Procurement Services 104: Purchasing Ethics

Purpose

To establish the responsibilities of persons with purchasing authority who acquire goods and services for the university from vendors.

Reference

Board of Regents Policy 04.10.000
Alaska Statute 39.52

Definitions

Conflict of Interest: Situations in which financial or other personal considerations may compromise or have the appearance of compromising an employee's professional judgment in the execution of any phase of the procurement process. Purchasing Authority: The ability to negotiate contracts, select vendors or commit the university in the procurement of goods and services.

Policy

General
All individuals with purchasing authority on behalf of the university must avoid any behavior that involves a real conflict of interest and any appearance, however remote, of using their affiliation with the university as a means of furthering personal interests. The mere appearance of a conflict of interest can be as serious and damaging as an actual conflict of interest. Reports of conflicts based on appearances can undermine public trust in ways that may not be adequately restored even when the mitigating facts of a situation are brought to light. Apparent conflicts, therefore, should be evaluated and managed with the same vigor as known conflicts.

Situations where an employee has a financial or other interest in a vendor who the university is or is considering doing business with and where that employee is in a position to influence relevant business decisions may be considered a Conflict of Interest and should be reported Director of Business Services. Conflict of interest problems may be resolved by full disclosure as well as making appropriate arrangements that clearly exclude that employee from participating in the decisions.
Employees with purchasing authority should not request or accept from any individual or organization doing or seeking to do business with the university, a favor, gratuity or special consideration for themselves or any member of their family that will result in any direct or indirect financial gain.
Employees with purchasing authority should not engage directly or indirectly in a personal financial transaction that primarily relies upon information obtained through his or her university employment and is not otherwise common knowledge.   Relevant Regulations Ethics and Conduct Alaska Statute 39.52 and Board of Regents Policy & Regulation 04.10.000 prescribe the ethics and conduct that apply to all procurement transactions. These documents provide rules on the misuse of public position, improper gifts or gratuities, improper disclosure of information, improper influence in grants, contracts, leases, etc. An explanatory handbook and forms are available from the Ethics Coordinator in the Human Resources office.   Improper Influence in State Grants, Contracts, Leases or Loans According to Alaska Statute 39.52.150, an employee who can affect the award, execution, or administration of a State grant, contract, lease, or loan may not apply for, be a party to, or have an personal or financial interest in that state grant, contract, lease, or loan. This prohibition also applies to the employee’s immediate family.

However, an employee (or a family member) may apply for or be a party to a competitively solicited state grant, contract or lease, if the public employee does not serve in the same administrative unit awarding or administering the grant, contract, or lease and so long as the public employee is not in a position to take official action in the award or administration of the grant, contract, or lease.
Also, an employee (or a family member) may apply for and receive a state loan that is generally available to the public and has fixed eligibility standards, so long as the public employee does not take (or withhold) official action affecting the award or administration of the loan.”

Misuse of Official Position
According to Alaska Statute 39.52.120, employees may not use their positions for personal gain or to give an unwarranted benefit or treatment to any person. For example, employees may not:

• use their official positions to secure employment or contracts;
• accept compensation from anyone other than the state for performing official duties;
• use state time, equipment, property or facilities for their own personal or financial benefit or for partisan political purposes;
• take or withhold official action on a matter in which they have a personal or financial interest; or
• coerce subordinates for his/her personal or financial benefit.

Civil and Criminal Penalties
Any university employee who knowingly makes a false statement in support of a sole source procurement, limited competition, or emergency procurement, is guilty of a Class A misdemeanor. A person who knowingly, and under a scheme or artifice, contracts for or purchases supplies or services in violation of law is guilty of a Class C felony and is liable for all costs and damages to the university arising out of the violation.

Effective: 10/25/2005