The Insider

A lawyer with expertise in charitable trusts who once worked for the Texas attorney general's office says nonprofits have a variety of ways of dealing with special-interest ties between board members and contractors. "Some organizations just have a flat-out prohibition, like 'We're just not going to let this happen.' Methodist obviously does not." The key question about the contract's propriety, opines our expert, is whether the hospital is "getting fair market value" on the contract. Since neither Mathis nor Bookout would disclose the dollar figures, that remains an open question.

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