For Indiana lawmakers, a $500,000 ethics question

Call it the $500,000 question.

Indiana lawmakers are grappling with how to handle a last-minute change intended to strengthen an ethics reform package that, until now, had been on the fast track for approval.

The change would require lawmakers to separately list on their annual financial disclosure forms any businesses in which they own an equity interest of $500,000 or more.

Sen. Brent Waltz, R-Greenwood, offered the surprise amendment to House Bill 1002 last week on the final day for amendments and the Senate adopted it. He declined to comment, saying the amendment “speaks for itself.”

Ethics experts say the change would increase transparency and accountability, providing citizens with a way to gauge the importance of legislators’ potential conflicts of interests.

But the measure has caused some angst among lawmakers, especially those in the House, where questions about conflicts have continued even amidst a push for ethics reform.

House Speaker Brian Bosma, who has made ethics reform a top priority this year, dissented on the Senate version of the bill earlier this week, saying he needed more time to review the Waltz amendment.

“I didn’t object to it necessarily,” Bosma said, “but just wanted to have the option to take a hard look and revise if necessary.”

His decision will be an indication of just how far lawmakers are willing to go to reform the state’s ethics laws after a series of recent Statehouse scandals.

But the clock is ticking. This year’s legislative session ends Wednesday.

Lawmakers are already required to disclose most of their business interests — but not necessarily the size of those interests. That can make it hard for the public to gauge potential conflicts between lawmakers’ personal financial interests and their support or opposition to legislation.

HB 1002 would expand required disclosures to include family members who are lobbyists and the business and financial interests of lawmakers’ parents and children.

It would also make various changes to the rules governing executive branch employees.

Ethics experts said the Waltz amendment requiring an additional disclosure for high-dollar business investments would shed more light on situations like the one last year involving then-Rep. Eric Turner.

Turner, who was a member of Bosma’s leadership team, privately lobbied to kill a nursing home construction moratorium, despite his role in his family’s nursing home development business.

At that time, nobody knew the size or significance of Turner’s involvement with the company. Only later did The Associated Press obtain documents showing that Turner had millions of dollars at stake.

“This could shed more light on folks who are extremely wealthy and could use their position to create a more lucrative business environment for themselves,” said Julia Vaughn, policy director for Common Cause Indiana, a government accountability group. “I think this is an important piece of information and certainly the Turner scenario made clear these kind of situations can exist.”

Stuart Yoak, executive director of Indiana University’s Association for Practical and Professional Ethics, said $500,000 is a large number and may not apply to many lawmakers.

Still, the change would provide Hoosiers with a tool to help them measure how important a particular financial interest is to their lawmakers, he said.

“It helps citizens understand what kind of interests their lawmakers may have,” he said. “It opens (that interest) to public awareness, which can then allow the public to raise questions about the bias that equity interest might cause.”

One case where such a disclosure requirement could have come into play involved Rep. Eric Koch, the Bedford Republican who is chairman of the House Energy Committee.

He introduced a bill earlier this year that would have prevented local governments from regulating oil and gas drilling, but later dropped the measure after The Star reported on potential ethical concerns surrounding his membership in at least 28 oil and gas companies, some with operations in Indiana.

Koch has never publicly revealed the size of those interests, making it difficult to determine what kind of impact his legislation would have had on his personal income.

But it is a question that is likely to come up again given his chairmanship of the energy committee.

Call Star reporter Tony Cook at (317) 444-6081. Follow him on Twitter: @indystartony.