News From Terre Haute, Indiana

March 20, 2012

Daniels signs conflict of interest bill

Some, including Chalos, believe law goes too far, restricts local control

Maureen Hayden
CNHI Statehouse Bureau

INDIANAPOLIS — Rodney Chamberlain has worked for his city’s parks department for two decades and has served on his city council for 12 years, but a new “conflict of interest” law will force him — and many more like him — to make a choice between public office and public employment.

On Monday, Indiana Gov. Mitch Daniels signed a bill into law that bars government workers from serving in an elected office that sets budgets, laws, or policies that could benefit that employee.

That same legislation prohibits many — but not all — local officeholders from directly overseeing their relatives.

Daniels called the legislation a “good government” bill that was long overdue.

That sentiment is echoed by the Indiana Association of Cities and Towns, known as IACT, which is an organization of local elected officials that made the bill one its top legislative priorities.

But there are office holders across the state who may be impacted by the new law that say it’s a heavy-handed move by the legislature to interfere in local government.

“The problem I have with it is that I’m a taxpayer, and it takes away my right to run for office,” said Chamberlain, an Anderson, Ind., city councilman and Anderson parks employee.

“I tell people what I do for a living and they’ve elected me to serve as their representative,” he added. “So now you’re talking about taking away their rights as voters, too.”

The legislation, known as House Bill 1005, has the potential to impact the elected boards that oversee township, town, city and county governments across the state, when it goes into effect Jan. 1, 2013.

In Terre Haute, for example, two members of the city council are also city firefighters. In Anderson, two city council members are city employees and a Madison County councilman works in the county assessor’s office.

In Kokomo, there’s a city police officer who’s on the city council. In Fort Wayne, the deputy police chief sits on the city council.

“I think the (new law) is another example of big government deciding that they know better than the everyday, common folk,” said Jim Chalos, a Terre Haute firefighter, city councilman and son a former Terre Haute mayor.

The legislation is part of a local government reform effort that Daniels has been pushing since he took office. The legislation emerged from what’s known as the 2007 “Kernan-Shepard” commission that recommended sweeping changes in how local government is run.

Rep. Kevin Mahan is a Republican and former Blackford County sheriff who carried the bill in the House. He called it a “good start” toward more accountability and transparency in how local government is run.

He garnered support for the bill from several key stakeholders, including IACT and the Indiana Association of Counties.

“I think they supported it because it’s good government and good policy,” Mahern said.

The legislation doesn’t go into effect until Jan. 1, 2013, and it “grandfathers” in some office holders and public employees.

IACT executive director Matt Greller said that as local governments are struggling with tightened budgets and declining revenues, it’s critical to assure local taxpayers that elected officials weren’t making decisions out of self-interest.

“Whether there were bad decisions or not being made in the past (because of conflicts of interest), there was a perception that some bad decisions were being made,” Greller said. “It’s time to clear that up.”

Under the law that Daniels signed Monday, anyone elected to a council or board in 2013 or after can’t be an employee of the government agency that board oversees.

Government employees can run for office, but if elected, would have to give up their jobs.

The legislation allows officials now holding those dual roles, and any of those elected this fall, to keep them until the following election.

The same legislation forbids an official from supervising a relative, but there are exceptions. In townships, for example, trustees with offices in their homes can hire just one relative, who can make no more than $5,000 per year.

There are other exemptions: Volunteer firefighters are exempt from the nepotism provision. Sheriffs can still hire their spouses to be jail matrons. A coroner whose term has expired can serve as a deputy coroner even if the top job of coroner is filled by a relative.

The new law also contains language for contractual services with family members of office holders, beefing up requirements for the bidding and awarding of contracts.

The legislation’s supporters are convinced it will lend more credence to the decisions made by local elected officials. But opponents are skeptical.

Chalos, the Terre Haute firefighter and councilman, said local voters should be making the decisions about who sits on their local councils, not state legislators.

“I believe in the system that has been set in place by our forefathers,” Chalos said. “People know when somebody is self-serving and people know when they believe someone is doing a good job. Ultimately, every four years they get an opportunity to judge that. I think it should be left in the hands of the people who they want to represent them.”

Howard Greninger of the Tribune-Star contributed to this story.

Maureen Hayden is the Indiana Statehouse bureau chief for CNHI, the parent company of the Tribune-Star. She can be reached at