Ethics Overview Biennial Institute for Legislators Athens, GA December 2014 Doug Chalmers Political Law Group 770-630-5927 [email protected].

Ethics OverviewEthics Overview

Biennial Institute for LegislatorsBiennial Institute for Legislators

Athens, GAAthens, GA

December 2014December 2014

Doug ChalmersPolitical Law Group

[email protected]

mailto:[email protected]

Legal DisclaimerLegal Disclaimer

•These materials are offered solely for general training purposes, and they do not constitute legal advice applicable to specific situations.

•Legal advice will not be offered absent a written attorney-client agreement with Political Law Group, a Chalmers LLC.

Table of ContentsTable of Contents

• Campaign Finance

• Personal Financial Disclosure

• Lobbyists / Gifts / Bribery / Honoraria

• Business Transactions and Reporting

• Improper Conduct

• House / Senate Ethics Rules

Campaign FinanceCampaign Finance• Reporting Schedule

oNon-election year: January 31 and June 30. No December 31 report.

oElection year: January 31 added. Rest is the same: March, June, Sept, Oct, Dec.

o Two business day reports. If faxed, must also be filed electronically within five business days.

o Termination statements within 10 days

Excess ContributionsExcess Contributions

Excess contributions may only be used as follows:

Charitable and nonprofit organizations, including PACs which are registered nonprofits;

Transfer without limit to any political party;

Transfer (subject to limits) to any candidate;

Return to contributors;

Future elections to the same office.

Debt RetirementDebt Retirement

• Campaigns with debt on date of general election may accept contributions to retire.

• Best test for whether campaign has debt: do campaign’s unpaid obligations on election day exceed cash-on-hand on that day? The amount the campaign may accept for debt retirement is the difference between these two figures.

• Contribution for debt retirement is attributed to contributor’s limits for previous general election.

Campaign FinanceCampaign Finance• Late Fees

oCommission no longer required to provide notice via registered or certified mail - can do it electronically if report filed electronically.

• BUT: there is still a sentence which states that “notice by electronic means does not satisfy the requirements of this paragraph.”

• oCampaigns may now be able to pay, rather than

candidates personally - will need to see how Commission interprets.

Accepting or Soliciting Accepting or Soliciting

Contributions during SessionContributions during Session

• Member may not “seek or accept” either (a) a contribution or (b) a pledge of a contribution during the legislative session

• Still remains to be seen what it means to “seek” a contribution. Don’t be the test case.

• May raise money for political parties, PACs or federal candidates during the session.

Illegal Campaign Contributions Illegal Campaign Contributions

by Public Agenciesby Public Agencies

•No agency and no person acting on behalf of an agency shall make, directly or indirectly, any contribution to any campaign

•Example 1: Use of public facilities (offices, phones, faxes, computers, etc.) in support of campaign operations.

•Example 2: government employees engaging in campaign activities on state time or property.

Personal Financial Personal Financial Disclosure StatementDisclosure Statement

Filing Deadlines:

-- Non-election year: before July 1

-- Election year: within 15 days of qualifyingDisclosures required:

(1) Monetary fees or honorarium received(2) Fiduciary positions held in business entities(3) Ownership interest in business which is:

(a) More than 5 percent of the business; or (b) Worth more than $5,000 (not $10,000)


(4) Real property in which the public officer owns a “direct ownership interest” interest worth more than $10,000.

“Direct ownership interest” includes beneficial use of property. Attorney General has said that a public officer may have to disclose real property owned by a business entity which is owned by public officer or his or her family.

(5) Real property in which spouse has direct ownership interest with FMV above $10,000.


(6) Occupation, employer, and principal activity and address of employer.(7) Spouse’s name, occupation, employer, and principal activity and address of such employer.(8) If actual knowledge, the name of any business or investment in which spouse and dependent children own the required amount.(9) If actual knowledge thereof, the name of any business in which spouse or dependent children serves as officer, director, equitable partner or trustee.(10) All annual payments of $10,000 [not $20,000] received by the public officer or any business listed on the report from any agency and on the list of transactions contained in O.C.G.A. § 45-10-25. Does not include legislative salary.

General Practice Pointers for General Practice Pointers for Campaigns and CandidatesCampaigns and Candidates

• Check campaign registration forms: proper treasurer, address, and district number.

• Choosing Option of Separate Accounting (“COOSA”) Form - should be on file.

• Incorporation of campaigns - recommended for liability purposes (Jill Chambers ruling).

Gifts / LobbyingGifts / Lobbying

• Continues to be no ban in state law on gifts.

• If a lobbyist pays for travel, events, meals, etc. for public official, it is reportable by the lobbyist as an expenditure

• Not reportable by public official

• Be cautious of “dot connectors”

• If the expenditure furthers public official’s nomination or election to office, it is a campaign contribution rather than lobbying expenditure

• Subject to limits

• Reportable by public official and contributor

Bribery and GratuitiesBribery and Gratuities

May not promise to perform, and may not perform, any official action as a result of anyone’s decision to donate or not donate• O.C.G.A. §§ 16-10-4 & 16-10-5

Criminal statutes - felonies• 1-5 years in jail• $100,000 fine

The key is to avoid linkage Alabama federal indictment

Accepting HonorariaAccepting Honoraria

• No legislator shall accept a monetary fee or honorarium in excess of $100.00 for a speaking engagement “which directly relates to the official duties of that public officer or the office of that public officer.”

• Prohibition does not include food, beverages, travel, lodging, and registration.

Lobbying ChangesLobbying Changes

• Fundamental philosophical change - from disclosure to prohibition

• New Rule:

o Registered lobbyist may not make anything defined as an “expenditure”

o No public officer shall accept any “expenditure” from a registered lobbyist.

o MAY make a “lobbying expenditure”


• Prohibited “Expenditures”

o Any payment made for the purpose of influencing the public officer.

o Any payment which can be reasonably construed as designed to encourage or influence a public officer.

o Reimbursement or payment of expenses above $75 “from any individual lobbyist” for “transportation, travel, lodging, registration, food and beverages.”


• Prohibited Expenditures (continued)

o Any gratuitous transfer, payment, tickets for admission to athletic, sporting, recreational, musical concert, or other entertainment events

o Reimbursement or payment of expenses for recreational or leisure activities.

o But does NOT include “Lobbying Expenditure.”


• Permitted “Lobbying Expenditures”

o Definition of “Expenditure” excludes “Lobbying Expenditure,” which is legal.

o These include:

• Promotional items generally distributed to the general public or public officers

• “Food and beverages produced in Georgia.”

• Award or plaque in recognition of service.


• Permitted “Lobbying Expenditures” (cont.)

o Discounts offered to the public

o Compensation for private employment

o Campaign contributions



o Food, beverages, and registration at group events to which all members of “agency” are invited

• “Agency” includes House, Senate, standing committees of such bodies (but not for more than one group event per committee per calendar year [presumably per lobbyist]), caucuses, and county commissions or municipal councils (“governing body of each political subdivision of this state”).

Lobbying ChangesLobbying Changes• Permitted “Lobbying Expenditures” (cont.)

o Reimbursement of expenses for public officer and “necessary” staff for transportation, lodging, travel, and registration for attending:

• Educational, information, charitable, or civic meetings or conferences;

• in the United States (no foreign travel); that

• “directly relate” to official duties.

• Includes food and beverages while attending.



o Anything else which does not fall in one of these categories and which involves reimbursement or payment under $75 for transportation, travel, lodging, registration, food and beverages.


• Lobbying Badge Requirement

o Registered lobbyist must wear badges when meeting with public official on government property

• House Ethics Rules place similar requirement on the member (171.9)

o Exception: if the lobbyist is a resident of that member’s district.

Business Transactions – Business Transactions –

Restrictions and ReportingRestrictions and Reporting

• O.C.G.A. § 45-10-1: Code of Ethics• A Member is a “part time public official with state-wide

powers”.• O.C.G.A. § 45-10-24(a)(1): With exceptions, it is unlawful

for a Member, “for himself or on behalf of any business, or for any business in which such public official or member of his family has a substantial interest to transact any business with any agency.”

• Prohibition applies to the Member, as well as to any business on whose behalf he or she is acting.



Prohibition does not apply to business transactions with counties, municipalities, etc.

“Substantial Interest” means the direct or indirect ownership of more than 25 percent of the assets or stock of any business.

“Family” means spouse and dependents. “Transact Business” means to sell or lease property or services,

on your own behalf or on behalf of a third party as agent, broker, dealer, or representative.

Numerous exceptions to this prohibition including: Transactions under sealed competitive bids; When a single transaction does not exceed $250.00 and

when the aggregate of all such transactions does not exceed $9,000.00 per calendar year;

There are 16 additional exceptions.

Business Transactions – Business Transactions – Restrictions and ReportingRestrictions and Reporting

Reporting Requirement: Must Disclose Attorney General’s office has informally said that all

legislators should file, even if no transactions to report – but this is not binding.

Reporting obligation does “not apply to any transaction when the amount of a single transaction does not exceed $250.00 and when the aggregate of all transactions does not exceed $9,000.00 per calendar year.”

Reporting Deadline: Prior to January 31 – covers previous year’s transactions.



Reports are filed with CFC Penalties for violations are harsh - an elected official

who violates the restriction on transactions, or who fails to file a required report, is subject to: (1) A civil fine not to exceed $10,000; (2) Restitution to state of any financial benefit

received from the violation.

““Improper Conduct”Improper Conduct”

• In 2011, the JLEC was abolished - jurisdiction now with the relevant Ethics Committee (House, Senate)

• “Improper Conduct” rules (OCGA 45-10-90 etc.) - may not:

• (1) Engage in conduct that is a conflict of interest, which means “an individual has multiple interests and uses his or her official position to exploit, in some way, his or her position for his or her own direct, unique, pecuniary, and personal benefit.”

• (2) Engage in conduct that is an “abuse of official power,” which means “threatening to use the powers or personnel of a state entity for personal purposes of coercion, retaliation, or punishment.”

• (3) Illegally use an employee in a political campaign (i.e., requires state employees to work on campaign matters during business hours or on state property).

House and Senate Ethics RulesHouse and Senate Ethics Rules

• Important to review the specific rules for your legislative body. Some topics covered in these rules:

• Unlawful use of office, position or government resources for personal gain or solicitation of campaign contributions

• Conflicts of Interest

• Bribery / special treatment / acceptance of gifts

• Sexual harassment

• Retaliation

Questions?

Doug ChalmersPolitical Law Group

5805 State Bridge Road, #G77Johns Creek, GA 30097

[email protected]

Ethics Overview Biennial Institute for Legislators Athens, GA December 2014 Doug Chalmers Political Law Group 770-630-5927 [email protected].

Documents

election day

illegal campaign contributions

date of general election

previous general election

campaign activities

business days

debt retirementcampaigns

business entities3ownership