HIBBING PUBLIC SCHOOLS
INDEPENDENT SCHOOL DISTRICT 701


BOARD POLICY 210
SERIES: 200 School Board
SUBJECT: 210 Conflict of Interest - School Board Members
ADOPTED:  
REVISED:  



The school board shall contract for goods and services in conformance with statutory conflict of interest laws and in a manner that will avoid any conflict of interest or the appearance of conflict of interest.  Accordingly, the school board will contract under the statutory exception provisions only when it is clearly in the best interest of the school district because of limitations which may exist on goods or services otherwise available to the school district.  The determinations as to whether a conflict of interest exists is to be made by the school board.


PROHIBITIONS AND STATUTORY EXCEPTIONS

A school board member who is authorized to take part in any manner in making any sale, lease, or contract in his or her official capacity shall not have a personal financial interest in, nor personally benefit from that sale, lease, or contract.

In the following circumstances, the school board may as an exception, by unanimous vote, contract for goods or services with a school board member of the school district:

1. In the designation of a bank or savings association, in which a school board member is interested, as an authorized depository for school district funds or source of borrowing, provided such deposited funds are protected in accordance with state law.  A school board member shall disclose his/her interest and it shall be entered in the minutes.  The disclosure must be made when the institution is first designated as a depository or source of borrowing, or when such school board member is elected, whichever is later.  This disclosure must only be made once.
2. The designation of an official newspaper in which a school board member is interested when it is the only newspaper complying with statutory requirements relating to the designation or publication.
3. A contract with a cooperative association of which the school board member is a shareholder or stockholder but not an officer or manager.
4. A contract for which competitive bids are not required by law.
5. A school board member may contract with the school district to provide construction materials or services, or both, when the sealed bid process is used.  When the contract comes before the school board for consideration, the interested school board member may not vote on the contract.  (Note:  This applies only where the school district has a population of 1,000 or less according to the last federal census.)


A contract made pursuant to the aforementioned exceptions will be void unless the school board authorizes the contract in advance of its performance by adopting a resolution setting out the essential facts and determining that the contract price is as low as or lower than the price at which the goods or services could be obtained elsewhere.  In the case of an emergency when the contract cannot be authorized in advance, payment of the claims must be authorized by a like resolution wherein the facts of the emergency are also stated.  Before a claim is paid, the interested school board member must file with the clerk of the school board an affidavit stating:

1. the name of the school board member and the office held,
2. an itemization of the goods or services furnished,
3. the contract price,
4. the reasonable value,
5. the interest of the school board member in the contract, and
6. that to the best of the school board member’s knowledge and belief, the contract price is as low as, or lower than, the price at which the goods or services could be obtained from other sources.


SCHOOL BOARD MEMBER EMPLOYMENT
A school board member may be newly employed or may continue to be employed by the school district as an employee where there is a reasonable expectation on July 1 or at the time the contract is entered into or extended, that the amount to be earned by that school board member under that contract or employment relationship, will not exceed $8,000 in that fiscal year.  The school board member must receive unanimous approval to continue in employment at a meeting where all school board members are present, or employment and further rights to employment while serving as a school board member are immediately terminated.


LIMITATION ON RELATED EMPLOYEES
1. The school board can hire or dismiss teachers only at duly called meetings.  Where a husband and wife or two siblings constitute a quorum, no contract employing a teacher may be made or authorized except upon the unanimous vote of the full school board.
2. The school board may not employ any teacher related by blood or marriage, within the fourth degree, computed by the civil law, to a school board member except by a unanimous vote of the full school board.


CONFLICTS PRIOR TO TAKING OFFICE
A school board member with personal financial interest in a sale, lease, or contract with the school district which was entered before taking office and presents an actual or potential conflict of interest, shall immediately notify the school board of such interest.  It shall thereafter be the responsibly of the school board member to refrain from participating in any action relating to the sale, lease, or contract.  Renewal of any enumerated exceptions for contracts relating to goods or services provided above and if the procedures provided in this policy are followed.




Legal References:
M.S. 122A.40, Subd. 3 (Teacher Hiring, Dismissal)
M.S. 471.87 (Public Officers; Interest in Contract; Penalty)
M.S. 471.88, Subds. 2, 3, 4, 5, 12, 13, 16 (Exceptions)