is fundamentally different.
Advisory Opinion #104 involved a situation in which money was collected through the State of Nebraska for the stated purpose of hosting an event for Nebraska Legislators. Advisory Opinion #157 involved a situation in which money was donated to a national organization, but specifically earmarked for the benefit of Nebraska Legislators. In the matter before us, donations are to be made to CSG to underwrite an event. Only one to two percent of those attending will be Members of the Nebraska Legislature. The donations are in no way earmarked for the benefit of Nebraska Legislators. The State of Nebraska belongs to CSG, and the Nebraska Legislature will pay the full conference registration fee for those Nebraska Senators who attend.
Accordingly, it is our position that a donation by a lobbyist or by a principal of a lobbyist to the Council of State Governments to help underwrite the 2008 Omaha conference is neither a gift to Members of the Nebraska Legislature or a lobbying expense. Such a donation is not reportable by lobbyists or principals on their quarterly reports.
In this opinion we have distinguished the facts before us from the facts considered in Advisory Opinions #104 and #157. This opinion should not be construed as overturning Advisory Opinions #104 or #157. It should not be construed as a withdrawal from our broad view that total amounts received or expended directly or indirectly for the purpose of carrying out lobbying activity are reportable.
Given our position to the first question posed, the second question is moot and no analysis or response is required.
Summary: A Nebraska lobbyist or a Nebraska principal which makes a donation to a national organization, of which the State of Nebraska is a member, to assist in underwriting an event at which a small percentage of the attendees will be members of the Nebraska Legislature is not making a reportable lobbying expenditure.
ADOPTED as an advisory opinion pursuant to Section 49-14,123(10) and Title 4, Chapter 1, Rules of Practice and Procedure. As provided in Section 49-14,123(10), this advisory opinion shall be binding upon the Commission unless amended or revoked, concerning the person or public body who requested the opinion and acted in reliance thereon in good faith unless material facts were omitted or misstated by the person in the request for the opinion.
DATED this ______ day of March 2008.
NEBRASKA ACCOUNTABILITY AND DISCLOSURE COMMISSION
Andre Barry, Chairman