Meetings
 
Agenda Item
Docket No. 12-1782
 
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RE:
Appearance in connection with a request for an advisory opinion regarding whether it is a conflict of interest if Louisiana Seafood Promotion and Marketing Board (LSPMB) members inadvertently received a benefit from Distributor Promotions and Incentive Programs conducted by the Seafood Marketing Campaign Team.
Facts:
The Louisiana Seafood Promotion and Marketing Board (LSPMB) is an agency located within the Office of Fisheries, Louisiana Department of Wildlife and Fisheries. The LSPMB is composed of individuals who are engaged in the Louisiana seafood industry.

The LSPMB is currently operating under a three year plan to expend $30 million derived from a Memorandum of Understanding between BP, LDWF, the Office of the Lieutenant Governor, the LSPMB, and the Louisiana Wildlife and Fisheries Foundation (LWFF) in the aftermath of the 2010 Deepwater Horizon incident. LSPMB was required to develop and implement a Seafood Marketing Program to help boost the sale of Louisiana seafood in the aftermath of the BP oil spill. LSPMB's plan was approved by BP, the LSPMB Board, LDWF, and the Lieutenant Governor.

In furtherance of implementing the Seafood Marketing Program, a Seafood Marketing Campaign Team was created. The LSPMB, LDWF, and LWFF entered into a contract with Gregory C. Rigamer & Associates, Inc. ("GCR") to be the project manager on the Seafood Marketing Campaign Team. The Seafood Marketing Campaign Team is made up of the Executive Director for LSPMB, a representative of GCR, and a representative of The Food Group (an advertising company which is a subcontractor of GCR).

The Seafood Marketing Campaign Team is tasked with implementing the Seafood Marketing Program, which has been approved by the LSPMB and to which the LSPMB has dedicated $15 million of the BP funds. At this point, the Seafood Marketing Campaign Team is not required to return to the LSPMB for permission or approval to run any particular promotions in furtherance of the Seafood Marketing Program. However, the LSPMB Executive Director has been given such authority to sign off on any task order, which is required to be submitted to LWFF to release any funds to fund such promotions. GCR is required to present quarterly reports to the LSPMB to keep them abreast of the activities being performed by the Seafood Marketing Campaign Team.

LWFF is a nonprofit, public charitable foundation. Its relationship with LSPMB regarding the $30 million BP fund is memorialized in an Addendum attached to the Memorandum of Understanding. The promotional and marketing activities contemplated by LSPMB are to be financed by the funds held in and disbursed by LWFF. LWFF will only disburse funds as directed by in writing from the LDWF and LSPMB (through its Executive Director). LWFF is responsible for providing quarterly Fund Statements to LDWF and LSPMB that illustrate all Fund Activities.

As stated before, the LSPMB is task with promoting and marketing Louisiana seafood products to end users as well as at every level of the supply chain. Part of the $30 million dollars received from BP is being used to fund specific Distributor Promotions and Incentive Programs. The expenditures would be decided by the Seafood Marketing Campaign Team through a Task Order which defines the capital commitment and tactics that would be dedicated to accomplishing a Distributor Promotion or Incentive Program. The LSPMB Board does not approve or otherwise direct specific activities, tactics, or Task Orders that are dedicated to and budgeted for the Seafood Marketing Campaign as the LSPMB has already approved the Seafood Marketing Program.

The Seafood Marketing Campaign would like to establish effective programs with vendors who are major distributors of Louisiana seafood products. Because LSPMB board members are participants in the industry, it is likely that the Seafood Marketing Campaign Team may conduct Distributor Promotions and Incentive Programs with vendors that carry Louisiana seafood or other products harvested, processed or dealt by the Board members.

The Food Group has identified a potential marketing campaign opportunity with Giant Eagle Supermarkets, which have stores in Western Pennsylvania, Ohio, Northern West Virginia and Western Maryland. The Seafood Marketing Campaign Team would like to have these supermarkets conduct in-store samplings of Louisiana seafood; publish and distribute coupons, consumer handouts and recipe booklets; publish and distribute direct mail fliers with a coupon included; and perform point of sale advertising.

Given that LSPMB members are participants in the Louisiana seafood industry, the proposed supermarket promotions could result in a financial benefit to the board members. An example given is that one member is a harvester and the supermarket promotion could lead to higher sale prices for his seafood at the dock. Other board members are processors, and their product might wind up on Giant Eagle's shelves through brokered or direct sales.

The Seafood Marketing Campaign Team would like to enter into an agreement to provide for at least 4 product sampling events costing $427,524; recipe cards to cost $7,476; direct mail outs with coupons to cost $50,000. The funds to cover the costs of this seafood promotion would come from the $15 million dedicated by the LSPMB to fund the Seafood Marketing Program it approved. The funds would be released from LWFF through a task order executed by LSPMB's Executive Director and LDWF.

Law:
La. R.S. 42:1111C(2)(d) prohibits a public servant and a legal entity in which the public servant exercises control or owns an interest from receiving any thing of economic value for services rendered to or for any person during his public service unless such services are neither performed for nor compensated by any person from whom such public servant would be prohibited by Section 1115(A)(1) or (B) from receiving a gift.

La. R.S. 42:1115A(1) prohibits a public servant from soliciting or accepting, directly or indirectly, any thing of economic value as a gift or gratuity from any person or from any officer, director, agent, or employee of such person, if such public servant knows or reasonably should know that such person has or is seeking to have a contractual, business or financial relationship with the public servant's agency.

La. R.S. 42:1115B(1) prohibits a public employee from soliciting or accepting, directly or indirectly, any thing of economic value as a gift or gratuity from any person or from any officer, director, agent, or employee of such person, if such public servant knows or reasonably should know that such person conducts operations or activities that are regulated by the public employees' agency.

Recommendations:
Adopt proposed advisory opinion.

Assigned Attorney: Tracy Barker
 
 
ATTACHMENTS:
Description:
2012-1782A Request for Advisory Opinion
2012-1782A LSPMB Info
2012-1782A MOU
2012-1782A Fund Agreement
2012-1782A GCR Agreement
2012-1782A Giant Eagle Promotion
2012-1782A Alaska Promotion Info
2012-1782A(2) Draft Opinion