Ethics ruling hampers fund-raising efforts

A ruling by the state Ethics Citizen's Advisory Board last spring has had a significant and detrimental impact on corporate giving to state entities, including UConn.

The ruling interferes with the ability of all state entities but most directly with the ability of UConn, the vocational technical schools, and the other public colleges to raise private funds, by prohibiting gifts from any vendor doing business with the state agency to which it plans to give funds or from any company that employs a lobbyist.

"The original ban on gifts applied only to individual state employees," says Rachel Rubin, chief compliance officer.

"Extending it to state agencies appears to be contrary to legislative intent and severely limits our ability to raise private dollars."

Under the ruling, gifts to UConn from companies doing business with UConn are prohibited. In addition, if a company is a registered lobbyist, then it would be similarly prohibited, even if it had no contractual relationship with UConn.

In practice, the ruling prohibits gifts from nearly every major corporation in the state. It means, for example, that Pfizer, General Electric, and other major Connecticut corporations cannot contribute to UConn or any state agency or public higher education institution because they are deemed lobbyists under state law, said Rubin.

Likewise, a gift of land that United Technologies planned to give to the state to provide additional parking at Rentschler Field would not be permissible.

It means, too, for example, that Bayer, which is leaving its West Haven campus and wants to contribute equipment to various teaching institutions, could not contribute to UConn. It could contribute, perhaps, to the University of Connecticut Foundation, but that issue is murky.

The problem has arisen even though the ruling does not ban gifts to a foundation associated with a public entity such as the UConn Foundation.

It may, however, ban the foundation from passing the gifts on to the University.

In a Nov. 2 letter from Cynthia Isales, assistant general counsel to the Office of State Ethics with regard to Charter Oak State College, Isales told Cynthia Forbes at Pratt & Whitney that: "The Code of Ethics would not prohibit the Foundation, a non-state entity, from receiving funds donated by Pratt & Whitney. It would, however, prohibit the Foundation from then turning those funds over to (Charter Oak State) College."