HB 1163-2_ Filed 02/09/2012, 10:14 Arnold

SENATE MOTION


MADAM PRESIDENT:

    I move
that Engrossed House Bill 1163 be amended to read as follows:

SOURCE: Page 1, line 1; (12)MO116304.1. -->     Page 1, between the enacting clause and line 1, begin a new paragraph and insert:
SOURCE: IC 3-9-2.5; (12)MO116304.1. -->     "SECTION 1. IC 3-9-2.5 IS ADDED TO THE INDIANA CODE AS A NEW CHAPTER TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2012]:
     Chapter 2.5. Registration by Certain State, City, or County Contractors
    Sec. 1. The definitions in IC 4-13-2.5 apply throughout this chapter.
    Sec. 2. (a) The following apply throughout this chapter:
        (1) A person with any ownership interest in or distributive share of a business entity of more than seven and one-half percent (7.5%) is an "affiliated person" of the business entity.
        (2) An executive employee of a business entity is an "affiliated person" of the business entity.
        (3) The spouse of an individual described in subdivision (1) or (2) is an "affiliated person" of the business entity of which the individual described in subdivision (1) or (2) is an affiliated person.
        (4) A minor child of an individual described in subdivision (1) or (2) is an "affiliated person" of the business entity of which the individual described in subdivision (1) or (2) is an affiliated person.
        (5) A subsidiary of a business entity is an "affiliated person" of the business entity.
        (6) A member of the same unitary business group as a business entity is an "affiliated person" of the business entity.
        (7) An organization that:
            (A) is recognized by the United States Internal Revenue Service as a tax exempt organization described in Section

501(c) of the Internal Revenue Code; and
            (B) is established by:
                (i) a business entity;
                (ii) a person who is an affiliated person of a business entity under subdivision (1), (2), (3), or (4); or
                (iii) an entity that is an affiliated person of a business entity under subdivision (5) or (6);
        is an "affiliated person" of the business entity.
        (8) A political action committee of which:
            (A) a business entity is a sponsor; or
            (B) an organization that is an affiliated person of a business entity under subdivision (7) is a sponsor;
        is an "affiliated person" of the business entity.
    (b) For purposes of section 7 of this chapter:
        (1) a business entity's "annual aggregate offers for contracts" is the total amount of money that the business entity would be paid under the contracts for which the business entity is making offers in a certain year; and
        (2) a business entity's "annual aggregate total value of contracts" is the total amount of money that the business entity is paid in a certain year under the contracts that the business entity has entered into.

     Sec. 3. As used in this chapter, "business entity" refers to any of the following:
        (1) A:
            (A) sole proprietorship;
            (B) partnership;
            (C) limited liability partnership;
            (D) limited liability company; or
            (E) corporation;
        doing business for profit.
        (2) Any other person doing business for profit, regardless of the person's legal organization.
    Sec. 4. As used in this chapter, "executive employee" refers to any of the following:
        (1) The president of a business entity.
        (2) The chairman of a business entity.
        (3) The chief executive officer of a business entity.
        (4) An employee of a business entity:
            (A) who has executive decision making authority over the long term and day to day affairs of the business entity; or
            (B) whose compensation is determined directly, in whole or in part, by:
                (i) the awarding of contracts by the state, a city, or a county to the business entity; or
                (ii) payments made under contracts awarded by the state, a city, or a county to the business entity.


    Sec. 5. As used in this chapter, "registrant" refers to a person registered under this chapter.
    Sec. 6. As used in this chapter, "sponsor" refers to an individual or organization that contributes at least thirty-three percent (33%) of the total funding of a political action committee.
    Sec. 7. (a) This section applies to the following:
        (1) A business entity whose annual aggregate offers for contracts with the state exceed one hundred thousand dollars ($100,000).

        (2) A business entity whose annual aggregate offers for contracts with the state, combined with the business entity's annual aggregate total value of contracts with the state, exceed one hundred thousand dollars ($100,000).
         (3) A business entity whose annual aggregate total value of contracts with the state exceeds one hundred thousand dollars ($100,000).
        (4) A business entity whose annual aggregate offers for contracts with a city or county exceed fifty thousand dollars ($50,000).
        (5) A business entity whose annual aggregate offers for contracts with a city or county, combined with the business entity's annual aggregate total value of contracts with a city or county, exceed fifty thousand dollars ($50,000).
        (6) A business entity whose annual aggregate total value of contracts with a city or county exceeds fifty thousand dollars ($50,000).
    (b) A business entity described in subsection (a) shall register with the department as provided in this chapter.
    (c) A business entity making an offer that will cause the business entity to meet the description set forth in subsection (a)(1), (a)(2), (a)(4), or (a)(5) shall register with the department before submitting the offer whose value causes the business entity to meet the description set forth in subsection (a)(1), (a)(2), (a)(4), or (a)(5).
    (d) A business entity that is described in subsection (c) has a continuing duty to ensure that the registration of the business entity is accurate during the period that:
        (1) begins on the date of registration; and
        (2) ends on the day after the date the contract for which the business entity made the offer is awarded.
If a change makes information reported by the business entity in registering under this chapter no longer accurate, the change must be reported to the department under subsection (f)(2) not later than two (2) business days after the change.
    (e) A business entity described in subsection (a)(3) or (a)(6) shall maintain the business entity's registration under this chapter and has a continuing duty to ensure that the registration is accurate for the longer of the following:
        (1) Four (4) years after the date of the award of any contract awarded to the business entity while the business entity met the description set forth in subsection (a)(3) or (a)(6).
        (2) One (1) year after the expiration or termination of any contract awarded to the business entity while the business entity met the description set forth in subsection (a)(3) or (a)(6).
    (f) If a change makes information reported by a business entity in registering under this chapter no longer accurate, the business entity must report the change to the department:
        (1) except as provided in subdivision (2), not later than ten (10) days after the change; or
        (2) if the business entity has a pending offer for a contract, not later than two (2) business days after the change.
    (g) A business entity required to register under this chapter, to ensure the continuing accuracy of the information reported by the business entity in registering under this chapter, shall notify the department of:
        (1) any change in information relating to an affiliated person of the business entity; or
        (2) any other material change.
    Sec. 8. (a) This section applies to a business entity that, on July 1, 2012, is described by section 7(a) of this chapter.
    (b) A business entity described in subsection (a) on July 1, 2012, shall register as provided in this chapter not later than September 1, 2012.
    (c) This section expires January 1, 2014.
    Sec. 9. (a) The registration required under this chapter and any changes to that registration must be made electronically. The department may adopt rules under IC 4-22-2 providing for electronic registration and electronic changes in registration under this chapter.
    (b) The registration of a business entity under this chapter must contain substantially the following information:
        (1) The registrant's name and business address.
        (2) The name and address of each of the registrant's affiliated persons and a description of the affiliation for each affiliated person.
    (c) The individual:
        (1) registering for a business entity under this chapter; or
        (2) changing the registration of a business entity under this chapter;
must certify, subject to the penalties for perjury, that, to the best of the individual's knowledge and belief, the information stated is true.
    (d) The department shall provide a registration certificate to a person that registers under this chapter.
    (e) A registration certificate provided under subsection (d) must be:
        (1) electronic;
        (2) accessible to the registrant through the department's Internet web site; and
        (3) protected by a password.
    Sec. 10. (a) For purposes of this section, a data base maintained under this section is "searchable" if the data base can be searched for the following terms:
        (1) Affiliated person.
        (2) Registrant.
        (3) State agency.
        (4) City or county.
    (b) The department shall provide for information that registrants are required to report in registering under this chapter to be posted on the Indiana transparency portal and to be kept in a searchable data base containing all information required to be submitted to the department under this chapter.
    (c) The data base maintained under subsection (b) must be fully accessible to the election division, as determined by the election division, the department, and the Indiana transparency portal.
    (d) The name of a minor child may not be placed in a location in the data base maintained under subsection (b) that is accessible to the public. Public information in the data base relating to a minor child:
        (1) must be designated as relating to a minor child; and
        (2) must provide a link to all contributions made by anyone reporting the same residential address as the minor child.
    Sec. 11. A registrant shall provide a copy of the registration certificate provided by the department under section 9(d) of this chapter to each affiliated person of the registrant whose identity is required to be disclosed under this chapter. A registrant shall provide a copy of the registration certificate to an affiliated person under this section by first class mail or hand delivery not later than ten (10) days after the registrant's registration under this chapter.
    Sec. 12. (a) At the time a registrant makes a contribution to a political action committee, the registrant shall inform the political action committee that the person is registered with the department under this chapter.
    (b) An affiliated person of a registrant shall notify any political action committee to which the affiliated person makes a contribution that the affiliated person is an affiliated person of a registrant under this chapter.
    Sec. 13. (a) During the period described in subsection (b):
        (1) a registrant who has a contract; and
        (2) affiliated persons of the registrant described in subdivision (1);
shall not make a contribution to an individual who holds a state, city, or county office or is a candidate for a state, city, or county office.
    (b) The prohibition on contributions under this section:
        (1) begins on the date on which the contract is awarded to the registrant; and
        (2) ends on the later of the following:
            (A) Four (4) years after the date on which a contract is awarded to the registrant.
            (B) One (1) year after the date of the expiration or termination of the contract.
    Sec. 14. (a) During the period described in subsection (b):
        (1) a registrant who has no contracts but has an offer for a contract pending; and
        (2) affiliated persons of the registrant described in subdivision (1);
shall not make a contribution to an individual who holds a state, city, or county office or is a candidate for a state, city, or county office.
    (b) The prohibition on contributions under this section:
        (1) begins on the date of issuance of the solicitation to which the registrant responded in submitting the offer; and
        (2) ends on the day after the date on which the contract for which the registrant submitted the offer is awarded.
    Sec. 15. (a) A candidate or a candidate's committee that receives a contribution from a person who is prohibited from making a contribution under section 13 or 14 of this chapter shall pay an amount equal to the value of the contribution to the election division not later than thirty (30) days after receiving the contribution.
    (b) The election division shall deposit payments made under this section in the campaign finance enforcement account established by IC 3-6-4.1-24.

SOURCE: IC 4-2-6-10.2; (12)MO116304.2. -->     SECTION 2. IC 4-2-6-10.2 IS ADDED TO THE INDIANA CODE AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2012]: Sec. 10.2. The following may not solicit political contributions on behalf of a candidate for public office, unless the soliciting individual is the candidate for public office:
        (1) An appointing authority.
        (2) An employee who has purchasing or procurement authority on behalf of the agency that employs the employee.

SOURCE: IC 4-13-1-16.5; (12)MO116304.3. -->     SECTION 3. IC 4-13-1-16.5 IS ADDED TO THE INDIANA CODE AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE UPON PASSAGE]: Sec. 16.5. (a) As used in this section, "covered transaction" means the award of a contract under:
        (1) IC 4-13.6-5-7;
        (2) IC 4-13.6-6;
        (3) IC 5-16-1;
        (4) IC 8-10-1; or
        (5) IC 8-23-9.
    (b) As used in this section, "resident of Indiana" means a person who is at least eighteen (18) years of age and is one (1) of the following:
        (1) A person who has registered a motor vehicle in Indiana.
        (2) A person who is registered to vote in Indiana.
        (3) A person who has a child enrolled in an elementary or a secondary school located in Indiana.
        (4) A person who derives more than one-half (1/2) of the person's gross income (as defined in Section 61 of the Internal Revenue Code) from sources in Indiana, according to the provisions applicable to determining the source of adjusted gross income that are set forth in IC 6-3-2-2. However, a person who would otherwise be considered a resident of Indiana under this subdivision is not a resident of Indiana if a preponderance of the evidence concerning the factors set forth in subdivisions (1) through (3) proves that the person is not a resident of Indiana.
    (c) Before October 1, 2013, and each year thereafter, the commissioner shall compile, make available for public inspection, and submit to the legislative council a report for the preceding state fiscal year stating:
        (1) for the contractors awarded contracts in covered transactions; and
        (2) for the subcontractors with which the contractors referred to in subdivision (1) enter into subcontracts in connection with contracts awarded in covered transactions;
the percentage of the employees of the contractors and subcontractors who work on the contracts that are residents of Indiana. The report to the legislative council must be in an electronic format under IC 5-14-6.

SOURCE: IC 4-13-2.5; (12)MO116304.4. -->     SECTION 4. IC 4-13-2.5 IS ADDED TO THE INDIANA CODE AS A NEW CHAPTER TO READ AS FOLLOWS [EFFECTIVE JULY 1, 2012]:
     Chapter 2.5. Political Contributions of Offerors and Contractors
    Sec. 1. This chapter applies to:
        (1) every offer submitted to a state agency, a city, or a county; and
        (2) every contract awarded by a state agency, a city, or a county;
after June 30, 2012.
    Sec. 2. (a) As used in this chapter, "contract" refers to a contract for:
        (1) goods;
        (2) services, including professional services;
        (3) a public works project; or
        (4) a highway project;
awarded by a state agency, city, or county.
    (b) A contract awarded by a state agency, a city, or a county under:
        (1) IC 4-13.6;
        (2) IC 5-22;
        (3) IC 5-23;
        (4) IC 8-23; or
        (5) any other statute;
is considered a contract for purposes of this chapter.
    Sec. 3. As used in this chapter, "city" has the meaning set forth in IC 36-1-2-3.
    Sec. 4. As used in this chapter, "contract officer" refers to:
        (1) an individual who is a purchasing agent under IC 5-22;
        (2) the state officer or employee responsible for awarding a contract; or
        (3) the city or county officer or employee responsible for awarding a contract.
    Sec. 5. As used in this chapter, "contractor" refers to a person who has been awarded a contract with a state agency, a city, or a county.
    Sec. 6. As used in this chapter, "department" refers to the Indiana department of administration established by IC 4-13-1-2.
    Sec. 7. (a) As used in this chapter, "offer" means a response to a solicitation.
    (b) The term includes a bid, a proposal, and a quote.
    Sec. 8. As used in this chapter, "offeror" means a person who submits an offer to a state agency, a city, or a county.
    Sec. 9. (a) As used in this chapter, "solicitation" means the procedure by which a state agency, a city, or a county invites persons to submit an offer to enter into a contract with the state agency, city, or county.
    (b) The term includes an invitation for bids, a request for proposals, and a request for quotes.
    Sec. 10. As used in this chapter, "state agency" refers to any of the following:
        (1) A state agency (as defined in IC 4-13-1-1(b)).
        (2) An entity that was established by the general assembly as a body corporate and politic and that is governed by a body, any of whose members is:
            (A) the governor; or
            (B) appointed by the governor.
    Sec. 11. Every offer submitted to a state agency, a city, or a county, and every contract entered into by a state agency, a city, or

a county must contain the following:
        (1) A certification by the offeror or contractor that either:
            (A) the offeror or contractor is not required to register with the department under IC 3-9-2.5; or
            (B) the offeror or contractor has registered with the department under IC 3-9-2.5 and acknowledges a continuing duty to update the registration.
        (2) A statement acknowledging that the contract is voidable under section 13 or 14 of this chapter for the offeror's or contractor's failure to comply with this chapter or IC 3-9-2.5.
    Sec. 12. (a) A person that:
        (1) is required to register with the department under IC 3-9-2.5; and
        (2) submits an offer;
must submit, along with the offer, a copy of the registration certificate provided to the person by the department under IC 3-9-2.5-9.
    (b) A contracting officer may not accept an offer from a person described in subsection (a) unless a copy of the person's registration certificate is submitted with the offer.
    Sec. 13. If a person that is required to register with the department under IC 3-9-2.5 knowingly or intentionally fails to register with the department under IC 3-9-2.5, or knowingly or intentionally fails to disclose to the department material information that the person is required to disclose under IC 3-9-2.5, in addition to the person being subject to any penalty under this chapter or IC 3-9-2.5:
        (1) the person, with respect to any offer submitted by the person, is nonresponsible; and
        (2) a contract awarded to the person is voidable by the contract officer if the contract officer considers the voiding of the contract to be in the best interest of the state, city, or county.
    Sec. 14. (a) This section applies to a contract with a person who violates IC 3-9-2.5-13 or IC 3-9-2.5-14.
    (b) A contract with the state, a city, or a county that is described in subsection (a) is voidable by the contract officer of the state, city, or county if the contract officer considers the voiding of the contract to be in the best interest of the state, city, or county.
    (c) If the person referred to in subsection (a) violates IC 3-9-2.5-13 or IC 3-9-2.5-14 more than two (2) times:
        (1) the contract described in subsection (a) is terminated by operation of law; and
        (2) the person referred to in subsection (a) is considered a nonresponsible offeror for three (3) years after the date of the person's latest violation of IC 3-9-2.5-13 or IC 3-9-2.5-14.

SOURCE: IC 4-13.6-6-2.8; (12)MO116304.5. -->     SECTION 5. IC 4-13.6-6-2.8 IS ADDED TO THE INDIANA

CODE AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE UPON PASSAGE]: Sec. 2.8. (a) As used in this section, "resident of Indiana" means a person who is at least eighteen (18) years of age and is one (1) of the following:
        (1) A person who has registered a motor vehicle in Indiana.
        (2) A person who is registered to vote in Indiana.
        (3) A person who has a child enrolled in an elementary or a secondary school located in Indiana.
        (4) A person who derives more than one-half (1/2) of the person's gross income (as defined in Section 61 of the Internal Revenue Code) from sources in Indiana, according to the provisions applicable to determining the source of adjusted gross income that are set forth in IC 6-3-2-2. However, a person who would otherwise be considered a resident of Indiana under this subdivision is not a resident of Indiana if a preponderance of the evidence concerning the factors set forth in subdivisions (1) through (3) proves that the person is not a resident of Indiana.
    (b) When entering a bid under this chapter or a contract for professional services without bids under IC 4-13.6-5-7 for a public works project, each contractor shall provide the division with information on the number of residents of Indiana who will be employed by the contractor and the number of residents of Indiana who will be employed by any subcontractor of the contractor.
    (c) A contract for a public works project may not be awarded to a contractor who does not:
        (1) employ residents of Indiana as at least eighty percent (80%) of the employees who work on the contract; and
        (2) enter into subcontracts only with subcontractors who employ residents of Indiana as at least eighty percent (80%) of the employees who work on the subcontract.
    (d) Before August 15, 2013, and each year thereafter, the division shall file with the commissioner a report for the preceding year stating:
        (1) for each contractor awarded a contract under this chapter; and
        (2) for each subcontractor with which a contractor referred to in subdivision (1) enters into a contract in connection with a contract awarded under this chapter;
the percentage of the employees of the contractor or subcontractor who work on the contract who are residents of Indiana.
    (e) A contract awarded under this chapter for a public works project is terminated if the division determines that the contractor has failed to:
        (1) employ residents of Indiana as at least eighty percent (80%) of the employees who work on the contract; and
        (2) enter into subcontracts only with subcontractors who

employ residents of Indiana as at least eighty percent (80%) of the employees who work on the subcontract.
    (f) A contractor or subcontractor who fails to employ residents of Indiana as at least eighty percent (80%) of the employees who work on the contract or subcontract commits a Class B infraction for each nonresident of Indiana employed in excess of the number of nonresident employees permitted by this section.

     (g) If:
        (1) a contract or subcontract awarded under this section is funded in whole or in part with federal funds;
and
        (2) imposing the requirements of this section would cause the state to lose the federal funds, as determined by the federal agency providing the funds, for the contract;
employing eighty percent (80%) Indiana residents for the contract or any subcontract becomes a goal for the contract, and subsections (a) through (f) do not apply.
".

SOURCE: Page 3, line 11; (12)MO116304.3. -->     Page 3, between lines 11 and 12, begin a new paragraph and insert:
SOURCE: IC 5-16-1-7.5; (12)MO116304.9. -->     "SECTION 9. IC 5-16-1-7.5 IS ADDED TO THE INDIANA CODE AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE UPON PASSAGE]: Sec. 7.5. (a) As used in this section, "resident of Indiana" means a person who is at least eighteen (18) years of age and is one (1) of the following:
        (1) A person who has registered a motor vehicle in Indiana.
        (2) A person who is registered to vote in Indiana.
        (3) A person who has a child enrolled in an elementary or a secondary school located in Indiana.
        (4) A person who derives more than one-half (1/2) of the person's gross income (as defined in Section 61 of the Internal Revenue Code) from sources in Indiana, according to the provisions applicable to determining the source of adjusted gross income that are set forth in IC 6-3-2-2. However, a person who would otherwise be considered a resident of Indiana under this subdivision is not a resident of Indiana if a preponderance of the evidence concerning the factors set forth in subdivisions (1) through (3) proves that the person is not a resident of Indiana.
    (b) When entering into a contract under this chapter, each contractor shall provide the state or commission with information on the number of residents of Indiana who will be employed by the contractor and the number of residents of Indiana who will be employed by any subcontractor of the contractor.
    (c) A contract for a public works project under this chapter may not be awarded to a contractor who does not:
        (1) employ residents of Indiana as at least eighty percent (80%) of the employees who work on the contract; and
        (2) enter into subcontracts only with subcontractors who

employ residents of Indiana as at least eighty percent (80%) of the employees who work on the subcontract.
    (d) Before August 15, 2013, and each year thereafter, the state or a commission entering into contracts under this chapter shall file with the commissioner of the Indiana department of administration a report stating:
        (1) for each contractor awarded a contract under this chapter; and
        (2) for each subcontractor with which a contractor referred to in subdivision (1) enters into a contract in connection with a contract awarded under this chapter;
the percentage of the employees of the contractor or subcontractor who work on the contract who are residents of Indiana.
    (e) A contract awarded under this chapter for a public works project is terminated if the state or commission determines that the contractor has failed to:
        (1) employ residents of Indiana as at least eighty percent (80%) of the employees who work on the contract; and
        (2) enter into subcontracts only with subcontractors who employ residents of Indiana as at least eighty percent (80%) of the employees who work on the subcontract.
    (f) A contractor or subcontractor who fails to employ residents of Indiana as at least eighty percent (80%) of the employees who work on the contract or subcontract commits a Class B infraction for each nonresident of Indiana employed in excess of the number of nonresident employees permitted by this section.

     (g) If:
        (1) a contract or subcontract awarded under this section is funded in whole or in part with federal funds;
and
        (2) imposing the requirements of this section would cause the state to lose the federal funds, as determined by the federal agency providing the funds, for the contract;
employing eighty percent (80%) Indiana residents for the contract or any subcontract becomes a goal for the contract, and subsections (a) through (f) do not apply.
".

SOURCE: Page 7, line 10; (12)MO116304.7. -->     Page 7, between lines 10 and 11, begin a new paragraph and insert:
SOURCE: IC 8-10-1-7.7; (12)MO116304.15. -->     "SECTION 15. IC 8-10-1-7.7 IS ADDED TO THE INDIANA CODE AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE UPON PASSAGE]: Sec. 7.7. (a) As used in this section, "resident of Indiana" means a person who is at least eighteen (18) years of age and is one (1) of the following:
        (1) A person who has registered a motor vehicle in Indiana.
        (2) A person who is registered to vote in Indiana.
        (3) A person who has a child enrolled in an elementary or a secondary school located in Indiana.
        (4) A person who derives more than one-half (1/2) of the

person's gross income (as defined in Section 61 of the Internal Revenue Code) from sources in Indiana, according to the provisions applicable to determining the source of adjusted gross income that are set forth in IC 6-3-2-2. However, a person who would otherwise be considered a resident of Indiana under this subdivision is not a resident of Indiana if a preponderance of the evidence concerning the factors set forth in subdivisions (1) through (3) proves that the person is not a resident of Indiana.
    (b) When entering into a contract under this chapter, each contractor shall provide the commission with information on the number of residents of Indiana who will be employed by the contractor and the number of residents of Indiana who will be employed by any subcontractor of the contractor.
    (c) A contract for a public works project under this chapter may not be awarded to a contractor who does not:
        (1) employ residents of Indiana as at least eighty percent (80%) of the employees of the contractor who work on the contract; and
        (2) enter into subcontracts only with subcontractors who employ residents of Indiana as at least eighty percent (80%) of the employees who work on the subcontract.
    (d) Before August 15, 2013, and each year thereafter, the commission shall file with the commissioner of the Indiana department of administration a report stating:
        (1) for each contractor awarded a contract under this chapter; and
        (2) for each subcontractor with which a contractor referred to in subdivision (1) enters into a contract in connection with a contract awarded under this chapter;
the percentage of the employees of the contractor or subcontractor who work on the contract who are residents of Indiana.
    (e) A contract awarded under this chapter for a public works project is terminated if the commission determines that the contractor has failed to:
        (1) employ residents of Indiana as at least eighty percent (80%) of the employees who work on the contract; and
        (2) enter into subcontracts only with subcontractors who employ residents of Indiana as at least eighty percent (80%) of the employees who work on the subcontract.
    (f) A contractor or subcontractor who fails to employ residents of Indiana as at least eighty percent (80%) of the employees who work on the contract or subcontract commits a Class B infraction for each nonresident of Indiana employed in excess of the number of nonresident employees permitted by this section.

     (g) If:
        (1) a contract or subcontract awarded under this section is

funded in whole or in part with federal funds; and
        (2) imposing the requirements of this section would cause the state to lose the federal funds, as determined by the federal agency providing the funds, for the contract;
employing eighty percent (80%) Indiana residents for the contract or any subcontract becomes a goal for the contract, and subsections (a) through (f) do not apply.

SOURCE: IC 8-23-9-4.6; (12)MO116304.16. -->     SECTION 16. IC 8-23-9-4.6 IS ADDED TO THE INDIANA CODE AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE UPON PASSAGE]: Sec. 4.6. (a) As used in this section, "resident of Indiana" means a person who is at least eighteen (18) years of age and is one (1) of the following:
        (1) A person who has registered a motor vehicle in Indiana.
        (2) A person who is registered to vote in Indiana.
        (3) A person who has a child enrolled in an elementary or a secondary school located in Indiana.
        (4) A person who derives more than one-half (1/2) of the person's gross income (as defined in Section 61 of the Internal Revenue Code) from sources in Indiana, according to the provisions applicable to determining the source of adjusted gross income that are set forth in IC 6-3-2-2. However, a person who would otherwise be considered a resident of Indiana under this subdivision is not a resident of Indiana if a preponderance of the evidence concerning the factors set forth in subdivisions (1) through (3) proves that the person is not a resident of Indiana.
    (b) When entering into a contract under this chapter, each contractor shall provide the department with information on the number of residents of Indiana who will be employed by the contractor and the number of residents of Indiana who will be employed by any subcontractor of the contractor.
    (c) A contract for a public works project under this chapter may not be awarded to a contractor who does not:
        (1) employ residents of Indiana as at least eighty percent (80%) of the employees of the contractor who work on the contract; and
        (2) enter into subcontracts only with subcontractors who employ residents of Indiana as at least eighty percent (80%) of the employees working on the subcontract.
    (d) Before August 15, 2013, and each year thereafter, the department shall file with the commissioner of the Indiana department of administration a report stating:
        (1) for each contractor awarded a contract under this chapter; and
        (2) for each subcontractor with which a contractor referred to in subdivision (1) enters into a contract in connection with a contract awarded under this chapter;
the percentage of the employees of the contractor or subcontractor who work on the contract who are residents of Indiana.
    (e) A contract awarded under this chapter for a public works project is terminated if the department determines that the contractor has failed to:
        (1) employ residents of Indiana as at least eighty percent (80%) of the employees who work on the contract; and
        (2) enter into subcontracts only with subcontractors who employ residents of Indiana as at least eighty percent (80%) of the employees who work on the subcontract.
    (f) A contractor or subcontractor who fails to employ residents of Indiana as at least eighty percent (80%) of the employees who work on the contract or subcontract commits a Class B infraction for each nonresident of Indiana employed in excess of the number of nonresident employees permitted by this section.

     (g) If:
        (1) a contract or subcontract awarded under this section is funded in whole or in part with federal funds;
and
        (2) imposing the requirements of this section would cause the state to lose the federal funds, as determined by the federal agency providing the funds, for the contract;
employing eighty percent (80%) Indiana residents for the contract or any subcontract becomes a goal for the contract, and subsections (a) through (f) do not apply.
".
SOURCE: Page 9, line 35; (12)MO116304.9. -->     Page 9, after line 35, begin a new paragraph and insert:
SOURCE: ; (12)MO116304.19. -->     "SECTION 19. An emergency is declared for this act.".
    Renumber all SECTIONS consecutively.
    (Reference is to EHB 1163 as printed February 8, 2012.)

________________________________________

Senator ARNOLD


MO116304/DI 92
2012