First, a conflict of interest doesn't mean you can't do the job properly; it means that there is reason for an outside observer to think you might not act solely in the interests of the party who you are supposed to be representing.
I'm not sure if this is exactly a conflict of interest, and I assume it isn't a violation of Michigan's ethics rules, but if Orr had any role in the selection it is inappropriate. You can't have people giving contracts to their friends and former colleagues--there is no way you can convince people that you have made the selection purely on the merits.
If, on the other hand, they had already been picked, or were picked without Mr. Orr's participation, that should be OK. But he should not have been part of the process.
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