Senate Bill No. 699
(By Senator Burnette and Hunter)
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[Introduced February 18, 2002; referred to the Committee
on the Judiciary.]
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A BILL to amend and reenact section five, article two, chapter six-b of the code of West Virginia, one thousand nine hundred thirty-one, as amended; to amend and reenact sections four and seven, article three of said chapter; and to further amend said article by adding thereto a new section, designated section four-a, all relating to ethical standards for elected and appointed officials and public employees; including political contributions from lobbyists as being prohibited items for public officials to accept; providing that certain items may be accepted by public officials without solicitation; providing that lobbyists are not required to report unreimbursed expenses incurred during travel; requiring employers of lobbyists to fulfill certain reporting requirements; and providing that lobbyists or their employers may have one reception costing not more than five thousand dollars for the Legislature and public.

Be it enacted by the Legislature of West Virginia:
That section five, article two, chapter six-b of the code of West Virginia, one thousand nine hundred thirty-one, as amended, be amended and reenacted; that sections four and seven, article three of said chapter be amended and reenacted; and that said article be further amended by adding thereto a new section, designated section four-a, all to read as follows:

§6B-2-5. Ethical standards for elected and appointed officials and public employees

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(a) Persons subject to section. -- The provisions of this section apply to all elected and appointed public officials and public employees, whether full or part time, in state, county, municipal governments and their respective boards, agencies, departments and commissions and in any other regional or local governmental agency, including county school boards.
(b) Use of public office for private gain. -- (1) A public official or public employee may not knowingly and intentionally use his or her office or the prestige of his or her office for his or her own private gain or that of another person. The performance of usual and customary duties associated with the office or position or the advancement of public policy goals or constituent services, without compensation, does not constitute the use of prestige of office for private gain.
(2) The Legislature, in enacting this subsection (b), relating to the use of public office or public employment for private gain, recognizes that there may be certain public officials or public employees who bring to their respective offices or employment their own unique personal prestige which is based upon their intelligence, education, experience, skills and abilities, or other personal gifts or traits. In many cases, these persons bring a personal prestige to their office or employment which inures to the benefit of the state and its citizens. Such persons may, in fact, be sought by the state to serve in their office or employment because, through their unusual gifts or traits, they bring stature and recognition to their office or employment and to the state itself. While the office or employment held or to be held by such persons may have its own inherent prestige, it would be unfair to such individuals and against the best interests of the citizens of this state to deny such persons the right to hold public office or be publicly employed on the grounds that they would, in addition to the emoluments of their office or employment, be in a position to benefit financially from the personal prestige which otherwise inheres to them. Accordingly, the commission is directed, by legislative rule, to establish categories of such public officials and public employees, identifying them generally by the office or employment held, and offering persons who fit within such categories the opportunity to apply for an exemption from the application of the provisions of this subsection. Such exemptions may be granted by the commission, on a case-by-case basis, when it is shown that: (A) The public office held or the public employment engaged in is not such that it would ordinarily be available or offered to a substantial number of the citizens of this state; (B) the office held or the employment engaged in is such that it normally or specifically requires a person who possesses personal prestige; and (C) the person's employment contract or letter of appointment provides or anticipates that the person will gain financially from activities which are not a part of his or her office or employment.
(c) Gifts. -- (1) A public official or public employee may not solicit any gift unless the solicitation is for a charitable purpose with no resulting direct pecuniary benefit conferred upon the official or employee or his or her immediate family: Provided, That no public official or public employee may solicit for a charitable purpose any gift from any person who is also an official or employee of the state and whose position as such is subordinate to the soliciting official or employee: Provided, however, That nothing herein shall prohibit a candidate for public office from soliciting a lawful political contribution. No official or employee may knowingly accept any gift, directly or indirectly, including political contributions from a lobbyist or from any person whom the official or employee knows or has reason to know:
(A) Is doing or seeking to do business of any kind with his or her agency;
(B) Is engaged in activities which are regulated or controlled by his or her agency; or
(C) Has financial interests which may be substantially and materially affected, in a manner distinguishable from the public generally, by the performance or nonperformance of his official duties.
(2) Notwithstanding the provisions of subdivision (1) of this subsection, a person who is a public official or public employee may accept a gift described in this subdivision but not solicit the following items, and there shall be a presumption that the receipt of any such gift item does not impair the impartiality and independent judgment of the person. This presumption may be rebutted only by direct objective evidence that the gift did impair the impartiality and independent judgment of the person or that the person knew or had reason to know that the gift was offered with the intent to impair his or her impartiality and independent judgment. The provisions of subdivision (1) of this subsection do not apply to items include:
(A) Meals and beverages;
(B) (A) Ceremonial gifts or awards which have insignificant monetary value;
(C) (B) Unsolicited Gifts of nominal value or trivial items of informational value;
(D) (C) Reasonable expenses for food, travel and lodging of the official or employee for a meeting at which the official or employee participates in a panel or speaking engagement at the meeting;
(E) (D) Gifts of tickets or free admission extended to a public official or public employee to attend charitable, cultural or political events, if the purpose of such gift or admission is a courtesy or ceremony customarily extended to the office;
(F) Gifts that are purely private and personal in nature; or
(G) (E) Gifts from relatives by blood or marriage, or a member of the same household; and
(F) Meals and beverages provided at a reception that is open to all members of the Legislature and the general public. Such a reception can be held only once each year and the total cost cannot exceed five thousand dollars.
(3) The commission shall, through legislative rule, promulgated pursuant to chapter twenty-nine-a of this code, establish guidelines for the acceptance of a reasonable honorarium by public officials and elected officials. The rule promulgated shall be consistent with this section. Any elected public official may accept an honorarium only when: (1) That official is a part-time elected public official; (2) the fee is not related to the official's public position or duties; (3) the fee is for services provided by the public official that are related to the public official's regular, nonpublic trade, profession, occupation, hobby or avocation; and (4) the honorarium is not provided in exchange for any promise or action on the part of the public official.
(4) (3) Nothing in this section shall be construed so as to prohibit the giving of a lawful political contribution as defined by law.
(5) (4) The governor or his designee may, in the name of the state of West Virginia, accept and receive gifts from any public or private source. Any such gift so obtained shall become the property of the state and shall, within thirty days of the receipt thereof, be registered with the commission and the division of culture and history.
(d) Interests in public contracts. -- (1) In addition to the provisions of section fifteen, article ten, chapter sixty-one of this code, no elected or appointed public official or public employee or member of his or her immediate family or business with which he or she is associated may be a party to or have an interest in the profits or benefits of a contract which such official or employee may have direct authority to enter into, or over which he or she may have control: Provided, That nothing herein shall be construed to prevent or make unlawful the employment of any person with any governmental body: Provided, however, That nothing herein shall be construed to prohibit a member of the Legislature from entering into a contract with any governmental body, or prohibit a part-time appointed public official from entering into a contract which such part-time appointed public official may have direct authority to enter into or over which he or she may have control when such official has been recused from deciding or evaluating and excused from voting on such contract and has fully disclosed the extent of such interest in the contract.
(2) In the absence of bribery or a purpose to defraud, an elected or appointed public official or public employee or a member of his or her immediate family or a business with which he or she is associated shall not be considered as having an interest in a public contract when such a person has a limited interest as an owner, shareholder or creditor of the business which is the contractor on the public contract involved. A limited interest for the purposes of this subsection is:
(A) An interest:
(i) Not exceeding ten percent of the partnership or the outstanding shares of a corporation; or
(ii) Not exceeding thirty thousand dollars interest in the profits or benefits of the contract; or
(B) An interest as a creditor:
(i) Not exceeding ten percent of the total indebtedness of a business; or
(ii) Not exceeding thirty thousand dollars interest in the profits or benefits of the contract.
(3) Where the provisions of subdivisions (1) and (2) of this subsection would result in the loss of a quorum in a public body or agency, in excessive cost, undue hardship, or other substantial interference with the operation of a state, county, municipality, county school board or other governmental agency, the affected governmental body or agency may make written application to the ethics commission for an exemption from subdivisions (1) and (2) of this subsection.
(e) Confidential information. -- No present or former public official or employee may knowingly and improperly disclose any confidential information acquired by him or her in the course of his or her official duties nor use such information to further his or her personal interests or the interests of another person.
(f) Prohibited representation. -- No present or former elected or appointed public official or public employee shall, during or after his or her public employment or service, represent a client or act in a representative capacity with or without compensation on behalf of any person in a contested case, rate-making proceeding, license or permit application, regulation filing or other particular matter involving a specific party or parties which arose during his or her period of public service or employment and in which he or she personally and substantially participated in a decision-making, advisory or staff support capacity, unless the appropriate government agency, after consultation, consents to such representation. A staff attorney, accountant or other professional employee who has represented a government agency in a particular matter shall not thereafter represent another client in the same or substantially related matter in which that client's interests are materially adverse to the interests of the government agency, without the consent of the government agency: Provided, That this prohibition on representation shall not apply when the client was not directly involved in the particular matter in which such professional employee represented the government agency, but was involved only as a member of a class. The provisions of this subsection shall not apply to legislators who were in office and legislative staff who were employed at the time it originally became effective on the first day of July, one thousand nine hundred eighty-nine, and those who have since become legislators or legislative staff and those who shall serve hereafter as legislators or legislative staff.
(g) Limitation on practice before a board, agency, commission or department. -- (1) No elected or appointed public official and no full-time staff attorney or accountant shall, during his or her public service or public employment or for a period of six months after the termination of his or her public service or public employment with a governmental entity authorized to hear contested cases or promulgate regulations, appear in a representative capacity before the governmental entity in which he or she serves or served or is or was employed in the following matters:
(A) A contested case involving an administrative sanction, action or refusal to act;
(B) To support or oppose a proposed regulation;
(C) To support or contest the issuance or denial of a license or permit;
(D) A rate-making proceeding; and
(E) To influence the expenditure of public funds.
(2) As used in this subsection, "represent" includes any formal or informal appearance before, or any written or oral communication with, any public agency on behalf of any person: Provided, That nothing contained in this subsection shall prohibit, during any period, a former public official or employee from being retained by or employed to represent, assist, or act in a representative capacity on behalf of the public agency by which he or she was employed or in which he or she served. Nothing in this subsection shall be construed to prevent a former public official or employee from representing another state, county, municipal or other governmental entity before the governmental entity in which he or she served or was employed within six months after the termination of his or her employment or service in the entity.
(3) A present or former public official or employee may appear at any time in a representative capacity before the Legislature, a county commission, city or town council or county school board in relation to the consideration of a statute, budget, ordinance, rule, resolution or enactment.
(4) Members and former members of the Legislature and professional employees and former professional employees of the Legislature shall be permitted to appear in a representative capacity on behalf of clients before any governmental agency of the state, or of county or municipal governments including county school boards.
(5) An elected or appointed public official, full-time staff attorney or accountant who would be adversely affected by the provisions of this subsection may apply to the ethics commission for an exemption from the six months prohibition against appearing in a representative capacity, when the person's education and experience is such that the prohibition would, for all practical purposes, deprive the person of the ability to earn a livelihood in this state outside of the governmental agency. The ethics commission shall by legislative rule establish general guidelines or standards for granting an exemption or reducing the time period, but shall decide each application on a case-by-case basis.
(h) Employment by regulated persons. -- (1) No full-time official or full-time public employee may seek employment with, be employed by, or seek to sell or lease real or personal property to any person who:
(A) Had a matter on which he or she took, or a subordinate is known to have taken, regulatory action within the preceding twelve months; or
(B) Has a matter before the agency to which he or she is working or a subordinate is known by him or her to be working.
(2) Within the meaning of this section, the term "employment" includes professional services and other services rendered by the public official or public employee, whether rendered as employee or as an independent contractor; "seek employment" includes responding to unsolicited offers of employment as well as any direct or indirect contact with a potential employer relating to the availability or conditions of employment in furtherance of obtaining employment; and "subordinate" includes only those agency personnel over whom the public servant has supervisory responsibility.
(3) A full-time public official or full-time public employee who would be adversely affected by the provisions of this subsection may apply to the ethics commission for an exemption from the prohibition contained in subsection (1). The ethics commission shall by legislative rule establish general guidelines or standards for granting an exemption, but shall decide each application on a case-by-case basis.
(4) A full-time public official or full-time public employee may not take personal regulatory action on a matter affecting a person by whom he or she is employed or with whom he or she is seeking employment or has an agreement concerning future employment.
(5) A full-time public official or full-time public employee may not receive private compensation for providing information or services that he or she is required to provide in carrying out his or her public job responsibilities.
(i) Members of the Legislature required to vote. -- Members of the Legislature who have asked to be excused from voting or who have made inquiry as to whether they should be excused from voting on a particular matter and who are required by the presiding officer of the House of Delegates or Senate of West Virginia to vote under the rules of the particular house shall not be guilty of any violation of ethics under the provisions of this section for a vote so cast.
(j) Limitations on participation in licensing and rate-making proceedings. -- No public official or employee may participate within the scope of his or her duties as a public official or employee, except through ministerial functions as defined in section three, article one of this chapter, in any license or rate-making proceeding that directly affects the license or rates of any person, partnership, trust, business trust, corporation or association in which the public official or employee or his or her immediate family owns or controls more than ten percent. No public official or public employee may participate within the scope of his or her duties as a public official or public employee, except through ministerial functions as defined in section three, article one of this chapter, in any license or rate-making proceeding that directly affects the license or rates of any person to whom the public official or public employee or his or her immediate family, or a partnership, trust, business trust, corporation or association of which the public official or employee, or his or her immediate family, owns or controls more than ten percent, has sold goods or services totaling more than one thousand dollars during the preceding year, unless the public official or public employee has filed a written statement acknowledging such sale with the public agency and the statement is entered in any public record of the agency's proceedings. This subsection shall not be construed to require the disclosure of clients of attorneys or of patients or clients of persons licensed pursuant to articles three, eight, fourteen, fourteen-a, fifteen, sixteen, twenty, twenty-one or thirty-one, chapter thirty of this code.
(k) Certain expenses prohibited. -- No public official or public employee shall knowingly request or accept from any governmental entity compensation or reimbursement for any expenses actually paid by a lobbyist and required by the provisions of this chapter to be reported, or actually paid by any other person.
(l) Any person who is employed as a member of the faculty or staff of a public institution of higher education and who is engaged in teaching, research, consulting or publication activities in his or her field of expertise with public or private entities and thereby derives private benefits from such activities shall be exempt from the prohibitions contained in subsections (b), (c) and (d) of this section when the activity is approved as a part of an employment contract with the governing board of such institution or has been approved by the employees' department supervisor or the president of the institution by which the faculty or staff member is employed.
(m) Except as provided in this section, a person who is a public official or public employee may not solicit private business from a subordinate public official or public employee whom he or she has the authority to direct, supervise or control. A person who is a public official or public employee may solicit private business from a subordinate public official or public employee whom he or she has the authority to direct, supervise or control when:
(A) The solicitation is a general solicitation directed to the public at large through the mailing or other means of distribution of a letter, pamphlet, handbill, circular or other written or printed media; or
(B) The solicitation is limited to the posting of a notice in a communal work area; or
(C) The solicitation is for the sale of property of a kind that the person is not regularly engaged in selling; or
(D) The solicitation is made at the location of a private business owned or operated by the person to which the subordinate public official or public employee has come on his or her own initiative.
(n) The commission by legislative rule promulgated in accordance with chapter twenty-nine-a of this code may define further exemptions from this section as necessary or appropriate.

ARTICLE 3. LOBBYISTS.

§6B-3-4. Reporting by lobbyists.
(a) A lobbyist shall file with the commission reports of his lobbying activities, signed under oath or affirmation by the lobbyist. Lobbyists who are required under this article to file copies of their registration statements with the clerks of the respective houses of the Legislature shall also contemporaneously file copies of all reports required under this section with the clerks. Such reports shall be filed as follows:
(1) On or before the Monday preceding the second Wednesday in January of each year, a lobbyist shall file an annual report of all lobbying activities which he or she engaged in during the preceding calendar year; and
(2) If a lobbyist engages in lobbying with respect to legislation, then:
(A) Between the fortieth and forty-fifth days of any regular session of the Legislature in which any such lobbying occurred, the lobbyist shall file a report describing all of his or her lobbying activities which occurred since the beginning of the calendar year; and
(B) Within twenty-one days after the adjournment sine die of any regular or extraordinary session of the Legislature in which any such lobbying occurred, the lobbyist shall file a report describing all of his or her lobbying activities which occurred since the beginning of the calendar year or since the filing of the last report required by this section, whichever is later.
(b)(1) Except as otherwise provided in this section, each report filed by a lobbyist shall show the lobbyist's compensation and the total amount of all expenditures for lobbying made or incurred by such lobbyist, or on behalf of such lobbyist by the lobbyist's employer, during the period covered by the report. The report shall also show subtotals segregated according to financial category, including meals and beverages; living accommodations; advertising; travel; contributions; gifts to public officials or employees or to members of the immediate family of such persons; and other expenses or services.
(2) Lobbyists are not required to report the following:
(A) Unreimbursed personal living and travel expenses not incurred directly for lobbying;
(B) Any expenses incurred for his or her own living accommodations; and
(C) Any unreimbursed expenses incurred for his or her own travel to and from public meetings or hearings of the legislative and executive branches.
(D) Any expenses incurred for telephone, and any office expenses, including rent and salaries and wages paid for staff and secretarial assistance; and
(E) Separate expenditures to or on behalf of a public official or employee in an amount of less than five dollars.
(c) If a lobbyist is employed by more than one employer, the report shall show the proportionate amount of such expenditures in each category incurred on behalf of each of his employers.
(d) The report shall describe the subject matter of the lobbying activities in which the lobbyist has been engaged during the reporting period.
(e) If, during the period covered by the report, the lobbyist made expenditures in the reporting categories of meals and beverages, living accommodations, travel, gifts or other expenditures, other than for those expenditures governed by subsection (f) of this section, which expenditures in any such reporting category total more than twenty-five dollars to or on behalf of any particular public official or employee, the lobbyist shall report the name of the public official or employee to whom or on whose behalf the expenditures were made, the total amount of the expenditures, and the subject matter of the lobbying activity, if any. Under this subsection (e), no portion of the amount of an expenditure for a dinner, party or other function sponsored by a lobbyist or a lobbyist's employer need be attributed to or counted toward the reporting amount of twenty-five dollars for a particular public official or employee who attends such function if the sponsor has invited to the function all the members of: (1) The Legislature; (2) either house of the Legislature; (3) a standing or select committee of either house; or (4) a joint committee of the two houses of the Legislature. However, the amount spent for such function shall be added to other expenditures for the purpose of determining the total amount of expenditures reported under subsection (b) of this section.
(f) (e) If, during the period covered by the report, the lobbyist made expenditures in the reporting categories of meals and beverages, lodging, travel, gifts and scheduled entertainment, which reporting expenditures in any such reporting category total more than twenty-five dollars for or on behalf of a particular public official or public employee in return for the participation of the public official or employee in a panel or speaking engagement at the meeting, the lobbyist shall report the name of the public official or employee to whom or on whose behalf the expenditures were made and the total amount of the expenditures.
§6B-3-4a. Reporting of employers of lobbyists.
(a) Anyone who employs a lobbyist, whether a corporation, labor union, professional group or association, or any other type of association, must report its general financial condition with the commission. This includes all financial statements for the fiscal year immediately preceding the year in which the lobbyist is employed. These statements must include, at a minimum, information concerning the employer's annual income, expenses, assets and liabilities.
(b) This information must be provided before or contemporaneously with the registration of the lobbyist. If the information for the preceding fiscal year is unavailable at the time of the registration of the lobbyist, the employer can provide the information for the fiscal year immediately preceding the year that immediately precedes the year of registration of the lobbyist, but the additional financial information must be filed immediately upon receipt of it.

§6B-3-7. Duties of lobbyists.

A person required to register as a lobbyist under this chapter shall also have the following obligations, the violation of which shall constitute cause for revocation of his registration, and may subject such person, and such person's employer, if such employer aids, abets, ratifies, or confirms any such act, to other civil liabilities, as provided by this chapter.
(1) Such persons shall obtain and preserve all accounts, bills, receipts, books, papers and documents necessary to substantiate the financial reports required to be made under this article for a period of at least five years from the date of the filing of the statement containing such items, which accounts, bills, receipts, books, papers, and documents shall be made available for inspection by the commission at any time: Provided, That if a lobbyist is required under the terms of his or her employment contract to turn any records over to his or her employer, responsibility for the preservation of such records under this subsection shall rest with such employer.
(2) In addition, a person required to register as a lobbyist shall not:
(A) Engage in any activity as a lobbyist before registering as such;
(B) Knowingly deceive or attempt to deceive any government officer or employee as to any fact pertaining to a matter which is the subject of lobbying activity;
(C) Cause or influence the introduction of any legislation for the purpose of thereafter being employed to secure its defeat;
(D) Exercise any undue influence, threats, extortion, or unlawful retaliation upon any government officer or employee by reason of such government officer or employee's position with respect to, or his vote upon, any matter which is the subject of lobbying activity;
(E) Exercise undue influence upon any legislator or other privately employed government officer or employee through communications with such person's employer;
(F) Give a gift to any government officer or employee in excess of or in violation of any limitations on gifts set forth in subsection (c), section five, article two of this chapter, or give any gift, whether lawful or unlawful, to a government officer or employee without such government officer or employee's knowledge and consent.

NOTE: The purpose of this bill is as follows: (1) To include political contributions from lobbyists as being prohibited items for public officials to accept; (2) to provide that certain nominal items may be accepted by public officials without solicitation; (3) to provide that lobbyists are not required to report unreimbursed expenses incurred during travel; (4) to require employers of lobbyists to fulfill certain reporting requirements; and (5) to require lobbyists to report their compensation; and (6) to provide that lobbyists or their employers cannot purchase meals or beverages for a particular public official but may have one annual reception costing not more than five thousand dollars for the Legislature and general public. The bill also deletes a substantial portion of existing law.

Strike-throughs indicate language that would be stricken from the present law, and underscoring indicates new language that would be added.

§6B-3-4a is new; therefore, strike-throughs and underscoring have been omitted.