Lakes Park Enrichment Foundation
Conflict of Interest Policy
Last updated: August 29, 2018
LAKES PARK ENRICHMENT FOUNDATION (“LPEF”), as a nonprofit, tax-exempt organization depends on charitable contributions from the public. Maintenance of its tax-exempt status is important both for its continued financial stability, and for the receipt of contributions and public support. The IRS, as well as state corporate and tax officials, view the operations of LPEF as a public trust that is subject to scrutiny by, and accountability to, governmental authorities and the public.
Consequently, there exists between LPEF and its Board a fiduciary duty that requires a broad and unbending degree of loyalty and fidelity. The Board has the responsibility of administering the affairs of LPEF honestly and prudently, and of exercising its best care, skill and judgment for the sole benefit of LPEF. The Board shall exercise the utmost good faith in all transactions, and members shall not use their positions or knowledge gained from LPEF for their personal benefit. This includes the appearance of conflict of interest for financial gain or as the result of personal relationships with other Board members, staff volunteers or program participants.
Conflicts of interest may arise in the relations of Board members with any of the following third parties:
• Persons and firms supplying goods and services to LPEF
• Persons and firms from whom LPEF leases property and equipment
• Persons and firms with whom LPEF is dealing or planning to deal in connections with the gift, purchase or sale of real estate, securities or other property
• Competing organizations
• Donors and others supporting LPEF
• Agencies, organizations and associations which affect the operations of LPEF
• Family members, friends and employees
A material conflicting interest may be defined as an interest, direct or indirect, with any persons and firms mentioned above. Such an interest may arise through:
• Owning stock or holding debt or other proprietary interests in any third party dealing with LPEF
• Serving on the Board of any third party dealing with LPEF
• Receiving remuneration for services with respect to individual transactions involving LPEF
• Using LPEF’s time, personnel, equipment, supplies or good will for other than LPEF-approved activities, programs and purposes
• Receiving personal gifts or loans from third parties that deal directly with LPEF. Gifts of nominal value (not to exceed $35) that could not be refused without discourtesy may be accepted. No personal gift of money is ever acceptable.
These lists are not exhaustive. Conflicts might arise in other areas or through other relationships. It is assumed that the Board members will recognize situations where there is the potential for conflict and discuss potential problems with the Board President. Such discussions shall remain confidential between the President and the member in question.
The potential for conflict does not mean, necessarily, that a conflict exists, or that the conflict is material or that upon disclosure, its existence would have an adverse effect on LPEF. Therefore, any potential conflict should immediately be brought to the attention of the Board President, who shall bring these matters, if material, to the Board. The LPEF Board shall determine whether a conflict exists and is material; and in the presence of an existing material conflict, whether the transaction may be authorized as just, fair, and reasonable for LPEF. The decision of the Board on these matters will rest in their sole discretion, and their concern must be the welfare of LPEF and the advancement of its purpose.
If a Board member is requested by LPEF to perform a service, or provide a product for the organization, competitive bids will be sought, and/or comparable valuation will be determined. Transactions may be authorized when:
• A material transaction is fully disclosed in the audited financial statements of the organization;
• The related party is excluded from the discussion and voting on such transaction
• A competitive bid or comparable valuation exists and
• LPEF’s Board has determined that the transaction is in the best interest of the organization.
If a contract is awarded, the Board member will be paid in accordance with the bid for the service or product. If the Board member desires to provide the service or product as a contribution, the member will submit a bill to the organization noting “DONATION TO LPEF” on the invoice.
Board members who become an LPEF program participant or a contractor must temporarily resign from the Board of Directors until the member is no longer using LPEF’s services or engaged as a contractor by LPEF.