Amends TCA Title 3; Title 4; Title 8; Title 9 and Title 12.

This bill prohibits state officials and state employees from bidding on, selling, or offering to sell to the state services in addition to goods, as discussed below. Under present law, it is a Class E felony for a state official or employee to bid on, sell, or offer for sale, any merchandise, equipment or material, or similar commodity, to the state during the tenure of such official's or employee's office or employment, or for six months thereafter, or to have any interest in the selling of the same to the state. A violator is also liable to the state for any and all sums paid out by the state, together with interest at the rate of 8 percent per annum, growing out of any such transaction. This bill extends the above-described offense to also apply to the same conduct in relation to a service. ON APRIL 1, 2021, THE HOUSE ADOPTED AMENDMENT #2 AND RESET HOUSE BILL 1040, AS AMENDED. AMENDMENT #2 rewrites this bill and makes it a Class E felony for a member of the general assembly or an entity in which a member of the general assembly has a controlling interest to bid on, sell, or offer for sale, any service to the state during the tenure of such member's office, or for six months thereafter. This amendment will not apply to: (1) Continuation of any service provided by a member of the 112th General Assembly so long as the member holds office for consecutive terms in the general assembly if the service was provided prior to the member's election to the general assembly and the member discloses the nature of the service and the name of the state agency, branch, bureau, commission, department, or other division of state government to which the service is provided on the member's statement of interest no later than July 1, 2021, and annually thereafter, if the member continues to provide the service; or (2) Employment contracts, including indigent defense contracts, unless otherwise prohibited by the state constitution. The above-described exemptions will not apply to services provided to the legislative branch. A person who is convicted under this amendment will forever afterwards be disqualified from holding any office under the laws or constitution of this state. If at the time of conviction for an offense specified in this amendment the person still holds an office under the constitution of this state, then this provision for disqualification will apply to such person at the end of the person's term of office, unless otherwise expelled from office prior to that time. Present law requires certain public officials, including members of the general assembly, to disclose conflicts of interest. Present law specifics particular information that must be disclosed. This amendment adds to the information required to be disclosed that members of the general assembly must disclose "the state agency, branch, bureau, commission, department, or other division of state government for which a member of the general assembly, or any entity in which the member has a controlling interest, continues the provision of a service and the nature of the service provided". The disclosure must be made prior to July 1, 2021, and annually thereafter, on the consolidated form in accordance with present law. This amendment defines "controlling interest" as any business relationship that gives one person the ability to direct the operations of the entity, and includes, but is not limited to, any interest over 50 percent. ON APRIL 22, 2021, THE HOUSE FURTHER CONSIDERED HOUSE BILL 1040, ADOPTED AMENDMENT #3, AND PASSED HOUSE BILL 1040, AS AMENDED. AMENDMENT #3 rewrites the provisions described above under House Amendment #2 to instead provide that it will be an offense for a member of the general assembly to bid on, sell, or offer for sale any service to a state entity or to have a financial interest in the bidding, selling, or offering for sale of any service to a state entity. The prohibition will apply during the tenure of the member's office and for six months thereafter. This amendment's prohibition does not apply to "an entity in which a member of the general assembly has a controlling interest" as did House Amendment #2. Under this amendment, it will be an exception to the application of the above-described offense if: (A) A member of the general assembly was elected prior to July 1, 2021; the member provided or offered to provide the service to a state entity prior to July 1, 2021, and the service is being provided or offered to the same state entity; the member has held office as a member of the general assembly continuously since July 1, 2021; and the member disclosed the nature of the service and the name of the state entity to which the service is provided or offered on the member's statement of interest no later than September 1, 2021, and annually thereafter, for all years in which the member has continuously served as a member of the general assembly; (B) The service is provided through an employment contract, an indigent defense contract, or a medical services contract unless prohibited by the Constitution of Tennessee; (C) The financial interest in the bidding, selling, or offering for sale of any service to a state entity is: held in a blind trust prior to administration of the member's oath of office, during the tenure of such member's service as a member of the general assembly, and for at least six months thereafter; and disclosed in accordance with present law disclosure requirements. This amendment provides that the exceptions described above in (A)-(C) will not apply to services provided to the legislative branch of state government. This amendment also provides that this amendment does not preclude either house of the general assembly from adopting a rule more restrictive than the prohibition set out in this amendment. A person who is convicted under this amendment will be forever afterwards disqualified from holding any office under the laws or constitution of this state. If at the time of conviction the person still holds an office under the constitution of this state, then this provision will apply to such person at the end of the person's term of office, unless otherwise expelled from office prior to that time.