Post-tenure move: Reference letter from institution to which I'm applying I'm a tenured faculty member and am applying for a lateral, mid-career move at University of X. Unlike a normal search that would be handled by a department, it is for a prestigious research position and the search is thus being handled by University X's Office of the Provost. They'll shortlist candidates and then the successful candidates will end up essentially as bonus positions for departments.
My question thus has to do with using a reference for a position at University of X from a professor at University of X.
I have been a long-time collaborator with a full professor at University of X. They often write me reference letters for fellowships, awards, nominations, etc. Normally, this colleague would write me a letter.
But, I am applying to work at his university! Given it is a lateral move, would it be weird to draw on a reference from this collaborator when applying to the University of X? On the one hand, it would be an opportunity to highlight the great fit I might bring to several faculties at this university. On the other hand, they might be seen as having a vested interest as a new line for their department would be, well, a new line.
A letter written by someone the reader knows is likely to be more credible than a letter written by someone unknown.  So it makes sense to get a letter from someone at X when you know the reader will be at X.

they might be seen as having a vested interest

Most letter writers have an interest in the success of the person they are recommending.  A writer who works at X will have additional knowledge of the interests of the whole university, which could result in a more useful letter.

would it be weird to draw on a reference from this collaborator when applying to the University of X?

No.