HB3995 93RD GENERAL ASSEMBLY

LRB093 15162 LRD 40758 b

93RD GENERAL ASSEMBLY
State of Illinois
2003 and 2004
HB3995

Introduced 1/9/2004, by Patricia R. Bellock

SYNOPSIS AS INTRODUCED:

230 ILCS 5/15.5 new
230 ILCS 5/15.6 new
230 ILCS 10/5.2 new
230 ILCS 10/5.3 new

Amends the Illinois Horse Racing Act of 1975 and the Riverboat Gambling Act. Prohibits a former member or employee of either the Illinois Racing Board or the Illinois Gaming Board from accepting employment or receiving compensation from an employer that (1) is an organization licensee under the Illinois Horse Racing Act of 1975 or an owners licensee under the Riverboat Gambling Act or (2) derives 50% or more of its gross income from one or more contracts with one or more organization licensees or owners licensees for at least 2 years. Prohibits a former member of either of those boards or former employee of either of those boards whose principal duties were directly related to procurement from engaging in a procurement activity relating to the board for 2 years. Creates a code of conduct for members and employees of the Illinois Racing Board and the Illinois Gaming Board. Prohibits certain conduct by those persons that may cause or have the appearance of causing a conflict of interest. Effective immediately.

A BILL FOR

AN ACT in relation to gambling.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 5. The Illinois Horse Racing Act of 1975 is amended by adding Sections 15.5 and 15.6 as follows:

(230 ILCS 5/15.5 new)

Sec. 15.5. Revolving door prohibition. A former member or employee of the Board may not, within a period of 2 years immediately after termination of that membership or employment, accept employment or receive compensation from an employer that: (1) is an organization licensee or an owners licensee under the Riverboat Gambling Act; or (2) derives 50% or more of its gross income from a contract or contracts with one or more organization licensees or owners licensees. This prohibition includes but is not limited to: lobbying the procurement process; specifying; bidding; proposing bid, proposal, or contract documents, on his or her own behalf or on behalf of any firm, partnership, association, or corporation.

A former member of the Board or a former employee of the Board who was employed by the Board for at least 6 months and whose principal duties were directly related to procurement is expressly prohibited for a period of 2 years after terminating membership or employment from engaging in any procurement activity relating to the Board. The prohibition includes but is not limited to: lobbying the procurement process; specifying; bidding; proposing bid, proposal, or contract documents, on his or her own behalf or on behalf of any firm, partnership, association, or corporation.

This Section applies only to persons who terminate membership or employment with the Board on or after the effective date of this amendatory Act of the 93rd General Assembly.

(230 ILCS 5/15.6 new)

Sec. 15.6. Code of conduct.

(a) Purpose. The purpose of this Section is to create a code of conduct to assure, to the maximum extent possible, that persons subject to this Act avoid situations, relationships, or associations that may lead to or represent a conflict of interest. If an employee of the Board has a question or concern as to the applicability of this Section to a current or prospective situation, relationship, or association, he or she must present the question or concern to the Chairman of the Board for clarification or guidance.

Members and employees of the Board are to discharge their duties and responsibilities with undivided loyalty to the Board and in such a manner as to promote and preserve public trust and confidence in the integrity of the conduct of gaming and in the integrity and impartiality of the Board. No Board member or employee shall use or attempt to use his or her official position to secure or attempt to secure any privilege, advantage, favor, or influence for himself, herself, or others. Members and employees of the Board shall bear responsibility for adherence to this policy and to the specific prohibitions and restrictions set forth in this Section.

Certain of the prohibitions in this Section affect or extend to the parents and children of Board members and employees. For purposes of this Section, these include the blood lineal relations of Board members and employees and, in the case of children, legally adopted children. It is recognized that, in some cases, Board members and employees may have limited influence over the decisions of their relatives. This limited influence will be taken into consideration in evaluating the circumstances of a violation or a potential violation of this Section that involves the lineal relatives of a Board member or employee.

Board members and employees and their respective spouses, parents, and children have an affirmative duty to avoid relationships that may cause or have the appearance of causing a conflict of interest.

(a-5) Definitions. For the purposes of this Section:

(1) The term "key person" means a key person as defined by the Illinois Gaming Board in administrative rules.

(2) The term "horse racing representative" means a representative of any race track under this Act, any racing association, or any person organization, or entity engaged in the conducting of horse racing under this Act.

(3) The term "Board employee" or "employee of the Board" means any State employee in the service of the Board.

(4) The term "conflict of interest" means a situation in which a Board member's or a Board employee's private interest, whether personal, financial, or otherwise, influences or creates the appearance that it may influence the Board member's or employee's judgment in the performance of his or her regulatory duties and responsibilities in a fair and impartial manner.

(5) The term "professional service agents of the Board" means any person, corporation, or organization providing legal, accounting, financial, public relations, auditing, architectural, data processing, or management consulting services to the Board.

(b) Gambling. Except as may be required in the conduct of official duties, Board members and employees shall not engage in gambling at any wagering facility licensed under this Act or engage in legalized gambling in any establishment identified by Board action that, in the judgment of the Board, could represent a potential for a conflict of interest.

(c) Outside employment. Board members and employees shall not hold or pursue employment, office, position, business, or occupation that may conflict with their official duties. Employees may engage in other gainful employment that does not interfere or conflict with their duties, provided that the employment is disclosed to the Board and approved by the Board.

Disclosure of outside employment must be made at the time of appointment to the Board or at the time the employee is hired to work for the Board or prior to accepting the outside employment. Any Board member who discloses outside employment to the Board shall recuse himself or herself from any discussion and decision made by the Board relative to his or her outside employment.

(d) Restrictions on receiving gifts. Board members and employees and their spouses, children, and parents may not, directly or indirectly, accept any gift, gratuity, service, compensation, travel, lodging, or thing of value, with the exception of unsolicited items of an incidental nature, from licensees or their affiliates, applicants or their affiliates, key persons, and horse racing representatives. This prohibition may be extended by Board action to any entity or individual that, in the judgment of the Board, could represent a potential for a conflict of interest.

(e) Prohibition on holding or acquiring ownership. Board members and employees of the Board, their spouses, children, and parents may not, directly or indirectly, hold or acquire or cause or encourage any other person to acquire any actual or contingent form of ownership interest or other financial interest in licensees or their affiliates, applicants or their affiliates, key persons, and horse racing representatives. This prohibition may extend to the holding or acquisition of an interest in any entity identified by Board action that, in the judgment of the Board, could represent the potential for or the appearance of a conflict of interest. The holding or acquisition of an interest in those entities through an indirect means, such as through a mutual fund, is not prohibited, except that the Board may identify specific investments or funds that, in its judgment, are so influenced by gaming holdings as to represent the potential for or the appearance of a conflict of interest.

Board members, upon leaving office, and employees of the Board, upon termination from employment with the Board, are precluded for a period of one year from the acquisition of any actual or contingent form of ownership interest or other financial interest in licensees or their affiliates, applicants or their affiliates, key persons, and horse racing representatives. This prohibition may be extended by Board action to any entity that, in the judgment of the Board, could represent a potential for or the appearance of a conflict of interest. The holding or acquisition of an interest in such entities through an indirect means, such as through a mutual fund, is not prohibited, except that the Board may identify specific investments or funds that, in its judgment, are so influenced by gaming holdings as to represent the potential for or the appearance of a conflict of interest.

(f) Prohibition on economic association. Board members and employees of the Board and their spouses, children, and parents shall not be directly or indirectly employed by, under contract with, or have any economic association with any licensee or its affiliates, applicant or its affiliates, key person, or horse racing representative. This prohibition may be extended to any entity or individual identified by Board action that, in the judgment of the Board, could represent the potential for or the appearance of a conflict of interest. This prohibition on economic association may by waived by Board action for a child or parent of an employee of the Board.

(g) Disclosure of economic association. Each Board member who owns or is employed by a firm or business entity shall, to the best of his or her ability, identify any current economic relationship, direct or indirect, representing the potential for or the appearance of a conflict of interest that may exist between the Board member's firm or business entity and any licensee or its affiliates, applicant or its affiliates, key person, or horse racing representative. The Board member must declare his or her intention to refrain from deliberations and voting on decisions related to the gaming entity in that relationship. This requirement may be extended by Board action to any entity or individual that, in the judgment of the Board, could represent the potential for or the appearance of a conflict of interest.

(h) Restrictions on professional service agents. Professional service agents of the Board may be subject to terms and conditions relating to restrictions or prohibitions in representation, employment, and contracting with licensees and their affiliates, applicants and their affiliates, key persons, and horse racing representatives. These restrictions and prohibitions shall be contained in the professional service contracts of the Board.

(i) Disclosure statements. Board members and employees must complete and timely file the statement of economic interest required under Article 4A of the Illinois Governmental Ethics Act, a copy of which must be provided to the Administrator.

(j) Past Board affiliation or employment. A former Board member or employee shall not, for a period of one year after termination of his or her Board appointment or employment, engage in any employment or contractual relations with or have any financial interest in any licensee or its affiliate, applicant or its affiliate, key person, or horse racing representative.

The prohibitions set forth in this subsection (j) may be extended by Board action to employment with any entity or individual that, in the judgment of the Board, could represent the potential for or the appearance of a conflict of interest.

The prohibitions set forth in this subsection (j) may be waived by Board action for an employee if, in the judgment of the Board, the employee was not involved in any way with any issue or transaction before or under investigation by the Board relative to any prospective employer during the employee's last year of employment with the Board. This waiver provision is not available to the Board's legal counsel.

(k) Prohibition on negotiations for employment. Board members and their representatives and employees of the Board and their representatives shall not initiate or participate in any negotiation or discussion of employment with any licensee or its affiliate, applicant or its affiliate, key person, or horse racing representative. A Board member or his or her representative or employee of the Board or his or her representative who initiates or participates in any negotiation or discussion of employment with any licensee or its affiliate, applicant or its affiliate, key person, or horse racing representatives must immediately provide written notice of the details of the negotiation or discussion to the Chairman of the Board as soon as the negotiation or discussion has occurred.

(l) Restrictions on post-employment appearances and discussions. A Board member or employee who leaves the employment of the Board for any reason may not:

(1) appear before the Board on any matter before the Board or an administrative law judge appointed by the Board or on any matter under investigation by the Board relative to a licensee or its affiliates, applicant or its their affiliates, key person, or horse racing representative; or

(2) engage in any discussion with any Board member or employee regarding any specific licensee or its affiliates, applicant or its affiliates, key person, or horse racing representative for a period of one year following the termination of the Board member's or employee's tenure or employment with the Board.

The prohibitions set forth in item (2) of this subsection (l) may be waived by Board action for an employee if, in the judgment of the Board, the employee was not involved in any way with any issue before or under investigation by the Board relative to any prospective employer during the employee's last year of employment with the Board. The waiver provisions set forth in this Section are not available to the Board's legal counsel.

(m) Violations. Violation of this Section by a member of the Board may result in sanctions up to and including removal from the Board. Violation of this Section by an employee or agent of the Board may result in discipline up to and including termination.

Section 10. The Riverboat Gambling Act is amended by adding Sections 5.2 and 5.3 as follows:

(230 ILCS 10/5.2 new)

Sec. 5.2. Revolving door prohibition. A former member or employee of the Board may not, within a period of 2 years immediately after termination of such membership or employment, accept employment or receive compensation from an employer that: (1) is an organization licensee under the Illinois Horse Racing Act of 1975 or an owners licensee; or (2) derives 50% or more of its gross income from a contract or contracts with one or more organization licensees or owners licensees. This prohibition includes but is not limited to: lobbying the procurement process; specifying; bidding; proposing bid, proposal, or contract documents, on his or her own behalf or on behalf of any firm, partnership, association, or corporation.

A former member of the Board or a former employee of the Board who was employed by the Board for at least 6 months and whose principal duties were directly related to procurement is expressly prohibited for a period of 2 years after terminating membership or employment from engaging in any procurement activity relating to the Board. The prohibition includes but is not limited to: lobbying the procurement process; specifying; bidding; proposing bid, proposal, or contract documents, on his or her own behalf or on behalf of any firm, partnership, association, or corporation.

This Section applies only to persons who terminate membership or employment with the Board on or after the effective date of this amendatory Act of the 93rd General Assembly.

(230 ILCS 10/5.3 new)

Sec. 5.3. Code of conduct.

(a) Purpose. The purpose of this Section is to create a code of conduct to assure, to the maximum extent possible, that persons subject to this Act avoid situations, relationships, or associations that may lead to or represent a conflict of interest. If an employee of the Board has a question or concern as to the applicability of this Section to a current or prospective situation, relationship, or association, he or she must present the question or concern to the Chairman of the Board or the Administrator for clarification or guidance.

Members and employees of the Board are to discharge their duties and responsibilities with undivided loyalty to the Board and in such a manner as to promote and preserve public trust and confidence in the integrity of the conduct of gaming and in the integrity and impartiality of the Board. No Board member or employee shall use or attempt to use his or her official position to secure or attempt to secure any privilege, advantage, favor, or influence for himself, herself, or others. Members and employees of the Board shall bear responsibility for adherence to this policy and to the specific prohibitions and restrictions set forth in this Section.

Certain of the prohibitions in this Section affect or extend to the parents and children of Board members and employees. For purposes of this Section, these include the blood lineal relations of Board members and employees and, in the case of children, legally adopted children. It is recognized that, in some cases, Board members and employees may have limited influence over the decisions of their relatives. This limited influence will be taken into consideration in evaluating the circumstances of a violation or a potential violation of this Section that involves the lineal relatives of a Board member or employee.

Board members and employees and their respective spouses, parents, and children have an affirmative duty to avoid relationships that may cause or have the appearance of causing a conflict of interest.

(a-5) Definitions. For the purposes of this Section:

(1) The term "key person" means a key person as defined by the Board in administrative rules.

(2) The term "horse racing representative" means a representative of any race track under the Illinois Horse Racing Act of 1975, any racing association, or any person organization, or entity engaged in the conducting of horse racing under the Illinois Horse Racing Act of 1975.

(3) The term "Board employee" or "employee of the Board" means any State employee in the service of the Board.

(4) The term "conflict of interest" means a situation in which a Board member's or a Board employee's private interest, whether personal, financial, or otherwise, influences or creates the appearance that it may influence the Board member's or employee's judgment in the performance of his or her regulatory duties and responsibilities in a fair and impartial manner.

(5) The term "professional service agents of the Board" means any person, corporation, or organization providing legal, accounting, financial, public relations, auditing, architectural, data processing, or management consulting services to the Board.

(b) Gambling. Except as may be required in the conduct of official duties, Board members and employees shall not engage in gambling on any riverboat licensed by the Board or engage in legalized gambling in any establishment identified by Board action that, in the judgment of the Board, could represent a potential for a conflict of interest.

(c) Outside employment. Board members and employees shall not hold or pursue employment, office, position, business, or occupation that may conflict with their official duties. Employees may engage in other gainful employment that does not interfere or conflict with their duties, provided that the employment is disclosed to the Administrator and the Board and approved by the Board or, as delegated, by the Administrator.

Disclosure of outside employment must be made at the time of appointment to the Board or at the time the employee is hired to work for the Board or prior to accepting the outside employment. Any Board member who discloses outside employment to the Board shall recuse himself or herself from any discussion and decision made by the Board relative to his or her outside employment.

(d) Restrictions on receiving gifts. Board members and employees and their spouses, children, and parents may not, directly or indirectly, accept any gift, gratuity, service, compensation, travel, lodging, or thing of value, with the exception of unsolicited items of an incidental nature, from licensees or their affiliates, applicants or their affiliates, key persons, and horse racing representatives. This prohibition may be extended by Board action to any entity or individual that, in the judgment of the Board, could represent a potential for a conflict of interest.

(e) Prohibition on holding or acquiring ownership. Board members and employees of the Board, their spouses, children, and parents may not, directly or indirectly, hold or acquire or cause or encourage any other person to acquire any actual or contingent form of ownership interest or other financial interest in licensees or their affiliates, applicants or their affiliates, key persons, and horse racing representatives. This prohibition may extend to the holding or acquisition of an interest in any entity identified by Board action that, in the judgment of the Board, could represent the potential for or the appearance of a conflict of interest. The holding or acquisition of an interest in those entities through an indirect means, such as through a mutual fund, is not prohibited, except that the Board may identify specific investments or funds that, in its judgment, are so influenced by gaming holdings as to represent the potential for or the appearance of a conflict of interest.

Board members, upon leaving office, and employees of the Board, upon termination from employment with the Board, are precluded for a period of one year from the acquisition of any actual or contingent form of ownership interest or other financial interest in licensees or their affiliates, applicants or their affiliates, key persons, and horse racing representatives. This prohibition may be extended by Board action to any entity that, in the judgment of the Board, could represent a potential for or the appearance of a conflict of interest. The holding or acquisition of an interest in such entities through an indirect means, such as through a mutual fund, is not prohibited, except that the Board may identify specific investments or funds that, in its judgment, are so influenced by gaming holdings as to represent the potential for or the appearance of a conflict of interest.

(f) Prohibition on economic association. Board members and employees of the Board and their spouses, children, and parents shall not be directly or indirectly employed by, under contract with, or have any economic association with any licensee or its affiliates, applicant or its affiliates, key person, or horse racing representative. This prohibition may be extended to any entity or individual identified by Board action that, in the judgment of the Board, could represent the potential for or the appearance of a conflict of interest. This prohibition on economic association may by waived by Board action for a child or parent of an employee of the Board.

(g) Disclosure of economic association. Each Board member who owns or is employed by a firm or business entity shall, to the best of his or her ability, identify any current economic relationship, direct or indirect, representing the potential for or the appearance of a conflict of interest that may exist between the Board member's firm or business entity and any licensee or its affiliates, applicant or its affiliates, key person, or horse racing representative. The Board member must declare his or her intention to refrain from deliberations and voting on decisions related to the gaming entity in that relationship. This requirement may be extended by Board action to any entity or individual that, in the judgment of the Board, could represent the potential for or the appearance of a conflict of interest.

(h) Restrictions on professional service agents. Professional service agents of the Board may be subject to terms and conditions relating to restrictions or prohibitions in representation, employment, and contracting with licensees and their affiliates, applicants and their affiliates, key persons, and horse racing representatives. These restrictions and prohibitions shall be contained in the professional service contracts of the Board.

(i) Disclosure statements. Board members and employees must complete and timely file the statement of economic interest required under Article 4A of the Illinois Governmental Ethics Act, a copy of which must be provided to the Administrator.

(j) Past Board affiliation or employment. A former Board member or employee shall not, for a period of one year after termination of his or her Board appointment or employment, engage in any employment or contractual relations with or have any financial interest in any licensee or its affiliate, applicant or its affiliate, key person, or horse racing representative.

The prohibitions set forth in this subsection (j) may be extended by Board action to employment with any entity or individual that, in the judgment of the Board, could represent the potential for or the appearance of a conflict of interest.

The prohibitions set forth in this subsection (j) may be waived by Board action for an employee if, in the judgment of the Board, the employee was not involved in any way with any issue or transaction before or under investigation by the Board relative to any prospective employer during the employee's last year of employment with the Board. This waiver provision is not available to the Board Administrator, Deputy Administrators, or legal counsel.

(k) Prohibition on negotiations for employment. Board members and their representatives and employees of the Board and their representatives shall not initiate or participate in any negotiation or discussion of employment with any licensee or its affiliate, applicant or its affiliate, key person, or horse racing representative. A Board member or his or her representative or employee of the Board or his or her representative who initiates or participates in any negotiation or discussion of employment with any licensee or its affiliate, applicant or its affiliate, key person, or horse racing representatives must immediately provide written notice of the details of the negotiation or discussion to the Administrator and Chairman of the Board as soon as the negotiation or discussion has occurred.

(l) Restrictions on post-employment appearances and discussions. A Board member or employee who leaves the employment of the Board for any reason may not:

(1) appear before the Board on any matter before the Board or an administrative law judge appointed by the Board or on any matter under investigation by the Board relative to a licensee or its affiliates, applicant or its their affiliates, key person, or horse racing representative; or

(2) engage in any discussion with any Board member or employee regarding any specific licensee or its affiliates, applicant or its affiliates, key person, or horse racing representative for a period of one year following the termination of the Board member's or employee's tenure or employment with the Board.

The prohibitions set forth in item (2) of this subsection (l) may be waived by Board action for an employee if, in the judgment of the Board, the employee was not involved in any way with any issue before or under investigation by the Board relative to any prospective employer during the employee's last year of employment with the Board. The waiver provisions set forth in this Section are not available to the Board Administrator, Deputy Administrators, or legal counsel.

(m) Violations. Violation of this Section by a member of the Board may result in sanctions up to and including removal from the Board. Violation of this Section by an employee or agent of the Board may result in discipline up to and including termination.

Section 99. Effective date. This Act takes effect upon becoming law.