VETERANS EDUCATION AND RESEARCH ASSOCIATION
OF NORTHERN NEW ENGLAND, INC.
P.O. Box 4655
White River Junction, Vermont 05001
Policy #3.6
Honoraria and Speaker Fees - Payment and Acceptance by VERANNE
I. PURPOSE: The purpose of this policy is to raise general awareness that prohibitions exist regarding honoraria and other compensation from non-governmental entities and employees with questions regarding the requirements of the Federal ethics laws should contact the Office of Regional Counsel (x5800).
II. POLICY: Acceptance of Donations of Honoraria and Speaker or Writing Fees
VA investigators often choose to have an honorarium or speaker fee directed to a VA Non-Profit Corporation (NPC) as a donation in lieu of accepting it personally. Some apparently do this in the belief that donating a fee to a nonprofit relieves them of the need to make sure the subject of their presentation is not related to their official VA duties or the need to take annual leave. However, federal ethics regulations at 5 CFR §2635.807 allow federal employees to earn fees for teaching, speaking or writing on topics related to their official duties ONLY if they are teaching a course requiring them to make multiple presentations that is part of the regularly established curriculum of the federal government or by an institution of higher education, an elementary school or an secondary school as those institutions are defined under federal law, or a program of education or training sponsored or funded by the Federal Government or by a State or local Government which is not offered by the previously mentioned types of schools. While the above exception authorizes Government employees to teach courses that involve the subject matter of their Government employment in certain circumstances, in no event may an employee receive compensation for such teaching if the teaching occurs as part of the employee’s official VA duties. Moreover, if teaching, speaking, or writing occurs as part of an employee’s official duties there is no exception allowing the employee to direct the payment to another entity such as the NPC because such a payment would still be considered to be constructively received by the employee and thus would violate the law.
VA employees may accept fees for teaching, speaking, or writing, ONLY if the topic is unrelated to their official duties AND such activities are performed outside of official duty hours. Investigators sometimes also believe they will not be assessed personal income taxes on a speaker fee if they instruct the payer to send the check to a nonprofit. However, the IRS is likely to view as income amounts earned any time there is a quid pro quo - an exchange of goods or services for payment - or when an individual exercises control over dispensation of payment. Such payments may be taxable to that individual regardless of whether payment goes to a nonprofit or the individual accepts it personally.
NPCs are not responsible for monitoring VA employees’ ethics except in regard to conflicts of interest. Nor should they be giving tax advice. However, NPCs can help prevent violations of federal ethics regulations if they require investigators to complete a simple form regarding donations of honoraria.
III. PROCEDURE
a)Using the attached "Honoraria Decision Tree" from NAVREF (Attachment #1), VA employees and the VERANNE administrative staff can determine if honoraria may be accepted by an individual or paid to the NPC.
b)Using the attached "Honoraria or Speaker Fee Donation Form" (Attachment #2), a VA employee may have an honoraria or speaker fee donated to VERANNE, so long as federal ethics regulations regarding outside teaching, writing and speaking, have not been violated. The individual completes the donation form and certifies the statements contained in the document. If an individual needs assistance in determining whether the presentation was "related" to official duties, the individual should contact a VA attorney.
c)The definition of whether teaching, speaking, or writing relates to official duties may be found at CFR 2635.807(a)(2), and are attached (Attachment #3).
d)A VA employee invited to present at a conference as part of his official duties, cannot direct the sponsor to make a donation to VERANNE (Attachment 4). However, VERANNE can contact the sponsor to inform the sponsor that VERANNE can accept a gratuitous contribution (Attachment 5).
e)If a VA employee is invited to present at a conference, and the topic is unrelated to his official duties and conducted during non-duty hours, the presenter may then accept the contribution or may direct it to the VERANNE (and may incur a personal tax liability).
f)A sample letter is attached regarding how the NPC may request funding for Scientific or Medical Education Support (Attachment #6 ).
g)Finally, no VA employee may speak on behalf of VERANNE. Only the Executive Director, or designee, may represent the interests of VERANNE with sponsors, pharmaceutical companies, or clinical research organizations.
h)A detailed list of items considered “gifts” is included (Attachment 7).
IV. ATTACHMENTS:
- Decision Tree
- Honoraria or Speaker Fee Donation Form
- Official Duties
- PI Letter to Sponsor
- VERANNE Letter to Sponsor
- Sample - Correct Way To Request Support For Education & Research
- Detailed List Of Items Considered “Gifts”
ATTACHMENT 1 - Honoraria Decision Tree
NPCs are often asked to pay honoraria and speaker fees or to accept donations of honoraria. To help NPCs work through the sometimes complex issues related to compensation for outside speaking, writing and teaching, NAVREF offers the following decision tree for NPC use in determining when honoraria and speaker fees may be paid to VA employees without putting the employee at risk of violating federal ethics regulations. Following the decision tree is discussion of NPCs accepting honoraria as donations.
Payment of Honoraria Decision Tree1. Is the speaker a VA employee? / NO / / Obtain the speaker’s Social Security number and mailing address. Issue an IRS Form 1099 Misc. if total payment(s) to the individual in one calendar year are $600 or more regardless of whether the check will be paid to the individual or to a nonprofit.See IRS Form 1099 Misc. instructions.
YES
2. Is the subject of the speaker’s presentation related to the speaker’s official VA duties? [See definition of “related” at §2635. 807(a)(2).]
NO / YES / UNCERTAIN / / Have the speaker obtain a written opinion from a VA attorney or ethics official and then follow instructions for “yes” or “no.”
/
Do not pay an honorarium or speaker fee regardless of whether the speaker is on annual leave or administrative leave/ authorized absence/official absence [5 CFR §2635.807] or intends to direct payment to a nonprofit. Exception: teaching certain courses offered by universities or sponsored and funded by the federal government [5 CFR 2635.807(a)(3)].
3. Is the speaker on off duty status (i.e., on annual leave or outside of normal VA duty hours)? / YES / / Have the speaker complete and submit an IRS Form W-9, or obtain the speaker’s Social Security number and mailing address, before issuing payment. Issue an IRS 1099 Misc. if total payment(s) to the individual in one calendar year are $600 or more regardless of whether the check will be paid to the individual or to a nonprofit.
NO
If the speaker is on duty (normal VA duty hours, administrative leave, authorized absence and official absence = “on duty” status), do not pay the speaker an honorarium or speaker fee. Payment would constitute dual compensation [§18 USC 209] regardless of whether the speaker directs payment to a nonprofit organization.
ATTACHMENT 2 - Sample Honoraria or Speaker Fee Donation Form
The Veterans Education and Research Association of Northern New England, Inc. (VERANNE) accepts donations of honoraria and speaker fees only if the individual earning the funds that enable the donation certifies that he or she has not violated federal ethics regulations regarding outside teaching, writing and speaking contained in 5 CFR §2635.807.
You must certify 1 and 2 or 3 and 4 below in order for VERANNEto accept your donation. If you need assistance determining whether your presentation was “related” to your official VA duties [see definition at CFR 2635.807(a)(2)], please consult the facility ethics official or a VA attorney. Note that a judgment of relatedness depends on a number of factors including substance and focus.
I am designating the honorarium/speaker fee in the amount of $ ______for my presentation at (facility, university, etc.,) ______
on (date) ______as a charitable donation to VERANNE.
I understand that theVeterans Education and Research Association of Northern New England, Inc.will provide me with acknowledgement of this donation.
1. _____ I certify that the topic of my presentation is unrelated to my official duties.
and
2. _____ I certify that I was on off duty status (annual leave or outside of normal VA duty hours) at the time I made the presentation.
OR:
3. _____ I certify that I was on off duty status (annual leave or outside of normal VA duty hours) at the time I made the presentation.
and
4. _____ I certify that this donation comprises compensation for teaching a course requiring multiple presentations during a program of education or training sponsored and funded by the federal government or by an institution of higher education, an elementary school or an secondary school.
______
Signature
______
Name (print)
ATTACHMENT 3 – OFFICIAL DUTIES
Please contact the Research & Development Office (x5370) or Regional Counsel for a copy.
ATTACHMENT 4 – Sample Gratuitous Donation Letter from PI to Conference Sponsor
Personal or VA Letterhead
Date
Conference Sponsor
Address
Dear Mr. Sponsor:
I am pleased to accept your invitation to speak at the XYZ national conference.
I appreciate your offer of an honorarium. However, I am a federal employee at the White River Junction VA Medical Center. I will be participating in your conference in an on-duty status and/or the topic of my presentation is related to my official VA duties. As such, I am prohibited from accepting honoraria for my participation in your conference.
I look forward to speaking at the XYZ national conference.
Sincerely,
John R. Snuffy, MD
ATTACHMENT 5 - Sample Gratuitous Donation Letter from NPC to Conference Sponsor
VERANNE Letterhead. May ONLY be sent by Executive Director, or designee.
Date
Conference Sponsor
Address
Dear Mr. Sponsor:
John R. Snuffy, MD, VA title at the White River Junction VA Medical Center, is pleased to have been invited to present during the XYZ national conference. After accepting your invitation, he was advised in a subsequent confirmation letter that he will be provided with an honorarium.
Dr. Snuffy discussed the matter with his service chief who agrees that VA has an interest in his attendance at the conference and in his presenting. Therefore, he is approved to participate on an authorized absence status and will participate while on official government time. As a result, Dr. Snuffy is prohibited from accepting an honorarium or directing its dispensation.
The Veterans Education and Research Association of Northern New England, Inc. is a 501(c)(3) organization established to support research and education at the White River Junction VA medical center. If the sponsor name would like to make a gratuitous general donation in support of research and education conducted at the White River Junction VA medical center, we would be pleased to accept it. Our federal ID number is 22-3091219.
If you have questions or need additional information, please contact me at 802-295-9363 X5692. Thank you for your consideration.
Sincerely,
Priscilla West
Executive Director
ATTACHMENT 6 - CorrectMethod to Request Scientific or Medical Education Support
VERANNE Letterhead. May ONLY be sent by Executive Director, or designee. May NOT be sent by a VA employee. Must refer to position with NPC.
March 18, 2006
Mr. Donald A. Donor
Director, Government Accounts
Biotech Pharmaceuticals and Medical Devices
1234 East Greene Street
Trenton, New Jersey 12345
Dear Mr. Donor:
I am writing on behalf of the Veterans Education and Research Association of Northern New England, Inc. (VERANNE) to request a contribution in the amount of $1500 for the general support of an approved training seminar on diabetes management that VA will be conducting in April. Elliot D. Investigator, MD, Chief, Internal Medicine at the VA Medical Center in White River Junction, VT, recently mentioned to me that Biotech Pharmaceuticals and Medical Devices has an interest in such training.
Diabetes is highly prevalent among veteran patients, and it is important to ensure that the clinical staff of the White River Junction, VT, VA Medical Center is current on the latest treatments. We are also inviting diabetes health care providers from the community to attend this training session. I have attached the preliminary program. We would be pleased to acknowledge your contribution in our final conference program.
VERANNE is a 501(c)(3) nonprofit organization established and operated in accordance with 38 USC 7361 to support research and medical education at the White River Junction, VT, VA Medical Center. Our Federal ID number is 00-1234567. A copy of our IRS notification of tax-exempt status is enclosed. Please make your check out to theVeterans Education and Research Association of Northern New England, Inc. and mail it to:
Priscilla West, Executive Director
Veterans Education and Research Association of Northern New England, Inc.
P.O. Box 4655
White River Junction, VT 05001
If you have questions or need additional information, please contact me at 802-295-9363 X5682. Thank you for considering our request.
Sincerely,
Priscilla West
Executive Director
Enclosure (1)
ATTACHMENT 7 – Detailed List Of Items Considered “Gifts”
GIFTS include any gratuity, favor, discount, entertainment, hospitality, loan, forbearance, or other item having monetary value. It includes services as well as gifts of training, transportation, local travel, lodgings and meals, whether provided in-kind, by purchase of a ticket, payment in advance, or reimbursement after the expense has been incurred. It does not include:
a)Modest items of food or refreshments, such as soft drinks, coffee and donuts, offered other than as a part of a meal;
b)Greeting cards and items with little intrinsic value, such as plaques, certificates, and trophies, which are intended solely for presentation;
c)Loans from banks and other financial institutions on terms generally available to the public;
d)Opportunities and benefits, including favorable rates and commercial discounts, available to the public or to a class consisting of all Government employees or all uniformed military personnel, whether or not restricted on the basis of geographic considerations;
e)Rewards and prizes given to competitors in contests or events, including random drawings, open to the public unless the employee’s entry into the contest or event is required as part of his official duties;
f)Pension and other benefits resulting from continues participation in an employee welfare and benefits plan maintained by a former employer;
g)Anything which is paid for by the Government or secured by the Government under Government contract;
h)Any gift accepted by the Government under specific statutory authority, including:
- Travel, subsistence, and related expenses accepted by an agency under the authority of 31 U.S.C. 1353 in connection with an employee’s attendance at a meeting or similar function relating to his official duties which take place away from his duty station. The agency’s acceptance must be in accordance with the implementing regulations at 41 C.F.R. part 304-1; and
- Other gifts provided in-kind which have been accepted by an agency under its agency gift acceptance statute; or
j)Anything for which market value is paid by the employee.
January 18, 2005