Amends TCA Section 5-21-121.

Under present law, the County Financial Management System of 1981 provides the following:<br /> <br /> (1) The director, purchasing agent, members of the committee, members of the county legislative body, or other officials, employees, or members of the board of education or highway commission must not be financially interested or have any personal beneficial interest, either directly or indirectly, in the purchase of any supplies, materials, equipment or contractual services for the county; and<br /> <br /> (2) A firm, corporation, partnership, association or individual furnishing any such supplies, materials, equipment or contractual services, must not give or offer, and the director or purchasing agent or any assistant or employee must not accept or receive directly or indirectly from any person, firm, corporation, partnership or association to whom any contract may be awarded, by rebate, gift or otherwise, any money or other things of value whatsoever, or any promise, obligation or contract for future reward or compensation.<br /> <br /> This bill clarifies that the prohibition described above in (1) applies to "other county officials" and adds employees of the finance department and purchasing department to the provision. This bill also revises the prohibition described above in (1) to instead prohibit the listed persons from having a direct interest in the purchase of supplies, materials, equipment, or contractual services for the county. This bill defines "controlling interest" as sufficient ownership in a business or company to control policy and management, including the ownership or control of the largest number of outstanding shares owned by any single individual in a business or company. This bill defines "direct interest" as a certain, absolute interest where a person is a party to a contract with the county such that the person stands to directly gain personally or through a business in which the person is the proprietor, a partner, or the person having the controlling interest in the business.<br /> <br /> This bill rewrites the provision described above in (2) and instead provides that the persons listed in (1) (as amended by this bill) must not have an indirect interest in the purchase of supplies, materials, equipment, or contractual services for the county unless the person publicly acknowledges such interest. A person who is not a member of a governing body and who is required to publicly acknowledge an indirect interest must do so by reporting such interest to the office of the county mayor to be compiled into a list that must be maintained as a public record. As used in this bill, "indirect interest" means an interest in a contract with the county held indirectly through one or more intermediary entities or businesses, including interests in contracts where a person is the sole supplier of goods or services in the county.<br /> <br /> ON APRIL 14, 2021, THE SENATE ADOPTED AMENDMENT #1 AND PASSED SENATE BILL 656, AS AMENDED.<br /> <br /> AMENDMENT #1 redefines "direct interest" to mean, for purposes of this bill, a contract with a person personally or with a business in which the person is the proprietor, a partner, or the person having the controlling interest in the business.<br /> <br /> This amendment also redefines "indirect interest", for purposes of this bill, to mean a contract in which a person is interested, but not directly so, and includes contracts where the person is directly interested and is the sole supplier of goods or services in the county.<br />