REQUESTED BY: The Honorable Ed Schrock, State Senator, District #38.
QUESTION: May a Nebraska state senator accept reimbursement for travel expenses from the Nebraska Account Scholarship Fund of the American Legislative Exchange Council (ALEC)?
The American Legislative Exchange Council (ALEC) is a membership organization composed of state legislators and private sector members. It is a non-profit, nonpartisan public policy institution which does not lobby state legislators. ALEC provides research, legislative analysis, model state legislation, and communication opportunities to legislative and private sector members.
Each year ALEC holds a conference. While the Nebraska State Legislature provides funds to state senators to attend a number of conferences and seminars, it does not normally provide funds for state senators to attend ALEC conferences. In order to finance the attendance of Nebraska state senators, ALEC offers scholarships. Recently these scholarships have consisted of actual travel expenses up to a pre-specified limit. These expenses are paid out of the Nebraska Scholarship Account.
ALEC maintains a general fund. It also maintains scholarship accounts for individual states. Regular membership dues, private sector dues and other revenue go into the general fund. The private members may designate that certain portions of their dues be placed in the scholarship accounts of specific states. In addition, ALEC receives contributions from people and entities which are designated for specific scholarship accounts. That is, an individual or entity may donate specifically to ALEC's Nebraska Scholarship Account. Thus, the money donated would be used to pay for scholarships for one or more Nebraska state senators.
Section 49-1490(1) of the Nebraska Political Accountability and Disclosure Act prohibits a principal, a lobbyist, or anyone acting on behalf of either, from giving a gift to certain categories of public officials, including state senators. Section 49-1490(2) prohibits a state senator from accepting a gift from a principal, a lobbyist, or anyone acting on behalf of either. Section 49-1490(3) provides that a gift is anything valued at more than $50 in any one month period with certain specified exceptions such as food and drink for immediate consumption and occasional travel around the state.
Section 49-1434 defines the term principal as "a person who authorizes a lobbyist to lobby on behalf of that principal." Section 49-1434(2) defines the term lobbyist as "a person who is authorized to lobby on behalf of a principal and shall include an officer, agent, attorney, or employee of the principal whose regular duties include lobbying."
Neither a principal, a lobbyist, nor anyone acting on behalf of either would be permitted to directly give a state senator a gift of travel expenses with a value of more than $50 in a one month period for travel outside the State of Nebraska. When a lobbyist or a principal makes a contribution to the ALEC Nebraska Scholarship Account, the lobbyist or principal knows that it will be used to provide a scholarship or gift to a Nebraska state senator. If the amount of the donation is more than $50, he or she may accomplish indirectly that which could not be done directly. In essence, ALEC, through its Nebraska Scholarship Account, is acting on behalf of a lobbyist or principal.
In making this statement, we do not mean to imply that certain lobbyists, certain principals, certain state senators or ALEC are deliberately attempting to circumvent state law. However, given the funding mechanism it is entirely possible that a state senator could accept an illegal gift by accepting travel expenses from the ALEC Nebraska Scholarship Account. Our concern on this issue is not merely theoretical. We are aware that in the past a number of private members of ALEC have been principals of lobbyists registered in Nebraska. In the past, principals and lobbyists in Nebraska have been asked to contribute to the Nebraska Scholarship Account. Therefore, a Nebraska state senator may not accept a scholarship of more than $50 from the Nebraska Scholarship Account of ALEC as that account is now funded.
Since we believe that all parties wish to comply with state law and are acting in good faith, we offer alternatives.
The first alternative would be for ALEC not to accept into its Nebraska Scholarship Account money from any lobbyist registered in Nebraska or its principals. This information is a matter of public record and may be easily obtained from the office of the Clerk of the Legislature.
A second alternative would be for ALEC not to accept from Nebraska lobbyists and their principals amounts exceeding the number of Nebraska state senators to be given scholarships multiplied by $50. That is, if ALEC knows that it will be awarding a total of five (5) scholarships to Nebraska state senators, a lobbyist or a principal may contribute an amount not to exceed $250.
A third alternative would be to abolish the Nebraska Scholarship Account. ALEC could offer scholarships from its general fund. Those contributing to the general fund would need to understand that contributions to the general fund are not earmarked in anyway for any particular purpose.