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$250 Limit Covers All Personal Gifts to Members, Staffers

I am a registered lobbyist and a longtime friend of a Senate staffer. We grew up on the same street and attended the same schools all the way from the first day of kindergarten through law school. I served as the best man in his wedding, and he was the best man in mine. Over the years, our wives have become close as well, so close that they speak nearly every day. My friend’s 40th birthday is coming up, and I would like to do something special for him. I’m thinking of getting him a $1,000 gift certificate to his favorite restaurant, The Inn at Little Washington. May I do so? If not, may we simply address the gift from my wife, who is not a lobbyist?

A: Wow, we should all have friends like you. Unfortunately, in this case, your friend may not be able to enjoy the full benefit of your generosity. [IMGCAP(1)]

Under the recently enacted Honest Leadership and Open Government Act, lobbyists such as yourself face penalties for making a gift to a Senate staffer that violates the Senate gift rule. As I am sure you know, the gift rule prohibits gifts of any kind to Senators and their staffers, unless an exception applies. Therefore, the question for you is whether there is an exception that allows the gift you have in mind.

Given your relationship with the staffer, the personal friendship exception would appear to be your best bet. This exception covers anything given on the basis of a personal friendship, unless the gift was provided because of the recipient’s official position. The rule sets forth three relevant factors, and you have a good shot at meeting all three. But, as you may have guessed, there’s a catch.

The first factor is the history of the relationship between you and the staffer, including whether you have previously exchanged gifts. Given your close friendship, I’m going to bet that this is not the first time you’ve exchanged gifts. If that’s right, so far so good.

The second relevant factor is whether you will pay personally for the gift, or whether you instead will seek a business reimbursement or tax deduction. It doesn’t sound like a reimbursement or deduction is what you have in mind here. So far, you are two for two.

The third factor is whether, at the same time you give the staffer his gift, you also plan to give similar gifts to other Congressional employees. Since this gift is for a special occasion, I imagine it’s not your plan to distribute $1,000 gift certificates to The Inn at Little Washington throughout Congress.

You appear, then, to meet all three exceptions. So what’s the catch?

For gifts given under the personal friendship exception, there is a $250 across-the-board limit. The only way around this limit is for the staffer to obtain written approval from the Ethics Committee. Unless the staffer obtains such approval, your gift is four times more generous than the rule allows. (Incidentally, if you’ve already purchased the gift certificate, you should know that the Congressional rules do not forbid gifts to Roll Call columnists — although our editors probably wouldn’t be too happy about one of us getting a gift from a lobbyist.)

Unfortunately, the idea that the gift be given by your wife rather than yourself, while ingenious, won’t get you around the Senate’s rule. The rule is a general prohibition upon all gifts, regardless of the source. Even if your wife’s gift qualified under the personal friendship exception, the $250 limit would still apply.

The restrictions on the gift to your friend would be no different if your friend were in the House, where the rules contain a similar $250 limit on gifts made on the basis of personal friendship. The consistency of the House and Senate rules on this point means that, for gifts given under the personal friendship exception, there is a $250 limit on all gifts to Congressional employees.

With the holiday season approaching, your question is a useful reminder that there are now stiff penalties for lobbyists’ violations of the Congressional gift rules, even where the recipient is a personal friend. Lobbyists face up to $200,000 fines for knowingly violating the gift rules — and up to five years in jail for “corrupt” violations.

This raises one more issue: how to determine the value of a gift. In the case of your gift, a certificate with a specific denomination, it’s easy. But what about valuing other gifts? Perhaps the most important thing to remember is that, under both the Senate and House rules, the fair market value governs, not the amount that the donor paid for a gift. I predict $250 gift certificates will be hot items this year.

C. Simon Davidson is an attorney in the Washington, D.C., office of McGuireWoods LLP. Click here to submit questions. Readers should not treat his column as legal advice. Questions are not confidential and do not create any attorney-client relationship.

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