Tuesday, March 13, 2007

Amendment 41 Facts

Frequently Asked Questions (FAQs)about Amendment 41

Can a University employee accept an award for exemplary service, innovation, research, teaching or other similar contribution from the University?Yes. Any award from the University, regardless of whether the award takes the form of a plaque, gift or cash does not fall within the provisions of the Amendment because the University does not fall within the definition of “persons” from whom state employees are restricted in their ability to accept money, gifts or things of value.

Can similar types of awards be accepted from people or organizations outside of the University?The answer to whether awards from outside entities are allowable should be decided on a case-by-case basis, and depends primarily upon the form of the award and the conditions surrounding the acceptance or use of the award. For example, an unsolicited award given by an outside organization recognizing an individual’s past contributions to his/her discipline that takes the form of a plaque or gift that is trivial in value would be allowable under the “unsolicited awards” exception to the Amendment. A monetary award by an outside entity that conditions receipt upon the recipient’s agreement to complete a project or spend the funds in a specified manner also likely would be allowable. However, acceptance of a monetary award that is based solely upon the recipient’s past performance and that does not impose any restrictions on the use of the award would not be allowable absent further clarification from the legislature or the courts on this subject.

Who is allowed to file a complaint with the Independent Ethics Commission?Anyone who believes they have knowledge of a violation of the Amendment’s provisions may file a complaint. A complaint can brought against a recipient of money, gifts or things of value or against a person who gave such items to a University employee. Likely complainants may include disgruntled colleagues, disaffected spouses, acquaintances or family members or individuals that work for entities that have given money, gifts or things of value to a University employee.

Can I continue to attend professional conferences or similar training opportunities paid for by the University?Yes. Things of value such as training and professional opportunities given in the normal course of employment by the University to its employees are not covered by the Amendment.

Can I attend receptions or meals or events sponsored by outside individuals, corporations or organizations as part of such conferences or trainings?The answer depends upon whether the sponsored event is part of the regularly scheduled agenda of the conference covered by the conference registration fee, in which case attendance is allowable, or whether the event is an off-line occasion in which a sponsor specifically invites a university employee and no consideration is given by the employee such as speaking at the off-line event. In the latter case, attendance is allowable, but the value of the meal or event accepted by the University employee should not exceed $50. Any value received in excess of $50 should be returned to the sponsor through an appropriate form of reimbursement.

What is the meaning of the term “consideration” as it is used in the Amendment?Consideration is a legal term which is not defined in Amendment 41 but has the generally accepted meaning of something of value given to another person such as money, goods or services. Consideration can come from agreeing to take an action, not taking an action you are entitled to take or an exchange of promises. For purposes of complying with the Amendment, money, gifts or things of value can be accepted in excess of the $50 limit so long as consideration of equal or greater value has been given by the recipient to the giver of the money, gift or thing of value.

My department currently allows me to act as a consultant to outside entities. May I continue to engage in such activities?Yes. While the University employee should be mindful of University and departmental policies and other restrictions relating to conflict of interest and conflict of commitment that are relevant to such activities, contracts between University employees and outside persons or organizations in which the employee agree to provide specified services in exchange for a reasonable fee are allowable under Amendment 41 because adequate consideration exists.

Corporate Tables
I have been invited to sit at the corporate table of a local business at a community event. I understand individual tickets cost $100 and the per seat price of a corporate table is even higher. Can I attend?Attendance is allowable, but value in excess of $50 dollars should not be accepted by a University employee. A reasonable approach for handling such situations is to reimburse the corporation for the cost of the ticket price above the $50 limit.

Accordingly, in the situation described above, the University employee could simply write a check to the corporation for $50—the difference between the price of an individual ticket and the $50 value the employee is allowed to receive. Although such situations may appear awkward, defending against a complaint before the ethics commission would likely be more awkward, so caution is advised. Additionally, as discussed in more detail below under the topic “fifty dollar limit,” a University employee can accept up to $50 dollars in value from a corporation only one time per year. There is no limit, however, on the total number of corporations from which a University employee can receive an annual $50 benefit. Finally, depending upon the nature of the event and the discretion of the University, the employee may be able to seek reimbursement for the “Amendment 41 share” of the ticket price paid by the employee.

Can I sit at a table at an event that has been paid for by the University? What about my spouse attending with me?Yes, it is the University’s position that seats at tables that have been paid for by the University and at which the employee is invited to sit are not covered by the Amendment. Whether a spouse can attend without reimbursement to the institution by the employee depends upon applicable policies outside the scope of Amendment 41 and the terms of employment of the particular employee. Such questions should be addressed with the employee’s department.

Elected Officials
Must I restrict my contact with local or state elected officials?Amendment 41 does not prohibit contact with local or state elected officials. Rather, it prohibits the giving of money to such persons and limits the gifts or things of value that can be given to these individuals. Your contact with elected officials should be guided by relevant University policies, including the policy that only the Board of Governors, Chancellor, Presidents and other limited individuals have the authority to represent the official position of the institutions or the System to elected officials. Although elected officials are under the same restrictions as University employees and are responsible for monitoring their own individual compliance with the Amendment, University employees should avoid engaging in any behavior that may be perceived as “inducing” an elected official to violate the Amendment.

What are the exceptions to the gift ban?As described in the Office of General Counsel’s January 8, 2007 communication to University employees, the exceptions to the gift ban fall into the following eight categories: campaign contributions; unsolicited items of trivial value; unsolicited awards; unsolicited informational material; admission to events where the recipient is a speaker; reasonable expenses paid by outside entities where the recipient speaks or otherwise presents or represents the state; gifts given by a relative or personal friend on special occasions and benefits that constitute normal employee compensation or incentives.

Can I continue to accept “freebies” such as pens, mugs, candy, product samples, canvas totes, t-shirts and the like from outside organizations or entities?Generally yes. As long as such items are unsolicited and of trivial value (less than $50 dollars in value) they can be accepted under an exception to Amendment 41. Although the Amendment does not limit the total number of such items that a University employee can accept, common sense and good judgment should used where numerous items are being received from a single source or where the value of any item received appears to exceed the $50 dollar limit.

Fifty Dollar Limit
How is the fifty dollar limit determined? How do I assign value to an item I received that has no price tag or other indication of value attached to it?According to the Amendment, a gift or thing of value having a fair market value or aggregate actual cost (for multiple items from the same source) greater than fifty dollars in any calendar year may not be received unless the giver of the gift receives consideration from the University employee of equal or greater value than the item the employee received or an exception applies.

A University employee is not limited in the number of sources from whom he or she can accept $50 in value, but is prohibited from accepting more than $50 per year from any single source. Although assignment of value is an inherently subjective task, the use of good judgment and common sense is essential in assigning values to items not containing a clear indication of value on their face. The most conservative approach would be to not accept or to return an item that the recipient has reason to suspect has a value in excess of $50 and is not covered by an exception to the Amendment.

Can I continue to accept honoraria?No, the Amendment specifically prohibits the acceptance of “honoraria.” Although the term “honoraria” is not defined, the Amendment does not prohibit receiving money for the performance of a service. Accordingly, if money received for performing a service such as speaking or making a presentation, that money should be characterized as a “speaker’s fee” rather than an honoraria.

Will the University defend and indemnify me if a complaint is brought against me in front of the independent ethics commission?Although indemnification and defense of University employees is a fact specific determination, the University likely will provide a defense to employees who have acted in the course and scope of their employment and have complaints brought against them. However, if an employee is ultimately found to have willfully or intentionally violated the Amendment’s provisions, there may be employment consequences to such employee.

What are the potential penalties if I am found to have violated the Amendment’s provisions?Besides the potential public embarrassment and harm to reputation of defending against a claim in front of the ethics commission, a University employee who is found to have breached the public trust could be found liable for fine or penalty of up to two times the amount of the value received. Other laws and penalties may apply depending on the facts of the situation.

Can my spouse or my dependent child accept scholarships?Yes, as previously stated in the Office of General Counsel’s January 8, 2007 guidance to University employees, scholarships are acceptable as long as adequate consideration supports the receipt of such scholarships. In recent weeks, additional guidance has been received that indicates that most scholarships will be deemed to have adequate consideration associated with them. Acceptable consideration may consist of various requirements for receipt and maintaining of scholarships such as enrollment at a particular school or set of schools, maintenance of a certain grade point average, and maintaining a certain course load or course of study.

Speaking Engagements/Fees
Can I continue to speak at conference or events and accept a fee for such service?Yes, accepting a reasonable fee for speaking at an event or conference is allowable under the Amendment. Additionally, the payment of reasonable expenses such as travel, registration and meals associated with such speaking engagement is also allowable under an exception to the Amendment.

Special Occasions/Personal Gifts
What constitutes a “special occasion” under the exception that allows me to receive gifts or things of value in excess of $50 in value from personal friends or relatives on special occasions?The term “special occasion” is not defined in the Amendment. Until clarification is received, it would be reasonable to consider any event or occasion that is out of the ordinary or usual course a special occasion. Thus, events such as holidays, birthdays, anniversaries, graduations, religious celebrations and ceremonies, family reunions, gatherings or trips, club events, specially planned outings and similar events or occasions would all qualify as special occasions.

My spouse is not a state employee and is not covered by Amendment 41, yet regularly receives gifts and items of value in excess of the $50 limit from individuals or entities that are defined as persons under the Amendment. Given the restrictions on my receipt of gifts or items of value from these same persons either directly, or indirectly through my spouse, can I continue to partake of these “benefits” given to him or her and/or can he or she continue accept such items without jeopardizing my employment or risking a complaint against me?

It is presently unclear under the Amendment to what extent the business or personal dealings of a University employee’s spouse will be considered as attributable to the University employee. Caution is advised in this area given the existing uncertainly. Until there is more guidance in this area, the most conservative and prudent approach would be to treat any gifts or things of value received by your spouse that you personally benefit from and have control over as covered under the Amendment and subject to applicable limitations.

I commonly receive free textbooks from publishers whom I assume would like me to look the textbook over and determine whether my department will use it. What are my options for keeping or returning or otherwise disposing of such items?

If unsolicited textbooks are received, regardless of the value, such items can be retained under an exception to the Amendment. Undesired textbooks can be returned or donated to others at the discretion of the recipient. Other forms of disposal, such as sale of such items, must be done in accordance with departmental and University policies.

Can I accept tickets to sporting events or other forms of entertainment such as concerts, movies, plays or ski tickets?Yes, but the analysis detailed above under the topic “corporate tables” is equally applicable to acceptance of the types of tickets at issue here. Caution should be exercised, however, because unlike social or community events where it is relatively simple to determine the per person price of an event, sports and concert venues have differential values accorded to different levels of seating. The best policy would be to ask the giver of the ticket to state its value and pay the differential above the $50 limit.

Unsolicited Items/Returns
What should I do about unsolicited gifts or items I receive and don’t want? What do I do if I suspect the item’s value is greater than $50?Although the exception for unsolicited items of trivial value generally applies and the recipient need not worry about returning such items, unwanted items can be returned to their source with a note of explanation if desired. Such items can also be donated to another person or organization. Common sense and good judgment is necessitated, and an item of significant value such a gift card of more than a $50 value, cell phone, I-Pod, computer or the like should not be accepted or should be returned if received. Donations of such items to the institution rather than an individual for institutional purposes continue to be acceptable and are subject to normal record keeping requirements and policies concerning acceptable use of such items.

May I attend a training seminar provided by a vendor that has a contract with the University where all travel, lodging and meals are paid by the vendor?Yes, so long as the interaction with the vendor is within the scope of your normal job duties and the primary purpose of the trip is to gain knowledge and training regarding the products, equipment or services that are being provided to the University by the vendor.

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