Source: http://www.westerncity.com/article/understanding-changes-gift-rules
Timestamp: 2019-04-21 05:31:41+00:00

Document:
This column is a service of the Institute for Local Government (ILG), whose mission is to promote good government at the local level. For more information and to access ILG’s resources on public service ethics, visit www.ca-ilg.org/trust. ILG thanks volunteer and retired City Attorney Michael Martello for his assistance with this article.
I’ve heard that the Fair Political Practices Commission (FPPC) has adopted changes to the gift regulations. Is this true? What do local officials need to know about these regulations?
A variety of changes to the gift regulations took effect Jan. 1, 2012. According to an FPPC press release, the goal was to simplify the gift regulations and make them easier to understand, while reinforcing the principle that public officials may not use their positions for personal gain.
Other changes to the gift regulations focused on organization and consistency. The FPPC plans to complete this work in spring 2012 by finalizing other proposed changes to the regulations that define a gift’s “personal benefit” and that address gifts of travel.
More detail on these rules is available at www.ca-ilg.org/GiftCenter.
This article covers the highlights of these changes.
The gift-giver must not be a lobbyist registered to lobby the official’s agency.
The new exclusion for payments and gifts from a long-term friend is similar but different from the exclusion for gifts based on existing social or business relationships. For example, the “friendship” exclusion is available to exclude a gift from a childhood friend or college roommate. For the exclusion to apply to a gift received by the official, the giver must be a “long-term, close personal” friend of the official and the friendship must be unrelated to the official’s position with the agency.
The exception to California’s gift rules applies to “repeated social events” like meals, rounds of golf and attendance at entertainment and sporting events.6 The exception apparently does not apply if a local agency has a lobbyist registration requirement and the gift-giver is a registered lobbyist.
The new gift regulations make simplifications in a number of areas.
If an official receives more than two free tickets to a 501(c)(3) event or receives the tickets from a source other than the nonprofit, or if the event is for a different kind of fundraiser (not nonprofit or political), the official must determine how to value the tickets.
If the official were paying face value for the ticket, typically the ticket value has two parts: the part that represents the donation to the event organizer; and the cost of putting on the event. The latter cost is the one to focus on for the purposes of California’s gift rules.
Otherwise, the value of the benefit the official receives is the per-guest share of the cost of food, entertainment and any other items provided to all guests at the event.16 Other specific benefits attendees receive (for example, golf greens fees) are valued at fair market value.17 This is the same approach for valuing attendance at invitation-only events.
Perhaps the best way to understand the current rules related to gifts is by visiting the ILG website section (www.ca-ilg.org/GiftCenter) that provides local officials with an updated analytical framework for applying the gift rules to particular situations. ILG offers these materials in conjunction with its mission of promoting good government at the local level; its goals include helping local officials understand when they should ask advice about how the rules apply in a given situation.
Still pending are rule changes related to who is the true recipient of a gift,29 gifts to an official’s family30 and the travel regulations.31 According to the FPPC, these will be addressed as a separate regulatory projects in 2012.
The goal underlying California’s gift rules is to prevent either the perception or the reality that gifts influence public officials’ actions. This is because public agency actions should always promote the public’s interests, as opposed to narrow personal or political interests.
Report gifts worth $50 or more on their Statement of Economic Interests.32 Gifts from a single source must be added up over the course of a calendar year. An official’s reporting obligation is triggered when the combined value of a series of gestures from a single gift-giver reaches $50 or more.
Within certain parameters, the practice of taking turns paying for the cost of attending social events and activities as long as the practice results in each party over time paying for his or her share of the costs (note that this is new).
Even so, public officials are well-advised to look beyond what the law allows in any situation involving a nice gesture. This includes considering how residents will view a public official’s actions.
For more details on these rules, read this article at www.ca-ilg.org/GiftCenter.
What’s the value of what I received?
Who gave me what I received?
Did I do something in exchange for what I received?
What kind of gift is it and do special rules apply as a result?
Which of the permitted courses of action do I want to take with respect to the gift?
Although the Institute for Local Government endeavors to help local officials understand laws that apply to public service, its informational materials are not legal advice. In addition, attorneys can and do disagree on the best interpretation of the complex rules relating to public service ethics. Officials are encouraged to consult an attorney or the Fair Political Practices Commission for advice on specific situations.
The following regulations took effect Jan. 1, 2012.
 2 Cal. Code of Regs. §18942(a)(18) (emphasis added).
 2 Cal. Code of Regs. §18942(17)(C).
 2 Cal. Code of Regs. §18942(8)(A).
 2 Cal. Code of Regs. §18942(a)(8)(B).
 2 Cal. Code of Regs. §18942(a)(7)(A).
 2 Cal. Code of Regs. §18942.2.
 2 Cal. Code of Regs. §18942(a)(16) (17).
 2 Cal. Code of Regs. §18942(a)(14) (15).
 2 Cal. Code of Regs. § 18946.4(b)(c).
 2 Cal. Code of Regs. § 18946.4(a)(1).
 2 Cal. Code of Regs. § 18946.4(a)(2).
 See 2 Cal. Code of Regs. § 18946.4(a)(2).
 2 Cal. Code of Regs. § 18946.2(c).
 2 Cal. Code of Regs. § 18946.2(f) (may be intended to be “(g)”).
 2 Cal. Code of Regs. § 18946.2(b),(c).
 2 Cal. Code of Regs. §§ 18946.3(definition of ceremonial role and requirements public agency must satisfy for participation to qualify as a “ceremonial role”), 18942(12) (exception to gift rules for events at which an official performs a ceremonial role — exception also extends to one guest and any supporting staff).
 2 Cal. Code of Regs. § 18946.2(e).
 2 Cal. Code of Regs. § 18942(12) (exception to gift rules for events at which an official performs a ceremonial role — exception also extends to one guest and any supporting staff).
 2 Cal. Code of Regs. § 18942.3(definition of ceremonial role and requirements public agency must satisfy for participation to qualify as a “ceremonial role”).
 2 Cal. Code of Regs. § 18944.1(d).
 2 Cal. Code of Regs. §§ 18942.3.
 2 Cal. Code of Regs. § 18950 and following.
 Cal Gov’t Code § 87207(a)(1).
 Cal. Gov’t Code § 89503; 2 Cal. Code Regs. § 18940.2 (the FPPC adjusts the limit biennially, and it will remain at $420 until the end of 2012).
 If the limit is exceeded one has several options, any of which must be exercised within 30 days of receiving the gift. One may return the gift unused to the donor, reimburse the donor for all or a portion of the value of the gift or donate the gift, without claiming a tax deduction, to a charitable organization or government agency. 2 Cal. Code Regs. §§ 18942(a)(2), 18943(a).
 Cal. Gov’t Code § 87103(e); 2 Cal. Code Regs. § 18703.4. This is because public officials may not make, participate in making, or influence governmental decisions that affect their personal financial interests. Cal. Gov’t Code § 87100. The law makes a judgment that one is financially self-interested in a decision when one accepts gifts exceeding the $420 gift limit from someone affected by that decision. Cal. Gov’t Code § 89503; 2 Cal. Code Regs. § 18940.2(a).

References: §18942
 §18942
 §18942
 §18942
 §18942
 §18942
 §18942
 §18942
 § 18946
 § 18946
 § 18946
 § 18946
 § 18946
 § 18946
 § 18946
 § 18946
 § 18942
 § 18942
 § 18944
 § 18950
 § 87207
 § 89503
 § 18940
 § 87103
 § 18703
 § 87100
 § 89503
 § 18940