Filing Number: 18-01
Subject: Charitable Fundraising
Keywords: gifts, non-profit, solicitation
Decision By: Eric Monzo, Paula Jenkins-Massie, Sally Jensen, Robert Ralston, Christopher Simon, Charles Toliver
Contact Email: admin@nccethics.org
 
Status: Active

Question:

Whether the requester, an elected County official, who purchased a raffle ticket, being sold in the lobby of a building owned by a government, in support a non-profit organization and for a non-cash prize, must report the proceeds on the County gift log if he wins the raffle? 

Conclusion:

No.  The purchase of this raffle ticket is a purchase for a chance to win a potential non-cash prize, and such a purchase is likened to a donation made by the requester to the non-profit organization.  If the requester wins the non-cash prize, the requestor paid the price set by the non-profit for the chance to win that prize.  Because the requester, in effect, paid for the prize, winning the prize would not be a gift to the requester from the non-profit pursuant to the Ethics Code, and, as such, he would not be required to log it in the departmental gift log.[1]  Additionally, the format of the raffle is such that the ticket was not sold to the requestor in a manner which implicates the application of the Ethics Code, as it was not intended to influence the requester’s vote or official action.[2]  Additionally, the Commission finds that a reasonable person would not perceive the purchase by the requester of the raffle ticket for a non-cash prize as something improper or something which would impair the requester’s judgment in his official duties.[3] 

Facts:

The Ethics Commission was contacted by an elected County official, the requester, who purchased a raffle ticket for a non-cash prize, and in support of a well-recognized non-profit organization.  The tickets were being sold in the lobby of a government-owned building, in which the requester works.  The non-profit agency was selling the ticket for $1.00 per ticket or for $5.00 for the number of tickets which is equal to the length of the purchaser’s arm. The prizes for the winning raffle tickets included stuffed animals, but not cash prizes.  Because the tickets were being sold in the lobby of the building in which the requester works, the requester had the option to ignore the ticket sellers and walk by, or he could stop for a few moments and buy the raffle tickets on his way in or out of the building. The tickets were not being sold in the offices where the requester works which could have inappropriately used tie for which the requester was paid to work for the County, and there was no undue pressure from a co-worker for the requester to purchase a ticket. The people selling the raffle tickets were not County employees. 

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.

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.

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 Opinion

            In Advisory Opinion 96-07, the Commission opined that a County employee with building and construction code responsibilities, was not permitted to sell fundraising raffle tickets to the contractors that the County employee regulated even if the tickets were for non-profit organizations and/or political candidates when the profits from the ticket sales went to the non-profit and/or the political candidates and not to the County employee.  In rendering its opinion, the Commission stated that the sale of such tickets by the County employee would create an appearance of impropriety, contrary to the Ethics Code.  In that instance, a contractor who purchased a ticket from the County employee for a cause favored by that County employee would create an appearance that the contractor was ingratiating himself in the favor of the County employee. Further, it created an appearance that the County employee’s actions and/or decisions were being influenced by the contractor’s purchase of the tickets, and not by the merits as to whether the contractor met the applicable building and construction code.  The Commission determined that this would violate the Ethics Code in that the sale of such tickets by the County employee would cause the public to believe that the County employee was making inspections more favorable to contractors who purchased tickets from him, and less favorable to those who did not.  Additionally, the Commission noted that the fact that the proceeds from the raffle tickets went to a non-profit organization or a political campaign and not to the County employee, did not remove the taint, especially when the County employee was directly soliciting the sale of the tickets.   

Analysis:

The purchase by a County official or employee of a raffle ticket for a chance to win a non-cash prize from a non-profit organization for $1.00 or $5.00 is akin to making a small donation to that non-profit organization.  If that County official or employee happens to be the lucky winner of the noncash-prize from the non-profit organization, the winner paid the price set for the prize by the non-profit. The non-cash prize won by the County official or employee, therefore, was purchased; it was not a gift from the non-profit organization to the winner. Therefore, the County official or employee is not required by the Ethics Code to list the prize in the departmental gift log.[4] 

            The fact that the raffle tickets were sold in the lobby of the governmental building in which the requester works is not an issue which renders the situation violative of the Ethics Code.  The requester was at liberty to pass by the place in the lobby where the tickets were being sold, and the process of buying the raffle ticket did not use time for which the requester was being paid to perform work for the County.

            In contrast to the fact pattern discussed in the Commission’s Advisory Opinion referenced above, the requester, here, is not selling the person who is selling the raffle tickets. Hence, the concerns of the Commission set forth in the prior opinion, that the sale of raffle tickets by the County employee to persons regulated by the County, would create an appearance of undue influence in violation of the Ethics Code, are not present here.  

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 facts presented here and outlined above, however, do not present an issue wherein a reasonable member of the public could conclude that the County official violated the Ethics Code by improperly accepting a gift.  The price of the raffle ticket, determined by the non-profit organization, is the value of either the potential to win one of the non-cash prizes, or it is the value of the non-cash prize that is won by the purchaser of the ticket. If the County official wins the non-cash prize, he does not receive a gift, as defined by the Ethics Code. 

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 CASTLE COUNTY ETHICS COMMISSION
ON THIS 22ND DAY OF FEBRUARY 2018
 
Eric J. Monzo, Esquire, Chairperson
New Castle County Ethics Commission

 

Decision:  Unanimous

 

 

 

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….” 

[2] Section 2.03.104.H states, in pertinent part: “New Castle County discourages the acceptance of gifts from the public by County employees or County officials.  No County employee or County official shall accept any compensation, gift, payment of expenses, promise of future financial benefit, or any other thing of monetary value which is intended or received to influence the vote, official action or judgment of the recipient or which creates the reasonable perception in the public that the vote, official action or judgment of the recipient would be influenced or impaired by the gift. …”

[3] See footnote 2, above.

[4] Nothing prevents the County official or employee from listing the prize and its value in the departmental gift log, however, if the winner chooses to do so.