(a) A grantee may not permit a person to participate in an administrative decision regarding a project if:

1. (1) The decision is likely to benefit that person or a member of his or her immediate family; and

2. (2) The person:

   1. (i) Is a public official; or
   2. (ii) Has a family or business relationship with the grantee.

(b) A grantee may not permit any person participating in the project to use his or her position for a purpose that is—or gives the appearance of being—motivated by a desire for a private financial gain for that person or for others.

(Authority: 20 U.S.C. 1221e-3 and 3474)