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Transcript of Slide Number #1 © 2007 Nan McKay & Associates Cara Gillette Ethics © 2007 Nan McKay & Associates.
Slide Number #1
© 2007 Nan McKay & Associates
Cara Gillette
EthicsEthics
© 2007 Nan McKay & Associates
Slide Number #2
© 2007 Nan McKay & Associates
IntroductionIntroduction
What we’ll cover: Ethical decision-making Principles of personal and business ethics Procurement ethics Policies that support ethical decisions in the
workplace
October 2007 Ethics 2
Slide Number #3
© 2007 Nan McKay & Associates Your Ethical RoleYour Ethical Role
As public housing officials, we are stewards of the public trust
Keep in mind that HUD views ethics violations as a serious crime
October 2007 Ethics 3
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© 2007 Nan McKay & Associates
What Is Ethics?What Is Ethics?
It’s knowing right from wrongEthical path not always easy one
There are serious problems in today’s business worldPreserving reputation is important
Yours and the housing authority’s
October 2007 Ethics 4
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© 2007 Nan McKay & Associates
Your ChallengeYour Challenge
The first challenge is knowing the “right thing” to do Ignorance of the law is not an excuse You need to consider not only the letter, but
also the spirit of the law Chances are if it feels wrong, there’s a good
chance it is!
October 2007 Ethics 5
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© 2007 Nan McKay & Associates
Your ChallengeYour Challenge
The next challenge is doing what’s right Avoid personal temptations – the “big stuff”
makes the news, but the day-to-day behaviors represent the largest arena for breach in ethics
October 2007 Ethics 6
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© 2007 Nan McKay & Associates
Your ChallengeYour Challenge
The “three R’s” to remember: Respect – people, PHA and your work Responsibility—customers, coworkers,
PHA, yourself Results—consider how something is done
as well as what
October 2007 Ethics 7
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© 2007 Nan McKay & Associates
Your ChallengeYour Challenge
Day-to-day breaches of ethics: Falsifying time sheets Office supplies that end up at home Not taking responsibility when you make a
mistake Reporting sick while out shopping
October 2007 Ethics 8
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© 2007 Nan McKay & Associates
Ethical Decision MakingEthical Decision Making
Guidance can be found in: HUD handbooks Housing authority policies Professional codes of ethics Laws
Ethics 9October 2007
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© 2007 Nan McKay & Associates
Ethical Decision MakingEthical Decision Making
Some questions to ask: Does it violate housing authority policy?
Admin Plan or ACOP PHA personnel policy PHA fraud and ethics policies PHA procurement policy
Ethics 10October 2007
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© 2007 Nan McKay & Associates
Ethical Decision MakingEthical Decision Making
Some questions to ask: Does it violate professional codes of ethics? Does it violate the Golden Rule? Are there “shushers”?
If someone is pressuring you keep it secret and not talk about it, chances are it’s unethical
Ethics 11October 2007
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© 2007 Nan McKay & Associates
Ethical Decision MakingEthical Decision Making
Some questions to ask: Does it pass the Mom Test? Does it pass the TV Test? Are any person’s, the PHA’s, or another
entity’s rights abridged or violated? The right to know, the right to privacy, the
right to property
Ethics 12October 2007
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© 2007 Nan McKay & Associates
Ethical Decision MakingEthical Decision Making
Some questions to ask: Are any duties or responsibilities not met? What if everyone did this? Does it minimize actual or potential harm?
Look again at an ethical decision before acting
Ethics 13October 2007
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© 2007 Nan McKay & Associates
Principles of Personal EthicsPrinciples of Personal Ethics
Ethics is personal because it comes down to you, your conscience, and your behaviors and decisions Willing compliance with the law Basic justice – being fair – and refusing to take
unfair advantage Impartiality – objectivity
Ethics 14October 2007
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© 2007 Nan McKay & Associates
Principles of Personal EthicsPrinciples of Personal Ethics
Ethics is personal Openness – full disclosure Confidentiality Due diligence – duty of care Fidelity to personal responsibilities Avoiding potential or apparent conflict of
interest
Ethics 15October 2007
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© 2007 Nan McKay & Associates
Principles of Personal EthicsPrinciples of Personal Ethics
In short, doing good and preventing harm is the essence of ethical behavior
Ethics 16October 2007
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© 2007 Nan McKay & Associates
Principles of Personal EthicsPrinciples of Personal Ethics
Ethics determines your professional duties: Appropriate professional relations Actions that produce desired outcomes Confidentiality Impartiality
Ethics 17October 2007
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© 2007 Nan McKay & Associates
Case Study #1Case Study #1
You are the waiting list supervisor While attending a college prep meeting at your
son’s high school, the principal, who needs to write your son a recommendation, asks you about her recently divorced daughter who recently applied for Section 8 assistance
How would you handle this?
October 2007 Ethics 18
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© 2007 Nan McKay & Associates
Ethics: It’s A Personal DecisionEthics: It’s A Personal Decision
It comes down to you: Are you willing to: Comply with laws Be fair Be objective Disclose dishonesty Maintain confidentiality
Do your duty
Adhere to personal responsibility
Avoid conflict of interest situations
Exhibit concern and respect for others
Be honest
October 2007 19
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© 2007 Nan McKay & Associates
Ethical ChecklistEthical Checklist
Appendix 1 gives you a good checklist for making ethical decisions
Ethics 20October 2007
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© 2007 Nan McKay & Associates
Business EthicsBusiness Ethics
Attention to business ethics is critical in times of fundamental change Values that were previously taken for granted
are now strongly questioned Attention to ethics is a moral compass and
sensitizes leaders and staff as to how they should act
Ethics 21October 2007
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© 2007 Nan McKay & Associates
Business EthicsBusiness Ethics
Managerial conduct: You have the responsibility to not support
unethical behavior, including: Illegal activity Illegal practices Unethical practices
October 2007 Ethics 22
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© 2007 Nan McKay & Associates
Business EthicsBusiness Ethics
PHA policies should give clear instruction on how to deal with persons and agencies who participate in: Wrongful use of resources Mismanagement of contracts Conflicts of interest
October 2007 Ethics 23
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© 2007 Nan McKay & Associates
Business EthicsBusiness Ethics
Part of management in PHA PHA need to strive for a more positive public
image PHA’s policies should provide clear and
detailed guidance on ethics
October 2007 Ethics 24
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© 2007 Nan McKay & Associates
Myths about Business EthicsMyths about Business Ethics
1. Business ethics is more a matter of religion than management Not trying to change values—managing decisions
and behavior is the goal
October 2007 Ethics 25
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© 2007 Nan McKay & Associates
Myths about Business EthicsMyths about Business Ethics
2. Employees are ethical so we don’t need attention to business ethics Ethic dilemmas are complex Many ‘gray areas’
3. Business ethics is an academic or religious discipline
October 2007 Ethics 26
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© 2007 Nan McKay & Associates
Myths about Business EthicsMyths about Business Ethics
4. Business ethics is about the obvious: Do good! More than just being honest Code of Ethics provide priority and focus
regarding workplace issues
October 2007 Ethics 27
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Myths about Business EthicsMyths about Business Ethics
5. Ethics is the good guys preaching to the bad guys Good people can make bad decisions
6. Ethics can’t be managed 7. Our PHA is not in trouble so we must
be ethical
October 2007 Ethics 28
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© 2007 Nan McKay & Associates
How Do We Benefit From Ethics In The How Do We Benefit From Ethics In The Workplace?Workplace?
Laws now protect workers from abuse and discrimination
Anti-trust laws protect consumers Promotes openness, dialogue and honesty Promotes confidence in our work
environment
October 2007 Ethics 29
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© 2007 Nan McKay & Associates
How Do We Benefit From Ethics In The How Do We Benefit From Ethics In The Workplace?Workplace?
Ethics policies are an insurance policy—help ensure policies are legal
Allows PHA to detect ethics issues early on Portrays a strong positive image to the
public Legitimizes management actions
October 2007 Ethics 30
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© 2007 Nan McKay & Associates
Ethical DilemmasEthical Dilemmas
Sometimes there isn’t one clear choice Ethical dilemmas faced by
managers are often more real-life and highly complex with no clear guidelines, whether in law or policy
October 2007 Ethics 31
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© 2007 Nan McKay & Associates
Ethical DilemmasEthical Dilemmas
You know you have a significant ethical conflict when there is presence of: Significant value conflicts among differing
interests Real alternatives that are equally justifiable;
and Significant consequences to stakeholders
October 2007 Ethics 32
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© 2007 Nan McKay & Associates
Ethical DilemmasEthical Dilemmas
An ethical dilemma exists when you’re faced with having to make a choice among these alternatives
October 2007 Ethics 33
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© 2007 Nan McKay & Associates
Ethical Dilemma #1Ethical Dilemma #1
Your boss told you that one of your employees is soon to be laid off, and that you’re not to tell your employee yet – he might tell the whole PHA and get everyone in an uproar
Meanwhile, you heard from your employee that he plans to buy a new car and remodel his house
What should you do?
October 2007 Ethics 34
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Ethical Dilemma #2Ethical Dilemma #2
A colleague told you that she plans to quit the company in two months to take a new job offer
Meanwhile, your boss told you that you didn’t get a promotion because he’s going to give the promotion to your colleague (above)
What should you do?
October 2007 Ethics 35
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© 2007 Nan McKay & Associates
Procurement EthicsProcurement Ethics
October 2007 Ethics 36
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© 2007 Nan McKay & Associates
Important TermsImportant Terms
Mandatory vs. optional references ‘Shall’ and ‘must’ are mandatory in regs,
handbooks or law ‘Should’ or ‘may’ are guidance and not
requiredPHAs needs to establish policies
October 2007 Ethics 37
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© 2007 Nan McKay & Associates
Procurement Laws and RegulationsProcurement Laws and Regulations
Procurement is acquiring goods and services using federal funds
Procurement policy must be compliant with the following mandatory references: Part 85 CFR Handbook 7460.8 State or local law
October 2007 Ethics 38
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© 2007 Nan McKay & Associates
Procurement Laws and RegulationsProcurement Laws and Regulations
Part 85 ‘The Common Rule’ has requirements for all entities receiving federal funds and provides guidance on: Development of procurement policy and system Important parts of contract administrative system General guidance for PHAs for standard of conduct Requirements for price and cost analysis
October 2007 Ethics 39
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© 2007 Nan McKay & Associates
ProcurementProcurement
HUD Procurement Handbook 7460.8 REV 2 (revised March 2007)
Provides guidance on asset management and project-based management
Does not apply to Indian HAs or HCVFees for COCC not subject to handbook
October 2007 Ethics 40
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© 2007 Nan McKay & Associates
ProcurementProcurement
Chapter 4 of the new HUD Handbook 7460.8 REV 2 deals directly with the need to set ethical standards for procurement Appendix 2
We will deal with ethics as it applies throughout the procurement process
October 2007 Ethics 41
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© 2007 Nan McKay & Associates
Basics Of ProcurementBasics Of Procurement
Setting the limits Determining who is authorized to make
purchases Distinctions between goods and services Construction Contract management
October 2007 Ethics 42
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© 2007 Nan McKay & Associates
State or Local LawState or Local Law
PHAs must comply with state or local laws re: procurement
Some states have more stringent laws PHAs must comply with the stricter law
October 2007 Ethics 43
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© 2007 Nan McKay & Associates
Public Access to Procurement Public Access to Procurement InformationInformation
Certain procurement information should be made public according to state laws
Other information is sometimes protected from disclosure and should not be made public
PHAs should exercise caution!
October 2007 Ethics 44
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© 2007 Nan McKay & Associates
Public Access to Procurement Public Access to Procurement InformationInformation
Many states have enacted FOI laws Could vary from state to state PHA’s procurement policy must
incorporate the state law
October 2007 Ethics 45
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© 2007 Nan McKay & Associates
Procurement and Good BusinessProcurement and Good Business
PHA’s goal should satisfy end users in terms of cost, quality and timeliness while complying with HUD regs and policies
Should exercise personal initiative and sound judgment
When there are doubts, officers should seek advice
October 2007 Ethics 46
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© 2007 Nan McKay & Associates
Procurement and Good BusinessProcurement and Good Business
Policy must state who has authority to purchase, what amount, and what approval is required This may change in the transition to project-
based management
October 2007 Ethics 47
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© 2007 Nan McKay & Associates
Procurement PolicyProcurement Policy
Sets standards for purchases
Ethics 48October 2007
Example Procurement PolicyExample Procurement Policy
October 2007 Ethics 49
Purchase Amount
Purchase Authority
Procurement Method
Less than $50
Site Manager
Petty cash. Receipts required and must be logged. Submitted to Regional Manager
$50-$2,000 Site Manager
Micropurchase. 1 reasonable price quote. Purchases should be equally distributed
$2,000 -$100,000
Regional Manager
3 quotes (Fax, written, or email). Oral only for building materials & supplies not services. Purchases equally distributed.
Over $100,000
Asset Manager
Formal advertisement and sealed bid.
Slide Number #50
© 2007 Nan McKay & Associates
Contracting OfficerContracting Officer
The contracting officer acquires supplies, services and construction needed by PHA Signs contracts, PO’s, agreements At many PHAs, procurement authority is being
“drilled down” to the site Imperative that property managers with
procurement authority understand the rules
October 2007 Ethics 50
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Contracting OfficerContracting Officer
Contracting officer can be centralized, decentralized, or a mix (both at the project with the head officer at the COCC) Analyzes bids/proposals Detects contract irregularities Ratifies unauthorized commitments with
justification
October 2007 Ethics 51
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© 2007 Nan McKay & Associates
ContractingContracting Officer Officer
Contracts must comply with… HUD regulations Procurement policy of PHA State or local laws Signature of contracting officer establishes
PHA legal commitment
October 2007 Ethics 52
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© 2007 Nan McKay & Associates
Important PointImportant Point
Separation of duties and functions PHAs should ensure that the person who
places purchase orders does not also “receive” the items purchased
October 2007 Ethics 53
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© 2007 Nan McKay & Associates
Important PointImportant Point
Records on each procurement must be maintained for at least three years
Ethics 54October 2007
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© 2007 Nan McKay & Associates
The Connection Between The Connection Between Procurement & EthicsProcurement & Ethics
Simply stated, decisions made to purchase goods and services for the agency must be in the best interest of the agency
Each decision must be made without outside influence
October 2007 Ethics 55
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The Connection Between The Connection Between Procurement & EthicsProcurement & Ethics
Keeping ethics on the front burner in all procurement activities means that everyone understands the PHA procurement policy, what it means, the terms, and the consequences of noncompliance
October 2007 Ethics 56
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© 2007 Nan McKay & Associates
Important TermsImportant Terms
We’ll go through some of the important terms used in procurement and contract management Anyone purchasing goods or
services needs to understand these terms
October 2007 Ethics 57
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Circumventing Purchasing Circumventing Purchasing AuthorityAuthority
Sanctions must be imposed for circumventing this authority
October 2007 Ethics 58
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© 2007 Nan McKay & Associates
Conflict Of InterestConflict Of Interest
Simply stated, we must avoid conflicts of interest, real or perceived
October 2007 Ethics 59
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© 2007 Nan McKay & Associates
Conflict Of Interest, What Is It?Conflict Of Interest, What Is It?
A conflict of interest occurs when a PHA employee, officer, or agent, or member of their family, stands to gain financially or otherwise, from a decision made by the PHA
October 2007 Ethics 60
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© 2007 Nan McKay & Associates
Conflict of InterestConflict of Interest
PHAs must adhere to conflict of interest prohibitions:
No PHA employee, officer, or agent shall participate in a contract if a conflict of interest, financial or otherwise, real or apparent, would be involved Includes family, partners and organizations
October 2007 Ethics 61
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© 2007 Nan McKay & Associates
Conflict of InterestConflict of Interest
Neither the PHA, contractors or subcontractors may enter into any contract or connection with PHA during their tenure or 1 year after: Board members of PHA (present or former) or
their immediate family Present and former tenant commissioners are
excepted from this provision not serving on a resident corporation and do not make policy…
October 2007 Ethics 62
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Conflict of InterestConflict of Interest
PHA employees who formulate policy or who influence decisions with respect to the project(s), or their immediate family or their partner
Public officials, member of local government, or state or local legislator, or their immediate family, who exercise functions or responsibilities with respect to the project(s) of the PHA
October 2007 Ethics 63
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Conflict of Interest - ExampleConflict of Interest - Example
Joan Johnson, a board member, is the parent of Dwayne Johnson, who is applying to be the PHA’s public housing facilities director
October 2007 Ethics 64
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Conflict of Interest - ExampleConflict of Interest - Example
A former board member, Charles Conrad, whose tenure ended less than a year ago, enters into a contract with the PHA to provide consulting services
October 2007 Ethics 65
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© 2007 Nan McKay & Associates
Conflict of Interest - ExampleConflict of Interest - Example
A PHA employee, Dawn Shimoda, is seeking election to the city council, which exercises authority over PHA operations Employees may seek election but if elected
may have to resign
October 2007 Ethics 66
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© 2007 Nan McKay & Associates
Conflict Of InterestConflict Of Interest
Let’s take a moment to look at some samples that HUD put together as illustrations of conflict of interest
Ethics 67October 2007
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© 2007 Nan McKay & Associates
Example #1Example #1
Cybil is a commissioner She is also VP of the board of American
Handicapped Citizens of her county She does not receive a salary or any other
compensation for serving on AHC’s board AHC is subrecipient of $25,000 in PHA funds
Is there a problem here?
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Answer #1Answer #1
No – Cybil may continue to serve as a commissioner of the PHA and also as VP of AHC’s Board Cybil has no financial interest in AHC A conflict of interest would arise in this
situation only if Cybil received a salary or other compensation for her AHC board service. 24 CFR § 570.611(b)
69
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Illustration #2Illustration #2
The PHA wishes to lease office space in the city The PHA will pay the rent The mayor owns the building which the PHA
would like to lease Can the mayor lease office space to the PHA?
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Answer #2Answer #2
No 24 CFR § 92.356(b) & ©
Prohibit a person who is an elected official of a city and in a position to gain inside information from obtaining a financial benefit from such activity
71
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© 2007 Nan McKay & Associates
Gratuities, Kickbacks, and Use of Gratuities, Kickbacks, and Use of Confidential InformationConfidential Information
October 2007 Ethics 72
PHA employees, commissioners, or agents must not accept, solicit, or agree to accept gratuities, favors, or anything of monetary value from contractors or parties with contractual agreements
Slide Number #73
© 2007 Nan McKay & Associates
GiftsGifts
PHAs may set minimum rules where the financial interest is not substantial or the gift is of nominal value Common PHA policy is to allow
gifts worth under $25 if shared with the whole office
October 2007 Ethics 73
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© 2007 Nan McKay & Associates
Kickbacks, Kickbacks, Anti-Competitive PracticesAnti-Competitive Practices
Not always obvious Rebates, coupons, points and discounts,
taken personally, can be considered an anti-competitive practice
October 2007 Ethics 74
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© 2007 Nan McKay & Associates
Kickbacks, Kickbacks, Anti-Competitive PracticesAnti-Competitive Practices
An anti-competitive practice would be providing information that would give one firm an advantage over another, for example:
Cost estimates Names of other bidders Other valuable information
October 2007 Ethics 75
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© 2007 Nan McKay & Associates
Back Door SellingBack Door Selling
Avoiding the procurement process For example, dealing directly with the
manager intending to use the service Green Lawn Company will provide services
for $500 per month, avoiding the need to bid
October 2007 Ethics 76
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© 2007 Nan McKay & Associates
NepotismNepotism
The practice of giving positions in the PHA to relatives or friends rather than to the most qualified The ACC prohibits this
practice
October 2007 Ethics 77
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© 2007 Nan McKay & Associates
NepotismNepotism
Applies to any present or former member of the board or employee who formulates policy or who influences decisions Applies throughout tenure or
employment and for one year after
October 2007 Ethics 78
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© 2007 Nan McKay & Associates
SanctionsSanctions
The executive director and the board are responsible for establishing sanctions for violations of ethical standards Civil and administrative remedies
HUD may exercise any available remedy as well
October 2007 Ethics 79
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© 2007 Nan McKay & Associates
Case StudyCase Study
You are a PHA foreman You own a two-family home and advertise your unit
for rent A mother and her two children want to rent the unit You agree to rent the unit This potential tenant then hands you a HCV voucher
RFTA form from your PHA What do you do?
October 2007 Ethics 80
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Case StudyCase Study
Your supervisor asks you to sell tickets for a councilwoman’s upcoming campaign
You are the procurement officer and you know lots of vendors, so you have the best chance of selling the tickets
How do you avoid this situation and keep your job?
October 2007 Ethics 81
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Procurement CategoriesProcurement Categories
Do’s and don’ts Petty cash Small purchases Sealed bids
October 2007 Ethics 82
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Petty CashPetty Cash
Do Use for small purchases where it may be
impractical to issue a check Don’t
Use for everyday or repeat business
October 2007 Ethics 83
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Sealed Bidding Sealed Bidding
This process if full of potential areas of risk Do
Protect the PHA at all times Protect the “information” in connection with the
bid process Ensure bids are date/time stamped and locked
until bid opening
October 2007 Ethics 84
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© 2007 Nan McKay & Associates
Sealed Bidding Sealed Bidding
Do Publicize the Invitation for Bid (IFB) including, if
applicable, the pre-bid conference, as stated in the PHA’s procurement policy
Disclose any conflict of interest, real or perceived, with any potential bidder
October 2007 Ethics 85
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© 2007 Nan McKay & Associates
Sealed BiddingSealed Bidding
Don’t Give any potential bidder any information that
not all potential bidders are given Provide any information at the bid opening other
than the name of the bidder and proposed price
October 2007 Ethics 86
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The Envelope Please!The Envelope Please!
Common mistakes Opening envelope prior
to official date and time Accepting a bid after
the official bid opening date and time…
October 2007 Ethics 87
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The Envelope Please!The Envelope Please!
Common mistakes Commenting on the “Winner!” prior to
validation of bid documents and conducting due diligence procedures
Allowing changes in bid documents Providing information to one bidder only
October 2007 Ethics 88
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Unethical ActionsUnethical Actions
Revealing proprietary information
Changing the bid after opening
Attempting to influence the selection of bidder based on known false information
October 2007 Ethics 89
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Disclose Potential ConflictsDisclose Potential Conflicts
Avoid actual conflict of interest
Consider the consequences
State Board Of Ethics Trust your inner voice
Contact HUD Job loss, reputation Contact state office How does it look on
the front page of the paper?
October 2007 Ethics 90
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© 2007 Nan McKay & Associates
Competitive Proposals (RFP)Competitive Proposals (RFP)
Professional services (architect, engineer) done through the competitive process
Both technical and price factors are considered Allows discussions with
each offeror
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© 2007 Nan McKay & Associates
Competitive Proposals (RFP)Competitive Proposals (RFP)
Do Be very specific in the SOW – describe in
detail the service(s) or good(s) the PHA is soliciting
Don’t Make a decision before best and final offers
are received
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© 2007 Nan McKay & Associates
Contract ManagementContract Management
The PHA is obligated to ensure the performance of the contract
Must inspect products when delivered
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© 2007 Nan McKay & Associates
Other Areas for Ethics Other Areas for Ethics ManagementManagement
Nondiscrimination Sexual harassment
Human Resources Hiring, promoting,
discipline
Fraud
October 2007 Ethics 94
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© 2007 Nan McKay & Associates
Sexual HarassmentSexual Harassment
One of the most common and increasing areas of lawsuits
Violates Title VII, Civil Rights Act of 1964
October 2007 Ethics 95
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© 2007 Nan McKay & Associates
Sexual HarassmentSexual Harassment
Sexual harassment is unwelcome behavior that happens to someone because of his or her sex
Most lawsuits based on a “hostile work environment”
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© 2007 Nan McKay & Associates
Ethics in Human ResourcesEthics in Human Resources
HR policies and processes should foster ethics in: Getting the best employees Paying employees Training employees Ensuring compliance Ensuring safe work environments Fostering productivity
October 2007 Ethics 97
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© 2007 Nan McKay & Associates
Ethics in Human ResourcesEthics in Human Resources
Thorough and well-defined hiring practices Background checks References Law enforcement and drug checks Interviews done the same way for all applicants,
with documentation supporting the hire
October 2007 Ethics 98
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© 2007 Nan McKay & Associates
Ethics in Human ResourcesEthics in Human Resources
Training Ethics policies and procedures are useless
unless all staff members are trained about what they are, how they work, and their roles
The legal system often interprets employee behavior (rather than written policies) as de facto policy
October 2007 Ethics 99
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© 2007 Nan McKay & Associates
Ethics in Human ResourcesEthics in Human Resources
Training Orient new employees to the PHA’s ethics
policies and procedures during new employee orientation
Review ethics is management training experiences
Involve staff in review of codes and policies …
October 2007 Ethics 100
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© 2007 Nan McKay & Associates
Ethics in Human ResourcesEthics in Human Resources
Performance evaluations Include ethical performance as a dimension in
performance appraisals
October 2007 Ethics 101
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© 2007 Nan McKay & Associates
Ethics in Human ResourcesEthics in Human Resources
Discipline How supervisors correct behavioral problems
and make sure staff adheres to rules The purpose is to correct, not to punish or
embarrass An articulated disciplinary policy and process
ensure that the process is ethical
Page 9-23
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© 2007 Nan McKay & Associates
Ethics in Human ResourcesEthics in Human Resources
Often, a positive approach solves the problem without having to discipline
Frequent communication to employees
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© 2007 Nan McKay & Associates
Ethics in Human ResourcesEthics in Human Resources
Discipline Thorough documentation from the beginning
Includes emails Talk to the employee and document the
conversation
The question the courts ask is whether the employer had “just cause” to discipline
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© 2007 Nan McKay & Associates
FraudFraud
Fraud is the intentional, false representation of concealment of a material fact for the purpose of inducing another to act on it, to the injury of an entity or person
October 2007 Ethics 105
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© 2007 Nan McKay & Associates
Ethics ResourceEthics Resource
Office Of Inspector General (IG) posted an updated guide on fraud prevention on March 5, 2004 HUD looks for good internal controls Appendix 3
October 2007 Ethics 106
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Conditions That Foster FraudConditions That Foster Fraud
Stress in employees’ personal life Financial troubles
Credit card debt Divorce Addictions
Emotional issues
October 2007 Ethics 107
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© 2007 Nan McKay & Associates
Conditions That Foster FraudConditions That Foster Fraud
Working conditions Employees feel unfairly treated Lack of recognition for the value of their work
Financial compensation Appreciation for the work performed Lack of respect by supervisors and other
employees
October 2007 Ethics 108
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Conditions That Foster FraudConditions That Foster Fraud
Working conditions “No one cares” - if there is an atmosphere that
no one cares, no one is checking, it doesn’t make any difference
Everyone else is doing it, I might as well get mine
October 2007 Ethics 109
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© 2007 Nan McKay & Associates
Fraud PreventionFraud Prevention
Increasing the perception of detection might be the most effective fraud prevention method Controls do little good in forestalling theft and
fraud if those who may be inclined to commit fraud do not know that controls are in place
October 2007 Ethics 110
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© 2007 Nan McKay & Associates
Practical Steps – Fraud PreventionPractical Steps – Fraud Prevention
PHA policies clear and up-to-date Personnel, procurement, and ethics ACOP and Admin Plan Nondiscrimination
October 2007 Ethics 111
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© 2007 Nan McKay & Associates
Practical Steps – Fraud PreventionPractical Steps – Fraud Prevention
Institute good internal control Checks and balances
PO system – who is authorized to purchase, who is authorized to receive goods
Rent collection – who receives rent, who posts Inventory control
Well-defined system, inventory taken regularly
October 2007 Ethics 112
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Practical Steps – Fraud PreventionPractical Steps – Fraud Prevention
Internal controls Alter “routine or predictable” systems from time
to time Take notice of employees that never take a
vacation for more than one or two days at a time Conduct random audits, and make it well known Institute an atmosphere of accountability
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Internal controls Time sheets Sick time claims Patterns of absences
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Practical Steps – Fraud Prevention Practical Steps – Fraud Prevention
Management must set the tone Must inspire staff Must clearly communicate the mission of the
PHA Must establish a system that recognizes
individual accomplishment
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Management must: Promote qualified staff Establish an atmosphere in which honest
employees do not fear reprisals for reporting abuse Anonymous reporting Whistle blower protection provisions
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Guidelines for Managing Ethics in Guidelines for Managing Ethics in the Workplacethe Workplace
PHA policies should be clear, and practice should match policies Only then can PHA
manage ethics
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Recognize that managing ethics is a process Ethics programs may seem more process-
oriented than other management practices The most important aspect from ethics
management is the process of reflection and dialogue that produces results
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Bottom line of managing ethics is accomplishing preferred behaviors in the workplace Ethical policies and rules are meaningless
unless they generate fair and just behaviors Codes of ethics and policies must also
generate procedures and training
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The best way to handle ethical dilemmas is to avoid their occurrence in the first place Codes of ethics and ethics policies sensitize
employees to ethical considerations and minimize the chances of unethical behavior occurring in the first place
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Make ethics decisions in groups, and make decisions public, as appropriate Thus diverse interests and perspectives are
more integrated, and credibility of the decision is increased
Suspicion of unfair bias is decreased
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Integrate ethics management with other management practices For example, when developing personnel
policies, reflect on what ethical values most important in the agency’s culture and then design policies to produce these behaviors
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Guidelines for Managing Ethics in Guidelines for Managing Ethics in the Workplacethe Workplace
Use cross-functional teams when developing and implementing ethics policies and procedures PHA employees should feel a sense of
participation and ownership in the ethical values of the PHA
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Value forgiveness Managing ethics may actually increase the number
of ethical issues to be dealt with because people are more sensitive to their occurrence
Help people recognize and address their mistakes and then support them to try to operate ethically
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Trying to operate ethically and making a few mistakes is better than not trying at all All organizations are made up of people People are not perfect Some organizations fear sticking their necks out
because they fear mistakes – it’s the trying that counts
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Ethics ResourceEthics Resource
HUD’s Office of General Counsel and PIH published an ethics reference manual February 2003 Appendix guidance
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Key Roles and Responsibilities in Key Roles and Responsibilities in Ethics ManagementEthics Management
Roles vary according to the size of the PHA The following functions
are responsibilities that should be included somewhere in the agency
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The PHA’s executive director must fully support ethics The ED should announce ethics policies and
procedures, and champion their development and implementation
The ED should always aspire to lead ethically And if a mistake is made, admit it
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The board should approve ethics policies And monitor that policies are implemented
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Key Roles and Responsibilities in Key Roles and Responsibilities in Ethics ManagementEthics Management
Consider establishing an ethics management committee The committee would oversee development,
implementation, and training of ethics policies and procedures
Should be comprised of senior management
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Consider assigning/developing an ethics officer or ombudsperson Trained in matter of ethics in the workplace,
particularly about resolving ethical dilemmas
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