February 21, 2012
HOUSE BILL No. 1250
DIGEST OF HB 1250
(Updated February 20, 2012 3:07 pm - DI 87)
Citations Affected: IC 4-2; IC 4-15.
Synopsis: State government nepotism. Prohibits an individual who is
employed by a state agency from being: (1) employed in the same
agency in which the individual's relative is the appointing authority;
and (2) placed in the direct line of supervision of a relative. Allows a
job assignment that existed on July 1, 2012, to be continued. Allows an
individual employed in an agency for at least 12 consecutive months
immediately preceding the date the individual's relative becomes the
appointing authority of the agency to: (1) remain employed by the
agency; and (2) be within the direct line of supervision of the relative.
Prohibits an individual from contracting with or supervising the work
of a business entity of which a relative is a partner, executive officer,
or sole proprietor. Provides that a person within an agency who violates
the nepotism statute may be subject to the penalties enforced by the
state ethics commission. Repeals provisions concerning employment
of relatives in state agencies.
Effective: July 1, 2012.
(SENATE SPONSORS _ LAWSON C, HOLDMAN, TALLIAN)
January 9, 2012, read first time and referred to Committee on Government and Regulatory
January 25, 2012, amended, reported _ Do Pass.
January 30, 2012, read second time, ordered engrossed. Engrossed.
January 31, 2012, read third time, passed. Yeas 92, nays 4.
February 1, 2012, read first time and referred to Committee on Pensions and Labor.
February 9, 2012, amended, reported favorably _ Do Pass.
February 20, 2012, read second time, amended, ordered engrossed.
February 21, 2012
Second Regular Session 117th General Assembly (2012)
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between statutes enacted by the 2011 Regular Session of the General Assembly.
HOUSE BILL No. 1250
A BILL FOR AN ACT to amend the Indiana Code concerning state
offices and administration.
Be it enacted by the General Assembly of the State of Indiana:
SOURCE: IC 4-2-6-1; (12)EH1250.2.1. -->
SECTION 1. IC 4-2-6-1, AS AMENDED BY P.L.2-2007,
SECTION 19, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
JULY 1, 2012]: Sec. 1. (a) As used in this chapter, and unless the
context clearly denotes otherwise:
(1) "Advisory body" means an authority, a board, a commission,
a committee, a task force, or other body designated by any name
of the executive department that is authorized only to make
(2) "Agency" means an authority, a board, a branch, a bureau, a
commission, a committee, a council, a department, a division, an
office, a service, or other instrumentality of the executive,
including the administrative, department of state government. The
term includes a body corporate and politic set up as an
instrumentality of the state and a private, nonprofit, government
related corporation. The term does not include any of the
(A) The judicial department of state government.
(B) The legislative department of state government.
(C) A state educational institution.
(D) A political subdivision.
(3) "Appointing authority" means the following:
(A) Except as provided in clause (B), the chief administrative
officer of an agency. The term does not include a state officer.
(B) For purposes of section 16 of this chapter, "appointing
(i) an elected officer;
(ii) the chief administrative officer of an agency; or
(iii) an individual or group of individuals who have the
power by law or by lawfully delegated authority to make
(4) "Assist" means to:
(C) advise; or
(D) furnish information to;
a person. The term includes an offer to do any of the actions in
clauses (A) through (D).
(5) "Business relationship" includes the following:
(A) Dealings of a person with an agency seeking, obtaining,
establishing, maintaining, or implementing:
(i) a pecuniary interest in a contract or purchase with the
(ii) a license or permit requiring the exercise of judgment or
discretion by the agency.
(B) The relationship a lobbyist has with an agency.
(C) The relationship an unregistered lobbyist has with an
(6) "Commission" refers to the state ethics commission created
under section 2 of this chapter.
(7) "Compensation" means any money, thing of value, or financial
benefit conferred on, or received by, any person in return for
services rendered, or for services to be rendered, whether by that
person or another.
(8) "Direct line of supervision" means the chain of command
in which the superior affects, or has the authority to affect,
the terms and conditions of the subordinate's employment,
including making decisions about work assignments,
compensation, grievances, advancements, or performance
(8) (9) "Employee" means an individual, other than a state officer,
who is employed by an agency on a full-time, a part-time, a
temporary, an intermittent, or an hourly basis. The term includes
an individual who contracts with an agency for personal services.
(9) (10) "Employer" means any person from whom a state officer
or employee or the officer's or employee's spouse received
compensation. For purposes of this chapter, a customer or client
of a self-employed individual in a sole proprietorship or a
professional practice is not considered to be an employer.
(10) (11) "Financial interest" means an interest:
(A) in a purchase, sale, lease, contract, option, or other
transaction between an agency and any person; or
(B) involving property or services.
The term includes an interest arising from employment or
prospective employment for which negotiations have begun. The
term does not include an interest of a state officer or employee in
the common stock of a corporation unless the combined holdings
in the corporation of the state officer or the employee, that
individual's spouse, and that individual's unemancipated children
are more than one percent (1%) of the outstanding shares of the
common stock of the corporation. The term does not include an
interest that is not greater than the interest of the general public
or any state officer or any state employee.
(11) (12) "Information of a confidential nature" means
(A) obtained by reason of the position or office held; and
(i) a public agency is prohibited from disclosing under
(ii) a public agency has the discretion not to disclose under
IC 5-14-3-4(b) and that the agency has not disclosed; or
(iii) is not in a public record, but if it were, would be
(12) (13) "Person" means any individual, proprietorship,
partnership, unincorporated association, trust, business trust,
group, limited liability company, or corporation, whether or not
operated for profit, or a governmental agency or political
(13) (14) "Political subdivision" means a county, city, town,
township, school district, municipal corporation, special taxing
district, or other local instrumentality. The term includes an
officer of a political subdivision.
(14) (15) "Property" has the meaning set forth in IC 35-41-1-23.
(16) "Relative"means any of the following:
(A) A spouse.
(B) A parent or stepparent.
(C) A child or stepchild.
(D) A brother, sister, stepbrother, or stepsister.
(E) A niece or nephew.
(F) An aunt or uncle.
(G) A daughter-in-law or son-in-law.
For purposes of this subdivision, an adopted child of an
individual is treated as a natural child of the individual. For
purposes of this subdivision, the terms "brother" and "sister"
include a brother or sister by the half blood.
(15) (17) "Represent" means to do any of the following on behalf
of a person:
(A) Attend an agency proceeding.
(B) Write a letter.
(C) Communicate with an employee of an agency.
(16) (18) "Special state appointee" means a person who is:
(A) not a state officer or employee; and
(B) elected or appointed to an authority, a board, a
commission, a committee, a council, a task force, or other
body designated by any name that:
(i) is authorized by statute or executive order; and
(ii) functions in a policy or an advisory role in the executive
(including the administrative) department of state
government, including a separate body corporate and politic.
(17) (19) "State officer" means any of the following:
(A) The governor.
(B) The lieutenant governor.
(C) The secretary of state.
(D) The auditor of state.
(E) The treasurer of state.
(F) The attorney general.
(G) The superintendent of public instruction.
(18) (20) The masculine gender includes the masculine and
(19) (21) The singular form of any noun includes the plural
(b) The definitions in IC 4-2-7 apply throughout this chapter.
SOURCE: IC 4-2-6-16; (12)EH1250.2.2. -->
SECTION 2. IC 4-2-6-16 IS ADDED TO THE INDIANA CODE
AS A NEW
SECTION TO READ AS FOLLOWS [EFFECTIVE JULY
1, 2012]: Sec. 16. (a) This chapter does not prohibit the
continuation of a job assignment that existed on July 1, 2012.
(b) As used in this section, "employed" refers to all employment,
including full-time, part-time, temporary, intermittent, or hourly.
The term includes service as a state officer or special state
(c) An individual employed in an agency may not hire a relative.
(d) Except as provided in subsection (e), an individual may not
be employed in the same agency in which an individual's relative
is the appointing authority.
(e) An individual may be employed in the same agency in which
the individual's relative is the appointing authority, if the
individual has been employed in the same agency for at least twelve
(12) consecutive months immediately preceding the date the
individual's relative becomes the appointing authority.
(f) Except as provided in subsection (e), an individual may not
be placed in a relative's direct line of supervision.
(g) An individual employed in an agency may not contract with
or supervise the work of a business entity of which a relative is a
partner, executive officer, or sole proprietor.
(h) Any person within an agency who knowingly participates in
a violation of this chapter is subject to the penalties set forth in
section 12 of this chapter.
SOURCE: IC 4-15-7; (12)EH1250.2.3. -->
SECTION 3. IC 4-15-7 IS REPEALED [EFFECTIVE JULY 1,
2012]. (Employment of Relatives by Public Officials Prohibited).