Filing Number: 17-04
Subject: Appearance of Impropriety
Keywords: appearance of impropriety, compensation, conflict, contract, contractor, County official, County policy, dinner, educational, employee, expenses, gifts, impropriety, invitations, official business, presumption of good faith, private advantage or gain, private business, professional services, public purpose, seminar, shared gift, State of Delaware, supplier, training, undue influence, vendor
Decision By: Eric J. Monzo, Chairperson; Paula Jenkins-Massie, Vice-Chairperson; Johanna Bishop, Robert Ralston, Christopher Simon and Charles Toliver
Contact Email: admin@nccethics.org
 
Status: Active

Question:

Whether a long-standing County vendor may provide free training and lunch during training presented by the vendor on its products to County employees who are charged with administration and maintenance of the vendor’s products which are used in every County department?

Conclusion:

The lunch offered by the County vendor is a gift pursuant to the Ethics Code.[1]  Additionally, the “free” training by the vendor on its product line is also a gift unless the County paid for such training as part of its contract with the vendor, which means it is not free.  Under the circumstances presented here, however, both the lunch and the training are permissible gifts under the Ethics Code, as explained further, below.  Acceptance of these gifts must be recorded in the appropriate gift log(s).    



[1] Section 2.03.102 defines “gift” as follows, in pertinent part: “Gift means anything that is received without consideration of equal or greater value….An email invitation is not a gift, unless specifically accepted, is not considered a gift.” 

Facts:

          The Ethics Commission was contacted by a department manager (“Requestor”) after he received an unsolicited email invitation from a County vendor offering lunch and training for his team.  The Requestor did not want to accept the invitation if it violated the Ethics Code.  Prior to receipt of this email invitation from the vendor, the team gave feedback to the Requestor that they needed more information on certain products purchased from the vendor in order to perform up to expected and necessary standards.  The vendor in question has been a long-standing County vendor and, in that sense, it is not a typical County vendor.  The types of products purchased by the County from this vendor, as well as the prices of those products, are negotiated by contract between the State of Delaware and the vendor.  The County does not contract directly with this vendor. 

Code or Prior Opinion:

Code or Prior Opinion:

Relevant Ethics Code Provisions and Case Law

            In Section 2.03.102, the following relevant terms are defined by the Ethics Code, as follows:

Gift means anything that is received without consideration of equal or greater value. … A gift is considered accepted upon receipt or control or direction unless it is promptly returned in its entirety. An email invitation, unless specifically accepted, is not considered a gift.

Governmental body means any department, authority, commission, committee, council, board, bureau, division, service, office, official, administration, legislative body, or other establishment in the executive, legislative or judicial branch of a state, a nation or a political subdivision thereof or any department performing a governmental function.

Negligible value means value of less than twenty-five dollars ($25.00).

Private enterprise means any activity conducted by any person, whether conducted for profit or not for profit and includes the ownership of real or personal property. Private enterprise does not include any activity of the federal, State or local government or of any department, authority or instrumentality of the federal, State or local government.

Promptly means within thirty (30) days when used in reference to recording the acceptance of a gift in a public gift log or returning such a gift to the donor.

Public gift log means a public document kept by County Council, a County department, or County agency for the purpose of memorializing the acceptance of gifts by County employees and officials and which shall include entries for the date of receipt, the name, workplace or other address of the donor and recipient, a description of the gift and an approximate valuation.

The New Castle County Ethics Code prohibits conduct on the part of County officials or employees which either creates the appearance of impropriety even where no direct conflict of interest is present.  Specifically, conduct which creates an appearance of impropriety is prohibited by Section 2.03.104(A) of the New Castle County Code.[1]  To determine if an appearance of impropriety exists, the Delaware courts have stated that “[t]he test is… if the conduct would create in reasonable minds, with knowledge of all relevant facts, a perception that an official’s ability to carry out [his or] her duties with integrity, impartiality and competence is impaired.”  Hanson v. Delaware State Public Integrity Com’n, 2012WL3860732, at *16 (Del.Super. 2012), aff’d, 69 A.3d 370 (Del.Supr. 2013); and “[t]he test for appearance of impropriety is whether the conduct would create in reasonable minds, with knowledge of all the relevant circumstances that a reasonable inquiry would disclose, a perception that the [official’s] ability to carry out [the official’s] responsibilities with integrity, impartiality and competence is impaired.”  In re Williams, 701 A.2d 825, 832 (Del.Super. 1997).  The courts have advised the Commission to look at the totality of the facts presented, and this Commission has historically applied this standard when reviewing the conduct of County officials and employees.

            It is a violation of the New Castle County Ethics Code if a County official or employee uses his or her office or employment for his or her personal or private benefit, the benefit of a member of his or her immediate family, or a business with which he or she is associated.[2]  Economic benefits thereby derived with a de minimus impact may be exempted. [3]          

            The acceptance of gifts by New Castle County employees and officials can be complicated, and the acceptance of gifts by County employees and officials is discouraged.[4]   Further, Section 2.03.104.H.4 states:

Gifts of greater than negligible value from entities doing business with, regulated by, or which may be reasonably foreseen to do business with or be regulated by the County within the next three years, with the exception of gifts described in Subsections I.5. through I.7. of this Division, shall not be accepted by officials, employees, or governmental departments unless a prior Advisory Opinion is sought from the Ethics Commission regarding compliance with the Code of Ethics. Any such gift or donation of other than negligible value which is accepted following the receipt of an Opinion of the Commission shall promptly be recorded by the recipient in a public gift log.  

The Ethics Code must be consulted to determine the circumstances under which a gift may be accepted.  Section 2.03.104.I.9 of the Code states that “[a]n Advisory Opinion request shall be made to the Ethics Commission prior to the acceptance of any gift not described by or limited in Subsections I.1. through I.9.”

            Prior Commission Opinions

            In Advisory Opinion 11-06, the Commission was asked whether an employee could accept an all-expense paid seminar trip from a vendor to attend a seminar offered by a manufacturer of products carried by the vendor.  In finding that the proposed action would violate the then-newly adopted gift law, the Commission held that Section 2.03.104.H.4[5] would be violated by the acceptance of the gift.  In reaching this conclusion, the Commission stated: “The requester has been offered the trip because of his status as a County employee and his professional expertise in advising on products purchased for use by the County. The vendor clearly states its intention in offering the trip: to affect the employee's judgment about future purchases….The Commission believes the reasonable member of the public would believe that acceptance of this all-expense paid trip from the vendor would influence the judgment of the employee and would violate the Ethics Code.” 

            In Advisory Opinion 96-03, a County employee asked the Commission whether a vendor may pay the costs incurred from the provision of a demonstration of an upgraded product to County officials where the vendor had a long-term contractual relationship with the County agency and the demonstration was offered to resolve complaints through acquisition of the upgraded product, available to the County under the current contract at no additional cost.  In deciding that the vendor demonstration would not violate the Ethics Code, the Commission stated:  “This is not a situation in which the vendor is vying with others to sell the County agency a new product or service. The County agency is currently contractually committed to a long-term relationship with this vendor. There is a longstanding history of complaints concerning the vendor's current product. In an effort to resolve these complaints, the vendor invited agency officials to a demonstration of an upgraded product which, under the contract, is available at no additional cost.”  The Commission stated, further: “This does not create an appearance of impropriety because the vendor's payment of these costs does not create the appearance that the County officials' decision to acquire the upgraded product was improperly influencing ‘by factors other than the merits’.”

In Advisory Opinion 92-09, a County official wanted to participate in a training session held for representatives of a manufacturer of equipment for which the County employee drafts plans and specifications.  The Commission held that an appearance of impropriety would not be created and the employee would not violate the Ethics Code by participating in the training session.  The Commission held, further, however, that the employee’s transportation costs, lodging, and hospitality expenses incurred in the attendance of the seminar must be disclosed on the employee’s next filing of the Statement of Financial Interests.  

            In Advisory Opinion 08-02, a County employee, who serves on a State board, asked whether he could accept gifts of reasonable costs of attendance at professional conferences given by the State board.  The Commission approved, and stated:

Section 2.03.104.I.7 of the New Castle County Ethics Code gift law is determinative regarding this request.  Unlike gifts, training expenses from private non-governmental sources which may not be accepted unless they are approved in advance by the Ethics Commission, gifts from governmental bodies or associations of governmental bodies of “training expenses, including reasonable transportation/lodging/subsistence costs or reasonable reimbursement for such expenses,” may be accepted at any time without the recording in a public gift log if approved by a department manager, agency head, or elected office holder.” (footnotes omitted.) 



[1] New Castle County Code Section 2.03.104(A) states: “No County employee or County official shall engage in conduct which, while not constituting a violation of Subsection 2.03.103(A)(1), undermines the public confidence in the impartiality of a governmental body with which the County employee or County official is or has been associated by creating an appearance that the decisions or actions of the County employee, County official or governmental body are influenced by factors other than the merits.” 

[2] New Castle County Code Section 2.03.103(A)(1).

[3] Id.

[4] See New Castle County Code Section 2.03.104.H.

Analysis:

          The Requestor and his team of County employees administer and maintain equipment and products which are distributed throughout County government.  The performance and reliability of these products are critical to the functioning of daily operations at every level of County government. The Requestor and his team must remain educated and trained on the product line in order to meet acceptable performance standards.  Although the vendor in question, here, is technically a County vendor, the products at issue are procured through a contract which is negotiated by employees of the State of Delaware, not County employees. In most instances, the acceptance by a County employee of a gift of free training, and a free meal during the training would be prohibited by the Ethics Code as a violation of the gifts laws, may be a conflict of interest, and/or may create the appearance of impropriety as referenced in the Code.  The facts presented, here, however, mitigate against the potential for a conflict of interest or an appearance of impropriety as the procurement process and the prices of the products from this vendor are set by the State of Delaware.  Training may be included in the cost of the products negotiated by the State. Additionally, the Ethics Code would not be violated if the value of the lunch provided by the vendor is less than $25.00 per person.  The issue of a free lunch, however, could be easily resolved if the County employees who are attending the training either bring their own lunches or their lunches are provided by, and paid for, by the County, instead of the vendor.    Any gift of this nature, if accepted, must be reduced to a monetary value and promptly recorded in the appropriate gift log. 

Finding:

          Acceptance of gifts by County officials and employees is discouraged by the Ethics Code and, therefore, also by the Ethics Commission. Acceptance of gifts by County officials and employees often raise serious issues which can negatively affect the public trust.  These issues include potential conflicts of interest, decisions made through improper influence, appearance of impropriety, and personal gain by virtue of County employment.  The potential for the existence of these issues is enhanced when the gift is offered by a County vendor.  The facts presented here and outlined above, however, reduce or nullify the likelihood that these issues will result from the acceptance of the training and lunch by the Requestor and his team.  The County’s relationship and contract rates with this vendor are set by the State of Delaware.  Training may be included in the cost of the products purchased from this vendor.  The need for training on these products, and staying current on them, is critical to the functioning of County government. The value of the lunch which might accompany the training must be negligible per the Ethics Code.  The issue with respect to the lunch could be easily resolved if the County paid for their employees’ lunches or these employees bring their own lunches to the training. Either way, acceptance of the monetary value of the training and lunch must be promptly reported in the departmental gift log.      

In rendering this advisory opinion, this Commission has applied the New Castle County Ethics Code, which establishes the minimum level of ethical conduct required of County officials and employees.

BY AND FOR THE NEW CASTE COUNTY ETHICS COMMISSION

ON THIS 14TH DAY OF JUNE, 2017.

 

 

Eric J. Monzo, Esquire, Chairperson

New Castle County Ethics Commission

                                                                      

Footnotes:

[1] Section 2.03.102 defines “gift” as follows, in pertinent part: “Gift means anything that is received without consideration of equal or greater value….An email invitation is not a gift, unless specifically accepted, is not considered a gift.” 

[2] New Castle County Code Section 2.03.104(A) states: “No County employee or County official shall engage in conduct which, while not constituting a violation of Subsection 2.03.103(A)(1), undermines the public confidence in the impartiality of a governmental body with which the County employee or County official is or has been associated by creating an appearance that the decisions or actions of the County employee, County official or governmental body are influenced by factors other than the merits.” 

[3] New Castle County Code Section 2.03.103(A)(1).

[4] Id.

[5] See New Castle County Code Section 2.03.104.H.

[6] Section 2.03.104.H.4 states:  Gifts of greater than negligible value from entities doing business with, regulated by, or which may be reasonably foreseen to do business with or be regulated by the County within the next three years, with the exception of gifts described in Subsections I.5. through I.7. of this Division, shall not be accepted by officials, employees, or governmental departments unless a prior Advisory Opinion is sought from the Ethics Commission regarding compliance with the Code of Ethics. Any such gift or donation of other than negligible value which is accepted following the receipt of an Opinion of the Commission shall promptly be recorded by the recipient in a public gift log.”