Question: If a couple of teachers expressed an interest in providing vending machines at their school site, would that be considered a conflict of interest? One machine would be for staff and the other may be used by students, assuming all of food and drink guidelines would be adhered to.

Response: The major issue, in our opinion, is that the teachers are not businesses nor school organizations so they cannot operate the vending machines themselves unless they do have a separate business (with a real tax identification number) to do so. The teacher’s revenue from the vending machines would be taxable income to those teachers, reportable to the Internal Revenue Service and Franchise Tax Board if they went into the "vending machine" business.

In addition to the IRS and Franchise Tax Board issues stated in the above paragraph, state law prohibits any solicitation — sales or other requests for money — of students on school grounds except by district-controlled programs, such as the cafeteria, student groups or other board-approved groups. Teachers and other employees do not fall into these categories.

There could be conflict of interest issues if the teachers do have a real business operating vending machines, and the school site did not get bids or quotes (depending on the amount of the contract) prior to selection of the teachers’ business getting the job.

7/16/08