Recent Gift Rule Amendments

April 11, 2003

MEMORANDUM FOR ALL MEMBERS, OFFICERS AND EMPLOYEES

FROM: Committee on Standards of Official Conduct

Joel Hefley, Chairman

Alan B. Mollohan, Ranking Minority Member

SUBJECT: Recent Gift Rule Amendments

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The House Rules for the 108^th Congress that were adopted on January 7, 2003 include two amendments of the gift rule (House Rule 25, clause 5) – one on perishable food sent to House offices for staff, and the other on Member or staff travel to charity events.

This memorandum sets out the Committee’s guidance on those two amendments.[1] As this memorandum makes clear, there are a number of considerations that apply to accepting a gift under either of these new provisions. Thus before accepting such a gift, Members and staff should review this memorandum closely and consult with the Committee’s Office of Advice and Education (202-225-7103) on any questions.

Gifts of Perishable Food Sent to House Offices for Staff

At times lobbying firms or other private sources send meals or similar food items to a House office for consumption by staff. The only provision of the gift rule under which such gifts of food may be acceptable is the provision allowing the acceptance of virtually any gift having a value of less than $50, but subject an annual limitation of less than $100 in gifts from any source in a calendar year.

Prior to the amendment of the gift rule in January, the Committee had interpreted the gift rule to require that any such gift of food, even though intended for consumption by staff, be deemed to be a gift to those staff members’ employing Member. Accordingly, under that interpretation, the total value of any such gift had to be less than $50, and the gift’s value would count against the annual gift limit of the employing Member.

However, under the recently approved “perishable food” amendment of the gift rule, such a gift of food sent to a House office is now deemed to be a gift to the individual recipients, and not to the employing Member. Thus now, where a private source sends perishable food to a House office for staff, each staff member may accept food having a value of up to $49.99, subject, however, to the following limitations –

Each staff member must comply with the annual gift limitation of less than $100 from any source in a calendar year. Any gift having a value of less than $10 does not count against the annual limitation. In order to comply in good faith with the dollar limitations on gifts, a staff member who is offered such a gift of food must learn both the identity of the donor and the dollar value of the food provided.[2]

While, as noted above, the gift rule provides that a gift valued at less than $10 is generally acceptable, the Committee has long advised that to accept such a gift from one source on a repetitive basis is contrary to the spirit of the gift rule, and hence is not permissible under the House Code of Official Conduct.[3] Accordingly, it would be impermissible for a staff member to accept gifts of perishable food, even if valued at less than $10 each, from any one source on a repetitive basis.

The Committee has also long advised that a gift of food sent to a House office for staff, even if within the dollar limits of the gift rule, must be refused entirely if the person offering it has a direct interest in the particular legislation or other official business on which staff is working at the time.[4] Acceptance of the food in that circumstance may implicate the illegal gratuities statute, which prohibits the acceptance of any gift for or because of an official act. This limitation also continues to apply.

While the gift rule sets out the categories of gifts that a Member or staff person may accept if offered, Members and staff are generally prohibited from soliciting gifts. Accordingly, a Member or a staff person may never request or suggest that anyone send a gift of food to a House office.

Members and staff should also note that this change in the gift rule does not affect the prohibition against accepting food or beverages from any private organization or individual for any event sponsored by a House office, such as a meeting, a conference or a briefing. As discussed in a Committee advisory of September 28, 2001, a separate rule (House Rule 24, clauses 1-3) generally prohibits Members and staff from accepting private subsidy for official House business, including events sponsored by a Member, committee or leadership office, a caucus, or any other House office.

Gifts of Transportation and Lodging in Connection with Charity Events

The gift rule as adopted by the House in 1995 included a provision stating that Members and staff may accept an unsolicited offer of free attendance at a charity event from the event’s sponsor, but prohibited the acceptance of transportation or lodging in connection with such an event.[5] An explanation of that provision – including a definition of the term “charity event” as used in the rule – appears on pp. 25-28 of the Committee’s Gifts and Travel booklet.

The “charity event” provision of the gift rule was amended in January 2003 to allow Members and staff to accept transportation and lodging in connection with a charity event, provided that three requirements are satisfied:

All of the net proceeds of the event are for the benefit of an established charity, i.e., “an organization described in section 501(c)(3) of the Internal Revenue Code of 1986 and exempt from taxation under section 501(a) of such Code,”

Reimbursement for the transportation and lodging is paid by the charitable organization, and

The offer of free attendance is made by the charitable organization.

No other change was made in the charity event provision. In view of the above three requirements for the acceptance of transportation and lodging in connection with a charity event, as well as the pre-existing limitations in the rule that continue to apply, a Member or staff person who is considering accepting travel to attend a charity event must bear in mind the following points.

Events covered by the rule. An event is a “charity event” for purposes of the rule only if the primary purpose of the event is to raise funds for charity. Thus the mere fact that a donation to charity will result from an event does not necessarily mean that a Member or staff person may accept from the sponsor an offer of free attendance at, or travel expenses to, the event. An event will likely be deemed a “charity event” for purposes of the rule where the participants or attendees pay an admission fee, and more than half of the fee paid is tax deductible as a charitable donation. Where an event has any other format, a Member or staff person considering attending the event should first consult with the Standards Committee to ensure that it constitutes a “charity event” for purposes of the gift rule.

Expenses may be accepted only from the beneficiary charity. Under the rule, the only entity from which a Member or staff person may accept transportation or lodging to attend a charity event is the charitable organization that benefits from the event. Travel expenses to the event may not be accepted from any donor to or participant in the event, or from anyone else. Furthermore, a Member or staff person may not accept transportation or lodging expenses from the beneficiary charity if those expenses would be paid using donations that were earmarked, either formally or informally, for payment of expenses of congressional participants.[6] Before accepting travel to a charity event, a Member or staff person should make inquiry to the charitable organization to ensure that it understands the applicable rules and is acting consistently with them.

An invitation may be accepted only from the beneficiary charity. Under the rule, the only entity from which a Member or staff person may accept an offer of free attendance at a charity event is the charitable organization that benefits from the event. An offer of free attendance may not be accepted from any donor to or participant in the event, or from anyone else. Accordingly, if a Member or staff person receives an invitation to or a similar communication regarding a charity event from any person other than the beneficiary charity, the Member or staff person should not attend the event.

Limitations on acceptance of transportation and lodging expenses. Where acceptance of transportation and lodging is otherwise permissible, the Standards Committee interprets the rule to allow a Member or staff person to accept only such expenses as are reasonably necessary for the individual to attend the event. It appears that with rare exception, only one night of lodging, or at most two, will be necessary to attend any charity event. Where attendance at a charity event is otherwise permissible, a Member or staff person may also accept an invitation to be accompanied at the event, at the expense of the charity, by his or her spouse or a dependent – but only by one or the other, not both, and not by any other individual.

Gifts of meals and other benefits. The charity event provision does not allow the acceptance of any meals other than a meal at the charity event that is taken “in a group setting with all or substantially all of the other attendees.”[7] Any other meals, as well as any other things of value, that are offered in connection with one’s participation in a charity event may be accepted only if the cumulative value of such gifts offered by any source is less than $50, and during the year the individual does not accept gifts from that source having a value of $100 or more. Where a Member or staff person is accompanied at a charity event by his or her spouse or dependent, the official should bear in mind that any such gifts given to the accompanying individual are deemed to be gifts to the official and count against the gift rule dollar limits applicable to that official.

Disclosure of travel to charity events on Financial Disclosure Statements. Members, as well as staff required to file a Financial Disclosure Statement, who accept travel to attend a charity event must disclose that travel on Schedule VII of their financial disclosure, if the value of that travel (or the total value of all travel accepted from the sponsoring charitable organization during the year) exceeds $285.

In addition, to reiterate a point noted above, Members and staff are generally prohibited from soliciting any gift. Accordingly, under no circumstances may a Member or staff person request or suggest that a charity or anyone else provide the individual (or an accompanying spouse or child) with free attendance at a charity event, or transportation or lodging in connection with such attendance.

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Any questions on these rules changes should be directed to the Committee’s Office of Advice and Education at (202) 225-7103.

[1] The gift rule provides that all of its provisions are to be interpreted and enforced solely by the Standards Committee, and that the Committee is authorized to issue guidance on any provisions of the rule (House Rule 25, cl. 5(f)).

[2] Bear in mind that a gift from an individual who is employed by or similarly affiliated with any organization is deemed to be a gift from both that individual and the affiliated organization (see p. 17 of the Committee’s Gifts and Travel booklet (April 2000)). Thus, for example, where staff members accept a gift of perishable food from a lobbyist, it counts against their gift limits with regard to both that lobbyist and his or her firm.

[3] House Rule 23, cl. 2. See p. 19 of the Committee’s Gifts and Travel booklet.

[4] See the Gifts and Travel booklet, p. 19, and the Committee’s Advisory Memorandum on gifts from lobbyists of November 14, 2002, p. 2.

[5] See House Rule 25, cl. 5(a)(4)(C), 107^th Congress.

[6] Consistent with this interpretation, a Member or staff person traveling to a charity event under this provision may not accept a flight on, for example, a corporate aircraft that is being used to fly corporate officials to the event, even if the charity reimburses the corporation for the flight. Aside from concerns on whether a corporation may lawfully accept such a reimbursement under Federal Aviation Administration rules (see p. 98 of the Gifts and Travel booklet), under the rule, as discussed in the text, a donor to a charity event should have no role in providing travel to a participating Member or staff person.

[7] House Rule 25, cl. 5(a)(4)(D). See also the discussion of this gift rule provision on pp. 26-27 of the Gifts and Travel booklet.