Conflict of Interest in Purchasing and Contracting

Senate Bill 20, passed during the 84th Texas Legislature, modified procurement and contracting guidelines for state agencies and institutions of public education.  The UNT System has taken measures to implement necessary business practices to address the provisions established by Senate Bill 20 and Section 2261.252 of the Texas Government Code.

As part of the requirements, officers and employees of state agencies are required to disclose their financial interests and the financial interests of their family members.   The UNT System and its component institutions are prohibited from contracting to purchase goods or services from a vendor if a key officer or employee or the officer’s or employee’s family member has a financial interest in the vendor. 

When a potential conflict of interest exists, officers and employees involved in procurement or contract management are required to complete a disclosure form and submit it to UNT System Business Support Services (BSS) with the ePro requisition or with submission of the contract.  If the potential conflict of interest is related to a purchasing card transaction or the execution of a contract or some other situation that does not involve an ePro requisition or submission of a contract, the completed disclosure form should be submitted to BSS via email to conflictdisclosures@untsystem.edu

Any potential conflicts of interest reported will be reviewed for approval before the procurement or contracting process is completed.

Definitions:

“Officers and employees involved in procurement or contract management” means:

1.      UNT System Business Support Services Buyers and Senior Buyers;

2.      Officers or employees of the System or a component institution authorized to request the approval of a contract for the purchase of goods or services’

3.      Officers or employees authorized to sign contracts involving the purchase of goods or services; and

4.      An officer or employee of the System or a component institution who requests approval of a bid or contract for the purchase of goods or services from a person in category 1, 2 or 3 of this definition.   

“Family Member” means anyone related to the officer or employee involved in procurement or contract management within the second degree of consanguinity (related by blood) or affinity (related by marriage).  Second degree of consanguinity includes a parent, child, sibling, grandparent, or grandchild.  Second degree of affinity includes a spouse, stepparent, stepchild, or spouse of a person within the second degree of consanguinity.  It also includes anyone related to the officer’s or employee’s spouse by the second degree of consanguinity.  A chart regarding affinity and consanguinity is posted below for reference. 

“Financial Interest” means an interest—other than a retirement plan, a blind trust, insurance coverage, or an ownership interest of less than one percent in a corporation—where the officer or employee or officer’s or employee’s Family Member:

1.      Owns or controls, directly or indirectly, an ownership interest of at least one percent, including the right to share in profits, proceeds, or capital gains, in an entity that provides goods or services; or

2.      Could reasonably foresee that a contract with an entity that provides goods or services could result in financial benefit to the officer or employee or the officer’s or employee’s Family Member. 

The percent of interest owned may be calculated using either voting stock, shares owned, or market value of shares. 

Important Links:

Memo – New Conflict of Interest Disclosure Requirement Issued June 16, 2017

Purchasing/Contracting Conflict of Interest Disclosure Form 

The following link provides an outline of Relationships by Consanguinity or Affinity:
Relationships by Consanguinity or Affinity Charts for Potential Conflicts of Interest

Questions regarding this requirement should be directed to one of the following individuals in UNT System Business Support Services:

Mike Abernethy, Senior Director of Procurement Services
Email: Michael.Abernethy@untsystem.edu
Phone: 940.369.5510
Toll-Free Phone: 855.868.4357

Joey Saxon, Senior Director and HUB Coordinator
Email: Joey.Saxon@untsystem.edu
Phone: 940.369.5611
Toll-Free Phone: 855.868.4357