State Codes and Statutes

State Codes and Statutes

Statutes > North-carolina > Chapter_131E > GS_131E-21

§ 131E‑21.  Conflict of interest.

(a)        No commissioner or employee of the hospital authority orthat person's spouse shall do either of the following:

(1)        Acquire any interest, direct or indirect, in any hospitalfacility or in any property included or planned to be included in a hospitalfacility.

(2)        Have any interest, direct or indirect, in any contract orproposed contract for materials or services to be furnished or used inconnection with any hospital facility, except an employment contract for anemployee. The foregoing restriction shall not apply to any contract,undertaking, or other transaction with a bank or banking institution, savingsand loan association or public utility in the regular course of its business;Provided that any such contract, undertaking, or other transaction shall beauthorized by the commissioners by specific resolution on which no commissionerhaving an interest, direct or indirect, shall vote.

(b)        The fact that a person or that person's spouse owns tenpercent (10%) or less stock of a corporation or has a ten percent (10%) or lessownership in any other business entity or is an employee of that corporation orother business entity does not make the person have an "interest, director indirect" as this phrase is used in subsection (a) of this section;provided that, in order for the exception to apply, the contract, undertakingor other transaction shall be authorized by the commissioners by specificresolution on which no commissioner or employee having an interest, direct or indirect,shall vote.

(c)        If a commissioner or employee of an authority or thatperson's spouse owns or controls an interest, direct or indirect, in anyproperty included or planned to be included in any hospital facility, thecommissioner or employee shall immediately disclose the same in writing to theauthority and the disclosure shall be entered upon the minutes of theauthority. Failure to disclose shall constitute misconduct in office and shallbe grounds for a commissioner's removal from office under G.S. 131E‑22.

(d)        Subsection (a) of this section shall not apply to anycommissioner of a hospital authority if (i) the undertaking or contract orseries of undertakings or contracts between the hospital authority and one ofits officials is approved by specific resolution of the governing body adoptedin an open and public meeting and recorded in its minutes and the amount doesnot exceed twelve thousand five hundred dollars ($12,500) for medically relatedservices and twenty‑five thousand dollars ($25,000) for other goods orservices within a 12‑month period; and (ii) the official entering intothe contract or undertaking with the hospital authority does not in an officialcapacity participate in any way or vote.

(e)        Subsection (a) of this section shall not apply to anyemployment relationship between a hospital authority and the spouse of acommissioner of the hospital authority.

(f)         A contract entered into in violation of this section isvoid. A contract that is void under this section may continue in effect untilan alternative can be arranged when: (i) immediate termination would result inharm to the public health or welfare, and (ii) the continuation is approved asprovided in this subsection. A hospital authority that is a party to thecontract may request approval to continue contracts under this subsection fromthe chairman of the Local Government Commission. Approval of continuation ofcontracts under this subsection shall be given for the minimum period necessaryto protect the public health or welfare. (1943, c. 780, s. 7; 1971, c. 749; 1983, c. 775, s. 1; 1983 (Reg.Sess., 1984), c. 1058, s. 1; 2001‑409, s. 7.)