Indiana Republicans' Liquor Stores Deal Raises Conflict Woes

INDIANAPOLIS (AP) — The involvement of two prominent Indiana Republicans in a deal to purchase a chain of liquor stores has raised concerns about a potential conflict of interest.

State GOP Chairman Kyle Hupfer and Indianapolis Business Journal co-owner Nate Feltman are minority partners with Indiana Liquor Group in a deal to purchase Save-on Liquor, The Indianapolis Star reported.

Hupfer and Feltman said they don't plan to push for legislation to favor the business.

But business leaders and political experts fear that the move has strengthened the liquor lobby and that Republican lawmakers will advance legislation favoring the industry to help their political allies.

"Even if Kyle (Hupfer) and company, never say a word, it will be known they have this business interest," said Andy Downs, director of the Mike Downs Center for Indiana Politics at Indiana University-Purdue University Fort Wayne. "There will be some legislators who don't want to upset the state chair and high-ranking members of the party."

There are no laws saying Hupfer can't have private investments. Hupfer noted that he's not an elected official and doesn't make any policies.

"I don't think there is any conflict of interest or the optics of a conflict of interest," Hupfer said.

Feltman, who was the commerce secretary under former Gov. Mitch Daniels, said he hasn't been directly involved with the Statehouse in over a decade.

"I'm not familiar and don't know all of the issues in the industry, and I'm not even the majority shareholder," Feltman said. "I am interested in a business opportunity."

Republican Rep. Ben Smaltz, who chairs the chamber's Public Policy committee, said he doesn't believe Republicans will be influenced.

"For me, it's about policy," Smaltz said. "Everything I do and everyone I associate with here wants to know the compelling state interest, and how do we help Hoosiers."

Hupfer and Feltman aren't alone in facing conflict of interest concerns. Republican Sen. Chip Perfect's efforts to eliminate the state's child labor laws raised concerns because he employs hundreds of minors at the Perfect North Slopes ski resort. He later backed off from the move and asked for a special committee to study the issue later this year.