Ethics officer says INDOT official didn't violate law by not disclosing land sale for I-69

That was the finding of an investigation by the state's top ethics officer into the sale of the land by Troy Woodruff, INDOT's former chief of staff, and his family.

The 81-page report released Friday by Indiana Inspector General David Thomas was sharply critical, though, of Woodruff's decision not to disclose the sale to the Indiana State Ethics Commission.

The report calls upon the state to enact stricter disclosure requirements.

Even though state law did not require the disclosure of the eminent domain action to the ethics commission, an Indiana Department of Transportation ethics official recommended Woodruff notify the ethics commission of the transaction. Because Woodruff did not follow the advice, he "fueled allegations of wrongdoing," according to the report.

Thomas, in a rare press conference Friday morning, said the case has been with his office on and off for about four years. Thomas said what likely generated interest in Woodruff's involvement in I-69 was the fact the INDOT official didn't go before the ethics commission to talk about the land in a public forum.

Thomas said former INDOT Commissioner Michael Cline had a similar situation where property from his family members was going to be affected by a road project in Northern Indiana. But Cline came to the ethics commission and disclosed the information "so questions wouldn't even be asked," Thomas said.

Thomas said through his office's review, Woodruff is cleared of "being a criminal or violating the code of ethics."

"But here's the thing, and I guess it's another takeaway, when you engage in conduct that goes right up to that line and then you dance away from the line and say well it wasn't violated — that's OK. But this is what happens," Thomas said. "If you sense the frustration in my voice, it affects so many people."

The report said Woodruff's case demonstrates the importance of an ethics officer's role in a state agency.

"It further reveals the dramatic consequences that can result from the failure to follow the advice of an agency ethics officer. The public response to the conduct addressed in this report reveals the negative reaction that is certain to occur when a state employee engages in conduct that comes narrowly close to violating criminal and ethical laws. This conduct not only gives rise to the appearance of impropriety, but diminishes public trust even when there is no violation of law. This case also reveals how the actions of one individual can dramatically affect so many fellow workers," according to the inspector general office's report.

Because Woodruff did not follow the ethics officer's advice, the report recommends that the former official, who stepped down as INDOT chief of staff on Thursday to work in the private sector, should be required to abide by a one-year "cooling-off" period. State ethics rules require the one-year period before state employees can take a job with a company whose contracts they administered or negotiated while employed by the state, though INDOT Commissioner Karl Browning could choose to waiver that period for Woodruff.

According to the report, Woodruff, who is also a former state representative, listed the land on his financial disclosure statement filings in 2009 to 2011, but didn't tell the ethics commission because he was "concerned about doing anything more and drawing further attention to the matter."

The Marion County prosecutor's office and a special prosecuting attorney appointed in Daviess County are declining to seek charges against Woodruff. Federal attorneys also stated there would be no further review of the case.

But Thomas recommends the state's eminent domain law should be changed to require state agencies and state employees file a written disclosure with the ethics commission if the state seizes property from an employee.

The report also recommends that INDOT adopt disclosure and screening requirements even more stringent than required by current law when an INDOT project involves the property owned by an employee of the agency or their family members.

An INDOT spokesman said Friday that Gov. Mike Pence has directed the agency to implement the recommendations found in the report.

"INDOT respects and appreciates the work of the Inspector General, FBI, Indiana State Police, Federal Highways, U.S. Attorney and prosecutors for both Marion and Daviess counties for their thorough investigations and reporting of the facts in this case. Based upon the contributions he has made, Commissioner Browning feels the state would have benefited if Troy had stayed with INDOT," INDOT spokesman Will Wingfield said in an emailed statement.

Woodruff did not return a call seeking comment by the Courier & Press Friday afternoon.

Following an investigation by The Indianapolis Star, Gov. Mike Pence in 2013 asked the Inspector General to review the state's purchase of nearly three acres in Daviess County from Woodruff and his family for the I-69 project. The Star alleged Woodruff didn't inform the state he sold land for the project.

In 2010, Thomas issued a report that cleared Woodruff on the land sale, stating an investigation by his office showed the INDOT employee and former state lawmaker didn't violate state laws on compensation or conflict of interest.

In a note written to INDOT staff this week, Woodruff said he had one regret leaving the agency, "and that is the fact I could no longer stay around waiting on (the investigation) of myself that started in October of 2012 to finally come to an end."

"Believe me I wanted it to be out, and one day it will be, not so much for me or my family but quite honestly for you all. I wanted to shout from the roof top that the people of this agency are owed an apology. Even as the media accused me of so many things, what they were actually implying is that this agency is corrupt. You don't deserve that," Woodruff wrote.

In July, Woodruff revealed his plans to leave state employment. Woodruff had gone before the ethics commission to approve a procedure to avoid conflicts of interest as he negotiated for a job with Indianapolis-based RQAW Corp., an engineering firm that regularly does business with the state. But according to an INDOT spokesman this week, Woodruff is now going into business for himself.