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FEATHER SOUND
COMMUNITY SERVICES DISTRICT
CONFLICT OF INTEREST
POLICY
Purpose
The purpose of this
policy is to protect the interest of FEATHER SOUND COMMUNITY
SERVICES DISTRICT (FSCSD) in transactions or arrangements that might
benefit the private interest of a board or committee member. This
policy is intended to supplement but not replace any applicable
state and federal laws governing conflict of interest applicable to
nonprofit and governmental organizations.
Definitions
1.
Interested Person
Any board member, or
member of a committee, who has a direct or indirect financial
interest, as defined below, is an interested person.
2.
Financial Interest
A person has a financial
interest if the person has, directly or indirectly, through
business, investment, or family:
a.
An ownership or
investment interest in any entity with which FSCSD has a transaction
or arrangement,
b.
A compensation
arrangement with FSCSD or with any entity or individual with which
FSCSD has a transaction or arrangement, or
c.
An ownership or
investment interest in, or compensation arrangement with, any entity
or individual with which FSCSD might potentially enter (or conclude)
a transaction or arrangement. Compensation includes direct and
indirect remuneration as well as gifts or favors. A financial
interest is not necessarily a conflict of interest. A person who has
a financial interest has a conflict of interest only if the board or
committee decides that a conflict of interest exists.
Procedures
1.
Duty to Disclose
In connection with any
actual or possible conflict of interest, an interested person must
disclose the existence of the financial interest and be given the
opportunity to disclose all material facts to the other board
members and/or members of committees (as applicable) considering the
proposed transaction or arrangement.
2.
Determining Whether a Conflict of Interest Exists
After disclosure of the
financial interest and all material facts, and after any discussion
with the interested person, he/she shall leave the governing board
or committee meeting while the determination of a conflict of
interest is discussed and voted upon. The remaining board or
committee members shall decide if a conflict of interest exists.
3.
Procedures for Addressing the Conflict of Interest
a.
An interested person may
make a presentation at the governing board or committee meeting, but
after the presentation, he/she shall leave the meeting during the
discussion of, and the vote on, the transaction or arrangement
involving the determination of conflict of interest.
b.
The chairperson of the
board or committee shall, if appropriate, appoint a disinterested
person or committee to investigate alternatives to the proposed
transaction or arrangement.
c.
After exercising due
diligence, the board or committee shall determine whether FSCSD can
obtain with reasonable efforts a more advantageous transaction or
arrangement from a person or entity that would not give rise to a
conflict of interest.
d.
If a more advantageous
transaction or arrangement is not reasonably possible under
circumstances not producing a conflict of interest, the governing
board or committee shall determine by a majority vote of the
disinterested board members whether the transaction or arrangement
is in FSCSD’s best interest, for its own benefit, and whether it is
fair and reasonable. In conformity with the above determination it
shall make its decision as to whether to enter into the transaction
or arrangement.
4.
Violations of the Conflicts of Interest Policy
a.
If the board or committee
has reasonable cause to believe a member has failed to disclose
actual or possible conflicts of interest, it shall inform the member
in a written statement of the basis for such belief and afford the
member an opportunity to explain the alleged failure to disclose.
b.
If, after hearing the
member’s response and after making further investigation as
warranted by the circumstances, the board or committee determines
the member has failed to disclose an actual or possible conflict of
interest, it shall take appropriate disciplinary and corrective
action as agreed upon by a majority vote of the disinterested board
members.
Records of Proceedings
The minutes of the
governing board and all committees with board delegated powers shall
contain:
a.
The names of the persons
who disclosed or otherwise were found to have a financial interest
in connection with an actual or possible conflict of interest, the
nature of the financial interest, any action taken to determine
whether a conflict of interest was present, and the board’s or
committee’s decision as to whether a conflict of interest in fact
existed.
b.
The names of the persons
who were present for discussions and votes relating to the
transaction or arrangement, the content of the discussion, including
any alternatives to the proposed transaction or arrangement, and a
record of any votes taken in connection with the proceedings.
Annual Statements
Each board member and
member of a committee shall annually sign a statement which affirms
such person:
a.
Has received a copy of
the conflicts of interest policy,
b.
Has read and understands
the policy,
c.
Has agreed to comply with
the policy, and
d.
Understands FSCSD is a
non-profit organization and in order to maintain its federal tax
exemption it must engage primarily in activities which accomplish
one or more of its tax-exempt purposes.
Periodic Reviews
To ensure the FSCSD
operates in a manner consistent with its purposes and does not
engage in activities that could jeopardize its tax-exempt status,
periodic reviews shall be conducted. The periodic reviews shall, at
a minimum, include the following subjects:
a.
Whether financial
transactions are reasonable, based on competent survey information
and the result of arm’s length bargaining.
b.
Whether transactions and
other arrangements conform to FSCSD’s written policies, are properly
recorded, reflect reasonable investment or payments for goods and
services, further its purposes and do not result in inurement,
impermissible private benefit or are in any manner to the detriment
of FSCSD.
FEATHER SOUND
COMMUNITY SERVICES DISTRICT
ANNUAL DISCLOSURE
STATEMENT
CONFLICT OF INTEREST
I am a board member, a committee member, or an
employee of the following organizations:
I certify that, except as described below, I am not now nor at any
time during the past year have been:
1) A participant, directly or indirectly, in any arrangement,
agreement, investment, or other activity with any vendor, supplier,
or other party; doing business with FSCSD which has resulted or
could result in personal benefit to me.
2) A recipient, directly or indirectly, of any salary payments or
loans or gifts of any kind or any free service or discounts or other
fees from or on behalf of any person or organization engaged in any
transaction with FSCSD.
Any exceptions to 1 or 2 above are stated below with a full
description of the transactions and of the interest, whether direct
or indirect, which I have (or have had during the past year) in the
persons or organizations having transactions with FSCSD.
Date: ________________
Signature: _______________________________
Printed name: ________________________________
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