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Procurement Perspectives: Gifts and gratuities have restrictions for officials

Stephen Bauld
Procurement Perspectives: Gifts and gratuities have restrictions for officials

As a government official, you need to be very careful when it comes to receiving any type of holiday gifts.

As an example, the New York City Conflict of Interest Law differentiates in its treatment of gifts and gratuities. The law provides that municipal officials may not accept anything valued at more than $50 dollars from anyone they know or should know is doing business or seeking to do business with the city.

However, municipal officials are subject to an outright prohibition against accepting anything from anyone other than the city for performing their official duties.

For most municipalities, a partial solution is to impose a disclosure requirement. One underlying premise of a disclosure requirement is that a staff member or elected official will be unlikely to disclose any “gift” that has been improperly solicited or accepted.

Since the question of whether disclosure was made is usually cut and dry, it is far easier to take disciplinary action in relation to a failure to disclose than it is for accepting what is in effect a bribe.

The Bellamy Report contained the following specific recommendations in relation to disclosure:
the city should establish a registry for gifts received by staff and councillors. The registry should be run by the integrity commissioner’s office.

the gift registry should contain the following details in a searchable database:
(a) The name of the individual who received the gift and the capacity in which he or she was serving at the time.
(b) A description of the gift.
(c) The person or group who presented it.
(d) The date in which the gift was received.
(e) The occasion on which the gift was given.
(f) The estimated value of the gift, if known.
(g) A running total of the value of gifts received by staff or councillors from that person or group in the previous 12 months.
(h) What the individual intends to do with the gift.
(i) Whether the gift should remain with the city if the recipient leaves.

It is difficult to argue against either disclosure or registry requirements, provided they are reasonably constrained and do not go so far as to become an invasion of privacy.

Specifically, gifts between people that are clearly private and personal (e.g., an engagement ring) should not require either disclosure or registration, even if involving a person who works for a supplier (as donor) and a municipal staff member or elected official as recipient.

The higher the value that a gift or other gratuity becomes, the more likely it is that a municipality will ban it outright.

Many municipalities have adopted policies along the following lines:

No elected or appointed officer or employee shall…solicit or accept any gift, directly or indirectly, whether in the form of money, loan, gratuity, favour, service, thing or promise, or in any other form, under circumstances in which it can reasonably be inferred that the gift is intended to influence the officer or employee in the performance of such person’s official duties. Nothing herein shall preclude the solicitation or acceptance of lawful contributions for election campaigns.

However, in the vast majority of cases the relevant municipal bylaw and policy then goes on to create a number of exceptions, permitting certain gifts to be kept.

The Bellamy Report recommended that:
the city should permit councillors and staff to accept gifts, entertainment or other benefits of nominal value, except from lobbyists. The definition of normal value and other criteria for acceptable gifts should be established in consultation with the integrity commissioner.
under no circumstances should staff or councillors accept gifts or benefits of any value from lobbyists.
With all these rules, it is better to have someone wish you a Merry Christmas and a Happy New Year and call it a day.
Stephen Bauld is a government procurement expert and can be reached at swbauld@purchasingci.com.
Some of his columns may contain excerpts from The Municipal Procurement Handbook published by Butterworths.

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