Conflict of Interest

 

Recently, a parent's middle school child came home from school and announced that the school was now serving TCBY Yogurt.  It was soon discovered that this yogurt was being supplied by Main Line Treats and Delights, a company owned by School Board Director Ralph Tang and/or his wife. 

Since this was an apparent conflict of interest for Mr. Tang, this issue was brought to School Board President McGarrigle's attention.  Her first reaction was to state that this was not a subject that rose to the level of the School Board's attention. 

However, when a parent filed a Pennsylvania Right to Know Law request for all the documentation concerning this contractual arrangement, the School Board decided to cancel the arrangement with the Tang company.  They also decided to bid the contract since the original arrangement with Tang's company was not awarded on a bid, but was agreed to directly with Mrs. Tang.  The Board also stated that Mr. Tang would recuse himself from the vote on the contract.

The School Board was to vote on the bids at the April 20th meeting, however, several residents voiced their concerns over the propriety of awarding a contract to the Tang company since Mr. Tang is a member of the Board.  They stated that this was a clear conflict of interest and an ethical issue which should dictate that no Board member should benefit from contracts with the School District over which he has oversight.

As a result of the concerns raised, the Board decided not to vote on the contract at that time, of which there was apparently only one bid, which was from the Tang company.  They decided to widen the scope of the requirements for the contract and rebid it at a later date.

While we applaud the Board for not awarding a contract to one of it's own members at this time, we are disappointed that they are apparently prepared to reconsider a bid from it's fellow Board member again.

We believe this is a very clear issue which should cause the Board to reject any contract from the Tang company for the following reasons:

  • It is a clear conflict of interest for a Board member to be given a contract to receive income in the School District over which he has responsibility and oversight.
  • The recusal of Mr. Tang's vote on the contract does not diminish the conflict of interest since some family income will be dependent on the School District over which he has authority.
  • The appearance of impropriety in this matter is enough that it should cause the School Board to avoid this issue completely.
  • How can we ever consider that Mr. Tang's votes and decisions in the future will be unbiased if he is receiving family income from the School District ?

We believe this decision should be an easy one for the Board.  They should always reject any contract which would enrich one of it's own. 

You can email the Board on this issue using the "Contact Board Members" button on this website.  The following is a story in the Daily Local regarding this issue:

 

Board puts frozen yogurt deal on ice

Published: Sunday, April 26, 2009

 

By DANIELLE LYNCH, Staff Writer
 
EAST WHITELAND — To avoid a conflict of interest, Great Valley School Board delayed a decision about a frozen yogurt contract because a board member's wife owns the company.

"I'm fully aware of the law and school code and how the Ethics Act works," said school board member Ralph Tang on Wednesday. "I understand my responsibility to abstain fully from any conflict of interest."

Tang's wife, Cindy, owns TCBY at the King of Prussia mall in Upper Merion, and her company is Main Line Treats and Delights LLC.

The school board decided not to vote on a awarding a project bid to the frozen yogurt company at its Monday night meeting.

Board member Susanne Carr said it would be best to rebid the project to avoid all possible conflicts of interest.

"It's a delight, but the kids can live without it," Carr said at the meeting. "I don't think anything unethical went on, but this is a way to protect the district and board."

With the exception of a dissenting vote from board member Kevin McTear, the board decided it would go through a second bidding process for frozen yogurt.

The school district has been looking into providing frozen yogurt to students for years, according to Director of Business Affairs Chuck Linderman.

"Unfortunately, it has become a heated issue," Linderman said.

Just before Christmas, the district sent out bid documents to three companies within a 15-mile radius, and only Cindy Tang's company responded, according to Linderman.

District Solicitor Jim McErlane said the school board could have voted on the sole bid Monday night.

"But a lot of municipalities and school boards would go out to bid again," McErlane said.

Also, McErlane said Tang could recuse himself from any vote that deals with his wife's company.

Some residents urged the school board to vote against awarding a contract to Cindy Tang's company.

Resident Steve Kantrowitz said he means no disrespect to Ralph Tang but it's important for the district to avoid the appearance of impropriety. Kantrowitz also took issue with documents related to the frozen yogurt company.

A March 27 inspection report issued by the Montgomery County Health Department Division of Environmental Services lists Ralph and Cynthia Tang as owners of the company. In addition, a business entity's filing history for the company done by the Pennsylvania Department of State lists Ralph Tang as company president.

"Even if he (Ralph Tang) is not president, he can't get around this by saying it's owned by his wife," Kantrowitz said.

Kantrowitz said Tuesday the board stepped in the right direction by agreeing to go out to bid again.

"I am legally 100 percent the owner, president and CEO of the company," Cindy Tang said Tuesday.

Cindy Tang said her husband's name is listed on some documents because he helped her get the business started. She said the documents have not been updated to reflect the new status.

"But I'm the rightful owner now," she said.

The business opened in November 2007. Cindy Tang approached the district's Supervisor of Food Services Barbara Nissel last January to see whether the district would be interested in supplying her product.

Nissel said the school district had been considering offering frozen yogurt since July 2007 when the state Department of Education sent out guidelines to school districts about competitive foods. Frozen yogurt was included on the list.

"School districts have an option to accept them or not," Nissel said. "Great Valley does, though, because it wants to offer the best for the students."

When the school district sent out requests for proposals to vendors, it mentioned requirements for the frozen yogurt, such as the yogurt being low in sugar and fat and having active cultures, Nissel said.

"If I couldn't find a company with these standards, we wouldn't have frozen yogurt at our district," she said. "What I think is difficult for the public to understand in our situation is that not all frozen yogurt is created equal."

The district then introduced a pilot program in which it offered Cindy Tang's frozen yogurt for $1.75 to students from the end of February through the third week in March.

About 175 to 250 yogurts were sold each day, according to Nissel.

"It was very successful," Nissel said.

Cindy Tang said her husband did not know that she had approached Nissel. She said her husband did not involve himself in any way with the TCBY business pilot program or use his position on the school board to influence any outcomes.

"My husband is a man of integrity and high moral character, and I'm disappointed that some community members are accusing him of lacking integrity, especially since he's had absolutely nothing to do with this," Cindy Tang said. "Ralph has nothing to do with the daily operations of the store; he does not work there."

Cindy Tang said she remains passionate about her product and business. She said her product is nutritionally sound and makes children happy.

"Studies show that live active cultures boost immune systems, increase absorption of vitamins and minerals, and enhance digestion," said Cindy Tang.

Ralph Tang maintains he had nothing to do with the contract.

"I never talked to anyone, so from my standpoint I'm clean," he said. "I don't believe my passion and integrity will be compromised."

The school board directed administrators to send out documents again to the vendors.

"We will rebid this and send it out to a lot of people," Nissel said. "My only concern is that they are fresh-dipped products, so if we get them from too far away, we will have a problem."

To contact staff writer Danielle Lynch, send an e-mail to dlynch@dailylocal.com.