2013-Op.(Mar. 12).

Case Date:March 12, 2013
Alaska Attorney General Opinions 2013. 2013-Op.(Mar. 12). March 12, 2013Patricia Jacobson Chair and Designated Ethics Supervisor University of Alaska Board of Regents 202 Butrovich Building 910 Yukon Drive P.O. Box 755300 Fairbanks, AK 99775-5300Re: Advisory Opinion Addressing Denali Commission Compensation AGO File No. AN2010100322Dear Chair Jacobson: This opinion addresses your request for advice regarding the Request for Ethics Determination, dated January 28, 2013, forwarded to you by Pat Gamble, President of the University of Alaska. As chair of the Board of Regents for the university, you serve as Mr. Gamble's ethics supervisor and are entitled to receive advice under AS 39.52 240(a). Mr. Gamble seeks clarification of his responsibilities under the Executive Branch Ethics Act. Specifically, he asks whether acceptance of federal compensation for service on the Denali Commission, a federal agency created to provide job training and encourage economic development in Alaska, will violate AS 39.52.120. He considers his work with the commission to be part of his job as the president of the university. To date, he has waived compensation from the commission for that work because AS 39.52.120(b)(2) states that a public officer may not receive compensation for performance of official duties from a person other than the state.(fn1) He reports that, based on a recent analysis of federal law, the Denali Commission will require that he be paid federal compensation for commission service in the future. The commission also will reimburse travel expenses either to him if he pays those expenses or to the university if the university pays them, as it has in the past. As discussed in detail below, acceptance of the compensation from the Denali Commission is permitted and doing so will not violate the Ethics Act. Also, the commission's payment of travel expenses in this circumstance is a gift to the state. I. BACKGROUND INFORMATION A. Denali Commission The Denali Commission is an independent federal agency created by the Denali Commission Act of 1998(fn2) to, among other things, provide job training and encourage economic development in distressed communities in Alaska and to promote modern infrastructure needs, including power, water and sanitation, in rural Alaska. The federal legislation creating the commission provides for seven specially named commissioners appointed by the United States Secretary of Commerce, including the Governor of Alaska, who serves as co-chair, and the President of the University of Alaska, or for either position, an individual selected from nominations submitted by the governor or university president.(fn3) The Denali Commission Act also provides that the commissioners "shall be compensated" for their services based on a federal pay schedule and requires the commission to pay their travel expenses, including per diem based on federal rates.(fn4) In an opinion dated March 30, 2012, the Comptroller General of the United States Accountability Office determined that the commission may not accept waivers of compensation from nonfederal commissioners because failure to pay the compensation would violate the Antideficiency Act. That act prohibits federal agencies from accepting voluntary services without specific statutory authority.(fn5) Then, in December 2012, the Internal Revenue Service issued a Letter Ruling determining that the Denali Commission's nonfederal commissioners are its "employees" and that compensation paid for commission services is income, which must be included in the person's gross income for federal tax purposes, whether accepted or not. In reaching the conclusion that the commissioners are employees, and not agents of their respective offices or organizations identified in the Denali Commission Act, the ruling finds, among other reasons, that the Secretary of Commerce appoints the person to serve in each position and may remove that person; that is, a position is not filled by operation of the statutory designations alone. B. Past Recognition of Denali Commission Service as Function of State Position Historically, based on President Gamble's disclosure, the opinions discussed in the preceding section, and a 2003 informal attorney general opinion,(fn6) we understand that Alaska public officers serving as commissioners have simply declined to accept compensation from the Denali Commission based on the prohibition in AS 39.52.120(b)(2) and that the commission regularly reimburses...

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