Conflict of Interest

Conflict of Interest Thomas M. Moncure, Jr. University Counsel

“That government is, or ought to be...most effectually secured against the danger of maladministration.”George MasonVirginia Declaration of Rights

The General Assembly adopted the State and Local Government Conflict of Interest Act (COIA) as “a single body of law” on the subject. COIA – Single body of law? Not exactly....

PROCUREMENT ACT • Although the Confict of Interest Act (COIA) is meant to be comprehensive, there are provisions in the Procurment Act that supplement COIA.

COIA-Three areas of conduct addressed: • CONTRACTS (Article 3) • TRANSACTIONS (Article 4) • GENERAL PROHIBITIONS (Article 2)

PERSONAL INTEREST • Required to invoke the prohibitions related to CONTRACTS and TRANSACTIONS

PERSONAL INTERESTDEFINED • A financial benefit or liability reasonably valued or estimated at $10,000 annually, or an ownership (equity) interest greater than 3%. (Section 2.2-3101)

YOU=EMPLOYEE + IMMEDIATE FAMILY • Immediate Family: Your spouse and any dependent residing with you. • Dependent: Anybody to whom you provide more than half their financial support. (Section 2.2-3101)

CONTRACT • A contract is any agreement with or on behalf of a governmental agency involving payment of public money. (Section 2.2-3101)

CONTRACT • EMPLOYMENT CONTRACT The only personal interest in a contract you can have with George Mason University (or another state agency)unless an exception applies. (Section 2.2-3106.A.)

CONTRACTGeneral Exceptions • You may have a personal interest in a contract with another state agency if awarded by competitive sealed bidding or competitive negotiation. (Section 2.2-3106.B.)

CONTRACTGeneral Exceptions • A family member’s employment by George Mason University is not a conflict if you exercise no control over their activities and do not influence those activities. (Section 2.2-3106.C.1.)

CONTRACTGeneral Exceptions • You may have a personal interest in an employment contract with another state agency. (Section 2.2-3106.C.3.)

CONTRACTGeneral Exceptions • You may purchase goods or services from George Mason University at uniform prices available to the general public. (Section 2.2-3106.C.4.)

CONTRACTGeneral Exceptions • You may have a personal interest in a contract for the sale or lease of real property provided that you do not participate as an employee of George Mason University. (Section 2.2-3110.A.1.)

CONTRACTGeneral Exceptions • You may have a personal interest, based on income only, if you (meaning family) have no authority in the contract with the outside entity, and you (meaning employee) have no authority in the contract with George Mason University. (Section 2.2-3110.A.4.)

CONTRACTGeneral Exceptions • You may have a personal interest if the outside entity is a public service corporation, financial institution or public utility, and you (meaning employee) disqualify yourself publicly and do not participate in the contracting. (Section 2.2-3110.A.6.)

CONTRACTGeneral Exceptions • You may have a personal interest if the goods or services purchased by George Mason University do not exceed $500. (Section 2.2-3110.A.7.)

CONTRACTGeneral Exceptions • You may have a personal interest if grants and programs offered by George Mason University are paid with uniform rates to all qualified applicants. (Section 2.2-3110.A.8.)

CONTRACTGeneral Exceptions • You may have a personal interest in your spouse’s contract with George Mason University if the spouse was employed for five or more years before the marriage. (Section 2.2-3110.A.9.)

CONTRACTHigher Education Exceptions • 1. Found to be in the best interest of the Commonwealth; • An employee’s and family member’s employment by GMU in teaching, research and administrative support positions does not create a conflict if such dual employment is: • 2. Employee does not have the sole authority to supervise, evaluate or make personnel decisions regarding the other. (Section 2.2-3106.C.2.)

CONTRACTHigher Education Exceptions • You may have a personal interest in a contract with a publisher or wholesaler of textbooks and educational materials if you are the author or creator. (Section 2.2-3106.C.5.)

CONTRACTHigher Education Exceptions • An employee may obtain collections or scholarly works if: • 1. The President approves; • 2. The acquisition is in the best interest of the Institution’s public mission. (Section 2.2-3106.B.6.)

CONTRACTHigher Education Exceptions • You may have a personal interest, based on equity only, if you: • 1. Disclose the interest in writing; • 2. Contract is found to be in the best interest of the Commonwealth; • 3. Neither you or your family member are involved in negotiating or approving the contract. (Section 2.2-3110.A.5.)

CONTRACTHigher Education Exceptions • You may have a personal interest in a contract for research and development or commercialization of intellectual property if: • 1. Approved, prior to entering into contract; • 2. Interest is disclosed; • 3. Based on University policy; • 4. Disclosure made to the Secretary of the Commonwealth. (Section 2.2-3106.C.8.)

TRANSACTIONS • You cannot have a personal interest in a transaction, which is any matter considered by you in any committee or subcommittee or other gathering on which an official action is taken or contemplated. (Section 2.2-3112)

TRANSACTIONS • Typically, transactional matters involve casting votes or making decisions on hiring, promotion and procurement committees.

TRANSACTIONSGeneral Exceptions • Exceptions to transactional conflicts involve waiver and disclosure, but with a specificity that requires consultation with counsel prior to the transaction.

GENERAL PROHIBITIONS • Certain conduct by public employees is prohibited. Unlike the Contracts or Transaction provisions of COIA, there are NO minimum dollar amounts and there are NO exceptions. (Section 2.2-3103)

GENERAL PROHIBITIONS • You cannot accept or solicit money or anything of value for: • 1. Services performed within the scope of your duties; • 2. Obtaining employment, appointment or promotion for any person; • 3. Obtaining a contract for any person or business with any governmental agency.

GENERAL PROHIBITIONS • You cannot use confidential information for economic benefit.

GENERAL PROHIBITIONS • You cannot accept any gift, favor or service reasonably tending to influence the performance of official duties.

GENERAL PROHIBITIONS • You cannot accept any business or professional opportunity when reasonably afforded to influence the performance of official duties.

GENERAL PROHIBITIONS • You cannot accept gifts where timing and frequency causes reasonable questions of impartiality.

REASONABLE • …means “fair; just; ordinary or usual; not immoderate or excessive; not capricious or arbitrary.” Sydnor Pump & Well Co. v. Taylor, 201 Va. 311 (1959).

PENALTIES • A knowing violation of COIA is a crime, punishable by up to 12 months in jail and a fine of up to $2,500. There are also civil forfeiture provisions.

ADVICE • The Attorney General can provide advisory opinions which, upon full disclosure of the facts and good faith reliance, is a bar to prosecution.

WARNING • University Counsel, as Assistant Attorneys General, MUST report any reasonable conclusion that a knowing violation of COIA has occurred.

ERGO,ASK BEFORE YOU ACT!

Conflict of Interest