Ethics Orientation for State Officials
Contractual Conflicts of Interest: State Contracts Only
What is Public Contract Code Section 10410?
Public Contract Code section 10410 imposes additional conflict-of-interest restrictions concerning state contracts and contractors. This section contains two separate prohibitions. First, there is a general ban on state officers and employees from having economic interests in state contracts. Second, there is a separate ban against state officers and employees acting as independent contractors with state agencies.
Violations void the contract and can result in criminal penalties or civil remedies.
The General Ban is Very Broad
Reduced to its essentials, the general ban provides that no state officer or employee shall do the following:
- engage in any employment, activity or enterprise;
- from which the officer or employee receives compensation, or in which he or she has a financial interest; and
- that is sponsored or funded, in whole or in part, by any state agency or department through a contract.
An exception is provided for unsalaried part-time members of boards and commissions. A variety of other specific exceptions are set forth in the law.
Ban on Independent Contracting
In addition to the general prohibition, section 10410 specifically prohibits a state officer or employee from contracting on his or her own behalf with a state agency as an independent contractor to provide goods or services.
Ban on Consultants’ Additional Contracts
In addition to the general prohibition, Public Contract Code section 10365.5 specifically prohibits any outside consultant from bidding on or being awarded a contract for services, goods or supplies or any related action that is required, suggested or otherwise deemed appropriate in the end product of their original consulting contract. Limited exceptions apply.
You have completed the "Contractual Conflicts of Interest: State Contracts Only" module. The next module is Code of Ethics.
presented by
The California Attorney General's Office and the Fair Political Practices Commission