Restricted Expenditures — Contracts and Bids
Financial Interest in a Vendor
A state agency may not enter into a contract for the purchase of goods or services with a private vendor if any of the following agency employees or officials have a financial interest in the vendor:
- A member of the agency's governing body;
- The governing official, executive director, general counsel, chief procurement officer, or procurement director of the agency; or
- A family member related to an employee or official described in (1) or (2) within the second degree by affinity or consanguinity.
A state agency employee or official has a financial interest in a vendor if the employee or official:
- Owns or controls, directly or indirectly, an ownership interest of at least one percent in the vendor, including the right to share in profits, proceeds or capital gains; or
- Could reasonably foresee that a contract with the vendor could result in a financial benefit to the employee or official.
A financial interest prohibited by this section does not include a retirement plan, a blind trust, insurance coverage, or an ownership interest of less than one percent in a corporation.
Source: Government Code Section 2261.252(b – d).