www.wintercenterhousing.org - Conflict of Interest Policy

The Winter Center’s effectiveness depends on its record of accomplishment and its reputation. The Agency's success results directly from maintaining the confidence of the individuals, groups, and organizations with whom it works. The Winter Center’s greatest asset is its good name. For that reason, it is crucial that the Agency have a responsible and well-conceived Conflict of Interest policy and procedure.

The policy and procedure will also help assure compliance with the U.S. Internal Revenue Service (IRS) rules against private inurement and private benefit and with state statutes addressing conflict transactions.

One of the principal purposes of the Conflict of Interest policy and of this procedure is to help Winter Center staff and Board members identify and avoid or resolve conflicts of interest with the Agency. For that reason, Winter Center employees and Board members must read and retain a copy of this Conflict of Interest Policy and Procedure at the outset of their tenure with the Winter Center and at such time as the policy or procedure is amended.

There may be certain volunteers or Winter Center grantees, who, because of the level of their involvement in Winter Center business, and because of their access to inside information, are covered by this Conflict of Interest policy and must be fully informed of its contents. The Conflict of Interest policy will be discussed at all orientation sessions for new employees and Board members.

This Standard Operating Procedure provides guidance in three areas:

Understanding conflict concepts and definitions;
The Winter Center's administration and procedure for reviewing and managing conflicts; and
Key questions to evaluate conflicts and potential conflicts.

In situations in which there is an actual or an appearance of a conflict, the Human Resource Advisory Committee must review the situation, as set forth in Section II, below. They will review and approve, approve with modifications, or disapprove the recommended course of action.

I. UNDERSTANDING CONFLICT CONCEPTS AND DEFINITIONS

A. Conflict of Interest: A conflict exists when a covered person (as defined below) proposes to act on any issue, matter, or transaction in which the Winter Center has an interest, and the covered person may have an interest separate from the Winter Center. A conflict of interest also exists in situations in which there is an appearance that a covered person is utilizing inside information that is proprietary to the Winter Center for his or her benefit, is acting in his or her own interests rather than the best interests of the Winter Center, has the ability to exercise undue influence over Winter Center decisions, or is receiving favorable treatment by the Winter Center because of his or her status as a covered person.

B. Covered Persons: All employees, Board members, Chapter Trustees/Advisors, and, as defined below, Close Relatives, Major Donors, Related Organizations, and Other Insiders.

C. Close Relative: spouse, child (natural or adopted), parent and step-parent, inlaws (father, mother, daughter, son, brother and sister in-laws), grandchild, grandparent, brother or sister of a covered person, and any person with whom a covered person shares living quarters under circumstances that closely resemble a marital relationship or who is financially dependent upon the covered person.

D. Inside Information: Any material information that is identified as confidential and proprietary, pertaining to the business and affairs of the Winter Center, whether related to a specific transaction or to matters pertaining to the Winter Center's interests, activities, and policies.

E. Major Donor: An individual, corporation, or foundation that makes a gift or pledge of $50,000 or more at any one time or cumulatively $250,000 within a 5 year period prior to the occurrence of the conflict either in cash, appreciated securities, other assets or in land, easement, or bargain-sale value.

F. Other Insiders: Individuals, such as current or former members of Winter Center advisory boards or committees, volunteers or former employees who, by virtue of their current involvement or their involvement within the past 12 months with the Winter Center, either have access to inside information that could place them within a conflict situation or could give the appearance of such persons having the ability to unduly influence the Winter Center. Depending on the facts and circumstances, an independent contractor, grantee, other outside party, or their employees may be an "other insider" where that person or entity has access to inside information.

G. Related Organization: (Winter Center Housing Partners) Any organization in which a covered person(s) directly or indirectly:

a. owns or controls 25% or more of a limited partnership; or

b. is a director, executive officer, executor, administrator, trustee, beneficiary, controlling partner, or otherwise serves in a fiduciary capacity or holds a substantial beneficial interest; or

c. has legal or de facto power to control the election of members of the board of directors; or

d. has legal or de facto power to exercise a controlling influence over the management or policies.

"Organization" includes a corporation, partnership, trust, estate, joint venture, and unincorporated affiliation of any kind as well as public boards and commissions and not-for-profit organizations.

II. WINTER CENTER ADMINISTRATION AND PROCEDURE FOR REVIEWING AND MANAGING CONFLICTS

Procedure:

A member of the staff involved in a conflict or appearance of a conflict will disclose and bring the matter to the attention of his or her supervisor and will answer the applicable questions outlined in Section III, below. Based on the analysis of the applicable questions, the supervisor will bring the matter to the attention of the Winter Center Board President, with a recommended course of action. Each request for approval of a proposed course of action will describe in detail the particular activity in question that gives rise to the conflict or appearance of conflict, the reasons why the proposed course of action should be approved, and any special circumstances surrounding the situation. The Winter Center Board Executive Team may submit the request to the Legal Counsel, along with a recommended course of action. The General Counsel will convene the Human Resource Advisory Committee as the final arbiter of the matter.

A member of the Board of Directors involved in a conflict or appearance of a conflict will disclose and bring the matter to the attention of the appropriate Winter Center attorney who will work with the Board member to develop an appropriate recommended course of action, based on answers to the applicable questions outlined in Section III, below. The recommendation will then be submitted to the entire board of directors. Each request for approval of a proposed course of action will describe in detail the particular activity in question that gives rise to the conflict or appearance of conflict, the reasons why the proposed course of action should be approved, and any special circumstances surrounding the situation. Legal Counsel will bring such conflict and the recommended course of action to the above-referenced Human Resource Advisory Committee to review and ratify the recommended course of action or propose a course of action with modifications. The course of action recommended by the Human Resource Advisory Committee will be submitted to the Community Audit Committee as the final arbiter of the issue. The Audit Committee will approve, approve with modifications or disapprove the recommended course of action, as the final arbiter of the issue. If such a conflict involving a member of the Board of Directors is brought to the attention of a Winter Center staff member, the staff member will immediately notify the appropriate department director and the Winter Center Executive Team.

If other insiders or major donors are involved in a conflict or appearance of a conflict, the other insider, major donor, or the Winter Center representative working with such individual will disclose and bring the matter to the attention of the Winter Center Executive Team who will work with the other insider or major donor to develop an appropriate recommended course of action, based on answers to the applicable questions outlined in Section III, below. The recommendation will then be submitted to the Legal Counsel. Each request for approval of a proposed course of action will describe in detail the particular activity in question that gives rise to the conflict or appearance of conflict, the reasons why the proposed course of action should be approved, and any special circumstances surrounding the situation. Counsel will bring such conflict and the recommended course of action to the above-referenced Human Resource Advisory Committee to review and ratify the recommended course of action or propose a course of action with modifications. If such a conflict involving an other insider or major donor is brought to the attention of a Winter Center staff member, the staff member will immediately notify the appropriate department director and the Winter Center Executive Team.

Courses of Action: In all cases, conflicts of interest or circumstances giving rise to the appearance of a conflict must be disclosed in advance of initiating the activity giving rise to the conflict and in accordance with the procedures stated above. In developing responses to such conflicts, every effort will be made to avoid the conflict. In cases where it is not possible to completely avoid a conflict or the appearance of a conflict, reasonable efforts will be made to mitigate the effects of the conflict. At a minimum, the recommended course of action will ask the individual involved in the conflict to disclose the situation to the relevant parties and recuse and absent him/herself from any involvement in decisions pertaining to the conflict or the appearance of conflict. Before the conflict is disclosed and while the request for approval of a proposed course of action is pending or being considered, the individual involved in the conflict will refrain from participating in the questionable activity and/or withdraw from any discussion of or decision on the matter.

Report to the Board of Directors: All conflicts reviewed by the Human Resource Advisory Committee will be reported by the Committee Chair to the Community Audit Committee. The Counsel’s report will include the nature of the conflict, parties involved, and the disposition of conflict.

III. KEY QUESTIONS TO EVALUATE CONFLICTS AND POTENTIAL CONFLICTS:

There are many difficult and ambiguous issues associated with the types of conflict issues that confront the Winter Center. The following are typical categories of situations where conflicts might arise or give rise to the appearance of a conflict. While not all-inclusive, the following represent the great majority of types of conflict situations confronted by the Winter Center. If a particular scenario is not addressed, we will consult with a Winter Center attorney who will assist in analyzing relevant factors.

In evaluating conflict situations in order to determine an appropriate course of action, the Winter Center will be guided by the following criteria and considerations:

Compliance with the letter and the spirit of all applicable laws relevant to all parties to the transaction;
Adherence to Winter Center policies and procedures;
Ability to act within the scope of the Winter Center's values, such as "The Winter Center will model accountability"
Avoidance of private benefit and inurement;
Transparency;
Community benefits likely to be achieved;
Consequence to the Winter Center from declining to participate;
Financial or other benefit to the Winter Center;
Nature and extent of risk to the Winter Center's reputation;
Availability of other alternatives;
Ability to mitigate reputational risks; and
Financial or other benefits to the other party.

In order to help those involved with Winter Center activities to understand and evaluate those actual and potential conflicts as well as situations that give rise to the appearance of a conflict, it is required that the individual involved with the conflict and the Winter Center supervisor/Winter Center representative answer the following questions and submit the analysis to the Human Resource Advisory Committee, following the procedure outlined above. The Human Resource Advisory Committee, in reviewing whether to determine how to proceed with an actual or a perceived conflict, will use the answers to these questions as one factor in making their decision.

A. Hiring individuals who are close relatives of covered persons.

Is this job integral to the success of the Winter Center?
Have all Winter Center policies and procedures relevant to employment been followed?
Can this position be structured so that the conflicted party has no supervisory responsibilities with the employee without disrupting the Winter Center’s business practices?
Will the conflicted party play any role in the hiring process
Has the Winter Center assessed the public relations and political environment at all scales to be sure that this hire will not damage the Winter Center’s reputation?
What steps have been taken to determine if other qualified candidates exist? Has there been an open and competitive bidding process? Does this person have a unique expertise that the service cannot be obtained anywhere else?
Is the close relative candidate significantly more qualified or available at a more favorable cost, compared to other candidates? What are the alternatives if this person is not employed by the Winter Center?
Has the Winter Center balanced the financial benefits to the Winter Center with the reputational risk to the Winter Center of the hire?
How will this appear in the eyes of the public when tested against the value of "The Winter Center will model accountability?"

B. Contracting for products or services with covered persons.

Is this product or service integral to the success of the Winter Center?
Are the products, services, or expertise unique or very specialized?
Has the Winter Center taken appropriate measures to ensure that the Winter Center obtains the best market price for the work or services? Has there been an open and competitive bidding process?
Has the Winter Center received information from parties other than the conflicted party that address the cost and quality of the service or products being acquired or provided?
Has the Winter Center accessed the local public relations and political environment to be sure that this hire will not damage the Winter Center’s reputation?
Will the management of the delivery of the service or product within the Winter Center be done by someone other than the conflicted party or other than someone who is supervised by the conflicted party?
Are all of the costs, including the appearance of an insider arrangement, significantly less that the benefits to be obtained from the services to be performed or products provided?

How will this appear in the eyes of the public when tested against the value of "The Winter Center will model accountability?"

C. Purchases or Gifts of Interests in Land or Housing or Sales of Interests in Land or Housing.

For acquisitions, has the Winter Center determined that this is land or housing or an interest in land or housing that would be acquired by the Winter Center regardless of ownership (i.e. the property meets Winter Center standards and objectives)?
Has the proposed transaction been characterized accurately in the legal documents and with the public?
Have appropriate independent valuations been obtained in compliance and accordance with the Winter Centers CHDO obligations?
Has the proposed transaction been reviewed to ensure that appropriate conservation benefits are obtained?
Are the terms and conditions of the purchase sufficient to protect the land and on terms favorable to the Winter Center?
Will a covered person obtain any direct or indirect economic benefit from the transaction and, if so, have such benefits been properly reflected in pricing the transaction and determining values?
Has the transaction been structured to ensure that the Winter Center’s standards of transparency will be achieved?
Does the transaction comply with the Winter Center's gift-acceptance policies? (Note: There may be cases where the Winter Center will want to grant exceptions to that policy. The questions in this paragraph may be relevant for an analysis of when an exception may be appropriate.)
For sales, has the Winter Center marketed the property in an open, equitable, and transparent marketing process?
Has the Winter Center done a political and public relations assessment of the impact of this donation, purchase, or sale on the Winter Center’s reputation.
How will this transaction appear in the eyes of the public when tested against the value of "The Winter Center will model accountability?"

D. A covered person serving on the governing board of public and/or private corporations, non-profit organizations or government agencies commissions, or councils transacting business with the Winter Center or with which the Winter Center may have a potential adverse interest.

Is the covered person serving on the board of that entity as part of his or her job responsibility for the Winter Center?
Was there an advance disclosure and have both parties agreed that, in cases of conflict or where there was a direct and adverse interest/competition, there would be a mechanism for recusal, disclosure, or any other safeguards to protect the Winter Center?
Is there a plan in place for how staff will conduct themselves when serving on other Boards?
Will the individual’s time spent working on issues for the other board take away from his or her ability to perform his or her job for the Winter Center and if so, what is the benefit to the Winter Center?
What impact will this service have on the Winter Center's ability to do its business and on the Winter Center's reputation?
Will any decisions made by the individual working for the other organization be made with regard to the Winter Center's best interests?
What are the costs and benefits to the Winter Center?
What are the alternatives, if any?
How will this appear in the eyes of the public when tested against the value of "The Winter Center will model accountability?"

E. Use of inside information by a covered person.

Is the information proprietary to the Winter Center?
What steps have been taken to protect the information?
What are the costs and benefits to the Winter Center?
Is there any private benefit or private inurement?
What are the alternatives, if any?

How will this appear in the eyes of the public when tested against the value of "The Winter Center will model accountability?"

F. Transactions with grantees.

Does the grantee have a conflict of interest policy?
Would the issue violate the Winter Center’s conflict of interest policy and procedure?
What are the alternatives, if any?
Is the activity integral to the success of the Winter Center or the grantee?
Has the Winter Center accessed the local public relations and political environment to be sure that this relationship will not damage the Winter Center’s reputation?
Will the management of the project be done by someone other than the conflicted party or other than someone who is supervised by the conflicted party?

How will this appear in the eyes of the public when tested against the value of "The Winter Center will model accountability?”

G. Winter Center employees who engage in work outside of the Winter Center, including contracts and consultancies, and including both paid and unpaid work.

Is the other entity in the same or a similar field as the Winter Center?
Are the other entity’s purposes or interests in any way adverse to the Winter Center’s mission and interests?
Does the employee have access to financial or other confidential or proprietary data or information of the Winter Center? If so, what is the level of sensitivity?
Does the outside work detract in any way from the employee’s ability to perform her/his job duties during normal business hours?
Does the outside work create a conflict of loyalty between the Winter Center and the other employer?
Does the outside work create any risk to the Winter Center’s reputation?

How will this appear in the eyes of the public when tested against the value of "The Winter Center will model accountability?"

CONCLUSION:

Adhering to the Conflict of Interest policy and this standard operating procedure is a condition of association with the Winter Center as an employee, Board member, Advisor or Lead Volunteer. Violations of the Conflict of Interest policy and this procedure may be grounds for dismissal as an employee or volunteer or severance from the Board of Directors or Advisory Committee. The Community Audit Committee, the Human Resources Advisory Committee and the Winter Center’s Board of Directors will review and assess the Conflict of Interest policy and this standard operating procedure and their implementation on a regular basis and notify all stakeholders of any changes and/or revisions thereto.