Broken Arrow City Council
Meeting of: 01-17-2017
To: Mayor and City Council
From: Office of the City Attorney
Title:
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Presentation and discussion of statutory requirements for contracting with the City of Broken Arrow
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Background:
The Legal Department was recently asked to review the statutory provisions that address conflicts in municipal contracts. Section 8-113 of Title 11 of the Oklahoma Statutes sets forth several prohibitions regarding the ability of officers, employees and spouses to contract with a municipality. It provides in pertinent part:
Except as otherwise provided by this section, no municipal officer or employee, or any business in which the officer, employee, or spouse of the officer or employee has a proprietary interest, shall engage in:
1. Selling, buying, or leasing property, real or personal, to or from the municipality;
2. Contracting with the municipality; or
3. Buying or bartering for or otherwise engaging in any manner in the acquisition of any bonds, warrants, or other evidence of indebtedness of the municipality.
Importantly, there are a few exceptions to these prohibitions. They do not apply when competitive bids were obtained consistent with municipal ordinance or state law and two or more bids were submitted for the materials, supplies, or services to be procured (provided the notice of bids was made public and open to all potential bidders). The provisions also do not apply to members serving as an officer, director or employee of a financial institution so long as they abstain from voting on any matter relating to a transaction between or involving the financial institution.
For purposes of this section, "proprietary interest" means ownership of more than twenty-five percent (25%) of the business or of the stock therein or any percentage which constitutes a controlling interest but shall not include any interest held by a blind trust. Impor...
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