Conflict of Interest FAQ
What is the Political Reform Act and what does it require?
The State of California’s Political Reform Act of 1974, (Gov. Code, § 81000, et seq.), (the "Act"), prohibits public officials from participating in governmental decisions when personal financial interests may be affected by those decisions. The Act requires that all government employees and officials disqualify themselves from participating in a governmental decision when a financial conflict of interest is present.
All CSU employees are public officials subject to the Act. However, certain designated positions are identified in the CSU Conflict of Interest Code (COI). This designation requires employees appointed to these positions to annually file a Statement of Economic Interests (Form 700) and complete ethics training every two years.
A public official has a personal financial interest in a decision if it is reasonably foreseeable that the decision will have a material financial effect on the employee, a member of his or her immediate family, or on any one of the five kinds of economic interests.
1. A conflicting economic interest exists if “the decision will have a material financial effect, distinguishable from its effect on the public generally, on the [CSU employee or] a member of his or her immediate family.
2. If a decision will result in the increase or decrease of “personal expenses, income, assets, or liabilities of the [CSU employee] or his or her immediate family,” a conflicting personal economic interest exists.
3. A decision to appoint or promote a CSU employee’s spouse would constitute a conflicting economic interest.
Five Economic Interests - If it is reasonably foreseeable that any of the following will be materially affected by the decision, a conflict may exist:
1. Any business entity in which the employee has a direct or indirect investment worth $2,000 or more, including ownership of stock by the employee or the employee’s spouse or dependent child.
2. Any real property in which the employee has a direct or indirect interest worth $2,000 or more. One’s home is not included but any other investment property is.
3. Any source of income which provides $500 or more in value promised to, or received by, the employee within 12 months prior to the time when the decision is made.
4. Any business entity in which the employee is a director, officer, partner, trustee, employee, or holds any position of management.
5. Any donor of, or any intermediary or agent for a donor of, a gift or gifts totaling $420 or more in value provided to, received by, or promised to the employee within 12 months prior to the time when the decision is made. Gifts of meals, travel or anything else of value are included in the $420. (This amount is tied to a consumer price index and is occasionally adjusted.)
Why is my position designated?
The specifically designated CSU employees to which the CSU Code applies are those who are considered most likely to make, participate in making, or influence decisions that could significantly affect personal economic interests.
The Political Reform Act requires most state and government officials and employees to publically disclose their personal assets and income. The Fair Political Practices Commission (FPPC) is the state agency responsible for issuing Statement of Economic Interests, Form 700, and for interpreting the law’s provisions. A Form 700 is provided to employees by the university’s Conflict of Interest Officer or electronically by clicking on forms.
Employees who are required to file a Form 700 or Form 700U each April are in designated Conflict of Interest positions. Employees in designated positions must take ethics training course every two years. This course is required by law.
Newly appointed employees into a designated position are required to complete a Form 700 within 30 days and complete ethics training within 6 months of assuming the position.
The Ethics & Conflict of Interest Training website provides instructions on how to take the online ethics training course.