Wayne State University

Aim Higher

Policies-11

05-4 Contracts Between Wayne State University And External Organizations In Which University Employees Participate

1.0  Purpose

       The purpose of this university policy is to clarify the procedures that are in place to ensure compliance with the Board of Governors’ statute, “Contracts Between Wayne State University and External Organizations in Which University Employees Participate.”

2.0  Legal Requirements

2.1     In order for the University to contract with (1) a firm in which a University employee is a partner, employee, director, officer, or substantial stockholder,* and where the University employee has solicited the contract, engaged in negotiations regarding the contract, or represented either the firm or the University in the transaction, or with (2) an individual who is an employee of the University, the University must follow a “sunshine” procedure.

2.2     Specifically, the University must take the proposed contract to the Board of Governors and inform the Board of:

    • The name of each party involved in the contract;

    • The terms of the contract, including duration, financial consideration between the parties, facilities or services of Wayne State University included in the contract, and the nature and degree of assignment of employees of the University for fulfillment of the contract;

    • The nature of any pecuniary interest.

2.3     The Board of Governors must approve the contract by a vote of not less than two-thirds of the full membership of the Board in open session, and must enter the information regarding the contract into its minutes.

3.0  Sunshine Procedures

3.1     Any department, principal investigator, or other University entity seeking to make a purchase from (or otherwise contract with) (1) a firm in which a University employee is a partner, employee, director, officer, or substantial stockholder, where the University employee has solicited the contract, engaged in negotiations regarding the contract, or represented either the firm or the University in the transaction, or (2) an individual who is an employee of the University, shall forward to its dean or director a draft submission to the Board of Governors, together with a memorandum briefly explaining the rationale for contracting with the particular provider.  (A model Board submission is attached to this university policy.)

3.2     If the dean or director approves the request, s/he shall forward it to the appropriate senior officer.

3.3     If the senior officer approves the request, s/he shall initiate procedures to recommend it to the Board of Governors.

4.0  Prohibition

4.1     Neither the Purchasing department nor any other division of the University shall make any purchase from (or otherwise contract with)  (1) a firm in which a University employee is a  partner, employee, director, officer, or substantial stockholder, where the employee has solicited the contract, engaged in negotiations regarding the contract, or represented either the firm or the University in the transaction, or (2) an individual who is an employee of the University, unless the contract has received Board of Governors’ approval pursuant to section 2.3 of this university policy.

5.0  Certification

5.1     Where a firm in which a University employee is a partner, employee, director, officer, or substantial stockholder desires to contract with the University, in circumstances where the University employee has not solicited the contract, engaged in negotiations regarding the contract, or represented either the firm or the University in the transaction, an authorized agent of the firm may file with the Office of General Counsel a   certification  that   the   University    employee   has not solicited   the contract, engaged in negotiations regarding the contract, or represented either the firm or the University in the transaction.

5.2     In the Office of the General Counsel and the Purchasing department determine that the certification is adequate, the contract may be processed in the same manner as would any other, comparable, contract.

6.0  Duration

6.1     This university policy is revocable by the president at any time and without notice.

7.0  Effective Date

7.1     This university policy is effective immediately upon issuance.

7.2     Executive Order 92-4 is hereby revoked, effective immediately.

*A stockholder owning more than one percent of the total outstanding stock of any class where such stock is not listed on a stock exchange or stock with a present total market value in excess of $25,000 where such stock is listed on a stock exchange.

Signed by President Irvin D. Reid June 13, 2005.