Ethics: Indiana's Conflict of Interest Definition

This page is intended to provide general information and does not necessarily address all aspects of this topic. Because the facts of each situation may vary, this information may need to be supplemented by consulting legal advisors. It reflects in summary form statutes/constitutional provisions/legislative chamber rules in effect as of 5/31/2008 or statutes set to take effect shortly thereafter.

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Indiana's Policy Statutory Reference

Title 35  Criminal Law and Procedure
Article 44  Offenses Against Public Administration
Chapter 1  Bribery -- Official Misconduct
35-44-1-3.  Conflicts of interest -- Public servants.

  (a) A public servant who knowingly or intentionally:

   (1) has a pecuniary interest in; or

   (2) derives a profit from;

   a contract or purchase connected with an action by the governmental entity served by the public servant commits conflict of interest, a Class D felony.

(b) This section does not prohibit a public servant from receiving compensation for:

   (1) services provided as a public servant; or

   (2) expenses incurred by the public servant as provided by law.

(c) This section does not prohibit a public servant from having a pecuniary interest in or deriving a profit from a contract or purchase connected with the governmental entity served under any of the following conditions:

   (1) If the:

      (A) public servant is not a member or on the staff of the governing body empowered to contract or purchase on behalf of the governmental entity;

      (B) functions and duties performed by the public servant for the governmental entity are unrelated to the contract or purchase; and

      (C) public servant makes a disclosure under subsection (d)(1) through (d)(6).

   (2) If the contract or purchase involves utility services from a utility whose rate structure is regulated by the state or federal government.

   (3) If the public servant:

      (A) is an elected public servant or a member of the board of trustees of a state supported college or university; and

      (B) makes a disclosure under subsection (d)(1) through (d)(6).

   (4) If the public servant:

      (A) was appointed by an elected public servant or the board of trustees of a state supported college or university; and

      (B) makes a disclosure under subsection (d)(1) through (d)(7).

   (5) If the public servant:

      (A) acts in only an advisory capacity for a state supported college or university; and

      (B) does not have authority to act on behalf of the college or university in a matter involving a contract or purchase.

   (6) If the public servant:

      (A) is employed by the governing body of a school corporation and the contract or purchase involves the employment of a dependent or the payment of fees to a dependent; and

      (B) makes a disclosure under subsection (d)(1) through (d)(6).

   (7) If the public servant is under the jurisdiction of the state ethics commission as provided in IC 4-2-6-2.5 and obtains from the state ethics commission, following full and truthful disclosure, written approval that the public servant will not or does not have a conflict of interest in connection with the contract or purchase under IC 4-2-6 and this section. The approval required under this subdivision must be:

      (A) granted to the public servant before action is taken in connection with the contract or purchase by the governmental entity served; or

      (B) sought by the public servant as soon after the contract or purchase as the public servant becomes aware of the facts that give rise to a question of conflict of interest.

(d) A disclosure required by this section must:

   (1) be in writing;

   (2) describe the contract or purchase to be made by the governmental entity;

   (3) describe the pecuniary interest that the public servant has in the contract or purchase;

   (4) be affirmed under penalty of perjury;

   (5) be submitted to the governmental entity and be accepted by the governmental entity in a public meeting of the governmental entity prior to final action on the contract or purchase;

   (6) be filed within fifteen (15) days after final action on the contract or purchase with:

      (A) the state board of accounts; and

      (B) if the governmental entity is a governmental entity other than the state or a state supported college or university, the clerk of the circuit court in the county where the governmental entity takes final action on the contract or purchase; and

   (7) contain, if the public servant is appointed, the written approval of the elected public servant (if any) or the board of trustees of a state supported college or university (if any) that appointed the public servant.

(e) The state board of accounts shall forward to the state ethics commission a copy of all disclosures filed with the board under IC 16-22-2 through IC 16-22-5, IC 16-23-1, or this section.

(f) The state ethics commission shall maintain an index of all disclosures received by the commission. The index must contain a listing of each public servant, setting forth the disclosures received by the commission made by that public servant.

(g) A public servant has a pecuniary interest in a contract or purchase if the contract or purchase will result or is intended to result in an ascertainable increase in the income or net worth of:

   (1) the public servant; or

   (2) a dependent of the public servant who:

      (A) is under the direct or indirect administrative control of the public servant; or

      (B) receives a contract or purchase order that is reviewed, approved, or directly or indirectly administered by the public servant.

(h) It is a defense in a prosecution under this section that the public servant's interest in the contract or purchase and all other contracts and purchases made by the governmental entity during the twelve (12) months before the date of the contract or purchase was two hundred fifty dollars ($250) or less.

(i) Notwithstanding subsection (d), a member of the board of trustees of a state supported college or university, or a person appointed by such a board of trustees, complies with the disclosure requirements of this chapter with respect to the member's or person's pecuniary interest in a particular type of contract or purchase which is made on a regular basis from a particular vendor if the member or person files with the state board of accounts and the board of trustees a statement of pecuniary interest in that particular type of contract or purchase made with that particular vendor. The statement required by this subsection must be made on an annual basis.

(j) This section does not apply to members of the governing board of a hospital organized or operated under IC 16-22-1 through IC 16-22-5 or IC 16-23-1.

(k) As used in this section, "dependent" means any of the following:

   (1) The spouse of a public servant.

   (2) A child, stepchild, or adoptee (as defined in IC 31-9-2-2) of a public servant who is:

      (A) unemancipated; and

      (B) less than eighteen (18) years of age.

   (3) Any individual more than one-half (1/2) of whose support is provided during a year by the public servant.

Ind. Code § 35-44-1-3 (2008).

VII. ETHICS

87. It is declared that high moral and ethical standards among State Senators are essential to the conduct of free government; that the Senate believes that a code of ethics for the guidance of State Senators will help them avoid conflicts of interest in public office, will improve standards of public service, and will promote and strengthen the faith and confidence of the people of Indiana. The code is intended to protect the individual Senators while providing guidelines for all members of the Senate. Recognizing that service in the Indiana General Assembly is a part-time endeavor and that members of the General Assembly are individuals who are active in the affairs of their localities and elsewhere and that it is necessary that they maintain a livelihood and source of income apart from their legislative compensation, the following guidelines are adopted to assist the members in the conduct of their legislative duties.

88. A Senator who is offered:
(1) an economic or investment opportunity; or
(2) a loan, gratuity, discount, favor, hospitality, or other goods or services; by a person, shall consider, in determining whether or not to accept the offer, whether the Senator’s acceptance of the offer may affect the Senator’s independent legislative judgment. In so considering, the Senator shall take into account the following:
(A) whether the opportunity is being offered with the intent to influence the Senator’s conduct in the performance of legislative duties; or

(B) whether acceptance of the offer would have a unique, direct, and material effect on the nonlegislative income of the Senator, a member of the Senator’s immediate family or those of a partnership, corporation or business in which the Senator holds a legal or equitable interest. Should the Senator determine that, by acceptance of the offer, the Senator’s independent legislative judgment may be affected, the Senator shall refuse the offer.

89. A Senator who has a direct personal or pecuniary interest in a piece of legislation which is so substantial as to affect the Senator’s independent legislative judgment is not precluded from participating in committee and floor debate on the legislation, if the Senator publicly proclaims that interest.

90. During the course of a legislative session, a Senator may be placed in a position where the Senator has the obligation to vote on legislation in which the Senator has a direct personal or pecuniary interest. In making this decision pursuant to Rule 4 of the Standing Rules of the Senate and Orders for Government relative to the Senator’s activity on the legislation, the Senator shall consider the following:

(1) Whether the Senator’s interest in the legislation is so substantial as to affect the Senator’s independence of judgment with respect to the legislation.

(2) To what extent the Senator’s interest in the legislation mirrors the interest of the citizenry to which the Senator is directly responsible.

(3) The effect of the Senator’s participation in the voting on the legislation on public confidence in the integrity of the legislature.

(4) The need of the Senator’s particular contribution, such as special knowledge of the subject matter, to the effective functioning of the legislature.

(5) Whether the legislation would have a unique, direct, and material effect on the nonlegislative income of the Senator, a member of the Senator’s immediate family or those of a partnership, corporation, or business in which the Senator holds a legal or equitable interest.

91. A Senator may request the assistance of the Senate Legislative Ethics Committee (established pursuant to IC 2-2.1-3-5) in determining the propriety of the Senator’s:
(1) proposed acceptance of an offer;
(2) participation in upcoming debate; or
(3) participation in an upcoming vote.

92. Under Rule 91, the Senator shall:
(1) Prepare a written statement describing the matter requiring action or decision by the Senator and the nature of the Senator’s potential conflict of interest; and
(2) Deliver a copy of the statement to the Chairman of the Senate Legislative Ethics Committee. If the Chairman is unavailable, a copy of the statement may be delivered to the President Pro Tempore.

93. If a Senator requests the assistance of the Senate Legislative Ethics Committee under Rule 91, and there is insufficient time to comply with Rule 92, the Senator shall orally inform the Chairman of the Senate Legislative Ethics Committee of the potential conflict. The matter shall then be immediately referred to the Legislative Ethics Committee for its recommendation. The Committee shall issue an oral recommendation to the Senator making the request as soon as possible after considering the request. The Committee shall follow the oral recommendation with a written report as required by Senate Rule 95.

94. The Legislative Ethics Committee shall meet as soon as possible and render an advisory opinion on the question raised. Should the committee vote result in a tie, the effect will be to make no recommendation.

95. The written report of the Legislative Ethics Committee shall be forwarded to the President Pro Tempore of the Senate and the Senate Minority Leader. Copies of the report and the written statement of the Senator making the request shall be maintained in the offices of the Majority Attorney and the Minority Attorney. The committee’s written report and the written statement of the Senator making the request under Rule 92 shall remain confidential unless the Senator making the request consents to their disclosure.

96. In addition to any meetings held under Rule 94, the Senate Legislative Ethics Committee shall meet and may recommend amendments to the code of ethics for the Senate not later than thirty (30) days after the first session day of each legislative session, pursuant to IC 2-2.1-3-6.

Senate Rules 87 through 96 (2008).

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