CODE OF VIRGINIA

PROHIBITED CONTRACTS; ADDITIONAL EXCLUSIONS FOR CONTRACTS BY OFFICERS AND
EMPLOYEES OF HOSPITAL AUTHORITIES (§ 2.2-3109.1)

A. As used in this section, “hospital authority” means a hospital
authority established pursuant to Chapter 53 (§ 15.2-5300 et seq.) of Title
15.2 or an Act of Assembly.

B. The provisions of § 2.2-3109 shall not apply to:

   1.  The personal interest of an officer or employee of a hospital authority in
   additional contracts of employment with his own governmental agency that
   accrue to him because of a member of his immediate family, provided (i) the
   officer or employee and the immediate family member are licensed members of
   the medical profession or hold administrative support positions at the
   hospital authority, (ii) the governing board of the hospital authority finds
   that it is in the best interests of the hospital authority and the county,
   city, or town for such dual employment to exist, and (iii) after such finding,
   the governing board of the hospital authority ensures that neither the officer
   or employee, nor the immediate family member, has sole authority to supervise,
   evaluate, or make personnel decisions regarding the other;

   2.  Subject to approval by the governing board of the hospital authority, an
   officer or employee’s personal interest in a contract between his
   hospital authority and a professional entity that operates a clinical practice
   at any medical facilities of such other hospital authority and of which such
   officer or employee is a member or employee;

   3.  Subject to approval by the relevant governing body, an officer or
   employee’s personal interest in a contract for research and development
   or commercialization of intellectual property between the hospital authority
   and a business in which the employee has a personal interest, provided (i) the
   officer or employee’s personal interest has been disclosed to and
   approved by the hospital authority prior to the time at which the contract is
   entered into; (ii) the officer or employee promptly files a disclosure
   statement pursuant to § 2.2-3117 and thereafter files such statement annually
   on or before January 15; (iii) the local hospital authority has established a
   formal policy regarding such contracts in conformity with any applicable
   federal regulations that has been approved by its governing body; and (iv) no
   later than December 31 of each year, the local hospital authority files an
   annual report with the Virginia Conflict of Interest and Ethics Advisory
   Council disclosing each open contract entered into subject to this provision,
   the names of the parties to each contract, the date each contract was executed
   and its term, the subject of each contractual arrangement, the nature of the
   conflict of interest, the hospital authority’s employee responsible for
   administering each contract, the details of such hospital authority’s
   commitment or investment of resources or finances for each contract, and any
   other information requested by the Virginia Conflict of Interest and Ethics
   Advisory Council; or

   4.  Subject to approval by the relevant governing body, an officer or
   employee’s personal interest in a contract between the hospital
   authority and a business in which the officer or employee has a personal
   interest, provided (i) the personal interest has been disclosed to the
   hospital authority prior to the time the contract is entered into; (ii) the
   officer or employee files a disclosure statement pursuant to § 2.2-3117 and
   thereafter annually on or before January 15; (iii) the officer or employee
   does not participate in the hospital authority’s decision to contract;
   (iv) the president or chief executive officer of the hospital authority finds
   and certifies in writing that the contract is for goods and services needed
   for quality patient care, including related medical education or research, by
   any of the hospital authority’s medical facilities or any of its
   affiliated organizations, or is otherwise necessary for the fulfillment of its
   mission, including but not limited to the acquisition of drugs, therapies, and
   medical technologies; and (v) no later than December 31 of each year, the
   hospital authority files an annual report with the Virginia Conflict of
   Interest and Ethics Advisory Council disclosing each open contract entered
   into subject to this provision, the names of the parties to each contract, the
   date each contract was executed and its term, the subject of each contractual
   arrangement, the nature of the conflict of interest, the hospital
   authority’s employee responsible for administering each contract, the
   details of the hospital authority’s commitment or investment of
   resources or finances for each contract, and any other information requested
   by the Virginia Conflict of Interest and Ethics Advisory Council.

C. Notwithstanding the provisions of subdivisions B 3 and B 4, if the research
and development or commercialization of intellectual property or the officer or
employee’s personal interest in a contract with a business is subject to
policies and regulations governing conflicts of interest promulgated by any
agency of the United States government, including the adoption of policies
requiring the disclosure and management of such conflicts of interest, the
policies established by the hospital authority pursuant to such federal
requirements shall constitute compliance with subdivisions B 3 and B 4, upon
notification by the hospital authority to the Virginia Conflict of Interest and
Ethics Advisory Council by January 31 of each year of evidence of its compliance
with such federal policies and regulations.

D. The governing body may delegate the authority granted under subdivision B 2
to the president or chief executive officer of hospital authority. If the board
elects to delegate such authority, the board shall include this delegation of
authority in the formal policy required by clause (iii) of subdivision B 3. In
those instances where the board has delegated such authority, on or before
December 1 of each year, the president or chief executive officer of the
hospital authority shall file a report with the relevant governing body
disclosing each open contract entered into subject to this provision, the names
of the parties to each contract, the date each contract was executed and its
term, the subject of each contractual arrangement, the nature of the conflict of
interest, the hospital authority’s employee responsible for administering
each contract, the details of the hospital authority’s commitment or
investment of resources or finances for each contract, the details of how
revenues are to be dispersed, and any other information requested by the
governing body.

HISTORY: 2015, c. 699; 2016, cc. 773, 774.