REQUESTED BY: Larry Ruth, Attorney at Law
QUESTION: Do certain features of a fundraising effort for the Legal Defense Fund of a State Senator comply with the Nebraska Political Accountability and Disclosure Act?
You state that certain friends of Senator Bernice Labedz would like to hold a fundraising event for the purpose of paying legal expenses which she has recently incurred. These legal expenses are not associated with her campaign nor with her holding public office. You further state that you are aware of Commission Advisory Opinion #104 which analyzed the matter of legal defense funds and you wish to know if a fundraising event with certain proposed features is in compliance with the Nebraska Political Accountability and Disclosure Act and Advisory Opinion #104. You are proposing the following:
1) The organization and administration of the event would be undertaken by people or organizations who are either 1) not lobbyists or principals of lobbyists or 2) are being paid fair market value for their services by persons who are not lobbyists or principals or lobbyists.
2) Contributions will not knowingly be solicited from 1) any lobbyist before Nebraska's legislative or executive branch; 2) the principals of any lobbyists; 3) persons acting on behalf of a lobbyist or principal; or 4) political action committees. Solicitations for contributions will carry the following or similar language:
We cannot accept contributions from any lobbyists who are involved with Nebraska's legislative or executive branch from principals of lobbyists (those who authorize a lobbyist to lobby), or from anyone acting on behalf of a lobbyist or a principal. Also, we cannot accept contributions from political action committees.
3) Contributions will not knowingly be accepted from 1) any lobbyist before Nebraska's legislative or executive branch, 2) the principals of any lobbyists, 3) anyone acting on behalf of a lobbyist or a principal, or 4) political action committees. The only contributions which will be accepted will be in the form of checks (no cash or in-kind contributions) and the payors of these checks will be compared against 1) the most current official list of registered lobbyists (and their principals) prepared by the Clerk of the Legislature, and 2) the most current official list of political action committees prepared by the Nebraska Accountability and Disclosure Commission. In this manner you will attempt to exclude any contributions which are improper.
4) Contributions will be solicited and accepted from persons who may be officers, directors, shareholders and members of profit and non-profit corporations who are principals. However, solicitations will carry the following or similar language:
Assuming that you are neither a lobbyist or principal, or acting on their behalf, we can accept a contribution from you even though you are an officer, director, shareholder, member or employee of a profit or non-profit corporation who employs or authorizes a lobbyist to lobby. However, the funds given must be from your personal funds and not from corporate funds (or reimbursed from corporate funds), and must be given solely upon your individual decision.
Likewise we can accept a contribution from a corporation which is not a lobbyist or principal but which is a member of a trade association which authorizes a lobbyist to lobby. However, the funds must be given from the member's corporate funds and not from the principal's funds (or reimbursed from the principal's funds), and must be given solely upon the member's decision.
5) There will be no connection between the fundraising effort and any committee which has or may be formed to support Senator Labedz's candidacy. Solicitations will carry the following or similar language:
Your contribution to help Senator Labedz pay for her legal expenses is not a campaign contribution, and is not connected with any re-election effort by Senator Labedz.
Before turning to the question presented, we note that the word "contribution" is found extensively within the body of this opinion. Normally, the Commission uses the term "contribution" only as it is defined in Section 49-1415. However, for the purposes of this opinion, the term "contribution" will also be employed in accordance with common, non-statutory usage.
Section 49-1490(1) states that a principal, lobbyist, or anyone acting on behalf of either shall not give a gift to any official or member of any official's staff in the executive or legislative branches of state government. Section 49-1490(2) states that an official or any other person on his or her behalf in the legislative or executive branches of state government or a member of such official's staff or immediate family shall not solicit or accept a gift in violation of Section 49-1490(1). For the purposes of Sections 49-1490(1) and (2) gift is defined as "a payment, subscription, advance, forbearance, or honorarium, or the rendering or deposit or money, services or anything of value, the value of which exceeds twenty five dollars in any one month period." In order to avoid confusion we point out that this definition of gift is somewhat different than the one which was expressed in Advisory Opinion #104. This slight difference in definition is the result of the passage of LB1174 in 1988 which amended the Act.
As stated in your request, you note that a lobbyist, principal, or anyone acting on behalf of either may contribute to the legal defense fund in an amount of $25 or less in any one month. However, you are declining to accept contributions in any amount from these sources. The standard which has been set for this fundraising event on the matter of contributions from principals, lobbyists, and anyone acting on behalf of either is more restrictive then the standards provided by law or Advisory Opinion #104 and therefore is in compliance with both.
You indicate that in order to determine who is a lobbyist and who is a principal you will consult the most current list of registered lobbyists and principals prepared by the Clerk of the Legislature. This is a reasonable step in order to protect against the receipt of contributions that you either wish to avoid or contributions which are prohibited by law. However, you should understand that a lobbyist or a principal is someone who fits the definition of lobbyist and principal found in Section 49-1434. The failure of a lobbyist to register as a lobbyist does not make him or her any less a lobbyist nor his or her principal any less a principal. Should it come to your attention that a prohibited contribution has been received from a lobbyist, principal, or anyone acting on behalf of either, you would be required to decline or return the contribution.
Your proposal on contributions solicited and accepted from persons who may be officers, directors, shareholders and members of corporations which are principals correctly encompasses the decision of the Commission in Advisory Opinion #104.
You state that you will decline to accept contributions from separate segregated political funds or PACs. This position is consistent with Section 49-1469 which prohibits separate segregated political funds from using their funds for any purpose other than expenditures or disbursements for the support or opposition of candidates or ballot questions or, in some cases, for administrative expenses. The expenditure of PAC funds to make a contribution to a legal defense fund is prohibited. Your proposed use of the latest list maintained by the Commission of PACs in Nebraska is a reasonable step in order to determine if a contribution is being made by a PAC.
It should be noted that a public official receiving contributions for a legal defense fund who is required to file an annual Statement of Financial Interests pursuant to Section 49-1493 or Rule 2 of the Commission will need to provide information about these gifts on the annual statement. If a contribution to the legal defense fund exceeds $100, the name, address, occupation or nature of business of the contributor must be listed on the annual Statement of Financial Interests. See Section 49-1496(2)(e). Therefore, records should be kept of the contributions received.