An advisory opinion has been requested by the Department of Health and Mental Hygiene (DHMH) concerning whether an official may accept expenses for travel, lodging and meals from an entity that contracts with the official's agency, if they are proffered in connection with the official's performance of agency business in connection with the contract.

The Boards and Commissions Coordinator for DHMH has requested this opinion concerning whether the Executive Director (the Director) of the Maryland State Board of Examiners of Nurses (BEN) may accept reimbursement of expenses from the National Council of State Boards of Nursing for committee meetings she expects to attend as part of her official State duties. The BEN is established in Article 43, Annotated Code of Maryland, and has significant regulatory and licensing authority over the nursing profession. Its authority includes the power to adopt and revise standards of nursing practice performed by registered and licensed practical nurses; to prescribe standards for educational programs preparing persons for nursing licensure; to examine, license and renew licenses of qualified applicants; and to conduct hearings on disciplinary charges or deny, revoke or suspend a license. Approximately 3,000 applicants take nursing licensure examinations each year, paying fees of approximately $5--$10.

The National Council of State Boards of Nursing (the National Council or the Council) is an association of State boards that provides general services to its members, including working to enhance mobility within the nursing profession, working for similarity in licensure forms, working towards improved standards of nursing practice, and providing a disciplinary action data and reporting bank. Chief among its services is the Council's provision of the nursing license exams used almost exclusively across the United States. Council members, including the BEN, pay membership dues as well as a royalty fee for use of the licensing exams. Maryland's royalty fees are paid from exam fees collected from applicants.

The nursing exam is developed by a testing service in coordination with the National Council's Examination Committee. The Examination Committee drafts confidential directions for the development of materials to be used in examinations. All materials developed are placed in a pool for use in examinations. The Examination Committee also prepares the confidential instructions for particular licensing examinations and approves the final drafts of examinations. Four examinations are prepared each year, two for registered nurses and two for licensed practical nurses. The Director, who, with the BEN President, participates generally in National Council activities on behalf of the Board, has been invited to serve on the Examination Committee. Consistent with standard National Council and Committee policy, she has been offered reimbursement of expenses incurred in connection with her participation in Committee deliberations.

The issue in this request is application of the provisions of §3-106 of the Public Ethics Law (Article 40A, §3-106, Annotated Code of Maryland, the Ethics Law). This section prohibits officials and employees from soliciting any gift or accepting gifts from any person that is doing or seeking to do business with an official's agency. The Law's definition of "doing business with" includes having certain contractual relationships. See §1-102(d). As we believe that the payment by the BEN of royalty fees in itself establishes a contractual relationship between the agency and the National Council, it is our conclusion that the Council is an entity covered by the provisions of §3-106(a).

Moreover, we believe that the provision of expenses in this situation would constitute a gift as contemplated in §3-106. The term "gift" is defined in §1-102(p) of the Ethics Law to include the "transfer of anything of economic value regardless of form without adequate and lawful consideration." The provision of transportation, lodging or meals, or the reimbursement therefore, constitutes the transfer of a thing of value. Moreover, this transfer cannot, in our view, be treated as involving adequate and lawful consideration from the Director, as any services provided by her to the National Council also constitute a part of her official duties for the State of Maryland.

However, we believe that the fact that the Director's Examination Committee work is part of her official BEN duties does establish a basis for allowing acceptance of the proffered expenses. In our Opinion No. 81-31, we considered a request from the State Aviation Administration regarding acceptance by its employees of courtesy air travel in connection with their provision of briefings on Baltimore-Washington International Airport at airline reservation centers. We concluded there, in view of the tight agency-controlled circumstances presented, that the courtesy travel offered by the airlines was "more appropriately viewed as a gift to the State agency, rather than individual employees."

We do not believe that gifts of traveling expenses may in all cases, or even as a general matter, be viewed as gifts to an agency. Some such gifts, though arguably related to an employee's official duties, may result in improper influences on employees that destroy the arms length bargaining relationships that should exist between the State and those doing or seeking to do business with it. For example, we have disapproved provision of expenses where the donor was plainly offering a seminar as part of a general sales/public relations effort. Opinion No. 81-43. We have also barred acceptance of travel expenses by employees in connection with review of a potential vendor's facilities outside of the normal procurement process. Opinion No. 81-46. Nor do we think that gifts should be viewed as to the agency where they are only generally related to agency interests and they involve personal entertainment and favors accruing to the employee personally. Opinion No. 82-7.

We do, however, believe that there are some situations where a properly controlled gift of expenses relates so integrally to an agency program that it can properly be viewed as intended to further agency, rather than individual, interests. We noted in Opinion No. 81-31, for example, that the donated air travel expenses grew out of a long-standing established relationship between the air carriers and the agency, and involved an existing activity initiated by the agency as a part of its programmatic mission. Also, as is the case here, the employees were assigned as part of their official duties to provide significant substantive input to the activity that would be of direct and quantifiable benefit to the agency program. The travel expenses of the State Aviation Administration employees were, in addition, carefully controlled by the agency itself.

We conclude that under these types of circumstances travel expenses to be donated by private entities may be accepted, provided the agency has authority to accept such gifts. We therefore advise the Director and the Department that she may accept the expenses offered by the National Council, provided State procedures are followed.

Herbert J. Belgrad, Chairman
    Jervis S. Finney
    Reverend John Wesley Holland
    Barbara M. Steckel

Date: June 30, 1982