Changes to Existing Law

26.581.9 26.581.10 101st Legislative Session 93 2026 South Dakota Legislature Senate Bill 93 SENATE ENGROSSED Introduced by: Senator Reed Underscores indicate new language. Overstrikes indicate deleted language. An Act to prohibit certain state officers or employees from being employed by an 1 organization that was the recipient of a contract awarded on behalf of a state 2 agency for a period of time. 3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF SOUTH DAKOTA: 4 Section 1. That § 5-18A-17 be AMENDED: 5 5-18A-17. No state officer or employee who approves, awards, or administers a 6 contract on behalf of a state agency, may have an interest in a contract or derive a direct 7 benefit from a contract that is within the scope of the officer's or employee's official duties, 8 nor for a one-year period following the end of their employment or position as a state 9 officer may the officer or employee derive a direct benefit as a result of such contract 10 except as provided in § 5-18A-17.2. In addition, no such officer or employee may enter 11 into any contract, other than a contract of employment, with any state agency for a period 12 of one year following their leaving office or employment except as provided in § 5-18A-13 17.3.This prohibition includes any state officer or employee who, in his or her official 14 capacity, recommends the approval or award of the contract or who supervises a person 15 who approves, awards, or administers the contract. This prohibition does not include any 16 state officer who serves without compensation or who may be paid per diem pursuant to 17 § 4-7-10.4. If an officer or employee of this state has responsibility, on behalf of a state 18 agency, for approving, awarding, or administering a contract, that officer or employee 19 may not: 20 (1) Except as otherwise provided in 5-18A-17.2: 21 (a) Have an interest in a contract or derive a direct benefit from a contract that 22 is within the scope of the officer's or employee's official duties; or 23 (b) Derive a direct benefit from any contract that the officer or employee 24 approved, awarded, or administered on behalf of a state agency for at least 25 26.581.9 26.581.10 2 93 Underscores indicate new language. Overstrikes indicate deleted language. one year following the end of the individual's term of office or employment 1 with the state; 2 (2) Except as otherwise provided in § 5-18A-17.3, enter into any contract with a state 3 agency, other than an employment contract, for at least one year following the end 4 of the individual's term of office or employment with the state; or 5 (3) Be Except as otherwise provided in section 3 of this Act, be employed by any 6 organization that was the beneficiary of a contract approved, 6 awarded, or 7 administered by the officer or employee, for a period of: 7 8 (a) One year, if the value of the contract was not more than one five million dollars; 8 9 or 9 10 (b) Two years, if the value of the contract was more than one five million dollars. 10 11 Nothing in this section may be construed to apply to an officer or employee who 11 12 serves without compensation or who is only compensated per diem pursuant to § 4-7-12 4-7-13 10.4. 13 14 For purposes of this section, the responsibility for approving, awarding, or 14 15 administering a contract on behalf of a state agency includes supervising the approval, 15 16 award, or administration of a contract or recommending the approval or award of a 16 17 contract. 17 18 Section 2. That § 5-18A-17.2 be AMENDED: 18 19 5-18A-17.2. A governing body may authorize an officer or employee whose 19 20 responsibilities include approving, awarding, or administering a contract on behalf of a 20 21 state agency or; supervising any employee who has these responsibilities approves, 21 22 awards, or administers a contract on behalf of a state agency; or recommending to any 22 23 employee the approval or award of a contract on behalf of a state agency, to be a party 23 24 to or derive a direct benefit from a contract if: 24 25 (1) The officer or employee has provided full written disclosure to the governing body; 25 26 (2) The governing body has reviewed the: 26 27 (a) The essential terms of the transaction or contract and the state officer's or 27 28 employee's; and 28 29 (b) The role of the officer or employee in the contract or transaction; and 29 30 (3) The transaction and the terms of the contract are fair, reasonable, and not contrary 30 31 to the public interest. 31 32 The authorization shall be in writing. If a governing body authorizes an officer or 32 33 employee to be a party to or derive a direct benefit from a contract, the governing body 33 34 26.581.10 3 93 Underscores indicate new language. Overstrikes indicate deleted language. must provide the authorization in writing. Any authorization given pursuant to this section 34 26.581.9 3 93 Underscores indicate new language. Overstrikes indicate deleted language. 1 is a public record. Each authorization shall must be filed with the commissioner of human 1 2 resources and administration, who. The commissioner shall annually compile the 2 3 authorizations and present them annually for review by to the Government Operations 3 4 and Audit Committee for review. 4 5 Section 3. That a NEW SECTION be added to chapter 5-18A: 6 A governing body may authorize a former officer or employee whose 7 responsibilities included approving, awarding, or administering a contract on behalf of a 8 state agency; supervising any employee who approved, awarded, or administered a 9 contract on behalf of the state agency; or recommending to any employee the approval 10 or award of a contract on behalf of a state agency, to be employed by an organization that 11 was the beneficiary of a contract approved, awarded, or administered by the officer or 12 employee, before the time permitted in § 5-18A-17, if: 13 (1) The governing body has reviewed: 14 (a) The essential terms of the transaction or contract; and 15 (b) The role of the officer or employee in the contract or transaction; and 16 (2) The transaction and the terms of the contract are fair, reasonable, and not contrary 17 to the public interest. 18 The governing body must provide the authorization in writing. Any authorization 19 given pursuant to this section is a public record. Each authorization must be filed with the 20 commissioner of human resources and administration. The commissioner shall annually 21 compile the authorizations and present them to the Government Operations and Audit 22 Committee for review. 23

26.581.10 26.581.11 101st Legislative Session 93 2026 South Dakota Legislature Senate Bill 93 SENATE HOUSE STATE AFFAIRS ENGROSSED Introduced by: Senator Reed Underscores indicate new language. Overstrikes indicate deleted language. An Act to prohibit certain state officers or employees from being employed by an 1 organization that was the recipient of a contract awarded on behalf of a state 2 agency for a period of time. 3 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF SOUTH DAKOTA: 4 Section 1. That § 5-18A-17 be AMENDED: 5 5-18A-17. No state officer or employee who approves, awards, or administers a 6 contract on behalf of a state agency, may have an interest in a contract or derive a direct 7 benefit from a contract that is within the scope of the officer's or employee's official duties, 8 nor for a one-year period following the end of their employment or position as a state 9 officer may the officer or employee derive a direct benefit as a result of such contract 10 except as provided in § 5-18A-17.2. In addition, no such officer or employee may enter 11 into any contract, other than a contract of employment, with any state agency for a period 12 of one year following their leaving office or employment except as provided in § 5-18A-13 17.3.This prohibition includes any state officer or employee who, in his or her official 14 capacity, recommends the approval or award of the contract or who supervises a person 15 who approves, awards, or administers the contract. This prohibition does not include any 16 state officer who serves without compensation or who may be paid per diem pursuant to 17 § 4-7-10.4. If an officer or employee of this state has responsibility, on behalf of a state 18 agency, for approving, awarding, or administering a contract, that officer or employee 19 may not: 20 (1) Except as otherwise provided in § 5-18A-17.2: 21 (a) Have an interest in a contract or derive a direct benefit from a contract that 22 is within the scope of the officer's or employee's official duties; or 23 (b) Derive a direct benefit from any contract that the officer or employee 24 approved, awarded, or administered on behalf of a state agency for at least 25 26.581.10 26.581.11 2 93 Underscores indicate new language. Overstrikes indicate deleted language. one year following the end of the individual's term of office or employment 1 with the state; 2 (2) Except as otherwise provided in § 5-18A-17.3, enter into any contract with a state 3 agency, other than an employment contract, for at least one year following the end 4 of the individual's term of office or employment with the state; or 5 (3) Except as otherwise provided in section 3 of this Act, be Be employed by any 6 organization that was the beneficiary of a contract approved, 6 awarded, or 7 administered by the officer or employee, for a period of: 8 7 (a) One year, if the value of the contract was not more than five one million dollars; 8 or 9 or 10 (b) Two years, if the value of the contract was more than five one million dollars. 11 10 Nothing in this section may be construed to apply to an officer or employee who 12 11 serves without compensation or who is only compensated per diem pursuant to § 4-7-13 4-7-12 10.4. 14 13 For purposes of this section, the responsibility for approving, awarding, or 15 14 administering a contract on behalf of a state agency includes supervising the approval, 16 15 award, or administration of a contract or recommending the approval or award of a 16 contract. 17 contract. 18 Section 2. That § 5-18A-17.2 be AMENDED: 19 18 5-18A-17.2. A governing body may authorize an officer or employee whose 20 19 responsibilities include approving, awarding, or administering a contract on behalf of a 21 20 state agency or; supervising any employee who has these responsibilities approves, 22 21 awards, or administers a contract on behalf of a state agency; or recommending to any 23 22 employee the approval or award of a contract on behalf of a state agency, to be a party 24 23 to or derive a direct benefit from a contract if: 25 24 (1) The officer or employee has provided full written disclosure to the governing body; 26 25 (2) The governing body has reviewed the: 27 26 (a) The essential terms of the transaction or contract and the state officer's or 28 27 employee's; and 29 28 (b) The role of the officer or employee in the contract or transaction; and 30 29 (3) The transaction and the terms of the contract are fair, reasonable, and not contrary 31 30 to the public interest. 32 31 The authorization shall be in writing. If a governing body authorizes an officer or 33 32 employee to be a party to or derive a direct benefit from a contract, the governing body 34 26.581.10 3 93 Underscores indicate new language. Overstrikes indicate deleted language. 33 must provide the authorization in writing. Any authorization given pursuant to this section 1 34 26.581.11 3 93 Underscores indicate new language. Overstrikes indicate deleted language. is a public record. Each authorization shall must be filed with the commissioner of human 2 1 resources and administration, who. The commissioner shall annually compile the 3 2 authorizations and present them annually for review by to the Government Operations 4 3 and Audit Committee for review. 5 Section 3. That a NEW SECTION be added to chapter 5-18A: 6 A governing body may authorize a former officer or employee whose 7 responsibilities included approving, awarding, or administering a contract on behalf of a 8 state agency; supervising any employee who approved, awarded, or administered a 9 contract on behalf of the state agency; or recommending to any employee the approval 10 or award of a contract on behalf of a state agency, to be employed by an organization that 11 was the beneficiary of a contract approved, awarded, or administered by the officer or 12 employee, before the time permitted in § 5-18A-17, if: 13 (1) The governing body has reviewed: 14 (a) The essential terms of the transaction or contract; and 15 (b) The role of the officer or employee in the contract or transaction; and 16 (2) The transaction and the terms of the contract are fair, reasonable, and not contrary 17 to the public interest. 18 The governing body must provide the authorization in writing. Any authorization 19 given pursuant to this section is a public record. Each authorization must be filed with the 20 commissioner of human resources and administration. The commissioner shall annually 21 compile the authorizations and present them to the Government Operations and Audit 22 Committee for review. 23 4