STATE OF ALABAMA

ETHICS COMMISSIONMAILING ADDRESS

P.O. BOX4840MONTGOMERY,AL

36103-4840

STREET ADDRESS

RSA UNION100 NORTHUNIONSTREET

SUITE 104MONTGOMERY,AL 36104COMMISSIONERS

Helen Shnres Lee, Esq., ChairmanJohn H. Watson, Vice-Chairman

Lewis G. Odorn, Jr., Esq.Russell Jackson Drake. Esq.J. Harold Sonells

James L. Sumner, Jr.Director

Hugh R. Evans, IIIAssistant Director

General Counsel

October 6, 1999

TELEPHONE (334) 242-2997

FAX (334) 242-0248WEB SITE www.ethics.a1a1inc.net

ADVISORYOPINION NO. 99-40

F, Lenton WhiteCity AttorneyCity of DothanLegal DepartmentSuite 313City Hall Building126 North St. Andrews StreetPost Office Box 2128Dothan, Alabama 36302

Thing Of ValueiCity OfDothan DonatingMoney To Tax-Exempt Organization ForPurposes Of Holding A ChampionshipGolfTournament And The Golf ToumamentProviding Unsolicited Items To CityEmployees.

The City of Dothan may contribute money tothe Robert Trent Jones Golf TrailFoundation in association with the PGATour and the NIKE Tour and various cityemployeesand officialsmay accepthospitality in conjunction with the golftournament in the form of food andbeverages where the provider is present,lodging in the continental United States andAlaska incidental to the social occasion, andtickets to the social or sporting event if thehospitality does not extend beyond threeconsecutive days and is not continuous in

.-- - - . __h

F. Lenton WhiteAdvisory Opinion No. 99-40Page two

nature and the aggregate value of suchhospitality received by the public officialsand public employees of the City of Dothanin excess of $250 within a calendar day isreported to the Ethics Commissionby theprovider.

Further, the city employees and officialsmayaccept the hospitality in conjunction with thegolf tournament; provided, that thehospitalitywas not provided in exchange forthe contribution on the part of the City; thatthe hospitalityis provided to all sponsors ofthe event; that no other particular course ofaction is required of the City; and, that therewas no prearranged understanding that thehospitalitywould be provided in exchangefor the contribution.

Dear Mr. White:

The AlabamaEthics Commissionis in receipt of your request for an Advisory Opinion ofthis Commission, and this opinion is issued pursuant to that request.

OUESTION PRESENTED

May the City of Dothan on behalf of its officialsand employees acceptcertain items of hospitality after making a contribution to the golf tournament?

FACTS AND ANALYSIS

The facts as have been presented to this Commissionare as follows:

On October 18-24, 1999, the Robert Trent Jones Golf Trail will host the 1999NIKE TourChampionship at the Highland Oaks Golf Facility in Dothan, Alabama. This championshiptournament is held by the Robert Trent Jones Golf Trail Foundation, a tax-exempt organizationunder IRS Code § 503(c), in association with the PGA Tour and the NIKE Tour. The 1999

F. Lenton WhiteAdvisory OpinionNo. 99-40Page three

championshipwill be the third year the Foundation has hosted the event, Mobile and Opelikahaving done so in 1997 and 1998, respectively. The City of Dothan expects an economic impactupon the community ITomthis tournament in the amount of approximately six milliondollars.

The Robert Trent Jones Golf Trail Foundation is accepting donations for this tournamentin the form of sponsorships, part of which go to benefit Alabamacharities. In return for theirdonation, sponsors receive acknowledgment in the form of advertising and hospitality. Accordingto Mr. White, the City of Dothan is a sponsor for the NIKE Tour Championshipin the amount of$50,000.00. This donation was not made under any condition which required a particular courseof action ITomthe Foundation, nor were there any previous discussionsbetween the City and theFoundation regarding the sponsorship gifts. In fact, the gifts are offered to all sponsors. In returnfor its sponsorship, the Robert Trent Jones Golf Trail Foundation will make availableto the Cityof Dothan the followingunsolicited items upon approval of the Ethics Commission:

Shared sky box on 18thgreen40 sky box passes300 good any day tickets8 Pro-Am playing slots8 Pro-Am gift bags8 Paring!Awards party invitationsBusiness expo booth display space and signageSponsor Board company listing10 clubhouse passes10 clubhouse parking passesHole sponsorshipOne full page ad in golf tournament programOne full page ad in visitor's guide120 person golf outingTagging on billboards

Of these items only three are for sale individually;the 300 admission tickets at $6.00apiece, the 8 Pro-Am playing slots at $3,000.00 apiece and the business expo booth display spaceand signage at $1,500.00 apiece. The remainingitems have values which can only be estimatedbecause they are only availableas hospitality for sponsors.

The entire hospitality package listed above has an estimated value of approximately$41,000.00. The average value of each item. therefore, is less than $250 per day; however, someindividual items are a great deal more.

F. Lenton WhiteAdvisory Opinion No. 99-40Page four

No city official,agent or employeewill be offered, nor will they receive, any advertisingfrom the Foundation. Each advertising item will be used solelyby the City of Dothan for its ownofficialpublic relations purposes.

The City of Dothan requests an Advisory Opinion from the Ethics Commissionregardingwhether Dothan city officialsmay accept these unsolicited hospitality items on behalf of the Cityof Dothan for their own personal disposition and use for no more than three consecutive days andwhether or not the Ethics Law requires that the hospitality be reported to the Ethics Commissionif the receipt of the same is approved.

The AlabamaEthics Law, Code of Alabama. 1975, Section 36-25-1(31)(a) defines a"thing of value" as: .

"a. Any gift, benefit, favor, service, gratuity, tickets or passes to an entertainment,social or sporting event offered only to public officials,unsecured loan, other thanthose loans made in the ordinary course of business, reward, promise of futureemployment, or honoraria."

However, the Ethics Law removes from the definitionof a "thing of value" the followingsubject matters:

Section 36-25-1(31)(b) in pertinent part states:

"b. The term, thing of value, does not include any of the following, provided thatno particular course of action is required as a condition to the receipt thereof:

3. Hospitality extended to a public official, public employee, and his or herrespective household as a social occasion in the form of food and beverages wherethe provider is present, lodging in the continental United States and Alaskaincidental to the social occasion, and tickets to social or sporting events if thehospitality does not extend beyond three consecutive days and is not continuous innature and the aggregate value of such hospitality in excess of two hundredfifty dollars ($250) within a calendar day is reported to the commission by theprovider provided that the reporting requirement contained in this section shallnotapply where the expenditures are made to or on behalf of an organization to whicha federal income tax deduction is permitted under subparagraph (A) of paragraph(1) of subsection (b) of Section 170 of the Internal Revenue Code of 1986, asamended, or any charitable, education or eleemosynary cause of Section 501 ofTitle 26 of the U.S. Code, and where the public officialor public employee doesnot receive any direct financialbenefit. The reporting shall include the name or

F. Lenton WhiteAdvisory OpinionNo. 99-40Page five

names of the recipient or recipients, the value of the entire expenditure, the date or dates of theexpenditure, and the type of expenditure."

Section 36-25-7(a) states:

"(a) No person shall offer or give to a public officialor public employee or amember of the household of a public employee or a member of the household ofthe public officialand none of the aforementioned shall solicit or receive a thing ofvalue for the purpose of influencingofficialaction."

The AlabamaEthics Law exempts certain things from the definition of a thing of value. Inthe facts before the Commission;provided, there was no quid pro quo, in other words, there wasno prearranged understanding that if the City of Dothan would contribute money as a sponsor tothe golf tournament, they would receive certain items in exchange, this would fall squarely underthe exemption contained in the hospitalityprovision.

While Section 36-25-1(31)(b)(3) exempts the reporting requirement for expenditures thatare made to or on behalf of an organization that is either charitable, educational or eleemosynaryand where the public officialor public employee does not receive any direct financialbenefit,where the benefit ultimately accrues to the public officialsand public employeeswithin the City ofDothan who are able to utilize the sponsorship items, that hospitalitymust be reported to theEthics Commission if the value of such hospitality exceeds $250 within a calendar day.

Based on the above law and the facts as provided, the City of Dothan may contributemoney to the Robert Trent Jones Golf Trail Foundation in association with the PGA Tour and theNIKE Tour and various city employees and officialsmay accept hospitality in conjunction withthe golf tournament in the form of food and beverages where the provider is present, lodging inthe continental United States and Alaska incidental to the social occasion, and tickets to the socialor sporting event if the hospitality does not extend beyond three consecutive days and is notcontinuous in nature and the aggregate value of such hospitality received by the public officialsand public employees of the City of Dothan in excess of $250 within a calendar day is reported tothe Ethics Commissionby the provider.

Further, the city employees and officialsmay accept the hospitality in conjunction with thegolf tournament; provided, that the hospitalitywas not provided in exchange for thecontribution on the part of the City; that the hospitality is provided to all sponsors of the event;that no other particular course of action is required of the City; and, that there was noprearranged understanding that the hospitality would be provided in exchange for thecontribution.

- ---

F. Lenton WhiteAdvisory OpinionNo. 99-40Page six

CONCLUSION

The City of Dothan may contribute money to the Robert Trent Jones Golf TrailFoundation in association with the PGA Tour and the NIKE Tour and various city employees andofficialsmay accept hospitality in conjunctionwith the golf tournament in the form of food andbeverages where the provider is present, lodging in the continentalUnited States and Alaskaincidental to the social occasion, and tickets to the social or sporting event if the hospitality doesnot extend beyond three consecutive days and is not continuous in nature and the aggregate valueof such hospitality received by the public officialsand public employees of the City of Dothan inexcess of $250 within a calendar day is reported to the Ethics Commissionby the provider.

Further, the city employees and officialsmay accept the hospitality in conjunctionwith thegolf tournament; provided, that the hospitalitywas not provided in exchange for the contributionon the part of the City; that the hospitality is provided to all sponsors of the event; that no otherparticular course of action is required of the City; and, that there was no prearrangedunderstanding that the hospitality would be provided in exchange for the contribution.

AUTHORITY

By 5-0 vote of the AlabamaEthics Commission on October 6, 1999.

Helen Shores LeeChairAlabama Ethics Commission

-- - --