*ES0005.2*
Reprinted
April 8, 2025
ENGROSSED
SENATE BILL No. 5
_____
DIGEST OF SB 5 (Updated April 7, 2025 4:35 pm - DI 137)
Citations Affected: IC 4-12; IC 4-13; IC 4-15; IC 5-35.7; IC 12-8.
Synopsis: State fiscal and contracting matters. Allows a state agency
to use artificial intelligence software to prepare information and
projections for the state budget. Requires a state agency to: (1) report
to the budget committee certain information before submitting a new
(Continued next page)
Effective: Upon passage; July 1, 2025.
Baldwin, Garten, Mishler, Schmitt,
Doriot, Zay, Deery,
Randolph Lonnie M, Holdman, Bassler,
Freeman, Clark, Glick, Alexander,
Buchanan, Busch, Leising, Donato, Buck,
Walker G, Byrne, Bohacek, Maxwell,
Koch, Gaskill, Alting, Niezgodski, Raatz,
Carrasco, Dernulc, Johnson T, Tomes,
Walker K, Goode, Young M
(HOUSE SPONSORS — LEHMAN, SNOW, LOPEZ)
January 14, 2025, read first time and referred to Committee on Appropriations.
January 23, 2025, amended, reported favorably — Do Pass.
January 27, 2025, read second time, ordered engrossed. Engrossed.
January 28, 2025, read third time, passed. Yeas 49, nays 0.
HOUSE ACTION
March 3, 2025, read first time and referred to Committee on Ways and Means.
March 27, 2025, amended, reported — Do Pass.
April 7, 2025, read second time, amended, ordered engrossed.
ES 5—LS 7508/DI 137 Digest Continued
federal funds request or application to participate in a new federal
program; and (2) obtain the budget committee's review before
accepting an award of new federal funds that require a state match.
Requires that permanent full-time positions which have been vacant for
90 days or more be reviewed and either: (1) reauthorized; or (2)
eliminated; by the budget director. Requires the budget director to
provide a quarterly report to the governor's office regarding those
positions that were reauthorized or eliminated by the budget director in
the preceding three months. Requires a state agency to provide the state
comptroller with a contract for inclusion in the Indiana transparency
website not later than 30 days after the contract is fully executed.
Requires a state agency to provide quarterly reports to the budget
committee regarding the state agency's active contracts. Provides for
the reversion of funds appropriated to a state agency for expenses
related to a contract that are unused after the end of the contract term.
Requires the department of administration (department) to develop
certain contract language to be included in state contracts of $500,000
or more. Requires a state agency to provide a report to the budget
committee concerning amendments to a contract that: (1) increase the
maximum contract amount by not less than $500,000; or (2) for a
contract with an initial maximum contract amount of not less than
$500,000, extend the term of the contract by not less than six months.
Requires all contract opportunities of state agencies to be posted in the
form of a request for proposals or a request for quotations on the
department's website at least 30 days prior to the contract being
awarded. Prohibits a state agency from entering into a nonpublic
contract. Requires the office of the secretary of family and social
services and the office of Medicaid policy and planning to do the
following: (1) Review monthly reports on the Medicaid program
service utilization to identify trends and risks within the state Medicaid
program. (2) Post publicly on the office of the secretary of family and
social services's website monthly financial reports or expenditures and
revenues for each state Medicaid program and commentary providing
context for each monthly financial report. (3) Submit a quarterly report
to the budget committee.
ES 5—LS 7508/DI 137ES 5—LS 7508/DI 137 Reprinted
April 8, 2025
First Regular Session of the 124th General Assembly (2025)
PRINTING CODE. Amendments: Whenever an existing statute (or a section of the Indiana
Constitution) is being amended, the text of the existing provision will appear in this style type,
additions will appear in this style type, and deletions will appear in this style type.
Additions: Whenever a new statutory provision is being enacted (or a new constitutional
provision adopted), the text of the new provision will appear in this style type. Also, the
word NEW will appear in that style type in the introductory clause of each SECTION that adds
a new provision to the Indiana Code or the Indiana Constitution.
Conflict reconciliation: Text in a statute in this style type or this style type reconciles conflicts
between statutes enacted by the 2024 Regular Session of the General Assembly.
ENGROSSED
SENATE BILL No. 5
A BILL FOR AN ACT to amend the Indiana Code concerning state
and local administration.
Be it enacted by the General Assembly of the State of Indiana:
1 SECTION 1. IC 4-12-1-7.5 IS ADDED TO THE INDIANA CODE
2 AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY
3 1, 2025]: Sec. 7.5. A state agency may use artificial intelligence
4 software to prepare a statement required under section 7 of this
5 chapter or any budget projections for the state agency.
6 SECTION 2. IC 4-12-19 IS ADDED TO THE INDIANA CODE AS
7 A NEW CHAPTER TO READ AS FOLLOWS [EFFECTIVE JULY
8 1, 2025]:
9 Chapter 19. Federal Funds Requests
10 Sec. 1. This chapter does not apply to a request for new federal
11 funds that is subject to a nondisclosure agreement to prevent the
12 disclosure of confidential or proprietary business information.
13 Sec. 2. As used in this chapter, "new federal funds" means
14 federal assistance or other funds that are available from:
15 (1) the federal government, which the state is not currently
ES 5—LS 7508/DI 137 2
1 receiving; or
2 (2) a federal assistance program or other federal program, in
3 which the state is not currently participating.
4 Sec. 3. (a) As used in this chapter, "state agency" means:
5 (1) a department or office of the executive, including the
6 administrative, branch of state government; and
7 (2) separately elected state officers and any department or
8 office of separately elected state officers.
9 (b) The term does not include:
10 (1) the legislative branch of state government;
11 (2) the judicial branch of state government; or
12 (3) a state educational institution.
13 Sec. 4. (a) A state agency shall provide a report to the budget
14 committee not later than January 1, April 1, July 1, and October
15 1 of each year that details the requests for new federal funds
16 submitted by the state agency since the date of the state agency's
17 last report under this subsection.
18 (b) A state agency shall submit a report under subsection (a) in
19 the form and manner designated by the budget committee.
20 Sec. 5. (a) If a state agency's request for new federal funds
21 would require the state agency to transfer funds between state
22 accounts for a state match to receive the new federal funds, the
23 budget committee must review the new federal funds that would be
24 received.
25 (b) A state agency may not accept an award of federal funds
26 before the budget committee has conducted its review under
27 subsection (a).
28 SECTION 3. IC 4-13-1-29 IS ADDED TO THE INDIANA CODE
29 AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY
30 1, 2025]: Sec. 29. (a) To the extent a contract entered into by a state
31 agency is required to be posted on the Indiana transparency
32 website, the state agency shall provide the contract to the
33 department for inclusion on the Indiana transparency website not
34 later than thirty (30) days after the contract is fully executed.
35 (b) All contracts provided to the department for inclusion on the
36 Indiana transparency website must be electronically downloadable.
37 The information contained in a search of the contracts on the
38 Indiana transparency website must be available to download in an
39 accessible spreadsheet format regardless of the maximum number
40 of rows.
41 SECTION 4. IC 4-13-2-18, AS AMENDED BY P.L.9-2024,
42 SECTION 89, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
ES 5—LS 7508/DI 137 3
1 JULY 1, 2025]: Sec. 18. (a) For the purpose of the administration of the
2 allotment system provided by this section, each fiscal year shall be
3 divided into four (4) quarterly allotment periods, beginning
4 respectively on the first day of July, October, January, and April. In any
5 case where the quarterly allotment period is impracticable, the budget
6 director may prescribe a different period suited to the circumstances
7 but not extending beyond the end of any fiscal year.
8 (b) Except as otherwise expressly provided in this section, the
9 provisions of this chapter relating to the allotment system and to the
10 encumbering of funds shall apply to appropriations and funds of all
11 kinds, including standing or annual appropriations and dedicated funds,
12 from which expenditures are to be made from time to time by or under
13 the authority of any state agency. The provisions relating to the
14 allotment system shall not apply to money made available for the
15 purpose of conducting a post-audit of financial transactions of any state
16 agency. Likewise, appropriations for construction or for the acquisition
17 of real estate for public purposes may be exempted from the allotment
18 system by the budget director. The budget director shall prescribe
19 regulations as will ensure the proper application and encumbering of
20 those funds.
21 (c) No appropriation to any state agency shall become available for
22 expenditure until:
23 (1) the state agency shall have submitted to the budget agency a
24 request for allotment, the request for allotment to consist of an
25 estimate of the amount required for each activity and each
26 purpose for which money is to be expended during the applicable
27 allotment period; and
28 (2) the estimate contained in the request for allotment shall have
29 been approved, increased, or decreased by the budget director and
30 funds allotted as provided.
31 The form of a request for allotment, including a request by hand, mail,
32 facsimile transmission, or other electronic transmission, shall be
33 prescribed by the budget agency with the approval of the state
34 comptroller and shall be submitted to them at least twenty-five (25)
35 days prior to the beginning of the allotment period.
36 (d) Each request for allotment shall be reviewed by the budget
37 agency and respective amounts shall be allotted for expenditure if:
38 (1) the estimate is within the terms of the appropriation as to
39 amount and purpose, having due regard for the probable future
40 needs of the state agency for the remainder of the fiscal year or
41 other term for which the appropriation was made; and
42 (2) the agency contemplates expenditure of the allotment during
ES 5—LS 7508/DI 137 4
1 the period.
2 Otherwise the budget agency shall modify the estimate to conform with
3 the terms of the appropriation and the prospective needs of the state
4 agency, and shall reduce the amount to be allotted accordingly. The
5 budget agency shall act promptly upon all requests for allotment and
6 shall notify every state agency of its allotments at least five (5) days
7 before the beginning of each allotment period. The total amount
8 allotted to any agency for the fiscal year or other term for which the
9 appropriation was made shall not exceed the amount appropriated for
10 the year or term.
11 (e) The budget director shall also have authority at any time to
12 modify or amend any allotment previously made by the budget director.
13 (f) In case the budget director shall discover at any time that:
14 (1) the probable receipts from taxes or other sources for any fund
15 will be less than were anticipated; and
16 (2) as a consequence the amount available for the remainder of
17 the term of the appropriation or for any allotment period will be
18 less than the amount estimated or allotted;
19 the budget director shall, with the approval of the governor, and after
20 notice to the state agency or agencies concerned, reduce the amount or
21 amounts allotted or to be allotted to prevent a deficit.
22 (g) The budget agency shall promptly transmit records of all
23 allotments and modifications to the state comptroller.
24 (h) The state comptroller shall maintain as a part of the central
25 accounting system for the state, as provided, records showing at all
26 times, by funds, accounts, and other pertinent classifications, the
27 amounts appropriated, the estimated revenues, the actual revenues or
28 receipts; the amounts allotted and available for expenditure, the total
29 expenditures, the unliquidated obligations, actual balances on hand,
30 and the unencumbered balances of the allotments for each state agency.
31 (i) No payment shall be made from any fund, allotment, or
32 appropriation unless the state comptroller shall first certify that there
33 is a sufficient unencumbered balance in the fund, allotment, or
34 appropriation, after taking into consideration all previous expenditures
35 to meet the same. In the case of an obligation to be paid from federal
36 funds, a notice of a federal grant award shall be considered an
37 appropriation against which obligations may be incurred, funds may be
38 allotted, and encumbrances may be made.
39 (j) Every expenditure or obligation authorized or incurred in
40 violation of the provisions of this chapter shall be void. Every payment
41 made in violation of the provisions of this chapter shall be illegal, and
42 every official authorizing or making a void payment, or taking part in
ES 5—LS 7508/DI 137 5
1 a void payment, and every person receiving a void payment, or any part
2 of a void payment, shall be jointly and severally liable to the state for
3 the full amount paid or received. If any appointive officer or employee
4 of the state shall knowingly incur any obligation or shall authorize or
5 make any expenditure in violation of the provisions of this chapter, or
6 take any part, it shall be ground for removal of the appointive officer
7 or employee of the state by the officer appointing the appointive officer
8 or employee of the state. If the appointing officer is a person other than
9 the governor and fails to remove the officer or employee, the governor
10 may exercise the power of removal after giving notice of the charges
11 and opportunity for hearing to the accused officer or employee and to
12 the officer appointing the accused officer or employee.
13 (k) The budget director shall be responsible for the
14 authorization of employee positions. Such authorizations shall be
15 based on the following:
16 (1) A requirement that permanent full-time positions which
17 have been vacant for ninety (90) days or more be reviewed
18 and reauthorized prior to being filled. If requested by the
19 budget director, the state personnel director shall review such
20 vacant positions to determine the proper classification for the
21 position.
22 (2) Other relevant criteria as determined by the budget
23 director.
24 (l) The budget director shall provide a report to the governor
25 not later than January 1, April 1, July 1, and October 1 of each
26 year that lists the permanent full-time positions that were subject
27 to the budget director's review under subsection (k)(1) during the
28 preceding three (3) months.
29 SECTION 5. IC 4-15-2.2-26, AS ADDED BY P.L.229-2011,
30 SECTION 56, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE
31 JULY 1, 2025]: Sec. 26. (a) The director, after consulting with
32 appointing authorities and other qualified authorities, shall determine,
33 or cause to be determined, the authority, duties, and responsibilities of
34 all positions in the state civil service.
35 (b) The director shall prepare a classification plan that groups all
36 positions in the state civil service in classes, based on the authority,
37 duties, and responsibilities of each position. The classification plan
38 must set forth, for each class of positions, the class title and a statement
39 of the authority, duties, and responsibilities of the class. Each class of
40 positions may be subdivided, and classes may be grouped and ranked
41 in such manner as the director considers appropriate.
42 (c) New, reclassified, or reallocated positions must be classified,
ES 5—LS 7508/DI 137 6
1 reclassified, or reallocated in the same manner as positions were
2 initially classified or allocated.
3 (d) (c) The director periodically shall:
4 (1) review the positions in state civil service; and
5 (2) reallocate the positions to the proper classes based on the
6 duties and responsibilities of the positions at the time of the
7 review under subdivision (1).
8 (d) Upon request by the budget director under IC 4-13-2-18(k),
9 the director shall:
10 (1) review permanent full-time positions which have been
11 vacant for ninety (90) days; and
12 (2) either:
13 (A) reallocate a vacant position to the proper class based
14 on the duties and responsibilities of the position at the time
15 of the review under subdivision (1); or
16 (B) eliminate the position from state civil service.
17 SECTION 6. IC 5-35.7 IS ADDED TO THE INDIANA CODE AS
18 A NEW ARTICLE TO READ AS FOLLOWS [EFFECTIVE UPON
19 PASSAGE]:
20 ARTICLE 35.7. FISCAL INTEGRITY AND CONTRACT
21 ACCOUNTABILITY
22 Chapter 1. Definitions
23 Sec. 1. As used in this article, "active contract" means a
24 contract for which the term of the contract has not expired.
25 Sec. 2. (a) As used in this article, "contract" means a contract,
26 agreement, or similar arrangement by any other name, and
27 includes any amendments, addendums, or extensions.
28 (b) The term includes contracts entered into for state public
29 works projects by the public works division within the department.
30 (c) The term does not include:
31 (1) A contract between state agencies.
32 (2) A contract between a state agency and an employee of the
33 state agency concerning employment.
34 (3) A contract that is required to be kept confidential under
35 state or federal law to prevent the disclosure of confidential or
36 proprietary business information.
37 (4) A contract for legal services to aid in the performance of
38 the rights, powers, and duties conferred by IC 4-6.
39 Sec. 3. As used in this article, "contractor" means a person who
40 has entered into a contract with a state agency.
41 Sec. 4. As used in this article, "department" means the Indiana
42 department of administration created by IC 4-13-1-2.
ES 5—LS 7508/DI 137 7
1 Sec. 5. As used in this article, "initial contract" means the first
2 agreement between a state agency and a contractor concerning the
3 provision of specified goods or services, which may be later
4 amended.
5 Sec. 6. As used in this article, "maximum contract amount"
6 means the amount in a contract that total remuneration is not to
7 exceed.
8 Sec. 7. (a) As used in this article, "state agency" means:
9 (1) a department or office of the executive, including the
10 administrative, branch of state government; and
11 (2) separately elected state officers and any department or
12 office of separately elected state officers.
13 (b) The term does not include:
14 (1) the legislative branch of state government;
15 (2) the judicial branch of state government; or
16 (3) a state educational institution.
17 Chapter 2. Reporting Requirements
18 Sec. 1. (a) This chapter applies to a contract with a maximum
19 contract amount of not less than five hundred thousand dollars
20 ($500,000).
21 (b) This chapter does not apply to a contract entered into by the
22 Indiana department of transportation for the construction, repair,
23 or maintenance of a highway, street, road, or bridge.
24 Sec. 2. Not later than January 1, 2026, and not later than each
25 January 1, April 1, July 1, and October 1 thereafter, a state agency
26 must submit a report to the budget committee that provides
27 information regarding the following contracts of the state agency:
28 (1) For a report due January 1, active contracts as of
29 December 1 of the prior year.
30 (2) For a report due April 1, active contracts as of March 1 of
31 that year.
32 (3) For a report due July 1, active contracts as of June 1 of
33 that year.
34 (4) For a report due October 1, active contracts as of
35 September 1 of that year.
36 Sec. 3. A report submitted by a state agency under section 2 of
37 this chapter must include, at a minimum, the following
38 information:
39 (1) The current contract expenditures compared with the
40 maximum contract amount of the contract.
41 (2) Any changes made to the terms of the initial contract since
42 the prior report, including amendments or change orders,
ES 5—LS 7508/DI 137 8
1 with an explanation of necessity.
2 (3) The metrics used by the state agency to assess the success
3 and performance of the contract.
4 Sec. 4. A report submitted under section 2 of this chapter must
5 be in an electronic format.
6 Chapter 3. Reversion of Appropriations
7 Sec. 1. This chapter applies to a state fiscal year that begins on
8 or after July 1, 2025.
9 Sec. 2. Unless otherwise provided by law, any funds
10 appropriated by the general assembly to a state agency for an
11 expense related to a contract that remain unused ninety (90) days
12 after the end of the term of the contract:
13 (1) must be unallotted by the budget agency and no longer
14 available for the state agency's use; and
15 (2) on the June 30 after the funds are unallotted, revert to the
16 fund from which they were appropriated.
17 Chapter 4. Mandatory Contract Terms
18 Sec. 1. (a) This chapter applies to a contract between a state
19 agency and a contractor that:
20 (1) is entered into, renewed, or amended after June 30, 2026;
21 and
22 (2) has a maximum contract amount of not less than five
23 hundred thousand dollars ($500,000) in the initial contract.
24 (b) This chapter does not apply to a contract entered into by the
25 Indiana department of transportation for the construction, repair,
26 or maintenance of a highway, street, road, or bridge.
27 (c) This chapter does not apply to a contract for legal services
28 to aid in the performance of the rights, powers, and duties
29 conferred by IC 4-6.
30 Sec. 2. A contract between a state agency and a contractor must
31 contain the following provisions:
32 (1) To the extent practicable, clearly defined scopes and
33 success metrics.
34 (2) Liquidated damages or other remedies for missed
35 deadlines or overages.
36 (3) A requirement for either of the following:
37 (A) An independent third party review verifying that the
38 parties to the contract performed their obligations under
39 the contract in compliance with the terms of the contract.
40 (B) Other appropriate methods or means for verification
41 and validation of the terms of the contract.
42 Sec. 3. Not later than March 1, 2026, the department shall
ES 5—LS 7508/DI 137 9
1 provide contract language in its contract templates for state
2 agencies to include the provisions required under section 2 of this
3 chapter.
4 Chapter 5. Review of Amendments
5 Sec. 1. This chapter applies to a contract between a state agency
6 and a contractor that is entered into, renewed, or amended after
7 June 30, 2025.
8 Sec. 2. A state agency shall provide a report to the budget
9 committee not later than January 1, April 1, July 1, and October
10 1 of each year, in the form and manner designated by the budget
11 committee, that details the contract amendments entered into by
12 the state agency since the date of the last report under this section
13 to which at least one (1) of the following applies:
14 (1) For any contract, increase the maximum contract amount
15 by an amount that is not less than five hundred thousand
16 dollars ($500,000).
17 (2) For an initial contract with a maximum contract amount
18 of not less than five hundred thousand dollars ($500,000),
19 extend the term of the initial contract for a period of not less
20 than six (6) months.
21 Chapter 6. Contract Reporting and Requirements
22 Sec. 1. (a) This chapter applies to contracts entered into between
23 a state agency and a contractor.
24 (b) This chapter does not apply to a contract solely entered into
25 for licensed legal counsel.
26 Sec. 2. (a) All active contracts that are funded in part or in full
27 by state appropriated funds, including state, federal, and dedicated
28 funds, shall within thirty (30) days of entering into the contract be
29 submitted to the state budget agency and the department for
30 inclusion on the state transparency portal under IC 5-14-3.5-2.
31 (b) The state budget agency shall on or before June 1, 2026, and
32 June 1 each year thereafter compile a report of all contracts
33 submitted under subsection (a) for the immediately preceding
34 calendar year and submit the report to the state budget committee.
35 Sec. 3. All contract opportunities of state agencies must be
36 posted in the form of a request for proposals or a request for
37 quotations on the department's website at least thirty (30) days
38 prior to the contract being awarded.
39 Chapter 7. Prohibition of Nonpublic Contracts
40 Sec. 1. This chapter does not apply to the following:
41 (1) A contract solely entered into for licensed legal counsel.
42 (2) A purchase subject to the small purchase policies
ES 5—LS 7508/DI 137 10
1 established by a state agency under IC 5-22-8.
2 (3) A contract for services provided by a bank holding
3 company or its subsidiaries or for investments, investment
4 services, or financial services entered into by the treasurer of
5 state under IC 4-8.1, IC 5-13, or IC 10-12.
6 Sec. 2. As used in this chapter, "nonpublic contract" means a
7 contract that is entered into without solicitation of proposals or
8 competitive procurement. However, the term does not include a
9 contract entered into under the following:
10 (1) IC 5-22-10.
11 (2) IC 4-13.6-5-5 (Emergency conditions).
12 Sec. 3. Except as otherwise required by law, a state agency shall
13 not enter into a nonpublic contract.
14 SECTION 7. IC 12-8-6.5-16 IS ADDED TO THE INDIANA CODE
15 AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE
16 UPON PASSAGE]: Sec. 16. The secretary and the office of
17 Medicaid policy and planning shall do each of the following as it
18 pertains to the state Medicaid program:
19 (1) Review monthly reports on the Medicaid program service
20 utilization to identify trends and risks within the state
21 Medicaid program.
22 (2) Complete and post publicly on the office of the secretary's
23 website:
24 (A) monthly financial reports or expenditures and
25 revenues for each state Medicaid program; and
26 (B) commentary providing context for each monthly
27 financial report.
28 (3) Submit a quarterly report to the budget committee and the
29 Medicaid oversight committee established by IC 2-5-54-2
30 containing each report required under subdivision (2) and a
31 summary of the overall financial trends for the entire quarter.
32 SECTION 8. An emergency is declared for this act.
ES 5—LS 7508/DI 137 11
COMMITTEE REPORT
Mr. President: The Senate Committee on Appropriations, to which
was referred Senate Bill No. 5, has had the same under consideration
and begs leave to report the same back to the Senate with the
recommendation that said bill be AMENDED as follows:
Replace the effective date in SECTION 7 with "[EFFECTIVE
UPON PASSAGE]".
Page 7, between lines 29 and 30, begin a new paragraph and insert:
"(c) Notwithstanding section 9 of this chapter, all contracts
provided to the state comptroller for inclusion in the data base
must be electronically downloadable in an accessible spreadsheet
format regardless of the maximum number of rows.".
Page 8, between lines 23 and 24, begin a new paragraph and insert:
"Sec. 8. As used in this article, "state entity" means any of the
following:
(1) The executive branch of state government, including any
authority, branch, commission, committee, division, office, or
other instrumentality of the executive branch.
(2) Each individual elected to a state office (as defined in
IC 3-5-2-48).
(3) The legislative branch of state government.
(4) The judicial branch of state government.".
Page 11, after line 9, begin a new paragraph and insert:
"Chapter 7. Contract Reporting and Requirements
Sec. 1. This chapter applies to any state entity and any entity or
organization that receives state appropriations, including political
subdivisions (as defined in IC 5-14-3.9-2), nonprofit organizations,
and state educational institutions.
Sec. 2. (a) All active contracts that are funded in part or in full
by state appropriated funds, including state, federal, and dedicated
funds, shall within thirty (30) days of entering into the contract be
submitted to the state budget agency and the state comptroller for
inclusion on the state transparency portal under IC 5-14-3.5-2.
(b) The state budget agency shall on or before June 1, 2026, and
June 1 each year thereafter compile a report of all contracts
submitted under subsection (a) for the immediately preceding
calendar year and submit the report to the state budget committee.
Sec. 3. State funds may not be used to fund a state agency
contractual agreement unless IC 4-6-5-3 is followed first.
Chapter 8. Prohibition of Nonpublic Contracts
Sec. 1. This chapter does not apply to contracts solely entered
into for licensed legal counsel.
ES 5—LS 7508/DI 137 12
Sec. 2. As used in this chapter, "nonpublic contract" means a
contract that is entered into without solicitation of proposals or
competitive procurement. However, the term does not include a
contract entered into under the following:
(1) IC 5-22-10-4 (Emergency conditions).
(2) IC 4-13.6-5-5 (Emergency conditions).
Sec. 3. Notwithstanding any other provision of law to the
contrary, a state entity and any entity or organization that receives
state appropriations, including political subdivisions (as defined in
IC 5-14-3.9-2), nonprofit organizations, and state educational
institutions, shall not enter into a nonpublic contract.
Sec. 4. Notwithstanding any other provision of law to the
contrary, all contracts of a state entity and any entity or
organization that receives state appropriations, including political
subdivisions (as defined in IC 5-14-3.9-2), nonprofit organizations,
and state educational institutions, must be competitively procured.
Sec. 5. For all state entities with nonpublic contracts that have
not been competitively procured and that are in existence on June
30, 2025, the following apply:
(1) The nonpublic contract shall terminate December 31,
2025.
(2) On or before July 1, 2025, the state entity shall submit a
competitive procurement through a public process for any
new contract to replace a contract subject to termination
under subdivision (1).
Sec. 6. All contract opportunities of state entities must be posted
in the form of a Request for Qualifications "RFQ" on the state
entity's website for a minimum of twenty-four (24) hours or, when
feasible, at least thirty (30) days prior to the contract being
awarded.
SECTION 8. IC 12-8-6.5-16 IS ADDED TO THE INDIANA CODE
AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE
UPON PASSAGE]: Sec. 16. (a) The secretary and the office of
Medicaid policy and planning shall do each of the following as it
pertains to the state Medicaid program:
(1) Establish a reporting work group to review inputs and
overall financials validation.
(2) Establish a steering committee to develop accompanying
commentary. The reporting work group shall be accountable
to and provide all information reviewed to the steering
committee.
(3) Review monthly reports on the Medicaid program service
ES 5—LS 7508/DI 137 13
utilization to identify trends and risks within the state
Medicaid program.
(4) Complete and post publicly on the office of the secretary's
website:
(A) monthly financial reports or expenditures and
revenues for each state Medicaid program; and
(B) commentary providing context for each monthly
financial report.
(5) Submit a quarterly report to the budget committee
containing each report required under subdivision (4) and a
summary of the overall financial trends for the entire quarter.
(b) The steering committee shall be composed of members of the
office of the secretary, the state's contractor for actuarial forecasts,
and the budget agency.
(c) The budget committee shall receive a report containing
steering committee membership and meeting frequency prior to
July 1, 2025. Any changes to steering committee membership or
meeting frequency after the report is submitted under this
subsection shall be reported to the budget committee within thirty
(30) days.
SECTION 9. An emergency is declared for this act.".
Renumber all SECTIONS consecutively.
and when so amended that said bill do pass.
(Reference is to SB 5 as introduced.)
MISHLER, Chairperson
Committee Vote: Yeas 14, Nays 0.
_____
COMMITTEE REPORT
Mr. Speaker: Your Committee on Ways and Means, to which was
referred Senate Bill 5, has had the same under consideration and begs
leave to report the same back to the House with the recommendation
that said bill be amended as follows:
Page 1, delete lines 10 through 15, begin a new paragraph and
insert:
"Sec. 1. This chapter does not apply to a request for new federal
funds that is subject to a nondisclosure agreement to prevent the
disclosure of confidential or proprietary business information.
ES 5—LS 7508/DI 137 14
Sec. 2. As used in this chapter, "new federal funds" means
federal assistance or other funds that are available from:
(1) the federal government, which the state is not currently
receiving; or
(2) a federal assistance program or other federal program, in
which the state is not currently participating.
Sec. 3. (a) As used in this chapter, "state agency" means a
department or office of the executive, including the administrative,
department of state government.
(b) The term does not include:
(1) the legislative branch of state government;
(2) the judicial branch of state government; or
(3) a state educational institution.
Sec. 4. (a) If a state agency's request for new federal funds
would require the state agency to transfer funds between state
accounts for a state match as a condition to receive the new federal
funds, the state agency must obtain the budget committee's review
of the state agency's application for new federal funds.
(b) A state agency may not submit an application to which
subsection (a) applies before the budget committee has conducted
a review of the application.
Sec. 5. (a) A state agency shall provide a report to the budget
committee not later than January 1, April 1, July 1, and October
1 of each year that details the requests for new federal funds
submitted by the state agency since the date of the state agency's
last report under this subsection.
(b) A state agency shall submit a report under subsection (a) in
the form and manner designated by the budget committee.".
Delete page 2.
Page 3, delete lines 1 through 11, begin a new paragraph and insert:
"SECTION 3. IC 4-13-1-29 IS ADDED TO THE INDIANA CODE
AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY
1, 2025]: Sec. 29. (a) To the extent a contract entered into by a state
agency is required to be posted on the Indiana transparency
website, the state agency shall provide the contract to the
department for inclusion on the Indiana transparency website not
later than thirty (30) days after the contract is fully executed.
(b) All contracts provided to the department for inclusion on the
Indiana transparency website must be electronically downloadable.
The information contained in a search of the contracts on the
Indiana transparency website must be available to download in an
accessible spreadsheet format regardless of the maximum number
ES 5—LS 7508/DI 137 15
of rows.".
Page 6, delete lines 30 through 42.
Page 7, delete lines 1 through 33.
Page 8, between lines 8 and 9, begin a new line block indented and
insert:
"(3) A contract that is subject to a nondisclosure agreement to
prevent the disclosure of confidential or proprietary business
information.".
Page 8, delete lines 20 through 36, begin a new paragraph and
insert:
"Sec. 7. (a) As used in this article, "state agency" means a
department or office of the executive, including the administrative,
department of state government.
(b) The term does not include:
(1) the legislative branch of state government;
(2) the judicial branch of state government; or
(3) a state educational institution.".
Page 8, line 38, after "1." insert "(a)".
Page 8, between lines 40 and 41, begin a new paragraph and insert:
"(b) This chapter does not apply to a contract entered into by
the Indiana department of transportation for the construction,
repair, or maintenance of a highway, street, road, or bridge.".
Page 9, delete lines 23 through 42.
Page 10, delete lines 1 through 15.
Page 10, line 16, delete "4." and insert "3.".
Page 10, line 21, delete "sixty (60)" and insert "ninety (90)".
Page 10, line 27, delete "5." and insert "4.".
Page 10, line 28, after "1." insert "(a)".
Page 10, between lines 33 and 34, begin a new paragraph and insert:
"(b) This chapter does not apply to a contract entered into by
the Indiana department of transportation for the construction,
repair, or maintenance of a highway, street, road, or bridge.".
Page 10, line 36, delete "Clearly" and insert "To the extent
practicable, clearly".
Page 10, line 37, after "damages" insert "or other remedies".
Page 11, line 2, delete "6." and insert "5.".
Page 11, delete lines 6 through 9, begin a new paragraph and insert:
"Sec. 2. A state agency shall provide a report to the budget
committee not later than January 1, April 1, July 1, and October
1 of each year, in the form and manner designated by the budget
committee, that details the contract amendments entered into by
the state agency since the date of the last report under this section
ES 5—LS 7508/DI 137 16
to which at least one (1) of the following applies:".
Page 11, delete lines 17 through 22.
Page 11, line 23, delete "7." and insert "6.".
Page 11, delete lines 24 through 27, begin a new paragraph and
insert:
"Sec. 1. This chapter applies to contracts entered into between
a state agency and a contractor.".
Page 11, delete lines 37 through 38.
Page 11, line 39, delete "8." and insert "7.".
Page 11, line 41, delete "." and insert "or a purchase that is subject
to the small purchase policies established by a state agency under
IC 5-22-8.".
Page 12, delete lines 6 through 42, begin a new paragraph and
insert:
"Sec. 3. Notwithstanding any other provision of law to the
contrary, a state agency shall not enter into a nonpublic contract.
Sec. 4. All contract opportunities of state agencies must be
posted in the form of a request for proposals or request for
qualifications on the state agency's website for a minimum of
twenty-four (24) hours or, when feasible, at least thirty (30) days
prior to the contract being awarded.
SECTION 7. IC 12-8-6.5-16 IS ADDED TO THE INDIANA CODE
AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE
UPON PASSAGE]: Sec. 16. The secretary and the office of
Medicaid policy and planning shall do each of the following as it
pertains to the state Medicaid program:
(1) Review monthly reports on the Medicaid program service
utilization to identify trends and risks within the state
Medicaid program.
(2) Complete and post publicly on the office of the secretary's
website:
(A) monthly financial reports or expenditures and
revenues for each state Medicaid program; and
(B) commentary providing context for each monthly
financial report.
(3) Submit a quarterly report to the budget committee and the
Medicaid oversight committee established by IC 2-5-54-2
containing each report required under subdivision (2) and a
summary of the overall financial trends for the entire
quarter.".
Page 13, delete lines 1 through 19.
Renumber all SECTIONS consecutively.
ES 5—LS 7508/DI 137 17
and when so amended that said bill do pass.
(Reference is to SB 5 as printed January 24, 2025.)
THOMPSON
Committee Vote: yeas 22, nays 0.
_____
HOUSE MOTION
Mr. Speaker: I move that Engrossed Senate Bill 5 be amended to
read as follows:
Page 2, delete lines 4 through 6, begin a new paragraph and insert:
"Sec. 3. (a) As used in this chapter, "state agency" means:
(1) a department or office of the executive, including the
administrative, branch of state government; and
(2) separately elected state officers and any department or
office of separately elected state officers.".
Page 2, delete lines 11 through 18.
Page 2, line 19, delete "Sec. 5." and insert "Sec. 4.".
Page 2, between lines 25 and 26, begin a new paragraph and insert:
"Sec. 5. (a) If a state agency's request for new federal funds
would require the state agency to transfer funds between state
accounts for a state match to receive the new federal funds, the
budget committee must review the new federal funds that would be
received.
(b) A state agency may not accept an award of federal funds
before the budget committee has conducted its review under
subsection (a).".
Page 6, line 32, delete "subject to a nondisclosure agreement" and
insert "required to be kept confidential under state or federal law".
Page 6, between lines 34 and 35, begin a new line block indented
and insert:
"(4) A contract for legal services to aid in the performance of
the rights, powers, and duties conferred by IC 4-6.".
Page 7, delete lines 4 through 6, begin a new paragraph and insert:
"Sec. 7. (a) As used in this article, "state agency" means:
(1) a department or office of the executive, including the
administrative, branch of state government; and
(2) separately elected state officers and any department or
office of separately elected state officers.".
ES 5—LS 7508/DI 137 18
Page 8, between lines 20 and 21, begin a new paragraph and insert:
"(c) This chapter does not apply to a contract for legal services
to aid in the performance of the rights, powers, and duties
conferred by IC 4-6.".
Page 8, delete lines 27 through 28, begin a new line block indented
and insert:
"(3) A requirement for either of the following:
(A) An independent third party review verifying that the
parties to the contract performed their obligations under
the contract in compliance with the terms of the contract.
(B) Other appropriate methods or means for verification
and validation of the terms of the contract.".
Page 9, line 14, delete "state comptroller" and insert "department".
Page 9, between lines 19 and 20, begin a new paragraph and insert:
"Sec. 3. All contract opportunities of state agencies must be
posted in the form of a request for proposals or a request for
quotations on the department's website at least thirty (30) days
prior to the contract being awarded.".
Page 9, line 29, delete "IC 5-22-10-4 (Emergency conditions)." and
insert "IC 5-22-10.".
Page 9, line 31, delete "Notwithstanding any other provision of law
to the" and insert "Except as otherwise required by law,".
Page 9, line 32, delete "contrary,".
Page 9, delete lines 33 through 37.
Renumber all SECTIONS consecutively.
(Reference is to ESB 5 as printed March 27, 2025.)
LEHMAN
_____
HOUSE MOTION
Mr. Speaker: I move that Engrossed Senate Bill 5 be amended to
read as follows:
Page 9, line 9, after "1." insert "(a)".
Page 9, between lines 10 and 11, begin a new paragraph and insert:
"(b) This chapter does not apply to a contract solely entered into
for licensed legal counsel.".
Page 9, delete lines 21 through 24, begin a new paragraph and
insert:
"Sec. 1. This chapter does not apply to the following:
ES 5—LS 7508/DI 137 19
(1) A contract solely entered into for licensed legal counsel.
(2) A purchase subject to the small purchase policies
established by a state agency under IC 5-22-8.
(3) A contract for services provided by a bank holding
company or its subsidiaries or for investments, investment
services, or financial services entered into by the treasurer of
state under IC 4-8.1, IC 5-13, or IC 10-12.".
(Reference is to ESB 5 as printed March 27, 2025.)
LOPEZ
ES 5—LS 7508/DI 137