GOAC proposing addition to state conflict law adding 1 year ban to interest in state contracts.

The Government Operations and Audit Committee has introduced House Bill 1023 to address the EB-5 controversy in part that was brought up again and again during the last election cycle to prevent state employees from signing state contracts and then going to work for the people they’ve been signed with.

In part…:

FOR AN ACT ENTITLED, An Act to prohibit a state officer or employee from having an interest in any contract that the state employee or officer approved, awarded, or administered for one calendar year following termination of state employment.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF SOUTH DAKOTA:
Section 1. That § 5-18A-17 be amended to read as follows:

5-18A-17. No state officer or employee who approves, awards, or administers a contract involving the expenditure of public funds or the sale or lease of property, may have an interest in a contract that is within the scope of the officer’s or employee’s official duties. This prohibition includes any state officer or employee who, in his or her official capacity, recommends the approval or award of the contract or who supervises a person who approves, awards, or administers the contract. This prohibition is in effect for one calendar year after the state officer or employee terminates his or her office or employment with the state.

Follow the bill here. The underlined part is the addition to the law.

The only problem with the measure?  None logistically, but it could face amending because it’s a measured, reasonable, and sane response. A sane response to a ridiculously overblown issue that dominated the political scene for the last year.

Anyone care to speculate on how much showboating and grandstanding we’ll see on the issue?

5 Replies to “GOAC proposing addition to state conflict law adding 1 year ban to interest in state contracts.”

  1. JimV

    My only comment is a question. Why do we have to regulate ethics for public servants? Is it really that unclear how they show act?

    Reply
  2. Troy Jones

    Question:

    Let’s say that the head of Legislative Audit decides to go to work for Eide Bailly as a partner (reasonable someone with that level of experience would be offered partner). Legislative Audit has and will continue to issue contracts to firms like Eide Bailly. Would this person be prohibited from going to work for Eide Bailly under this law?

    As a partner, this person would have an interest (albeit probably worth less than the price of lunch (the benefits of the contract are divided among hundreds of partners).

    Or a nurse who works for the Prison who issues contracts all the time to Avera or Sanford? Would this person be prohibited from going to work for Avera/Sanford? Would potentially the liability (because of broadness of “interest” to Avera/Sanford make Avera/Sanford unwilling to hire this nurse?

    Don’t get me wrong, I want the law written clear to prevent a repeat of what occurred but I’m concerned it might be written too broadly. Let me go back to the nurse issue.

    It is highly conceivable that the Prison and one of the hospitals determine service would be better and cost less to contract with Avera/Sanford, they need the existing nurses to administer the contract during a phase-out period but both Avera/Sanford AND the Prison to have this person transfer to Avera/Sanford. As written, this appears to prohibit this from occurring.

    Reply
  3. mhs

    Completely unworkable. The focus is on the former employee having an interest in the contract. “Interest” is not defined, of course. This provision works to restrict future employment of current state employees which is a violation of the Commerce Clause and thereby unconstitutional. The nurse, in Troy’s example, may not be prevented by government action from seeking employment as she sees fit.

    The only way this concept works is to change the focus to the bidders for the contract and have it work that “no bidder may employ an person who was . . . blah blah blah.” You can more narrowly tailor this kind of restriction to employees who were in actual decision-making management roles, etc. to prevent the old “I’ll give you the contract if you give me a job” abuses.

    In short, this is a half-assed measure introduced for political reasons, and not a real attempt at reform.

    Reply
  4. Anonymous

    Strike “administered(s)” and that would clean it up nicely. This is designed to prevent golden parachutes. I don’t think someone who administered a state contract can (without help from a superior) help themselves get a job from administration.
    I do agree this is not needed. Just one more reason for competent people not to go into public service because when they move on, they are limited for a year in their subject area for jobs.

    Reply

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