An Indiana House committee has approved legislation to close a loophole the U.S. Supreme Court opened in 2024 that allows elected officials and government employees to receive unlimited "gratuities" for official acts, so long as the payment isn't agreed to in advance.
The 6-3 ruling by the nation's highest court overturned former Portage Mayor James Snyder's 2021 conviction for federal funds bribery by reinterpreting the $13,000 payment Snyder received from a city contractor as a potential gratuity not subject to federal prosecution.
Rather than engage in another long legal battle over the issue, federal prosecutors have agreed to dismiss Snyder's still-pending bribery charge when he's sentenced March 10 on a separate felony conviction of corruptly obstructing the administration of federal revenue laws.
Meanwhile, at the Statehouse, state Rep. Hal Slager, R-Schererville, wants to make sure no more Indiana public servants are getting tipped simply for doing their taxpayer-funded jobs.
"I think it's not in our best interest to allow public officials to receive payments of any kind for doing their official duty," Slager said.
"We've now opened the door to making that legal. And, just incidentally, since there's no tax on tips at the federal level, it would be non-taxable as well."
House Bill 1065 makes it a class A misdemeanor, punishable by up to one year in jail and a $5,000 fine, to offer a gratuity to a current or former public servant following an official act, or for a current or former public servant to solicit or accept a gratuity as a reward for an official act.
The crime would become a level 6 felony, punishable by up to 2½ years in jail and a $10,000 fine, if an offered, solicited or received gratuity has a fair market value exceeding $750, according to the legislation.
The prohibition would not apply to gratuities worth less than $100; a ceremonial or commemorative item like a plaque, trophy, framed photo or certificate; goods or services subject to a public reporting requirement; campaign donations; or compensation paid by the public servant's employer.
State Rep. Matt Pierce, D-Bloomington, enthusiastically supported the proposal because he said the U.S. Supreme Court ruling "was pretty bad, in my opinion."
"I mean, right now, without any change in the law, as long as I don't talk to a lobbyist or someone about how I'm going to vote, I can vote and then go out into the hallway with a portable credit card machine and ask if anyone would like to tip me for all of my voting and my fine effort. And as long as I haven't colluded and pledged ahead of time to vote a certain way in exchange for money, it's not a bribe. It can just be a tip," Pierce said.
"I can't imagine the public would be very comfortable with that kind of thing. But for the Supreme Court, they thought it was just OK."
The measure was unanimously approved Wednesday by the House Courts and Criminal Code Committee. The full House is expected to vote next week to forward it to the Senate.
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