96.11

OPINION NO. 96-11

Advice has been requested from the Maryland Agriculture Week, Inc., which annually hosts the Maryland Agricultural Dinner, as to whether it is required to register and report as a regulated lobbyist pursuant to the Maryland Public Ethics Law (State Government Article, Title 15, Annotated Code of Maryland). Based on the information provided about the organization, we advise that its activities do bring it within the definitions and requirements of the lobbying provisions of the Ethics Law and that it should register and report its expenditures as required by Subtitle 7 of the Law.

Maryland Agriculture Week, Inc. (the Corporation) was incorporated in 1978 with the objective of organizing a business league of persons and entities engaged in any aspect of the business of agriculture. Its incorporation followed several years in which representatives of Maryland agriculture had informally sponsored a dinner for members of the Maryland General Assembly, and apparently the original impetus for the activity was to communicate with and inform elected legislative and other officials about the industry and promote goodwill for the agricultural community in the government arena. The Corporation's primary activity includes the Maryland Agricultural Dinner (the Dinner), which occurs annually on the first Thursday in February. Invitations to the Dinner are sent in November to all members of the General Assembly, the Governor, other elective executive branch officials, all cabinet members, the State's Congressional delegation, representatives of agricultural youth organizations, and agriculture secretaries from surrounding states. Participation in the Dinner ranges between 750 and 780, including about 120—125 members of the Legislature (about 60—65 percent of the Legislature).

According to Corporation representatives, the Dinner program is not specifically focussed on legislation or particular legislative issues. It is viewed as a social occasion where people can interact and get to know each other. The program includes induction of individuals into the Maryland Agriculture Hall of Fame and the presenters of these individuals usually would make some remarks. There are exhibits promoting agriculture presented by commodity associations, and the affair promotes Maryland agriculture through presentation of a menu designed to showcase Maryland products. The program may include a video or other presentation designed to highlight a general aspect of Maryland agriculture activities. For example, a video was presented dealing with the industry's land stewardship activities, a program has been presented on agriculture's economic impact in the State, and the 1996 focus was on non-traditional uses of agricultural products. The program brochure, however, includes discussion of general legislative issues, highlighting general topic areas, though it does not focus on particular legislation.

Funding for the Dinner and other activities of the Corporation is through sponsorships purchased by various entities. These sponsorships are offered to those engaged in farming production and related activities, including private and corporate farm entities, commodity organizations, trade associations, and agribusiness entities such as the farm credit bureau, farm equipment suppliers, food processors, and farm transportation entities. The Dinner is not generally publicized as a public event, though apparently notices are included in the farm journal and other industry related publications. Also, the sponsorship cost, though tied to some extent to the Dinner, is not described as a ticket per se. According to the organization's recent President, the $75 sponsor fee is more like a fundraising contribution, which funds one admission for the sponsor and is otherwise placed in the organization's general treasury. Funds are then available to defray the cost of the Dinner for the invited guests and to fund other activities, including, for example, limited support activities for Maryland Agriculture Week, which takes place in March in conjunction with National Agriculture Week. In the past some of the sponsors that are regulated lobbyists have reported their sponsorship contributions on lobbying activity reports and officials have reported their attendance on annual financial disclosure reports.

The issue presented here is application of the lobbying registration and reporting requirements of §§15-701 and 15-704 of the Ethics Law. Generally, the Law requires registration by persons/entities who get personally in the presence of legislative or executive officials or employees for the purpose of influencing legislative action, and if in connection with that purpose are either compensated at least $500 or spend at least $100 exclusive of personal travel and subsistence. Registration is also required as an executive branch lobbyist if $100 is expended on food, gifts or other entertainment for executive branch officials to influence executive action. The Maryland Agricultural Dinner is a large function with some focus on matters involving legislative officials. The cost per meal is above $40 for 120 or more legislative officials and their guests, as well as several executive branch officials and employees. This activity therefore clearly crosses the $100 expenditure thresholds for both legislative and executive branch lobbying, and we believe involves a situation where Corporation must be viewed as getting in the presence of officials, through its agents who attend the dinner and interact directly with officials. The question, then, is whether this activity is for the purpose of influencing official action as contemplated by the §15-701 registration criteria.

We have considered this issue in two prior opinions directly addressing this question (Opinions No. 82-4 and No. 82-11). Both of these situations involved events sponsored by organizations when the Legislature was not in session, and were characterized by the sponsors as general education/information activities or as a social affair designed to create general interaction and enhance the entity's relations with government officials. Relying on the Law's broad definition of "legislative action,"1 we advised in both situations that registration and reporting would be required. We specifically indicated that the absence of particular pending legislation was not determinative, noting that the decision not to introduce legislation was viewed as legislative action. In both opinions the Commission took account of the significant focus on legislative officials and concluded that the general interest in improving goodwill and general relationships with legislators constituted attempting to influence legislative action.

In the situation here, though persons affiliated with the Corporation emphasize the social and generally unfocussed approach of the Dinner and its general relationship to Maryland Agriculture Week, our conclusion must be that this activity comes within the registration criteria as they have been previously applied in these very similar situations. In describing the history and purpose of the event, Corporation representatives seem to express its purposes and organization as creating a favorable legislative climate for Maryland agricultural interests. Also, both the sponsorship solicitation and the program state this as a purpose. The sponsorship letter, for example, states:

Educating our legislators face-to-face is one of the most effective means of gaining support for agriculture as we confront many tough issues which lie ahead for our industry. The Maryland Agricultural Dinner is designed to bring agribusiness and legislators together in a social setting to exchange ideas while enjoying Maryland's finest fare.

In our view, this framework of the Dinner brings the organization within our previous determinations requiring lobbyist registration. We recognize the particular long history of this activity and that unlike many legislative receptions it has a broader focus that is to some extent related to Maryland Agriculture Week. We believe, however, that the Corporation should in the future be the entity to register and report expenditures relating to the Dinner as required by §15-704. Based on the information provided, we believe that this activity can be viewed as a non-ticketed special event and the expenditures relating to the Dinner reported by the organization without the need to submit special reports identifying legislative recipients. Based on our conclusion that this event has a sufficient legislative focus to trigger lobbying registration, we advise that the total cost must be reported on the Corporation's activity report. Because the majority of the event's attendees are not State officials or employees, however, and its focus is only partly on legislation, only the cost per person for these individuals should be included on the "special event" line of the report. The remaining expenditures should be included on the "other expenses" line, and be labeled as event costs not directly attributable to officials and employees of the State.

A special meals and beverages report identifying elected executive branch recipients would also be required pursuant to §15-704(e), though a special report identifying non-elected officials and employees would be required only if the $75 threshold of §15-704(b) is reached. In order to avoid duplication in lobbying reporting, sponsors who are otherwise registered should be advised by the Corporation that they may note their contribution on a lobbying expenditure report, but should not include it as an expenditure, since the total expenditure for the Dinner will be reported by the Corporation. Also, of course, the Corporation and any officials who file financial disclosure pursuant to Subtitle 6 of the Law should be aware that gifts of meals and beverages exceeding $25 in value are reportable on annual financial disclosure statements.2

Michael L. May, Chairman,
   Mark C. Medairy, Jr.,
   Robert J. Romadka

Date: December 11, 1996

——————

1 Section 15-102(v) defines this term as an official action or nonaction relating to a bill, resolution, amendment, nomination, appointment, report, or other matter within the jurisdiction of the General Assembly, or a bill presented to the Governor for signature or veto. Legislative action specifically includes the following actions: introduction, sponsorship, consideration, debate, amendment, passage, defeat, approval or veto.

2 Any additional questions regarding specific reporting and disclosure issues or application of the gift acceptance provisions to executive branch officials should be directly presented to Commission staff for more detailed advice consistent with prior Commission opinions and information memoranda.