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2. Go Titans!

George Grange is a registered lobbyist who has a son, Red, a 15 year old high school student who lives with his father and mother.  Red’s best friend is Bill Seward, whose mother, Jane Seward, has just been elected to the General Assembly.  Red and Bill are the same age and have been best friends since they started school, and both are on the high school football team.  Bill lives with his father and mother.  The two boys have exchanged birthday and Christmas presents for years.

George has a pair of season tickets with the local professional football team.  Occasionally he will use these to entertain business clients, and will take the appropriate tax deduction.  Occasionally he will make personal use of the tickets, in which case their cost is not deductible.

The General Assembly is not in session, and the tickets cost $50 each.   

George is going to be out of town for next Sunday’s game, and he tells Red that he and Bill can use the tickets.  George does not plan to take a tax deduction with respect to these tickets. 

Is this a permissible gift?

  • Yes, because Bill is not a government official.
  • No, because George is a registered lobbyist and Bill is a member of the immediate family of an official in the legislative branch.
  • Yes, because the tickets are being given for a non-business purpose and are motivated by close personal friendship; George is not treating the gift as a deductible business expense and Red and Bill have a history of giving each other gifts.
  • Yes, because the General Assembly is not in session, and the tickets cost less than $55 each.
- Incorrect!
- Incorrect!
- Correct!
- Incorrect!

The correct answer is (3).

T.C.A. § 3-6-305(a)(1) prohibits a lobbyist from making a gift to the member of the immediate family of an official in the legislative branch.  T.C.A. § 3-6-301(12) defines “immediate family” as a spouse or minor child living in the household.  T.C.A. § 3-6-305(b)(3) excepts from the gift prohibition “gifts that are given for a non-business purpose and motivated by close personal friendship, but only to the extent such gifts are specifically defined and authorized by the rules of the Ethics Commission.”  The rules pertaining to this personal gift exception adopted by the Tennessee Ethics Commission are found at Tenn.R. & Regs. 0580-01-05-.04:

  1. In determining whether a gift is motivated by a close personal friendship, the Commission may consider factors including, but not limited to, the following, giving them such weight as may be appropriate in the facts and circumstances of each case:

    1. Whether the lobbyist or individual who is an employer of a lobbyist paid for or provided the gift out of his or her own personal funds or account, or whether the gift is instead being charged to the lobbyist’s business account, an employer of the lobbyist, or a lobbying firm.
    2. Whether the cost of the gift is taken as a business deduction by the lobbyist, a lobbying firm, or employer of the lobbyist.
    3. Whether there has been a history of gift giving between the lobbyist or the employer of a lobbyist, on the one hand, and the candidate, official, or his or her immediate family, on the other hand; and the nature of the previous gift giving.
    4. Whether the candidate, official, or immediate family member has reciprocated with a gift to the lobbyist or the employer of the lobbyist in the past, and whether the gift has been of similar value.
    5. Whether the lobbyist or the employer of a lobbyist provides the same or similar items to other candidates, Officials, or the immediate families of such candidates or officials at the same time, who are not also close personal friends.
    6. Whether the timing and circumstances of the gift are appropriate; whether a lobbyist or an employer of a lobbyist has a matter that is currently before or will shortly be before the official.
    7. In the case of a gift given by an individual who works for an employer of a lobbyist, whether the gift-giver is involved in lobbying activities on behalf of the employer.

Answer (4) is incorrect in that the exception set forth in T.C.A. 3-6-305(10)(a) applies to gifts from employers of lobbyists, not lobbyists, and does not extend to “entertainment” which would be the category that football tickets would fall under.

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