No. 41187 (New Rule): Rule R277-118. Board of Education Conflict of Interest Avoidance

(New Rule)

DAR File No.: 41187
Filed: 01/17/2017 03:39:56 PM

RULE ANALYSIS

Purpose of the rule or reason for the change:

The purpose of this rule is to provide procedures to prevent conflict of interest issues within the Utah State Board of Education (Board) when a Board employee separates or retires from the Board.

Summary of the rule or change:

This new rule defines terms; provides post separation or post retirement employment restrictions; and provides procedures for contract termination for a contractor who violates the terms of this rule.

Statutory or constitutional authorization for this rule:

• Art X, Sec 3
• Section 53A-1-401

Anticipated cost or savings to:

the state budget:

This new rule provides procedures to avoid conflicts of interest, which likely will not result in a cost or savings to the state budget.

local governments:

This new rule provides procedures to avoid conflicts of interest, which likely will not result in a cost or savings to local government.

small businesses:

This new rule provides procedures to avoid conflicts of interest, which likely will not result in a cost or savings to small businesses.

persons other than small businesses, businesses, or local governmental entities:

This new rule provides procedures to avoid conflicts of interest, which likely will not result in a cost or savings to persons other than small businesses, businesses, or local government entities.

Compliance costs for affected persons:

This new rule provides procedures to avoid conflicts of interest, which could result in contract/agreement termination if a contractor/subcontractor violates this rule and the terms of the contractor's/subcontractor's contract/agreement. It is anticipated, however, that that a contractor/subcontractor will be clear about consequences, so it is likely that there will be no compliance costs for affected persons.

Comments by the department head on the fiscal impact the rule may have on businesses:

To the best of my knowledge, there should be no fiscal impact on businesses resulting from this new rule.

Sydnee Dickson, State Superintendent

The full text of this rule may be inspected, during regular business hours, at the Office of Administrative Rules, or at:

Education
Administration
250 E 500 S
SALT LAKE CITY, UT 84111-3272

Direct questions regarding this rule to:

• Angela Stallings at the above address, by phone at 801-538-7656, by FAX at 801-538-7768, or by Internet E-mail at [e-mail]

Interested persons may present their views on this rule by submitting written comments to the address above no later than 5:00 p.m. on:

03/03/2017

This rule may become effective on:

03/10/2017

Authorized by:

Angela Stallings, Deputy Superintendent, Policy and Communication

RULE TEXT

R277. Education, Administration.

R277-118. Board of Education Conflict of Interest Avoidance.

R277-118-1. Authority and Purpose.

(1) This rule is authorized by:

(a) Utah Constitution Article X, Section 3, which vests general control and supervision over public education in the Board; and

(b) Section 53A-1-401, which allows the Board to make rules to execute the Board's duties and responsibilities under the Utah Constitution and state law.

(2) The purpose of this rule is to:

(a) define necessary terms;

(b) reduce the appearance or existence of conflicts of interest within the Board;

(c) establish rules for the prevention of pre and post separation or retirement conflicts of interest; and

(d) ensure that revolving door issues which could lead to compromise of sound ethical principles do not exist within the Board.

 

R277-118-2. Definitions.

(1)(a) "Agreement" means a written instrument used to transfer funding from the Board to an enterprise.

(b) "Agreement" does not include a grant.

(2)(a) "Board employee" means anyone employed by the Board on or after March 1, 2017.

(b) "Board employee" does not include a Board member elected in accordance with Title 20A, Chapter 14, Part 1, State School Board - Nomination and Election.

(3)(a) "Compensation" means any monetary payment or financial benefit received either directly or indirectly under a contract, subcontract, or agreement.

(b) "Compensation" does not include deferred payments, separation payments, or retirement-related payments which are made as a result of service while an employee of the Board.

(4)(a) "Direct and significant involvement" means meaningful participation in:

(i) creation of requirements for a contract or agreement;

(ii) creation of evaluation criteria for evaluation of an offer;

(iii) a bidders' pre-bid conferences for a contract or agreement;

(iv) evaluation of offers:

(v) determining that an enterprise is eligible to receive payment under a contract or agreement based on approval of work performed or materials furnished;

(vi) negotiation, award or modification of a contract or agreement;

(vii) evaluating or monitoring performance of a contractor; or

(viii) any other involvement that has a meaningful and significant impact on the compensation or benefits received by an outside contractor, vendor, or consultant, or other direct or indirect recipient of Board funding.

(b) "Direct and significant involvement" does not include administrative or clerical involvement only.

(5) "Employment" means either direct or indirect employment by a prime or subcontractor and also includes consultants at either a prime or sub-tier level.

(6) "Enterprise" means a form of business association, including a profit or not for profit corporation, partnership, sole proprietorship, limited liability company, or cooperative association.

 

R277-118-3. Post Separation or Post Retirement Employment Restrictions.

(1) The restrictions described in this R277-118 are not intended to alter or replace the post retirement employment restrictions that are mandated by Section 49-11-12, but are intended to be additions to the restrictions in Section 49-11-12.

(2) A former Board employee may not receive compensation for a period of two years after separating or retiring from the Board from an enterprise:

(a) that has received a contract or agreement from the Board:

(i) within the previous three years;

(ii) either at a prime or sub-tier level;

(iii) to perform services for or deliver products to the Board; and

(iv) at a total contract value of $50,000.00 or more in any calendar year; and

(b) where the former Board employee had direct and significant involvement in the procurement or contract administration process prior to the Board employee's separation or retirement.

 

R277-118-4. Contract Termination.

(1) A contract, subcontract, or other agreement with a Board contractor or subcontractor who provides compensation to a former Board employee in violation of Section R277-118-3 may be terminated at the discretion of the Board.

(2) Any contractor whose contract or subcontract is terminated as described in Subsection (1) shall receive the portion of the contract price reasonably attributable to goods or services already provided and accepted by the Board.

(3) Notice of the restrictions and termination provisions described in this R277-118 shall be included as a term in each Board contract or agreement.

 

KEY: conflicts of interest

Date of Enactment of Last Substantive Amendment: 2017

Authorizing, and Implemented or Interpreted Law: Art X Sec 3; 53A-1-401

 

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