House File 178 - IntroducedA Bill ForAn Act 1relating to conflicts of interest in certain government
2public contracts.
3BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA:
1   Section 1.  Section 279.7A, Code 2019, is amended to read as
2follows:
   3279.7A  Interest in public contracts prohibited — exceptions.
   41.  A member of the board of directors of a school
5corporation shall not have an interest, direct or indirect, in
6a contract for the purchase of goods, including materials and
7profits, and the performance of services for the director’s
8school corporation. A contract entered into in violation of
9this section is void.
   102.  This section does not apply to contracts for the
11purchase of goods or services which benefit a director, or
12to compensation for part-time or temporary employment which
13benefits a director, if the benefit to the director does
14not exceed two thousand five hundred dollars the allowable
15threshold amount
in a fiscal year, and contracts made by a
16school board, upon competitive bid in writing, publicly invited
17and opened. For purposes of this subsection, “allowable
18threshold amount”
means an amount, for a fiscal year, equal to
19the greater of six thousand dollars or the amount, in dollars,
20equal to one percentage point more than the allowable threshold
21amount for the prior fiscal year.

   223.  This section does not apply to a contract that is a
23bond, note, or other obligation of a school corporation if the
24contract is not acquired directly from the school corporation,
25but is acquired in a transaction with a third party, who may
26or may not be the original underwriter, purchaser, or obligee
27of the contract, or to a contract in which a director has an
28interest solely by reason of employment if the contract is made
29by competitive bid in writing, publicly invited and opened, or
30if the remuneration of employment will not be directly affected
31as a result of the contract and the duties of employment do not
32directly involve the procurement or preparation of any part of
33the contract.
   344.  The competitive bid qualification of this section
35does not apply to a contract for professional services not
-1-1customarily awarded by competitive bid.
2   Sec. 2.  Section 331.342, subsection 1, Code 2019, is amended
3to read as follows:
   41.  As used in this section, “contract”:
   5a.  “Allowable threshold amount” means an amount, for a
6fiscal year, equal to the greater of six thousand dollars or
7the amount, in dollars, equal to one percentage point more than
8the allowable purchasing amount for the prior fiscal year.
   9b.   “Contract”means a claim, account, or demand against
10or agreement with a county, express or implied, other than a
11contract to serve as an officer or employee of the county.
12However, contracts subject to section 314.2 are not subject to
13this section.
14   Sec. 3.  Section 331.342, subsection 2, paragraph j, Code
152019, is amended to read as follows:
   16j.  Contracts not otherwise permitted by this section, for
17the purchase of goods or services by a county, which benefit
18a county officer or employee, if the purchases benefiting
19that officer or employee do not exceed a cumulative total
20purchase price of one thousand five hundred dollars equal to
21the allowable threshold amount
in a fiscal year.
22   Sec. 4.  Section 362.5, subsection 1, Code 2019, is amended
23to read as follows:
   241.  When used in this section, “contract”:
   25a.  “Allowable threshold amount” means an amount, for a
26fiscal year, equal to the greater of six thousand dollars or
27the amount, in dollars, equal to one percentage point more than
28the allowable purchasing amount for the prior fiscal year.
   29b.   “Contract”means any claim, account, or demand against or
30agreement with a city, express or implied.
31   Sec. 5.  Section 362.5, subsection 3, paragraph j, Code 2019,
32is amended to read as follows:
   33j.  Contracts not otherwise permitted by this section, for
34the purchase of goods or services by a city having a population
35of more than two thousand five hundred, which benefit a city
-2-1officer or employee, if the purchases benefiting that officer
2or employee do not exceed a cumulative total purchase price
3of one thousand five hundred dollars equal to the allowable
4threshold amount
in a fiscal year.
5   Sec. 6.  Section 362.5, subsection 3, paragraph k, Code 2019,
6is amended by striking the paragraph.
7EXPLANATION
8The inclusion of this explanation does not constitute agreement with
9the explanation’s substance by the members of the general assembly.
   10Current Code provisions generally restrict school board
11members and city and county officers and employees from
12entering into contracts with the applicable governmental entity
13or having an interest, direct or indirect, in a contract with
14the entity. The prohibition does not, however, apply to
15contracts if purchases benefiting the individual do not exceed
16specified value thresholds in a fiscal year. The current
17thresholds are $2,500 for school board members, $1,500 for
18county officers or employees, $1,500 for officers or employees
19of a city with a population of more than 2,500, and $2,500 for
20officers or employees of a city with a population of 2,500 or
21less. This bill increases all such contract threshold amounts
22to an amount equal to the “allowable threshold amount” in a
23fiscal year. The bill defines “allowable threshold amount” as
24an amount, in a fiscal year, equal to the greater of $6,000 or
25an amount equal to one percentage point more than the allowable
26threshold amount for the prior fiscal year.
   27By operation of law, the threshold amount changes in the bill
28also apply to other provisions governing school board members
29and provisions governing certain school organizations and clubs
30under Code section 298A.15, port authorities under Code chapter
3128J, regional transit districts under Code chapter 28M, and
32county enterprise commissions under Code section 331.471.
-3-
ec/rn