Advisory Opinion No. 1994-19

Reportability Of Gifts To The State

The Office of Health Care Access (hereinafter referred to as “OHCA”) was established by Public Act No. 94-3, May Special Session and will be responsible for developing a plan for a consolidation of state health regulation and financing as well as developing a plan for health system reform.  Id. At §8(b).  The Commission on Hospitals and Health Care (hereinafter referred to as “CHHC”) has been mandated to assist OHCA in preparing recommendations for the 1995 Legislative Session.  In order to develop these recommendations, it will conduct a study of a portion of the health care system.  CHHC has asked Blue Cross and Blue Shield (hereinafter referred to as “BCBS”), a registered lobbyist, to assist in designing a program within Commission specified parameters and to apply this program to the Company’s extensive data base.  The resulting report or analysis and any related material would be given, free of charge, to CHHC.  CHHC Commissioner Gary R. Smart has asked whether receipt of this gift is permissible under the Codes of Ethics and whether there are any requirements which must be met by either CHHC or BCBS.

Although the Code of Ethics for Lobbyists, Chapter 10, Part II, Connecticut General Statutes, contains certain limitations regarding gifts from registered lobbyists, it does not restrict gifts of goods and services to the state, to the legislature, or to executive agencies, which gifts facilitate the execution of state action or functions.  Conn. Gen. Stat. §1-91(g)(5); Regulations of Conn. State Agencies, §1-92-51.  It is clear that providing CHHC with the necessary staff and resources to assist in the fulfillment of the agency’s responsibilities is a valid gift to the state.  Therefore, BCBS may participate in the study, regardless of the resultant cost.

Pursuant to Conn. Gen. Stat. §1-96, however, registered lobbyists must file periodic financial reports disclosing amounts expended or received both for “lobbying”, defined at Conn. Gen. Stat. §1-91(k), and for activities “in furtherance of lobbying”, a term not defined in the Lobbyist Code.  See Conn. Gen. Stat. §1-96 and Regulations of Conn. State Agencies, §1-92-41, et seq.  The Commission has broadly interpreted the phrase “in furtherance of lobbying” to include “activities and expenditures which foster good will between lobbyists and public officials . . . unless the activity is clearly personal and unrelated to any lobbying purpose.”  State Ethics Commission Advisory Opinion No. 93-14, 55 Conn. L.J. No. 4, p. 3E (July 27, 1993).  In general, only an unreimbursed expenditure made by an individual could be a personal, nonbusiness expense; rarely could this exception be allowed for a business entity.

In this case, the work to be performed by BCBS is neither personal in nature nor does it have a distinct business purpose (e.g. seeking a state contract).  Rather, it is being done strictly for the ultimate benefit of OHCA which will make recommendations to the General Assembly that may have a substantial effect on BCBS’s operations.  By complying with the request of CHHC, BCBS is, unquestionably, fostering goodwill with officials both at CHHC and OHCA.  Therefore, any costs associated with performing the study should be included in BCBS’s lobbyist financial reports as a lump sum in the “other expenses” section of the report.  Since the expenditures do not also incidentally benefit a public official, a detailed itemization is not necessary.  See Conn. Gen. Stat. §1-96(e).

By order of the Commission,

R.E. VanNorstrand
Chairperson