Conflict of Interest Policy

Last updated: November 6, 2026

Article 1. Purpose

The purpose of the conflict of interest policy is to protect the interests of Open Transit Software Foundation (the “Organization”) when it is contemplating entering into a transaction or arrangement that might benefit the private interest of an officer, director, or employee of the Organization, or might result in a possible excess benefit transaction. This policy is intended to supplement, but not replace, any applicable state or federal laws governing conflict of interest applicable to nonprofit and charitable organizations.

Article 2. Definitions

1. Interested Person

Any director, principal officer, or member of a committee with governing board-delegated powers who has a direct or indirect financial interest, as defined below, is an interested person.

2. Financial Interest

A person has a financial interest if the person has, directly or indirectly, through business, investment, or family:

  1. An ownership or investment interest in any entity with which the Organization has a transaction or arrangement;
  2. A compensation arrangement with the Organization, or with any entity or individual with which the Organization has a transaction or arrangement; or
  3. A potential ownership or investment interest in, or compensation arrangement with, any entity or individual with which the Organization is negotiating a transaction or arrangement.

Compensation includes direct and indirect remuneration, as well as gifts or favors that are substantial in nature. A financial interest is not necessarily a conflict of interest. Under Article 3, Section 2, a person who has a financial interest may have a conflict of interest only if the appropriate governing board or committee decides that a conflict of interest exists.

Article 3. Procedures

1. Duty to Disclose

In connection with any actual or possible conflict of interest, an interested person must disclose the existence and nature of his or her financial interest to the directors and members of committees with board-delegated powers considering the proposed transaction or arrangement.

The interested person must be given the opportunity to disclose all material facts to the directors and members of committees with governing board delegated powers considering the proposed transaction or arrangement. There normally is no duty to disclose with respect to ownership or investment interests in publicly traded entities where the interested person owns such an insignificant percentage of the outstanding stock of the entity that the potential benefit to the interested person is negligible.

If you think there is a remote chance of a conflict, do not hesitate, please disclose it!

2. Determining Whether a Conflict of Interest Exists

After disclosure of the financial interest and all material facts and any discussion with the interested person, he or she shall leave the governing board or committee meeting while the determination of a conflict of interest is discussed and voted upon. The remaining board or committee members shall decide if a conflict of interest exists.

3. Procedures for Addressing the Conflict of Interest

  1. An interested person may make a presentation at the governing board or committee meeting. After the presentation, he or she shall leave the meeting during the discussion of, and the vote on, the transaction or arrangement involving the possible conflict of interest.
  2. The chairperson of the governing board or committee shall, if appropriate, appoint a disinterested person or committee to investigate alternatives to the proposed transaction or arrangement.
  3. After exercising due diligence, the board or committee shall determine whether the Organization can obtain with reasonable efforts a more advantageous transaction or arrangement from a person or entity that would not give rise to a conflict of interest.
  4. If a more advantageous transaction or arrangement is not reasonably attainable under circumstances that would not give rise to a conflict of interest, the board or committee shall determine, by a majority vote of the disinterested directors, whether the transaction or arrangement is in the Organization’s best interest and for its own benefit and whether the transaction is fair and reasonable to the Organization. In conformity with the above determination, it shall make its decision as to whether to enter into the transaction or arrangement. In the alternative, the governing board or committee may enter into a unanimous consent resolution (with any conflicted members abstaining) in lieu of a meeting and a vote so long as the resolution explains whether the transaction or arrangement is in the Organization’s best interest and for its own benefit, and whether it is fair and reasonable.

4. Violations of the Conflict of Interest Policy

  1. If the board or committee has reasonable cause to believe an officer or director has failed to disclose an actual or possible conflict of interest, it shall inform the individual of the basis for such belief and afford the individual an opportunity to explain the alleged failure to disclose.
  2. After hearing the officer or director’s response and making further investigation as may be warranted by the circumstances, if the board or committee determines the officer or director has failed to disclose an actual or possible conflict of interest, it shall take appropriate disciplinary and corrective action.

Article 4. Records of Proceeding

The minutes of the board and all committees with board-delegated powers shall contain:

  1. The names of the persons who disclosed or otherwise were found to have a financial interest in connection with an actual or possible conflict of interest, the nature of the financial interest, any action taken to determine whether a conflict of interest was present, and the board’s or committee’s decision as to whether a conflict of interest in fact existed.
  2. The names of the persons who were present for discussions and votes relating to the transaction or arrangement, the content of the discussion, including any alternatives to the proposed transaction or arrangement, and a record of any votes taken in connection with the proceedings.

If instead of a meeting, the governing board or committee determines it is necessary or expedient to enter into a unanimous written consent resolution to record a conflict of interest decision, and the disqualified individual’s signature is necessary for unanimous consent, then the disqualified individual shall also sign the written resolution, but that person shall indicate with their signature that they are recused, and are only signing for the purposes of unanimous written consent.

Article 5. Compensation

  1. A voting member of any board or committee whose jurisdiction includes compensation matters and who receives compensation, directly or indirectly, from the Organization for services, is precluded from voting on matters pertaining to that member’s compensation.
  2. No voting member of the governing board or any committee whose jurisdiction includes compensation matters who receives compensation, directly or indirectly, from the Organization, either individually or collectively, is prohibited from providing information to any committee regarding compensation.

Article 6. Annual Statements

Each director, principal officer, and member of a committee with board delegated powers shall, at the beginning of their term and annually thereafter, sign a statement that affirms such person:

  1. Has received a copy of the conflict of interest policy;
  2. Has read and understands the policy;
  3. Has agreed to comply with the policy; and
  4. Understands that the Organization is a charitable organization, and in order to maintain its federal tax exemption it must engage primarily in activities that accomplish one or more of its tax-exempt purposes.

A form of such statement is attached to this Conflict of Interest Policy.

Article 7. Periodic Reviews

To ensure that the Organization operates in a manner consistent with its charitable purposes and that it does not engage in activities that could jeopardize its status as an organization exempt from federal income tax, periodic reviews shall be conducted. The periodic reviews shall, at a minimum, include the following subjects:

  1. Whether compensation arrangements and benefits are reasonable and are the result of arm’s-length bargaining.
  2. Whether partnership and joint venture arrangements conform to written policies, are properly recorded, reflect reasonable payments for goods and services, further the Organization’s charitable purposes and do not result in inurement or impermissible private benefit.
  3. Whether agreements to provide services further the Organization’s charitable purposes and do not result in inurement or impermissible private benefit.

Article 8. Use of Outside Experts

In conducting the periodic reviews provided for in Article 7, the Organization may, but need not, use outside advisors. If outside experts are used, their use shall not relieve the board of its responsibility for ensuring that periodic reviews are conducted.

The foregoing conflicts of interest policy was adopted by the board of directors on July 8, 2019.

(signed)
Name: Alan Borning
Title: Board member and Treasurer