This story was updated on Thursday, April 22, 2021, at 5:49 p.m. with additional information.
NASHVILLE — A bill banning Tennessee legislators from holding services contracts with the General Assembly while also placing new restrictions and public disclosure requirements on any similar contracts with general state government is headed to Gov. Bill Lee.
Representatives approved House Bill 1040 on an 82-0 vote Thursday. Senators passed it on a 30-0 vote later in the day.
House Speaker Cameron Sexton, R-Crossville, brought the much-amended bill after Jan. 8 raids on the homes and legislative offices of Rep. Robin Smith, R-Hixson, former speaker and Rep. Glen Casada, R-Franklin, and Rep. John Warner, R-Chapel Hill.
Federal officials have yet to disclose the nature of the probe, but both Smith and Casada, who are political consultants, were handling government-funded legislative constituent mail on behalf of a number of their GOP colleagues. That practice is currently allowed but wouldn't be after July 1, should Lee sign the bill.
It was the fourth time Sexton's much-amended bill came to the floor, the result of multiple questions about the legislation from fellow lawmakers. The legislation largely mirrors a 1950s-era law that makes contracts providing physical goods to the state a Class E felony, punishable by up to six years in prison.
This time, Sexton himself presented the legislation as he sought to reassure sitting legislators that they could continue their existing contracts or seek to renew them, provided they disclosed them or their business was in a blind trust.
"This bill, as you'll remember, has been on the floor a few times, and we've sent it back to committee," Sexton said. "I want to make sure we get an accurate detail on what this bill is." He added that "there seems to be a little bit" of misinformation "out there."
In an effort to alleviate some members' heartburn, an originally proposed total ban on representives and senators having services contracts with general state government was changed. Lawmakers elected prior to July 1, 2021, would be allowed to continue those contracts. But those coming after July 1 could not enter into such contracts.
Smith, who along with her attorney Ben Rose previously criticized the bill as not going far enough to include members' political consultants and immediate family members, did not vote yes or no on the measure. She was recorded as simply voting present.
In an interview following the bill's passage on Thursday, Smith said she had some issues with the bill making violations a felony given that "there's still a lot of discretion left to the courts to make a decision on how that applies."
Noting she had previously offered some amendments that weren't accepted, Smith said "I'm not opposed to the bill, but I thought the bill needed a little more construction. Again, I will obviously support our speaker, I think he's doing a fine job. I wish there were some other ways we could look at that." Alluding to the Senate's long-standing rule banning members' service contracts with state government, Smith said "even changing a House rule rather than making something a felony" might have worked.
Voting for the bill was Rep. Yusuf Hakeem, D-Chattanooga, who said "I think the bill is a great start. There's some desire to have it more restrictive than it is now. But it's better than what we've had in the past. And I think it gives more transparency. It lends itself to be modified going forward in my view in a positive way."
There are exceptions to the general government service contract ban for new members. That includes situations where the legislator is providing the service through an employment contract, an indigent legal defense contract or a medical services contract unless prohibited by the Tennessee Constitution.
Another exception is if 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 after leaving office.
During debate, Casada sought to raise questions that the legislation would jeopardize lawmakers' services contracts with local governments. Sexton told the chamber that is not the case. Casada was not recorded as voting on the bill.
Warner, a freshman who had not done business with the state but was the beneficiary of a murky "super PAC" in his 2020 GOP primary, voted present.
The bill later flew through the Senate with no debate. Senators have long had a provision in their rules preventing members from holding services contracts with either the General Assembly or general state governments.
Lee's press secretary, Casey Black, later said in response to a reporter's question as to whether Lee would sign the bill that "the governor will likely defer to the legislature's decision."
Contact Andy Sher at email@example.com or 615-255-0550. Follow him on Twitter @AndySher1.