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2020 Florida Statutes
Chapter 218
FINANCIAL MATTERS PERTAINING TO POLITICAL SUBDIVISIONS
FINANCIAL MATTERS PERTAINING TO POLITICAL SUBDIVISIONS
CHAPTER 218
FINANCIAL MATTERS PERTAINING TO POLITICAL SUBDIVISIONS
PART I
GENERAL FINANCIAL PROVISIONS RELATING TO POLITICALSUBDIVISIONS
(ss. 218.01-218.135)
PART II
REVENUE SHARING ACT OF 1972(ss. 218.20-218.26)
PART III
LOCAL FINANCIAL MANAGEMENT AND REPORTING(ss. 218.30-218.391)
PART IV
INVESTMENT OF LOCAL GOVERNMENT SURPLUS FUNDS(ss. 218.40-218.415)
PART V
LOCAL GOVERNMENTAL ENTITY AND DISTRICT SCHOOL BOARD FINANCIALEMERGENCIES
(ss. 218.50-218.504)
PART VI
PARTICIPATION IN HALF-CENT SALES TAX PROCEEDS(ss. 218.60-218.67)
PART VII
LOCAL GOVERNMENT PROMPT PAYMENT ACT(ss. 218.70-218.80)
PART I
GENERAL FINANCIAL PROVISIONSRELATING TO POLITICAL
SUBDIVISIONS
218.01 Authority to accept benefits of bankruptcy acts.
218.02 Disposition of unused funds relating to the refunding of bonds.
218.03 Creation of political subdivisions validated.
218.04 Proceedings relating to certain bonds sold, etc., to Federal Government validated.
218.05 Certain bonds sold to Federal Government, etc., validated.
218.06 Transfer of funds by county commissioners with relation to public works grants.
218.075 Reduction or waiver of permit processing fees.
218.076 Reduction or waiver of certain permit processing fees.
218.077 Wage and employment benefits requirements by political subdivisions; restrictions.
218.078 Minimum wage establishment by tribal governments.
218.12 Appropriations to offset reductions in ad valorem tax revenue in fiscally constrained counties.
218.125 Offset for tax loss associated with certain constitutional amendments affecting fiscally constrained counties.
218.131 Offset for tax loss associated with reductions in value of certain residences due to specified hurricanes.
218.135 Offset for tax loss associated with reductions in value of certain citrus fruit packing and processing equipment.
218.01 Authority to accept benefits of bankruptcy acts.—For the purpose of rendering effective the privilege and benefits of any amendments to the bankruptcy laws of the United States that may be enacted for the relief of municipalities, taxing districts and political subdivisions, the state represented by its legislative body gives its assent to, and accepts the provisions of any such bankruptcy laws that may be enacted by the Congress of the United States for the benefit and relief of municipalities, taxing districts and political subdivisions and its several municipalities, taxing districts and political subdivisions, at the discretion of the governing authorities thereof, may institute and conduct and carry out, by any appropriate bankruptcy procedure that may be enacted into the laws of the United States for the purpose of conferring upon municipalities, taxing districts and political subdivisions, relief by proceedings in bankruptcy in the federal courts.
History.—s. 1, ch. 15878, 1933; CGL 1936 Supp. 1365(2).
218.02 Disposition of unused funds relating to the refunding of bonds.—
(1) All funds heretofore or hereafter raised or created by any county or taxing district for the purpose of applying toward the payment of interest or principal of refunding bonds of such county or taxing district, when such refunding bonds are not issued and such funds not otherwise lawfully disposed of, shall revert back to the county or special taxing district to be used by the governing body or board of such county or taxing district for such general and lawful purposes of the county or taxing district raising such funds as in the judgment and discretion of such governing body or board shall seem to the best interest of the county or taxing district.
(2) For the purpose of carrying out the intent of this section, every officer or board, now or hereafter having the custody of any of the said funds shall transmit and return the same to the governing body or board of the county or taxing district, taking receipt therefor from such governing body or board.
History.—ss. 1, 2, ch. 15907, 1933; CGL 1936 Supp. 1365(4).
218.03 Creation of political subdivisions validated.—The creation, organization and existence of all cities, towns, counties, special tax school districts, special road and bridge districts, bridge districts and all other districts in this state which have heretofore issued or taken proceedings toward the issuance of any bonds for the purpose of financing or aiding in financing any work, undertaking or project financed or to be financed in whole or in part by a loan or grant heretofore made or agreed to be made to such public body by the United States acting through the Federal Emergency Administrator of Public Works are validated, ratified, approved and confirmed.
History.—s. 2, ch. 17750, 1937; CGL 1940 Supp. 1365(44).
218.04 Proceedings relating to certain bonds sold, etc., to Federal Government validated.—All proceedings heretofore taken in connection with the authorization or issuance of any issue of bonds, all or a part of which have heretofore been purchased by the United States through the Federal Emergency Administrator of Public Works, or an agreement for the purchase of all or a part of which has heretofore been entered into by the United States through the Federal Emergency Administrator of Public Works, issued or to be issued for the purpose of financing or aiding in the financing of any work, undertaking or project by any public body are validated, ratified, approved and confirmed notwithstanding any lack of power of such public body, or the governing board, council, commission or officers thereof, to authorize such bonds, or to execute the same, and notwithstanding any defects or irregularities in such proceedings or in such sale, execution or delivery, and all bonds heretofore or hereafter issued pursuant to such proceedings shall constitute binding, legal, valid, and enforceable obligations of such public body.
History.—s. 3, ch. 17750, 1937; CGL 1940 Supp. 1365(45).
218.05 Certain bonds sold to Federal Government, etc., validated.—
(1) All bonds heretofore issued for the purpose of financing or aiding in financing any work, undertaking or project by any public body to which any loan or grant has heretofore been made or agreed to be made by the United States through the Federal Emergency Administrator of Public Works for the purpose of financing or aiding in financing of such work, undertaking or project, including all proceedings for the authorization and issuance of such bonds and the sale, execution and delivery thereof, are validated, ratified, approved and confirmed, notwithstanding any lack of power of such public body or the governing board, council or commission or officers thereof, to authorize and issue such bonds, or to sell, execute or deliver the same, and notwithstanding any defects or irregularities in such proceedings, or in such sale, execution or delivery; and such bonds are and shall be binding, legal, valid and enforceable obligations of such public body.
(2) The term “bonds” includes bonds, notes, warrants, debentures, certificates of indebtedness, revenue certificates and all instruments or obligations evidencing or representing indebtedness, or evidencing or representing the borrowing of money or evidencing or representing a charge, lien, or encumbrance on specific revenues, income or property of a public body, including all instruments or obligations payable from a special fund.
History.—ss. 1, 4, ch. 17750, 1937; CGL 1940 Supp. 1365(43),(45).
218.06 Transfer of funds by county commissioners with relation to public works grants.—
(1) Boards of county commissioners of the several counties of the state, whenever it may be necessary to meet the requirements of the United States Government with reference to obtaining grants of federal funds in connection with the program of the Public Works Administration, may by resolution of such board, transfer and expend such sums of money as may be necessary to obtain said grant, from any fund to such other fund as may be necessary to meet said requirements and carry out the intent and purposes of the said transfer; provided, however, that no such transfer may be made by any county of the state without first having obtained the approval of the Department of Financial Services thereto, and in the counties of the state where there is provision for a budget commission, without first having also obtained the approval of said budget commission to said transfer.
(2) The Department of Financial Services and the budget commissions of the several counties of the state in which there are provisions for such budget commissions, may approve such transfers whenever in their opinion such transfers are necessary and proper.
History.—s. 1, ch. 18023, 1937; CGL 1940 Supp. 1373(73); ss. 12, 35, ch. 69-106; s. 252, ch. 2003-261.
218.075 Reduction or waiver of permit processing fees.—Notwithstanding any other provision of law, the Department of Environmental Protection and the water management districts shall reduce or waive permit processing fees for counties with a population of 50,000 or less on April 1, 1994, until such counties exceed a population of 75,000 and municipalities with a population of 25,000 or less, or for an entity created by special act, local ordinance, or interlocal agreement of such counties or municipalities, or for any county or municipality not included within a metropolitan statistical area. Fee reductions or waivers shall be approved on the basis of fiscal hardship or environmental need for a particular project or activity. The governing body must certify that the cost of the permit processing fee is a fiscal hardship due to one of the following factors:
(1) Per capita taxable value is less than the statewide average for the current fiscal year;
(2) Percentage of assessed property value that is exempt from ad valorem taxation is higher than the statewide average for the current fiscal year;
(3) Any condition specified in s. 218.503(1) which results in the county or municipality being in a state of financial emergency;
(4) Ad valorem operating millage rate for the current fiscal year is greater than 8 mills; or
(5) A financial condition that is documented in annual financial statements at the end of the current fiscal year and indicates an inability to pay the permit processing fee during that fiscal year.
The permit applicant must be the governing body of a county or municipality or a third party under contract with a county or municipality or an entity created by special act, local ordinance, or interlocal agreement and the project for which the fee reduction or waiver is sought must serve a public purpose. If a permit processing fee is reduced, the total fee shall not exceed $100.
History.—s. 1, ch. 94-278; s. 8, ch. 98-258; s. 25, ch. 2004-305; s. 4, ch. 2012-205.
218.076 Reduction or waiver of certain permit processing fees.—Notwithstanding any other provision of law, the Department of Environmental Protection shall waive processing fees for renewals of exemptions from the Class G-II ground water standards for sodium, odor, chloride, color, and total dissolved solids issued to any county, municipality, or independent special district, with reclaimed water land application facilities for wastewater effluent disposal when such exemptions were granted by the department by final agency action based upon findings that:
(1) The public will benefit from the land application due to the augmentation of the shallow water aquifer for irrigation use; and
(2) Compliance with the Class G-II ground water standard for sodium, chloride, color, and total dissolved solids is unnecessary for the protection of present and future potable water supplied; and
(3) The receiving water for the discharge is the local surficial aquifer used only for irrigation and allowed discharge will not impair such use; and
(4) The constituents for which the exemptions are granted are not expected to cause health-related problems at the projected discharge concentrations; and
(5) There is no reasonable relationship between economic, social, and environmental cost of compliance with the Class G-II ground water standards for sodium, chloride, odor, color, and total dissolved solids, and the economic, social, and environmental benefits of compliance; and
(6) The State of Florida provided the majority of the funds required to construct the wastewater treatment facility creating the discharge effluent; and
(7) The potential benefit of compliance is minor; and
(8) The applicant for the permit renewal has complied with all of the terms and conditions of the exemptions previously approved and which is (are) the subject of the renewal application.
History.—s. 9, ch. 98-258.
218.077 Wage and employment benefits requirements by political subdivisions; restrictions.—
(1) As used in this section, the term:
(a) “Employee” means any natural person who is entitled under state or federal law to receive a state or federal minimum wage.
(b) “Employer” means any person who is required under state or federal law to pay a state or federal minimum wage to the person’s employees.
(c) “Employer contracting to provide goods or services for the political subdivision” means a person contracting with the political subdivision to provide goods or services to, for the benefit of, or on behalf of, the political subdivision in exchange for valuable consideration, and includes a person leasing or subleasing real property owned by the political subdivision.
(d) “Employment benefits” means anything of value that an employee may receive from an employer in addition to wages and salary. The term includes, but is not limited to, health benefits; disability benefits; death benefits; group accidental death and dismemberment benefits; paid or unpaid days off for holidays, sick leave, vacation, and personal necessity; retirement benefits; and profit-sharing benefits.
(e) “Federal minimum wage” means a minimum wage required under federal law, including the federal Fair Labor Standards Act of 1938, as amended, 29 U.S.C. ss. 201 et seq.
(f) “Political subdivision” means a county, municipality, department, commission, district, board, or other public body, whether corporate or otherwise, created by or under state law.
(g) “Wage” means that compensation for employment to which any state or federal minimum wage applies.
(2) Except as otherwise provided in subsection (3), a political subdivision may not establish, mandate, or otherwise require an employer to pay a minimum wage, other than a state or federal minimum wage, to apply a state or federal minimum wage to wages exempt from a state or federal minimum wage, or to provide employment benefits not otherwise required by state or federal law.
(3) This section does not:
(a) Limit the authority of a political subdivision to establish a minimum wage other than a state or federal minimum wage or to provide employment benefits not otherwise required under state or federal law:
1. For the employees of the political subdivision;
2. For the employees of an employer contracting to provide goods or services for the political subdivision, or for the employees of a subcontractor of such an employer, under the terms of a contract with the political subdivision; or
3. For the employees of an employer receiving a direct tax abatement or subsidy from the political subdivision, as a condition of the direct tax abatement or subsidy.
(b) Apply to a domestic violence or sexual abuse ordinance, order, rule, or policy adopted by a political subdivision.
(4) If it is determined by the officer or agency responsible for distributing federal funds to a political subdivision that compliance with this act would prevent receipt of those federal funds, or would otherwise be inconsistent with federal requirements pertaining to such funds, then this act does not apply, but only to the extent necessary to allow receipt of the federal funds or to eliminate the inconsistency with such federal requirements.
(5) This section does not prohibit a federally authorized and recognized tribal government from requiring employment benefits for a person employed within a territory over which the tribe has jurisdiction.
History.—s. 1, ch. 2003-87; s. 1, ch. 2013-200; s. 5, ch. 2015-3; s. 4, ch. 2015-98.
218.078 Minimum wage establishment by tribal governments.—This act shall not prohibit a federally authorized and recognized tribal government from establishing a minimum wage in excess of the federal minimum wage for natural persons employed within any territory over which the tribe has jurisdiction.
History.—s. 2, ch. 2003-87.
218.12 Appropriations to offset reductions in ad valorem tax revenue in fiscally constrained counties.—
(1) Beginning in fiscal year 2008-2009, the Legislature shall appropriate moneys to offset the reductions in ad valorem tax revenue experienced by fiscally constrained counties, as defined in s. 218.67(1), which occur as a direct result of the implementation of revisions of Art. VII of the State Constitution approved in the special election held on January 29, 2008. The moneys appropriated for this purpose shall be distributed in January of each fiscal year among the fiscally constrained counties based on each county’s proportion of the total reduction in ad valorem tax revenue resulting from the implementation of the revision.
(2) On or before November 15 of each year, each fiscally constrained county shall apply to the Department of Revenue to participate in the distribution of the appropriation and provide documentation supporting the county’s estimated reduction in ad valorem tax revenue in the form and manner prescribed by the Department of Revenue. The documentation must include an estimate of the reduction in taxable value directly attributable to revisions of Art. VII of the State Constitution for all county taxing jurisdictions within the county and shall be prepared by the property appraiser in each fiscally constrained county. The documentation must also include the county millage rates applicable in all such jurisdictions for both the current year and the prior year; rolled-back rates, determined as provided in s. 200.065, for each county taxing jurisdiction; and maximum millage rates that could have been levied by majority vote pursuant to s. 200.065(5). For purposes of this section, each fiscally constrained county’s reduction in ad valorem tax revenue shall be calculated as 95 percent of the estimated reduction in taxable value times the lesser of the 2007 applicable millage rate or the applicable millage rate for each county taxing jurisdiction in the current year. If a fiscally constrained county fails to apply for the distribution, its share shall revert to the fund from which the appropriation was made.
(3) In determining the reductions in ad valorem tax revenues occurring as a result of the implementation of the revisions to Art. VII of the State Constitution approved in the special election held on January 29, 2008, the value of assessments reduced pursuant to s. 4(d)(8)a., Art. VII of the State Constitution shall include only the reduction in taxable value for homesteads established January 1 of the year in which the determination is being made.
History.—s. 16, ch. 2008-173; ss. 24, 25, ch. 2009-82; ss. 18, 19, 73, ch. 2010-153; s. 9, ch. 2010-166; s. 8, ch. 2011-125; s. 30, ch. 2012-193.
218.125 Offset for tax loss associated with certain constitutional amendments affecting fiscally constrained counties.—
(1) Beginning in the 2010-2011 fiscal year, the Legislature shall appropriate moneys to offset the reductions in ad valorem tax revenue experienced by fiscally constrained counties, as defined in s. 218.67(1), which occur as a direct result of the implementation of revisions of ss. 3(f) and 4(b) of Art. VII of the State Constitution which were approved in the general election held in November 2008. The moneys appropriated for this purpose shall be distributed in January of each fiscal year among the fiscally constrained counties based on each county’s proportion of the total reduction in ad valorem tax revenue resulting from the implementation of the revisions.
(2) On or before November 15 of each year, each fiscally constrained county shall apply to the Department of Revenue to participate in the distribution of the appropriation and provide documentation supporting the county’s estimated reduction in ad valorem tax revenue in the form and manner prescribed by the Department of Revenue. The documentation must include an estimate of the reduction in taxable value directly attributable to revisions of Art. VII of the State Constitution for all county taxing jurisdictions within the county and shall be prepared by the property appraiser in each fiscally constrained county. The documentation must also include the county millage rates applicable in all such jurisdictions for the current year and the prior year, rolled-back rates determined as provided in s. 200.065 for each county taxing jurisdiction, and maximum millage rates that could have been levied by majority vote pursuant to s. 200.065(5). For purposes of this section, each fiscally constrained county’s reduction in ad valorem tax revenue shall be calculated as 95 percent of the estimated reduction in taxable value multiplied by the lesser of the 2010 applicable millage rate or the applicable millage rate for each county taxing jurisdiction in the current year. If a fiscally constrained county fails to apply for the distribution, its share shall revert to the fund from which the appropriation was made.
History.—s. 7, ch. 2009-157; s. 31, ch. 2012-193; s. 3, ch. 2017-35.
218.131 Offset for tax loss associated with reductions in value of certain residences due to specified hurricanes.—
(1) In the 2019-2020 fiscal year, the Legislature shall appropriate moneys to offset the reductions in ad valorem tax revenue experienced by Monroe County and by fiscally constrained counties, as defined in s. 218.67(1), and all taxing jurisdictions within such counties, which occur as a direct result of the implementation of s. 197.318. The moneys appropriated for this purpose shall be distributed in June 2020 among the affected taxing jurisdictions based on each jurisdiction’s reduction in ad valorem tax revenue resulting from the implementation of s. 197.318.
(2) On or before November 15, 2019, each affected taxing jurisdiction shall apply to the Department of Revenue to participate in the distribution of the appropriation and provide documentation supporting the taxing jurisdiction’s reduction in ad valorem tax revenue in the form and manner prescribed by the department. The documentation must include a copy of the notice required by s. 197.318(4)(b) from the tax collector who reports to the affected taxing jurisdiction the reduction in ad valorem taxes it will incur as a result of implementation of s. 197.318. If Monroe County, a fiscally constrained county, or an eligible taxing jurisdiction within such county fails to apply for the distribution, its share shall revert to the fund from which the appropriation was made.
History.—s. 41, ch. 2018-118; s. 7, ch. 2019-42.
218.135 Offset for tax loss associated with reductions in value of certain citrus fruit packing and processing equipment.—
(1) For the 2018-2019 fiscal year, the Legislature shall appropriate moneys to offset the reductions in ad valorem tax revenue experienced by fiscally constrained counties, as defined in s. 218.67(1), which occur as a direct result of the implementation of s. 193.4516. The moneys appropriated for this purpose shall be distributed in January 2019 among the fiscally constrained counties based on each county’s proportion of the total reduction in ad valorem tax revenue resulting from the implementation of s. 193.4516.
(2) On or before November 15, 2018, each fiscally constrained county shall apply to the Department of Revenue to participate in the distribution of the appropriation and provide documentation supporting the county’s estimated reduction in ad valorem tax revenue in the form and manner prescribed by the department. The documentation must include an estimate of the reduction in taxable value directly attributable to the implementation of s. 193.4516 for all county taxing jurisdictions within the county and shall be prepared by the property appraiser in each fiscally constrained county. The documentation shall also include the county millage rates applicable in all such jurisdictions for the current year. For purposes of this section, each fiscally constrained county’s reduction in ad valorem tax revenue shall be calculated as 95 percent of the estimated reduction in taxable value multiplied by the applicable millage rate for each county taxing jurisdiction in the current year. If a fiscally constrained county fails to apply for the distribution, its share shall revert to the fund from which the appropriation was made.
History.—s. 42, ch. 2018-118; s. 37, ch. 2019-3.
PART II
REVENUE SHARING ACT OF 1972218.20 Short title.
218.21 Definitions.
218.215 Revenue sharing trust funds; creation and distribution.
218.23 Revenue sharing with units of local government.
218.245 Revenue sharing; apportionment.
218.25 Limitation of shared funds; holders of bonds protected; limitation on use of second guaranteed entitlement for counties.
218.26 Administration; distribution schedule.
218.20 Short title.—This part shall be known, and may be cited, as the “Florida Revenue Sharing Act of 1972.”
History.—s. 1, ch. 72-360; s. 1, ch. 73-349; s. 1, ch. 74-194.
218.21 Definitions.—As used in this part, the following words and terms shall have the meanings ascribed them in this section, except where the context clearly indicates a different meaning:
(1) “Unit of local government” means a county or municipal government and shall not include any special district as defined in part III.
(2) “County” means a political subdivision of the state as established pursuant to s. 1, Art. VIII of the State Constitution.
(3) “Municipality” means a municipality created pursuant to general or special law and metropolitan and consolidated governments as provided in s. 6(e) and (f), Art. VIII of the State Constitution. Such municipality must have held an election for its legislative body pursuant to law and established such a legislative body which meets pursuant to law.
(4) “Department” means the Department of Revenue.
(5) “Entitlement” means the amount of revenue which would be shared with an eligible unit of local government if the distribution from trust funds were based solely on the formula computation.
(6) “Guaranteed entitlement” means the amount of revenue which must be shared with an eligible unit of local government so that:
(a) No eligible county shall receive less funds from the Revenue Sharing Trust Fund for Counties in any fiscal year than the amount received in the aggregate from the state in fiscal year 1971-1972 under the provisions of the then-existing s. 210.20(2)(c), tax on cigarettes; the then-existing s. 323.16(4), road tax; and the then-existing s. 199.292(4), tax on intangible personal property.
(b) No eligible municipality shall receive less funds from the Revenue Sharing Trust Fund for Municipalities in any fiscal year than the aggregate amount it received from the state in fiscal year 1971-1972 under the provisions of the then-existing s. 210.20(2)(a), tax on cigarettes; the then-existing s. 323.16(3), road tax; and s. 206.605, tax on motor fuel. Any government exercising municipal powers under s. 6(f), Art. VIII of the State Constitution may not receive less than the aggregate amount it received from the Revenue Sharing Trust Fund for Municipalities in the preceding fiscal year.
(7) “Minimum entitlement” means the amount of revenue, as certified by a unit of local government and determined by the department, which must be shared with a unit of local government so that such unit will receive the amount of revenue necessary to meet its obligations as a result of pledges or assignments or trusts entered into which obligated funds received from revenue sources or proceeds which by terms of this act shall henceforth be distributed out of revenue sharing trust funds.
(8) “Population” means the latest official state estimate of population certified pursuant to s. 186.901 or, if there is no independent annual certification of population for any urban service district necessary to the requirements of this part, the population of such district shall be determined by applying the latest available percentage distribution to the population of the area affected.
(9) “All receipts available” means the amount estimated to be available for distribution during the fiscal year as determined, and as amended from time to time, by the department.
(10) “Second guaranteed entitlement for counties” means the amount of revenue received in the aggregate by an eligible county in fiscal year 1981-1982 under the provisions of the then-existing s. 210.20(2)(a), tax on cigarettes, and the then-existing s. 199.292(4), tax on intangible personal property, less the guaranteed entitlement. For any fiscal year, each eligible county shall be entitled to receive the second guaranteed entitlement for counties from the Revenue Sharing Trust Fund for Counties. The second guaranteed entitlement for counties shall be deemed separate and apart from the guaranteed entitlement and shall not be deemed to be a part of the guaranteed entitlement for purposes of any indenture, contract, or pledge to holders of obligations issued by any county.
History.—s. 1, ch. 72-360; s. 1, ch. 73-349; s. 1, ch. 74-194; s. 1, ch. 77-174; s. 59, ch. 87-224; s. 7, ch. 87-237; s. 26, ch. 93-233; s. 92, ch. 99-2; s. 7, ch. 2001-61; ss. 93, 94, 95, ch. 2003-402.
218.215 Revenue sharing trust funds; creation and distribution.—
(1) The Revenue Sharing Trust Fund for Counties is hereby created. All revenue designated for deposit in such fund shall be deposited by the appropriate agency. The distribution to the several counties shall be made monthly as provided in ss. 218.23 and 218.26.
(2) The Revenue Sharing Trust Fund for Municipalities is hereby created. All revenue designated for deposit in such fund shall be deposited by the appropriate agency. The distribution to the several municipalities shall be made monthly as provided in ss. 218.23 and 218.26.
History.—s. 1, ch. 72-360; s. 1, ch. 73-349; s. 1, ch. 74-194.
Note.—Former s. 218.24.
218.23 Revenue sharing with units of local government.—
(1) To be eligible to participate in revenue sharing beyond the minimum entitlement in any fiscal year, a unit of local government is required to have:
(a) Reported its finances for its most recently completed fiscal year to the Department of Financial Services, pursuant to s. 218.32.
(b) Made provisions for annual postaudits of its financial accounts in accordance with provisions of law.
(c) Levied, as shown on its most recent financial report pursuant to s. 218.32, ad valorem taxes, exclusive of taxes levied for debt service or other special millages authorized by the voters, to produce the revenue equivalent to a millage rate of 3 mills on the dollar based on the 1973 taxable values as certified by the property appraiser pursuant to s. 193.122(2) or, in order to produce revenue equivalent to that which would otherwise be produced by such 3-mill ad valorem tax, to have received a remittance from the county pursuant to s. 125.01(6)(a), collected an occupational license tax or a utility tax, levied an ad valorem tax, or received revenue from any combination of these four sources. If a new municipality is incorporated, the provisions of this paragraph shall apply to the taxable values for the year of incorporation as certified by the property appraiser. This paragraph requires only a minimum amount of revenue to be raised from the ad valorem tax, the occupational license tax, and the utility tax. It does not require a minimum millage rate.
(d) Certified that persons in its employ as law enforcement officers, as defined in s. 943.10(1), meet the qualifications for employment as established by the Criminal Justice Standards and Training Commission; that its salary structure and salary plans meet the provisions of chapter 943; and that no law enforcement officer is compensated for his or her services at an annual salary rate of less than $6,000. However, the department may waive the minimum law enforcement officer salary requirement if a city or county certifies that it is levying ad valorem taxes at 10 mills.
(e) Certified that persons in its employ as firefighters, as defined in s. 633.102, meet the qualification for employment as established by the Division of State Fire Marshal pursuant to ss. 633.408 and 633.412 and that s. 633.422 has been met.
(f) Certified that each dependent special district that is budgeted separately from the general budget of the local governing authority has met the provisions for annual postaudit of its financial accounts in accordance with the provisions of law.
Additionally, to receive its share of revenue sharing funds, a unit of local government shall certify to the Department of Revenue that the requirements of s. 200.065, if applicable, were met. The certification shall be made annually within 30 days of adoption of an ordinance or resolution establishing a final property tax levy or, if no property tax is levied, not later than November 1. The portion of revenue sharing funds which, pursuant to this part, would otherwise be distributed to a unit of local government which has not certified compliance or has otherwise failed to meet the requirements of s. 200.065 shall be deposited in the General Revenue Fund for the 12 months following a determination of noncompliance by the department.
(2) Any unit of local government which is consolidated as provided by s. 9, Art. VIII of the State Constitution of 1885, as preserved by s. 6(e), Art. VIII, 1968 revised constitution, shall receive an annual distribution from the Revenue Sharing Trust Fund for Counties equal to $6.24 times its population.
(3) The distribution to a unit of local government under this part is determined by the following formula:
(a) First, the entitlement of an eligible unit of local government shall be computed on the basis of the apportionment factor provided in s. 218.245, which shall be applied for all eligible units of local government to all receipts available for distribution in the respective revenue sharing trust fund.
(b) Second, revenue shared with eligible units of local government for any fiscal year shall be adjusted so that no eligible unit of local government receives less funds than its guaranteed entitlement.
(c) Third, revenues shared with counties for any fiscal year shall be adjusted so that no county receives less funds than its guaranteed entitlement plus the second guaranteed entitlement for counties.
(d) Fourth, revenue shared with units of local government for any fiscal year shall be adjusted so that no unit of local government receives less funds than its minimum entitlement.
(e) Fifth, after the adjustments provided in paragraphs (b), (c), and (d), and after deducting the amount committed to all the units of local government, the funds remaining in the respective trust funds shall be distributed to those eligible units of local government which qualify to receive additional moneys beyond the guaranteed entitlement, on the basis of the additional money of each qualified unit of local government in proportion to the total additional money of all qualified units of local government.
(4) Notwithstanding the provisions of paragraph (1)(c), no unit of local government which was eligible to participate in revenue sharing in the 3 years prior to initially participating in the local government half-cent sales tax shall be ineligible to participate in revenue sharing solely due to a millage or utility tax reduction afforded by the local government half-cent sales tax.
History.—s. 1, ch. 72-360; s. 1, ch. 73-349; s. 1, ch. 74-194; s. 1, ch. 74-628; s. 1, ch. 77-102; s. 65, ch. 77-104; s. 2, ch. 80-53; s. 17, ch. 80-71; s. 39, ch. 80-274; s. 124, ch. 81-259; s. 22, ch. 82-154; s. 6, ch. 83-115; s. 7, ch. 83-167; s. 8, ch. 87-237; s. 7, ch. 87-239; s. 52, ch. 89-169; s. 1175, ch. 95-147; s. 10, ch. 2000-173; s. 253, ch. 2003-261; s. 128, ch. 2013-183.
Note.—Former s. 218.22.
218.245 Revenue sharing; apportionment.—
(1) The apportionment factor for all eligible counties shall be composed of three equally weighted portions as follows:
(a) Each eligible county’s percentage of the total population of all eligible counties in the state.
(b) Each eligible county’s percentage of the total population of the state residing in unincorporated areas of all eligible counties.
(c) Each eligible county’s percentage of total sales tax collections in all eligible counties during the preceding year.
(2) The apportionment factor for all eligible municipalities shall be composed of three equally weighted portions as follows:
(a) The proportion of the population of a given municipality to the total population of all the eligible municipalities in the state, as adjusted by the following factors:
1. For a municipality with a population in excess of 50,000, the population shall be adjusted by multiplying its population by a factor of 1.791.
2. For a municipality with a population in excess of 20,000, but less than 50,001, the population shall be adjusted by multiplying its population by a factor of 1.709.
3. For a municipality with a population in excess of 5,000, but less than 20,001, the population shall be adjusted by multiplying its population by a factor of 1.425.
4. For a municipality with a population in excess of 2,000, but less than 5,001, the population shall be adjusted by multiplying its population by a factor of 1.135.
(b) The proportion of the sales tax collected within a given municipality to the total sales tax collected within all the eligible municipalities in the state. The sales tax collected within a given municipality shall be derived by allocating the amount of sales tax collections for the county in which the municipality is located to each municipality in the county on the basis of the proportion of each municipality’s population to the total population of the county.
(c) The ratio of the relative local ability to raise revenue, to be determined:
1. By dividing the per capita nonexempt assessed real and personal property valuation of all eligible municipalities by the per capita nonexempt real and personal property valuation of each eligible municipality.
2. By multiplying the population of an eligible municipality by the percentage applicable to that municipality as established under subparagraph 1.
3. By dividing the population, as recalculated to reflect the relative local ability, by the total recalculated population of all eligible municipalities in the state.
(d) For a metropolitan or consolidated government, as provided by s. 3, s. 6(e), or s. 6(f), Art. VIII of the State Constitution, the population or sales tax collections of the unincorporated area or areas outside of urban service districts, if such have been established, as determined in paragraphs (a)-(c) above and after adjustments made as provided therein, shall be further adjusted by multiplying the adjusted or recalculated population or sales tax collections, as the case may be, by a percentage which is derived by dividing:
1. The total amount of ad valorem taxes levied by the county government on real and personal property in the area of the county outside of municipal limits, as created pursuant to general or special law, or outside of urban service district limits, where such are established; by
2. The total amount of ad valorem taxes levied on real and personal property by the county and municipal governments.
(3) Revenues attributed to the increase in distribution to the Revenue Sharing Trust Fund for Municipalities pursuant to s. 212.20(6)(d)5. from 1.0715 percent to 1.3409 percent provided in chapter 2003-402, Laws of Florida, shall be distributed to each eligible municipality and any unit of local government that is consolidated as provided by s. 9, Art. VIII of the State Constitution of 1885, as preserved by s. 6(e), Art. VIII, 1968 revised constitution, as follows: each eligible local government’s allocation shall be based on the amount it received from the half-cent sales tax under s. 218.61 in the prior state fiscal year divided by the total receipts under s. 218.61 in the prior state fiscal year for all eligible local governments. However, for the purpose of calculating this distribution, the amount received from the half-cent sales tax under s. 218.61 in the prior state fiscal year by a unit of local government which is consolidated as provided by s. 9, Art. VIII of the State Constitution of 1885, as amended, and as preserved by s. 6(e), Art. VIII, of the Constitution as revised in 1968, shall be reduced by 50 percent for such local government and for the total receipts. For eligible municipalities that began participating in the allocation of half-cent sales tax under s. 218.61 in the previous state fiscal year, their annual receipts shall be calculated by dividing their actual receipts by the number of months they participated, and the result multiplied by 12.
History.—s. 1, ch. 72-360; s. 1, ch. 73-349; s. 1, ch. 74-194; s. 57, ch. 2004-265; s. 44, ch. 2005-236; s. 7, ch. 2009-68.
Note.—Former ss. 218.22 and 218.23.
218.25 Limitation of shared funds; holders of bonds protected; limitation on use of second guaranteed entitlement for counties.—
(1) Except as provided in subsection (2) with respect to the second guaranteed entitlement for counties, local governments shall not use any portion of the moneys received in excess of the guaranteed entitlement from the revenue sharing trust funds created by this part to assign, pledge, or set aside as a trust for the payment of principal or interest on bonds, tax anticipation certificates, or any other form of indebtedness, and there shall be no other use restriction on revenues shared pursuant to this part. The state does hereby covenant with holders of bonds or other instruments of indebtedness issued by local governments prior to July 1, 1972, that it is not the intent of this part to affect adversely the rights of said holders or to relieve local governments of the duty to meet their obligations as a result of previous pledges or assignments or trusts entered into which obligated funds received from revenue sources which by terms of this part shall henceforth be distributed out of the revenue sharing trust funds.
(2) The second guaranteed entitlement for counties may be assigned, pledged, or set aside as a trust for the payment of principal or interest on bonds, tax anticipation certificates, or any other form of indebtedness, including obligations issued to acquire an insurance contract or contracts from a local government liability pool and including payments required pursuant to any loan agreement entered into to provide funds to acquire an insurance contract or contracts from a local government liability pool.
(3) As an additional assurance to holders of bonds issued before April 18, 2000, which are secured by the guaranteed entitlement or second guaranteed entitlement for counties, or bonds issued to refund such bonds which mature no later than the bonds that they refunded and which result in a reduction of debt service payable in each fiscal year, it is the intent of the Legislature that, to the extent the elimination of tax sources dedicated to funding the guaranteed entitlement or the second guaranteed entitlement for counties or a reduction in the rate of assessment of such taxes results in an inability of a county to pay debt service on such bonds, the Legislature will provide alternative funding sources in an amount sufficient to pay any deficit in the amount required for such debt service. This commitment of the Legislature is contingent on the county first using any funds available under this part for the payment of such debt service.
(4) Notwithstanding subsections (1) and (2), a local government may assign, pledge, or set aside as a trust for the payment of principal or interest on bonds, tax anticipation certificates, or any other form of indebtedness an amount up to 50 percent of the funds received in the prior year.
History.—s. 1, ch. 72-360; s. 1, ch. 73-349; s. 1, ch. 74-194; s. 9, ch. 87-237; s. 11, ch. 2000-173; s. 96, ch. 2003-402.
218.26 Administration; distribution schedule.—
(1) The department is empowered to promulgate rules and regulations and to issue special instructions to local governments as required to carry out the provisions of this part.
(2) The department shall, for all taxes collected and received into the revenue sharing trust funds, establish a schedule of equal monthly distribution for any computation period. The department is authorized to receive funds pursuant to s. 215.18 at any time in order to make such monthly payments by the 25th day of the month.
(3)(a) The department shall compute the apportionment factors once each fiscal year for use during the fiscal year. The computation shall be made prior to July 25 of each fiscal year and shall be based upon information submitted and certified to the department prior to June 1 of each year.
(b) The apportionment factors shall, except in the case of error, remain in effect for the fiscal year.
(4) It shall be the duty of each agency and unit of local government required to submit certified information to the department pursuant to the administration of this part to file timely information. Any unit of local government failing to provide timely information required pursuant to the administration of this part shall, by such action, authorize the department to utilize the best information available or, if no such information is available, to take any necessary action, including disqualification, either partial or entire, and shall further, by such action, waive any right to challenge the determination of the department as to its share, if any, pursuant to the privilege of receiving shared revenues under this part.
History.—s. 1, ch. 72-360; s. 1, ch. 73-349; s. 1, ch. 74-194.
PART III
LOCAL FINANCIAL MANAGEMENTAND REPORTING
218.30 Short title.
218.31 Definitions.
218.32 Annual financial reports; local governmental entities.
218.322 County and municipal transportation program data.
218.33 Local governmental entities; establishment of uniform fiscal years and accounting practices and procedures.
218.335 Local governmental entity; authority to charge interest on overdue payments.
218.35 County fee officers; financial matters.
218.36 County officers; record and report of fees and disposition of same.
218.369 Definitions applicable to ss. 218.37-218.386.
218.37 Powers and duties of Division of Bond Finance; advisory council.
218.38 Notice of bond issues required; verification.
218.385 Local government bonds; sale.
218.386 Bonds; finder’s fees prohibited.
218.39 Annual financial audit reports.
218.391 Auditor selection procedures.
218.30 Short title.—This part shall be known and may be cited as the “Uniform Local Government Financial Management and Reporting Act.”
History.—s. 2, ch. 73-349.
218.31 Definitions.—As used in this part, except where the context clearly indicates a different meaning:
(1) “Local governmental entity” means a county agency, a municipality, or a special district as defined in s. 189.012. For purposes of s. 218.32, the term also includes a housing authority created under chapter 421.
(2) “Unit of local general-purpose government” means a county or a municipality established by general or special law.
(3) “Local governing authority” means the governing body of a unit of local general-purpose government.
(4) “Department” means the Department of Financial Services.
(5) “Special district” means a special district as defined in s. 189.012.
(6) “Dependent special district” means a dependent special district as defined in s. 189.012.
(7) “Independent special district” means an independent special district as defined in s. 189.012.
(8) “County fee officers” means those county officials who are assigned specialized functions within county government and whose budgets are established independently of the local governing body, even though said budgets may be reported to the local governing body or may be composed of funds either generally or specially available to a local governing authority involved.
(9) “Verified report” means a report that has received such test or tests by the department so as to accurately and reliably present the data that have been submitted by the local governmental entities for inclusion in the report.
(10) “Short-term debt” means any debt with a maturity of less than 1 year from the date of issuance.
(11) “Revenue bonds” means any obligations issued by a unit to pay the cost of a project or improvement thereof, or combination of one or more projects or improvements thereof, and payable from the earnings of such project and any other special funds authorized to be pledged as additional security therefor.
(12) “Limited revenue bonds” means any obligations issued by a unit to pay the cost of a project or improvement thereof, or combination of one or more projects or improvements thereof, and payable from funds, exclusive of ad valorem taxes, special assessments, or earnings from such projects or improvements.
(13) “Industrial development bond” means any obligation the interest on which is exempt from income taxes under the provisions of s. 103(b) of the United States Internal Revenue Code and the payment of the principal or interest on which under the terms of such obligation or any underlying arrangement is, in whole or in major part:
(a) Secured by any interest in property used or to be used in a trade or business or in payments in respect of such property.
(b) To be derived from payments in respect of property, or borrowed money, used or to be used in a trade or business.
(14) “Generally accepted accounting principles” means those accounting principles adopted by rule of the Board of Accountancy under chapter 473.
(15) “Auditor” means an independent certified public accountant licensed pursuant to chapter 473 and retained by a local governmental entity to perform a financial audit.
(16) “County agency” means a board of county commissioners or other legislative and governing body of a county, however styled, including that of a consolidated or metropolitan government, a clerk of the circuit court, a separate or ex officio clerk of the county court, a sheriff, a property appraiser, a tax collector, a supervisor of elections, or any other officer in whom any portion of the fiscal duties of the above are under law separately placed.
(17) “Financial audit” means an examination of financial statements in order to express an opinion on the fairness with which they are presented in conformity with generally accepted accounting principles and an examination to determine whether operations are properly conducted in accordance with legal and regulatory requirements. Financial audits must be conducted in accordance with auditing standards generally accepted in the United States and government auditing standards. When applicable, the scope of financial audits must encompass the additional activities necessary to establish compliance with the Single Audit Act Amendments of 1996, 31 U.S.C. ss. 7501-7507, and other applicable federal law.
(18) “Management letter” means a statement of the auditor’s comments and recommendations as prescribed by rules adopted by the Auditor General.
History.—s. 2, ch. 73-349; s. 4, ch. 79-183; s. 1, ch. 81-96; s. 83, ch. 83-217; s. 58, ch. 89-169; s. 2, ch. 92-300; s. 17, ch. 96-324; s. 61, ch. 2001-266; s. 254, ch. 2003-261; s. 5, ch. 2011-52; s. 78, ch. 2014-22; s. 12, ch. 2019-15.
218.32 Annual financial reports; local governmental entities.—
(1)(a) Each local governmental entity that is determined to be a reporting entity, as defined by generally accepted accounting principles, and each independent special district as defined in s. 189.012, shall submit to the department a copy of its annual financial report for the previous fiscal year in a format prescribed by the department. The annual financial report must include a list of each local governmental entity included in the report and each local governmental entity that failed to provide financial information as required by paragraph (b). The chair of the governing body and the chief financial officer of each local governmental entity shall sign the annual financial report submitted pursuant to this subsection attesting to the accuracy of the information included in the report. The county annual financial report must be a single document that covers each county agency.
(b) Each component unit, as defined by generally accepted accounting principles, of a local governmental entity shall provide the local governmental entity, within a reasonable time period as established by the local governmental entity, with financial information necessary to comply with the reporting requirements contained in this section.
(c) Each regional planning council created under s. 186.504, each local government finance commission, board, or council, and each municipal power corporation created as a separate legal or administrative entity by interlocal agreement under s. 163.01(7) shall submit to the department a copy of its audit report and an annual financial report for the previous fiscal year in a format prescribed by the department.
(d) Each local governmental entity that is required to provide for an audit under s. 218.39(1) must submit a copy of the audit report and annual financial report to the department within 45 days after the completion of the audit report but no later than 9 months after the end of the fiscal year.
(e) Each local governmental entity that is not required to provide for an audit under s. 218.39 must submit the annual financial report to the department no later than 9 months after the end of the fiscal year. The department shall consult with the Auditor General in the development of the format of annual financial reports submitted pursuant to this paragraph. The format must include balance sheet information used by the Auditor General pursuant to s. 11.45(7)(f). The department must forward the financial information contained within the annual financial reports to the Auditor General in electronic form. This paragraph does not apply to housing authorities created under chapter 421.
(f) If the department does not receive a completed annual financial report from a local governmental entity within the required period, it shall notify the Legislative Auditing Committee and the Special District Accountability Program of the Department of Economic Opportunity of the entity’s failure to comply with the reporting requirements.
(g) Each local governmental entity’s website must provide a link to the department’s website to view the entity’s annual financial report submitted to the department pursuant to this section. If the local governmental entity does not have an official website, the county government’s website must provide the required link for the local governmental entity.
(h) It is the intent of the Legislature to create the Florida Open Financial Statement System, an interactive repository for governmental financial statements.
1. The Chief Financial Officer may consult with stakeholders, including the department, the Auditor General, a representative of a municipality or county, a representative of a special district, a municipal bond investor, and an information technology professional employed in the private sector, for input on the design and implementation of the Florida Open Financial Statement System.
2. The Chief Financial Officer may choose contractors to build one or more eXtensible Business Reporting Language (XBRL) taxonomies suitable for state, county, municipal, and special district financial filings and to create a software tool that enables financial statement filers to easily create XBRL documents consistent with such taxonomies. The Chief Financial Officer must recruit and select contractors through an open request for proposals process pursuant to chapter 287.
3. The Chief Financial Officer must require that all work products be completed no later than December 31, 2021.
4. If the Chief Financial Officer deems the work products adequate, all local governmental financial statements for fiscal years ending on or after September 1, 2022, must be filed in XBRL format and must meet the validation requirements of the relevant taxonomy.
5. A local government that begins filing in XBRL format may not be required to make filings in Portable Document Format.
(2) The department shall annually by December 1 file a verified report with the Governor, the Legislature, the Auditor General, and the Special District Accountability Program of the Department of Economic Opportunity showing the revenues, both locally derived and derived from intergovernmental transfers, and the expenditures of each local governmental entity, regional planning council, local government finance commission, and municipal power corporation that is required to submit an annual financial report. In preparing the verified report, the department may request additional information from the local governmental entity. The information requested must be provided to the department within 45 days after the request. If the local governmental entity does not comply with the request, the department shall notify the Legislative Auditing Committee, which may take action pursuant to s. 11.40(2). The report must include, but is not limited to:
(a) The total revenues and expenditures of each local governmental entity that is a component unit included in the annual financial report of the reporting entity.
(b) The amount of outstanding long-term debt by each local governmental entity. For purposes of this paragraph, the term “long-term debt” means any agreement or series of agreements to pay money, which, at inception, contemplate terms of payment exceeding 1 year in duration.
(3)(a) The department shall notify the President of the Senate and the Speaker of the House of Representatives of any municipality that has not reported any financial activity for the last 4 fiscal years. Such notice must be sufficient to initiate dissolution procedures as described in s. 165.051(1)(a). Any special law authorizing the incorporation or creation of the municipality must be included within the notification.
(b) Failure of a county or municipality required under s. 163.387(8) to include with its annual financial report to the department a financial audit report for each community redevelopment agency created by that county or municipality constitutes a failure to report under this section.
(c) By November 1 of each year, the department must provide the Special District Accountability Program of the Department of Economic Opportunity with a list of each community redevelopment agency that does not report any revenues, expenditures, or debt for the community redevelopment agency’s previous fiscal year.
History.—s. 2, ch. 73-349; s. 15, ch. 77-165; s. 46, ch. 79-164; s. 5, ch. 79-183; s. 4, ch. 79-589; s. 42, ch. 80-274; s. 18, ch. 81-167; s. 16, ch. 83-55; s. 2, ch. 83-106; s. 43, ch. 89-169; s. 55, ch. 91-45; s. 93, ch. 92-152; s. 90, ch. 92-279; s. 55, ch. 92-326; s. 36, ch. 94-249; s. 18, ch. 96-324; s. 8, ch. 2000-152; s. 5, ch. 2000-264; s. 62, ch. 2001-266; s. 26, ch. 2004-305; s. 25, ch. 2011-34; s. 85, ch. 2011-142; s. 18, ch. 2011-144; s. 27, ch. 2013-15; s. 79, ch. 2014-22; s. 4, ch. 2018-102; s. 13, ch. 2019-15; s. 9, ch. 2019-163.
218.322 County and municipal transportation program data.—Each county and municipality shall annually provide the Department of Transportation with uniform program data. The data must conform to the local governmental entity’s fiscal year and must include, but need not be limited to, details on transportation receipts and expenditures and on the number of miles of road for which the local governmental entity is responsible. The Department of Transportation shall inform each local governmental entity of the method and format for submitting the data. The Department of Transportation shall compile the data and shall furnish the compilation of data to any interested person upon request.
History.—s. 29, ch. 96-324.
218.33 Local governmental entities; establishment of uniform fiscal years and accounting practices and procedures.—
(1) Each local governmental entity shall begin its fiscal year on October 1 of each year and end it on September 30.
(2) Each local governmental entity shall follow uniform accounting practices and procedures as promulgated by rule of the department to assure the use of proper accounting and fiscal management by such units. Such rules shall include a uniform classification of accounts.
(3) Each local governmental entity shall establish and maintain internal controls designed to:
(a) Prevent and detect fraud, waste, and abuse as defined in s. 11.45(1).
(b) Promote and encourage compliance with applicable laws, rules, contracts, grant agreements, and best practices.
(c) Support economical and efficient operations.
(d) Ensure reliability of financial records and reports.
(e) Safeguard assets.
(4) Any word, sentence, phrase, or provision of any special act, municipal charter, or other law that prohibits or restricts a local governmental entity from complying with this section or any rules adopted under this section is nullified and repealed to the extent of the conflict.
History.—s. 2, ch. 73-349; s. 66, ch. 77-104; s. 20, ch. 96-324; s. 63, ch. 2001-266; s. 14, ch. 2019-15.
218.335 Local governmental entity; authority to charge interest on overdue payments.—A local governmental entity may impose an interest penalty on any amount due and owing to it from another local governmental entity if payment of the amount is not made within 10 working days after the required time authorized by interlocal agreement. The rate of interest that must be imposed is the rate established under s. 55.03. This section does not apply to payments due from the state or any of its agencies.
History.—s. 1, ch. 84-178; s. 34, ch. 85-80; s. 21, ch. 96-324.
218.35 County fee officers; financial matters.—
(1) Each county fee officer shall establish an annual budget for carrying out the powers, duties, and operations of his or her office for the next county fiscal year. The budget must be balanced so that the total of estimated receipts, including balances brought forward, equals the total of estimated expenditures and reserves. The budgeting of segregated funds must be made in a manner that retains the relation between program and revenue source, as provided by law.
(2) The clerk of the circuit court, functioning in his or her capacity as clerk of the circuit and county courts and as clerk of the board of county commissioners, shall prepare his or her budget in two parts:
(a) The budget for funds necessary to perform court-related functions as provided in s. 28.36.
(b) The budget relating to the requirements of the clerk as clerk of the board of county commissioners, county auditor, and custodian or treasurer of all county funds and other county-related duties, which shall be annually prepared and submitted to the board of county commissioners pursuant to s. 129.03(2), for each fiscal year. Expenditures must be itemized in accordance with the uniform accounting system prescribed by the Department of Financial Services as follows:
1. Personnel services.
2. Operating expenses.
3. Capital outlay.
4. Debt service.
5. Grants and aids.
6. Other uses.
(3) The clerk of the circuit court shall furnish to the board of county commissioners or the county budget commission all relevant and pertinent information that the board or commission deems necessary, including expenditures at the subobject code level in accordance with the uniform accounting system prescribed by the Department of Financial Services.
(4) The final approved budget of the clerk of the circuit court must be posted on the county’s official website within 30 days after adoption. The final approved budget of the clerk of the circuit court may be included in the county’s budget.
(5) Each county fee officer shall establish a fiscal year beginning October 1 and ending September 30 of the following year, and shall report his or her finances annually upon the close of each fiscal year to the county fiscal officer for inclusion in the annual financial report by the county.
(6) The proposed budget of a county fee officer shall be filed with the clerk of the county governing authority by September 1 preceding the fiscal year for the budget, except for the budget prepared by the clerk of the circuit court for court-related functions as provided in s. 28.36.
History.—s. 2, ch. 73-349; s. 1176, ch. 95-147; s. 97, ch. 2003-402; s. 19, ch. 2011-144.
218.36 County officers; record and report of fees and disposition of same.—
(1) Each county officer who receives any expenses or compensation in fees, commissions, or other remuneration shall keep a complete record of all fees, commissions, or other remuneration collected by that county officer and shall make an annual report to the board of county commissioners within 31 days of the close of his or her fiscal year. Such report shall specify in detail the purposes, character, and amount of all official expenses and the amount of net income or unexpended budget balance as of the close of the fiscal year. All officers shall prepare such reports and subscribe under oath as to their accuracy and propriety.
(2) On or before the date for filing the annual report, each county officer shall pay into the county general fund all money in excess of the sum to which he or she is entitled under the provisions of chapter 145. Whenever a tax collector has money in excess, he or she shall distribute the excess to each governmental unit in the same proportion as the fees paid by the governmental unit bear to the total fee income of his or her office. Any excess held by a property appraiser shall be divided into parts for each governmental unit which was billed and which paid for the operation of the property appraiser’s office in the same proportion as the governmental units were originally billed. Such part shall be an advance on the current year’s bill, if any.
(3) The board of county commissioners may notify the Governor of the failure of any county officer to comply with the provisions of this section. Such notification shall specify the name of the officer and the office held by him or her at the time of such failure and shall subject said officer to suspension from office at the Governor’s discretion.
(4) Compliance by a county officer with the provisions of this section shall exempt said officer from making any report required pursuant to s. 116.03.
History.—s. 2, ch. 73-349; s. 17, ch. 74-234; s. 1, ch. 77-102; s. 5, ch. 88-175; s. 1177, ch. 95-147; s. 29, ch. 2004-305.
218.369 Definitions applicable to ss. 218.37-218.386.—As used in this section and in ss. 218.37, 218.38, 218.385, and 218.386, the term “unit of local government,” except where exception is made, means a county, municipality, special district, district school board, local agency, authority, or consolidated city-county government or any other local governmental body or public body corporate and politic authorized or created by general or special law and granted the power to issue general obligation or revenue bonds; and the words “general obligation or revenue bonds” shall be interpreted to include within their scope general obligation bonds, revenue bonds, special assessment bonds, limited revenue bonds, special obligation bonds, debentures, and other similar instruments, but not bond anticipation notes.
History.—s. 1, ch. 82-195; s. 84, ch. 83-217; s. 30, ch. 2004-305.
218.37 Powers and duties of Division of Bond Finance; advisory council.—
(1) The Division of Bond Finance of the State Board of Administration, with respect to both general obligation bonds and revenue bonds, shall:
(a) Provide information, upon request of a unit of local government, on the preliminary planning of a new bond issue.
(b) Collect, maintain, and make available information on new bonds of units of local government and of the state.
(c) Serve as a clearinghouse for information on bond issues of units of local government and of the state.
(d) Undertake or commission studies on methods to reduce the costs of local and state bond issues.
(e) Recommend changes in law and in local practices to improve the sale and servicing of local bonds.
(f) By January 1 each year, provide the Special District Accountability Program of the Department of Economic Opportunity with a list of special districts that are not in compliance with the requirements in s. 218.38.
(2) The Division of Bond Finance of the State Board of Administration shall also collect, maintain, and make available information from units of local government on lease-purchase agreements or certificates of participation, or other similar debt instruments, for which the total amount of principal payments under the agreement or series of agreements is $2 million or more.
(3) The Division of Bond Finance of the State Board of Administration may adopt rules to implement this section and ss. 218.38 and 218.385.
(4) The Division of Bond Finance of the State Board of Administration shall conduct a study of professional fees paid to fiscal advisers, bond counsel, and others and shall adopt a recommended fee schedule that is commensurate with fees typically paid in states similar to Florida in size and character. The schedule must be adopted by the division as the recommended fee schedule for all state and state agency financings.
History.—s. 6, ch. 79-183; s. 1, ch. 82-46; ss. 1, 9, ch. 82-195; s. 85, ch. 83-217; s. 2, ch. 88-318; s. 44, ch. 89-169; s. 15, ch. 92-173; s. 165, ch. 92-279; s. 55, ch. 92-326; s. 20, ch. 95-196; s. 23, ch. 96-324; s. 43, ch. 2004-305; s. 86, ch. 2011-142; s. 80, ch. 2014-22; s. 1, ch. 2015-22.
218.38 Notice of bond issues required; verification.—
(1)(a) Each unit of local government shall furnish the Division of Bond Finance of the State Board of Administration a complete description of all of its new general obligation bonds and revenue bonds, shall also provide the division with advance notice of the impending sale of any new issue of bonds, and shall also provide the division with a copy of the final official statement, if any is published, all as required by rules of the division.
(b)1. Excluding for the purposes of this paragraph those general obligation bonds and revenue bonds issued pursuant to the provisions of part III of chapter 154, parts II, III, and V of chapter 159, and part II of chapter 243, each unit of local government shall, within 120 days after the delivery of any general revenue or obligation bonds which were sold at public sale by competitive bids, file the following information with the division on forms prescribed by the division:
a. The name and address of the managing underwriter, if any, connected with the bond issue;
b. The name and address of any attorney or financial consultant who advised the unit of local government with respect to the bond issue;
c. Any fee, bonus, or gratuity paid by any underwriter or financial consultant, in connection with the bond issue, to any person not regularly employed or engaged by such underwriter or consultant; and
d. Any other fee paid by the unit of local government with respect to the bond issue, including any fee paid to attorneys or financial consultants.
2. Within 90 days after the delivery of such bonds, the managing underwriter or financial consultant shall file with the unit of local government a statement containing the information required by sub-subparagraph 1.c.
3. The information disclosed pursuant to this paragraph shall be maintained by the division and by the unit of local government as a public record.
(c)1. Excluding for the purposes of this paragraph those general obligation bonds and revenue bonds issued pursuant to the provisions of part III of chapter 154, parts II, III, and V of chapter 159, and part II of chapter 243, each unit of local government shall, within 120 days after the delivery of any general obligation or revenue bonds which were sold by negotiated bond sale authorized by s. 218.385, file the following information with the division on forms prescribed by the division:
a. The name and address of the managing underwriter, if any, connected with the bond issue;
b. The name and address of any attorney or financial consultant who advised the unit of local government with respect to the bond issue;
c. Any management fee charged by the managing underwriter, if any;
d. The underwriting spread which the managing underwriter, if any, expects to realize;
e. Any fee, bonus, or gratuity paid by any underwriter or financial consultant, in connection with the bond issue, to any person not regularly employed or engaged by such underwriter or consultant; and
f. Any other fee paid by the unit of local government with respect to the bond issue, including any fee paid to attorneys or financial consultants.
2. Within 90 days after the delivery of such bonds, the managing underwriter or financial consultant shall file with the unit of local government a statement containing the information required by sub-subparagraphs 1.c., d., and e.
3. The information disclosed pursuant to this paragraph shall be maintained by the division and by the unit of local government as a public record.
(2) Each unit of local government shall, upon request of the division, verify the information held by the division relating to the bonded obligations of the unit of local government.
(3) If a unit of local government fails to verify pursuant to subsection (2) the information held by the division, or fails to provide the information required by subsection (1), the division shall notify the Legislative Auditing Committee of such failure to comply.
History.—s. 7, ch. 79-183; s. 3, ch. 80-98; s. 19, ch. 81-167; s. 2, ch. 82-195; s. 17, ch. 83-55; s. 45, ch. 89-169; s. 166, ch. 92-279; s. 55, ch. 92-326; s. 24, ch. 96-324; s. 6, ch. 2000-264; s. 64, ch. 2001-266; s. 26, ch. 2011-34.
218.385 Local government bonds; sale.—
(1) All general obligation bonds and revenue bonds sold by a unit of local government, as defined in s. 218.369, shall be sold at public sale by competitive bids at such place or places as the governing body shall determine to receive proposals for the purchase of such bonds. Notice of such sale shall be published one or more times at least 10 days prior to the date of sale in one or more newspapers or financial journals published within or without the state and shall contain such terms as the governing body shall deem advisable and proper under the circumstances. However, if the governing body shall by resolution adopted at a public meeting determine that a negotiated sale of such bonds is in the best interest of the issuer, the governing body may negotiate for sale of such bonds.
(a) In the resolution authorizing the negotiated sale, the local governing body shall provide specific findings as to the reasons requiring the negotiated sale.
(b) A resolution authorizing a negotiated bond sale may be the same resolution as that authorizing the issuance of such bonds.
(2) Prior to the award of bonds, all proposals for the purchase of any bonds offered by a unit of local government as defined in s. 218.369 shall include a truth-in-bonding statement in substantially the following form:
The (insert unit of local government) is proposing to issue $ (insert principal) of debt or obligation for the purpose of (insert purpose) . This debt or obligation is expected to be repaid over a period of (insert term of issue) years. At a forecasted interest rate of (insert rate of interest) , total interest paid over the life of the debt or obligation will be $ (insert sum of interest payments) .
(3) Truth-in-bonding statements shall also include language in substantially the following form:
The source of repayment or security for this proposal is the (insert the unit of local government) existing (insert fund) . Authorizing this debt or obligation will result in $ (insert the annual amount) of (insert unit of local government) (insert fund) moneys not being available to finance the other services of the (insert unit of local government) each year for (insert the length of the debt or obligation) .
(4) All proposals for the purchase of any bonds offered by a unit of local government shall be opened in public. Such bonds when competitively bid shall be awarded by resolution to the lowest bid consistent with the notice of sale.
(5) No bid conforming to the notice of sale may be rejected unless all bids are rejected. If all bids are rejected, such bonds may be sold thereafter at public sale by competitive bids or by negotiated sale pursuant to this section.
(6) In the event the local governing body decides to negotiate for a sale of bonds, the managing underwriter, or financial consultant or adviser if applicable, shall provide to the unit of local government, prior to the award of bonds to the managing underwriter, a disclosure statement containing the following information:
(a) An itemized list setting forth the nature and estimated amounts of expenses to be incurred by the managing underwriter in connection with the issuance of such bonds. Notwithstanding the foregoing, any such list may include an item for miscellaneous expenses, provided it includes only minor items of expense which cannot be easily categorized elsewhere in the statement.
(b) The names, addresses, and estimated amounts of compensation of any finders, as defined in s. 218.386, connected with the issuance of the bonds.
(c) The amount of underwriting spread expected to be realized.
(d) Any management fee charged by the managing underwriter.
(e) Any other fee, bonus, and other compensation estimated to be paid by the managing underwriter in connection with the bond issue to any person not regularly employed or retained by it.
(f) The name and address of the managing underwriter or underwriters, if any, connected with the bond issue.
(g) Any other disclosure which the local governing body may require.
This subsection is not intended to restrict or prohibit the employment of professional services relating to local government bond issues.
(7) The failure of a unit of local government to comply with one or more provisions of this section or s. 218.38 shall not affect the validity of the bond issue; however, upon such failure to comply, the unit of local government shall be subject to the sanctions provided in s. 218.38(3).
(8) The truth-in-bonding statements prepared pursuant to this section are for informational purposes only and shall not affect or control the actual terms and conditions of the debt or obligations.
History.—s. 1, ch. 80-98; s. 125, ch. 81-259; s. 3, ch. 82-195; s. 84, ch. 92-142.
218.386 Bonds; finder’s fees prohibited.—
(1)(a) As used in this section, “finder” means a person who is not regularly employed by, or not a partner or officer of, an underwriter, bank, banker, or financial consultant or adviser and who enters into an understanding with either the issuer or the managing underwriter, or both, for any paid or promised compensation or valuable consideration directly or indirectly, expressly or impliedly, to act solely as an intermediary between such issuer and managing underwriter for the purpose of influencing any transaction in the purchase of such bonds.
(b) No underwriter, commercial bank, investment banker, or financial consultant or adviser shall pay any finder any bonus, fee, or gratuity in connection with the sale of general obligation bonds or revenue bonds issued by any unit of local government, unless full disclosure is made to the unit of local government prior to or concurrently with the submission of a purchase proposal for bonds by the underwriter, commercial bank, investment banker, or financial consultant or adviser and subsequently in the official statement or offering circular, if any, detailing the name and address of any finder and the amount of bonus, fee, or gratuity paid to such finder.
(2) The willful violation of this section is a felony of the third degree, punishable as provided in s. 775.082, s. 775.083, or s. 775.084.
(3) No violation of this section shall affect the validity of the bond issue.
History.—s. 2, ch. 80-98; s. 3, ch. 82-195.
218.39 Annual financial audit reports.—
(1) If, by the first day in any fiscal year, a local governmental entity, district school board, charter school, or charter technical career center has not been notified that a financial audit for that fiscal year will be performed by the Auditor General, each of the following entities shall have an annual financial audit of its accounts and records completed within 9 months after the end of its fiscal year by an independent certified public accountant retained by it and paid from its public funds:
(a) Each county.
(b) Any municipality with revenues or the total of expenditures and expenses in excess of $250,000, as reported on the fund financial statements.
(c) Any special district with revenues or the total of expenditures and expenses in excess of $100,000, as reported on the fund financial statements.
(d) Each district school board.
(e) Each charter school established under s. 1002.33.
(f) Each charter technical center established under s. 1002.34.
(g) Each municipality with revenues or the total of expenditures and expenses between $100,000 and $250,000, as reported on the fund financial statements, which has not been subject to a financial audit pursuant to this subsection for the 2 preceding fiscal years.
(h) Each special district with revenues or the total of expenditures and expenses between $50,000 and $100,000, as reported on the fund financial statement, which has not been subject to a financial audit pursuant to this subsection for the 2 preceding fiscal years.
(2) The county audit report must be a single document that includes a financial audit of the county as a whole and, for each county agency other than a board of county commissioners, an audit of its financial accounts and records, including reports on compliance and internal control, management letters, and financial statements as required by rules adopted by the Auditor General. In addition, if a board of county commissioners elects to have a separate audit of its financial accounts and records in the manner required by rules adopted by the Auditor General for other county agencies, the separate audit must be included in the county audit report.
(3)(a) A dependent special district may provide for an annual financial audit by being included in the audit of the local governmental entity upon which it is dependent. An independent special district may not make provision for an annual financial audit by being included in the audit of another local governmental entity.
(b) A special district that is a component unit, as defined by generally accepted accounting principles, of a local governmental entity shall provide the local governmental entity, within a reasonable time period as established by the local governmental entity, with financial information necessary to comply with this section. The failure of a component unit to provide this financial information must be noted in the annual financial audit report of the local governmental entity.
(4) A management letter shall be prepared and included as a part of each financial audit report.
(5) At the conclusion of the audit, the auditor shall discuss with the chair of the governing body of the local governmental entity or the chair’s designee, the elected official of each county agency or the elected official’s designee, the chair of the district school board or the chair’s designee, the chair of the board of the charter school or the chair’s designee, or the chair of the board of the charter technical career center or the chair’s designee, as appropriate, all of the auditor’s comments that will be included in the audit report. If the officer is not available to discuss the auditor’s comments, their discussion is presumed when the comments are delivered in writing to his or her office. The auditor shall notify each member of the governing body of a local governmental entity, district school board, charter school, or charter technical career center for which:
(a) Deteriorating financial conditions exist that may cause a condition described in s. 218.503(1) to occur if actions are not taken to address such conditions.
(b) A fund balance deficit in total or a deficit for that portion of a fund balance not classified as restricted, committed, or nonspendable, or a total or unrestricted net assets deficit, as reported on the fund financial statements of entities required to report under governmental financial reporting standards or on the basic financial statements of entities required to report under not-for-profit financial reporting standards, for which sufficient resources of the local governmental entity, charter school, charter technical career center, or district school board, as reported on the fund financial statements, are not available to cover the deficit. Resources available to cover reported deficits include fund balance or net assets that are not otherwise restricted by federal, state, or local laws, bond covenants, contractual agreements, or other legal constraints. Property, plant, and equipment, the disposal of which would impair the ability of a local governmental entity, charter school, charter technical career center, or district school board to carry out its functions, are not considered resources available to cover reported deficits.
(6) The officer’s written statement of explanation or rebuttal concerning the auditor’s findings, including corrective action to be taken, must be filed with the governing body of the local governmental entity, district school board, charter school, or charter technical career center within 30 days after the delivery of the auditor’s findings.
(7) All audits conducted pursuant to this section must be conducted in accordance with the rules of the Auditor General adopted pursuant to s. 11.45. Upon completion of the audit, the auditor shall prepare an audit report in accordance with the rules of the Auditor General. The audit report shall be filed with the Auditor General within 45 days after delivery of the audit report to the governing body of the audited entity, but no later than 9 months after the end of the audited entity’s fiscal year. The audit report must include a written statement describing corrective actions to be taken in response to each of the auditor’s recommendations included in the audit report.
(8) The Auditor General shall notify the Legislative Auditing Committee of any audit report prepared pursuant to this section which indicates that an audited entity has failed to take full corrective action in response to a recommendation that was included in the two preceding financial audit reports.
(a) The committee may direct the governing body of the audited entity to provide a written statement to the committee explaining why full corrective action has not been taken or, if the governing body intends to take full corrective action, describing the corrective action to be taken and when it will occur.
(b) If the committee determines that the written statement is not sufficient, it may require the chair of the governing body of the local governmental entity or the chair’s designee, the elected official of each county agency or the elected official’s designee, the chair of the district school board or the chair’s designee, the chair of the board of the charter school or the chair’s designee, or the chair of the board of the charter technical career center or the chair’s designee, as appropriate, to appear before the committee.
(c) If the committee determines that an audited entity has failed to take full corrective action for which there is no justifiable reason for not taking such action, or has failed to comply with committee requests made pursuant to this section, the committee may proceed in accordance with s. 11.40(2).
(9) The predecessor auditor of a district school board shall provide the Auditor General access to the prior year’s working papers in accordance with the Statements on Auditing Standards, including documentation of planning, internal control, audit results, and other matters of continuing accounting and auditing significance, such as the working paper analysis of balance sheet accounts and those relating to contingencies.
(10) Each charter school and charter technical career center must file a copy of its audit report with the sponsoring entity; the local district school board, if not the sponsoring entity; the Auditor General; and with the Department of Education.
(11) This section does not apply to housing authorities created under chapter 421.
(12) Notwithstanding the provisions of any local law, the provisions of this section shall govern.
History.—s. 65, ch. 2001-266; s. 924, ch. 2002-387; s. 28, ch. 2004-305; s. 2, ch. 2006-190; s. 2, ch. 2009-214; s. 20, ch. 2011-144; s. 25, ch. 2012-5; s. 1, ch. 2012-38; s. 23, ch. 2016-10.
218.391 Auditor selection procedures.—
(1) Each local governmental entity, district school board, charter school, or charter technical career center, prior to entering into a written contract pursuant to subsection (7), except as provided in subsection (8), shall use auditor selection procedures when selecting an auditor to conduct the annual financial audit required in s. 218.39.
(2) The governing body of a county, municipality, special district, district school board, charter school, or charter technical career center shall establish an auditor selection committee.
(a) The auditor selection committee for a county must, at a minimum, consist of each of the county officers elected pursuant to the county charter or s. 1(d), Art. VIII of the State Constitution or their respective designees and one member of the board of county commissioners or its designee.
(b) The auditor selection committee for a municipality, special district, district school board, charter school, or charter technical career center must consist of at least three members. One member of the auditor selection committee must be a member of the governing body of an entity specified in this paragraph, who shall serve as the chair of the committee.
(c) An employee, a chief executive officer, or a chief financial officer of the county, municipality, special district, district school board, charter school, or charter technical career center may not serve as a member of an auditor selection committee established under this subsection; however, an employee, a chief executive officer, or a chief financial officer of the county, municipality, special district, district school board, charter school, or charter technical career center may serve in an advisory capacity.
(d) The primary purpose of the auditor selection committee is to assist the governing body in selecting an auditor to conduct the annual financial audit required in s. 218.39; however, the committee may serve other audit oversight purposes as determined by the entity’s governing body. The public may not be excluded from the proceedings under this section.
(3) The auditor selection committee shall:
(a) Establish factors to use for the evaluation of audit services to be provided by a certified public accounting firm duly licensed under chapter 473 and qualified to conduct audits in accordance with government auditing standards as adopted by the Florida Board of Accountancy. Such factors shall include, but are not limited to, ability of personnel, experience, ability to furnish the required services, and such other factors as may be determined by the committee to be applicable to its particular requirements.
(b) Publicly announce requests for proposals. Public announcements must include, at a minimum, a brief description of the audit and indicate how interested firms can apply for consideration.
(c) Provide interested firms with a request for proposal. The request for proposal shall include information on how proposals are to be evaluated and such other information the committee determines is necessary for the firm to prepare a proposal.
(d) Evaluate proposals provided by qualified firms. If compensation is one of the factors established pursuant to paragraph (a), it shall not be the sole or predominant factor used to evaluate proposals.
(e) Rank and recommend in order of preference no fewer than three firms deemed to be the most highly qualified to perform the required services after considering the factors established pursuant to paragraph (a). If fewer than three firms respond to the request for proposal, the committee shall recommend such firms as it deems to be the most highly qualified.
(4) The governing body shall inquire of qualified firms as to the basis of compensation, select one of the firms recommended by the auditor selection committee, and negotiate a contract, using one of the following methods:
(a) If compensation is not one of the factors established pursuant to paragraph (3)(a) and not used to evaluate firms pursuant to paragraph (3)(e), the governing body shall negotiate a contract with the firm ranked first. If the governing body is unable to negotiate a satisfactory contract with that firm, negotiations with that firm shall be formally terminated, and the governing body shall then undertake negotiations with the second-ranked firm. Failing accord with the second-ranked firm, negotiations shall then be terminated with that firm and undertaken with the third-ranked firm. Negotiations with the other ranked firms shall be undertaken in the same manner. The governing body, in negotiating with firms, may reopen formal negotiations with any one of the three top-ranked firms, but it may not negotiate with more than one firm at a time.
(b) If compensation is one of the factors established pursuant to paragraph (3)(a) and used in the evaluation of proposals pursuant to paragraph (3)(d), the governing body shall select the highest-ranked qualified firm or must document in its public records the reason for not selecting the highest-ranked qualified firm.
(c) The governing body may select a firm recommended by the audit committee and negotiate a contract with one of the recommended firms using an appropriate alternative negotiation method for which compensation is not the sole or predominant factor used to select the firm.
(d) In negotiations with firms under this section, the governing body may allow a designee to conduct negotiations on its behalf.
(5) The method used by the governing body to select a firm recommended by the audit committee and negotiate a contract with such firm must ensure that the agreed-upon compensation is reasonable to satisfy the requirements of s. 218.39 and the needs of the governing body.
(6) If the governing body is unable to negotiate a satisfactory contract with any of the recommended firms, the committee shall recommend additional firms, and negotiations shall continue in accordance with this section until an agreement is reached.
(7) Every procurement of audit services shall be evidenced by a written contract embodying all provisions and conditions of the procurement of such services. For purposes of this section, an engagement letter signed and executed by both parties shall constitute a written contract. The written contract shall, at a minimum, include the following:
(a) A provision specifying the services to be provided and fees or other compensation for such services.
(b) A provision requiring that invoices for fees or other compensation be submitted in sufficient detail to demonstrate compliance with the terms of the contract.
(c) A provision specifying the contract period, including renewals, and conditions under which the contract may be terminated or renewed.
(8) Written contracts entered into pursuant to subsection (7) may be renewed. Such renewals may be done without the use of the auditor selection procedures provided in this section. Renewal of a contract shall be in writing.
(9) If the entity fails to select the auditor in accordance with the requirements of subsections (3)-(6), the entity must again perform the auditor selection process in accordance with this section to select an auditor to conduct audits for subsequent fiscal years.
History.—s. 65, ch. 2001-266; s. 1, ch. 2005-32; s. 15, ch. 2019-15.
PART IV
INVESTMENT OF LOCAL GOVERNMENTSURPLUS FUNDS
218.40 Short title.
218.401 Purpose.
218.403 Definitions.
218.405 Local Government Surplus Funds Trust Fund; creation; objectives; certification; interest; rulemaking.
218.407 Local government investment authority.
218.409 Administration of the trust fund.
218.411 Authorization for state technical and advisory assistance.
218.412 Rulemaking authority.
218.415 Local government investment policies.
218.40 Short title.—This part shall be known, and may be cited, as the “Investment of Local Government Surplus Funds Act.”
History.—s. 1, ch. 77-394.
218.401 Purpose.—It is the intent of this part to promote, through state assistance, the maximization of net interest earnings on invested surplus funds of local units of government, based on the principles of investor protection, mandated transparency, and proper governance, with the goal of reducing the need for imposing additional taxes.
History.—s. 1, ch. 77-394; s. 1, ch. 2008-59; s. 38, ch. 2019-3.
218.403 Definitions.—The following words or terms, when used in this part, shall have the following meanings:
(1) “Board” means the State Board of Administration.
(2) “Chief Financial Officer” means the mayor, manager, administrator, clerk, comptroller, treasurer, director of finance, or other local government official, regardless of the title of his or her office, charged with administering the fiscal affairs of a unit of local government.
(3) “Current expenses” means expenses to meet known cash needs and anticipated cash-flow requirements for the short term.
(4) “GASB” means the Governmental Accounting Standards Board.
(5) “GFOA” means the Government Finance Officers Association.
(6) “Governing body” means the body or board in which the legislative power of a unit of local government is vested.
(7) “Short term” means a maximum of 6 months of operation.
(8) “Surplus funds” means any funds in any general or special account or fund of a unit of local government, or funds held by an independent trustee on behalf of a unit of local government, which in reasonable contemplation will not be immediately needed for the purposes intended.
(9) “Trust fund” means the pooled investment fund created by s. 218.405 and known as the Local Government Surplus Funds Trust Fund.
(10) “Trustees” mean the Trustees of the State Board of Administration.
(11) “Unit of local government” means any governmental entity within the state not part of state government and shall include, but not be limited to, the following and the officers thereof: any county, municipality, school district, special district, clerk of the circuit court, sheriff, property appraiser, tax collector, supervisor of elections, authority, board, public corporations, or any other political subdivision of the state.
History.—s. 1, ch. 77-394; s. 4, ch. 87-239; s. 1178, ch. 95-147; s. 5, ch. 95-194; s. 1, ch. 97-9; s. 2, ch. 2008-59.
218.405 Local Government Surplus Funds Trust Fund; creation; objectives; certification; interest; rulemaking.—
(1) There is hereby created a Local Government Surplus Funds Trust Fund to be administered by the board and to be composed of local government surplus funds deposited therein by units of local government under the procedures established in this part. The board may contract with a professional money management firm to manage the trust fund.
(2) The primary objectives, in priority order, of investment activities shall be safety, liquidity, and competitive returns with minimization of risks.
(3) The trustees shall annually certify to the Joint Legislative Auditing Committee that the trust fund is in compliance with the requirements of this part and that the trustees have conducted a review of the trust fund and determined that the management of the trust fund is in accord with best investment practices.
(4) The board may adopt rules to administer the provisions of this section.
History.—s. 1, ch. 77-394; s. 3, ch. 98-124; s. 3, ch. 2008-59.
218.407 Local government investment authority.—
(1) Prior to any determination by the governing body that it is in the interest of the unit of local government to deposit surplus funds in the trust fund, the board or a professional money management firm must provide to the governing body enrollment materials, including a trust fund profile containing impartial educational information describing the administration and investment policy of the trust fund, including, but not limited to:
(a) All rights and conditions of participation, including potential restrictions on withdrawals.
(b) The historical performance, investment holdings, credit quality, and average maturity of the trust fund investments.
(c) The applicable administrative rules.
(d) The rate determination processes for any deposit or withdrawal.
(e) Any fees, charges, penalties, and deductions that apply to the account.
(f) The most recently published financial statements or independent audits, if available, prepared under generally accepted accounting principles.
(g) A disclosure statement for signature by the appropriate local government official.
(2) Upon review of the enrollment materials and upon determination by the governing body that it is in the interest of the unit of local government to deposit surplus funds in the trust fund, a resolution by the governing body and the signed acceptance of the disclosure statement by the local government official, who may be the chief financial or administrative officer of the local government, shall be filed with the board and, if appropriate, a copy shall be provided to a professional money management firm authorizing investment of its surplus funds in the trust fund established by this part. The resolution shall name:
(a) The local government official, who may be the chief financial or administrative officer of the local government, or
(b) An independent trustee holding funds on behalf of the unit of local government,
responsible for deposit and withdrawal of such funds.
(3) The board or a professional money management firm shall, upon the filing of the resolution, invest the moneys in the trust fund in the same manner and subject to the same restrictions as are set forth in s. 215.47. All units of local government that qualify to be participants in the trust fund shall have surplus funds deposited into a pooled investment account.
(4) The provisions of this part shall not impair the power of a unit of local government to hold funds in deposit accounts with banking or savings institutions or to invest funds as otherwise authorized by law.
History.—s. 1, ch. 77-394; s. 6, ch. 82-45; s. 3, ch. 84-137; s. 5, ch. 87-239; s. 9, ch. 98-47; s. 4, ch. 98-124; s. 4, ch. 2008-59.
218.409 Administration of the trust fund.—
(1) Upon receipt of the items specified in s. 218.407 from the local governing body, the board or a professional money management firm shall accept all wire transfers of funds into the trust fund. The board or a professional money management firm shall also wire-transfer invested local government funds to the local government upon request of the local government official named in the resolution.
(2)(a) The trustees shall ensure that the board or a professional money management firm administers the trust fund on behalf of the participants. The board or a professional money management firm shall have the power to invest such funds in accordance with a written investment policy. The investment policy shall be updated annually to conform to best investment practices. The standard of prudence to be used by investment officials shall be the fiduciary standards as set forth in s. 215.47(10), which shall be applied in the context of managing an overall portfolio. Portfolio managers acting in accordance with written procedures and an investment policy and exercising due diligence shall be relieved of personal responsibility for an individual security’s credit risk or market price changes, provided deviations from expectations are reported in a timely fashion and the liquidity and the sale of securities are carried out in accordance with the terms of this part.
(b) Officers and employees involved in the investment process shall refrain from personal business activity that could conflict with the proper execution and management of the investment program or that could impair their ability to make impartial decisions. Employees and investment officials shall disclose any material interests in financial institutions with which they conduct business on behalf of the trust fund. They shall further disclose any personal financial or investment positions that could be related to the performance of the investment portfolio. Employees and officers shall refrain from undertaking personal investment transactions with the same individual with whom business is conducted on behalf of the board.
(c) The board or a professional money management firm and all employees have an affirmative duty to immediately disclose any material impact to the trust fund to the participants. To ensure such disclosure, a system of internal controls shall be established by the board, which shall be documented in writing as part of the investment policy. The controls shall be designed to prevent the loss of public funds arising from fraud, employee error, and misrepresentation by third parties, unanticipated changes in financial markets, or imprudent actions by employees and officers of the board or a professional money management firm. The controls shall also include formal escalation reporting guidelines for all employees. The guidelines shall establish procedures to address material impacts on the trust fund that require reporting and action.
(d) The investment policy shall be reviewed and approved annually by the trustees or when market changes dictate, and in each event the investment policy shall be reviewed by the Investment Advisory Council.
(3) The board or a professional money management firm may purchase such surety or other bonds as may be necessary for its officials in order to protect the trust fund. A reserve fund may be established to fulfill this purpose. However, any reserve must be a portion of the management fee and must be fully disclosed, including its purpose, in the enrollment materials at the time a unit of local government considers participation. Further, any change in the amount to be charged for a reserve must have a reasonable notice period to allow any participant to withdraw from the trust fund prior to the new reserve charge being imposed.
(4) The board or a professional money management firm shall purchase investments for a pooled investment account in which all participants share pro rata in the capital gain, income, or losses, subject to any penalties for early withdrawal. Any provisions for penalties, including their purpose, must be disclosed in the enrollment materials. Any change in the amount to be charged for a penalty must have a reasonable notice period to allow any participant to withdraw from the trust fund prior to the new penalty charge being imposed. A system shall be developed by the board, and disclosed in the enrollment materials, subject to annual approval by the trustees, to keep account balances current and to apportion pooled investment earnings to individual accounts.
(5) The board shall keep a separate account, designated by name and number of each participating local government. A maximum number of accounts allowed for each participant may be established by the board. Individual transactions and totals of all investments, or the share belonging to each participant, shall be recorded in the accounts.
(6)(a) The board or a professional money management firm shall provide a report, at a minimum monthly or upon the occurrence of a material event, to every participant having a beneficial interest in the trust fund, the board’s executive director, the trustees, the Joint Legislative Auditing Committee, and the Investment Advisory Council. The report shall include:
1. Reports of any material impacts on the trust fund and any actions or escalations taken by staff to address such impacts. The trustees shall provide quarterly a report to the Joint Legislative Auditing Committee that the trustees have reviewed and approved the monthly reports and actions taken, if any, to address any impacts.
2. A management summary that provides an analysis of the status of the current investment portfolio and the individual transactions executed over the last month. This management summary shall be prepared in a manner that will allow anyone to ascertain whether investment activities during the reporting period have conformed to investment policies. Such reporting shall be in conformance with best market practices. The board or a professional money management firm shall furnish upon request the details of an investment transaction to any participant, the trustees, and the Investment Advisory Council.
(b) The market value of the portfolio shall be calculated daily. Withdrawals from the trust fund shall be based on a process that is transparent to participants and will ensure that advantages or disadvantages do not occur to parties making deposits or withdrawals on any particular day. A statement of the market value and amortized cost of the portfolio shall be issued to participants in conjunction with any deposits or withdrawals. In addition, this information shall be reported monthly with the items in paragraph (a) to participants, the trustees, and the Investment Advisory Council. The review of the investment portfolio, in terms of value and price volatility, shall be performed with practices consistent with the GFOA Recommended Practice on “Mark-to-Market Practices for State and Local Government Investment Portfolios and Investment Pools.” In defining market value, consideration shall be given to GASB Statement 31. Additional reporting may be made to pool participants through regular and frequent ongoing multimedia educational materials and communications, including, but not limited to, historical performance, investment holdings, amortized cost and market value of the trust fund, credit quality, and average maturity of the trust fund investments.
(7) Costs incurred in carrying out the provisions of this part shall be deducted from the interest earnings accruing to the trust fund. Such deductions shall be prorated among the participant local governments in the percentage that each participant’s deposits bear to the total trust fund. The remaining interest earned shall be distributed monthly to participants according to the amount invested. Except for costs, the board or a professional money management firm may not transfer the interest or use the interest for any other purpose, including, but not limited to, making up investment losses.
(8)(a) The principal, and any part thereof, of each account constituting the trust fund is subject to payment at any time from the moneys in the trust fund. However, the executive director may, in good faith, on the occurrence of an event that has a material impact on liquidity or operations of the trust fund, for 48 hours limit contributions to or withdrawals from the trust fund to ensure that the board can invest moneys entrusted to it in exercising its fiduciary responsibility. Such action must be immediately disclosed to all participants, the trustees, the Joint Legislative Auditing Committee, and the Investment Advisory Council. The trustees shall convene an emergency meeting as soon as practicable from the time the executive director has instituted such measures and review the necessity of those measures. If the trustees are unable to convene an emergency meeting before the expiration of the 48-hour moratorium on contributions and withdrawals, the moratorium may be extended by the executive director until the trustees are able to meet to review the necessity for the moratorium. If the trustees agree with such measures, the trustees shall vote to continue the measures for up to an additional 15 days. The trustees must convene and vote to continue any such measures before the expiration of the time limit set, but in no case may the time limit set by the trustees exceed 15 days.
(b) An order to withdraw funds may not be issued upon any account for a larger amount than the share of the particular account to which it applies; and if such order is issued, the responsible official shall be personally liable under his or her bond for the entire overdraft resulting from the payment if made.
(9) The Auditor General shall conduct an annual financial audit of the trust fund, which shall include testing for compliance with the investment policy. The completed audit shall be provided to the participants, the board, the trustees, the Investment Advisory Council, and the Joint Legislative Auditing Committee. As soon as practicable, but no later than 30 days after completion of the audit, the trustees shall report to the Joint Legislative Auditing Committee that the trustees have reviewed the audit of the trust fund and shall certify that any necessary items are being addressed by a corrective action plan that includes target completion dates.
History.—s. 1, ch. 77-394; s. 4, ch. 84-137; s. 1179, ch. 95-147; s. 5, ch. 98-124; s. 5, ch. 2008-59; s. 19, ch. 2009-21; s. 13, ch. 2010-180; s. 1, ch. 2018-140.
218.411 Authorization for state technical and advisory assistance.—
(1) The board is authorized, upon request, to assist local governments in investing funds that are temporarily in excess of operating needs by:
(a) Explaining investment opportunities to such local governments through publication and other appropriate means.
(b) Acquainting such local governments with the state’s practice and experience in investing short-term funds.
(c) Providing, in cooperation with the Department of Economic Opportunity, technical assistance to local governments in investment of surplus funds.
(2) The board may establish fees to cover the cost of such services, which shall be paid by the unit of local government requesting such service. Such fees shall be deposited to the credit of the appropriation or appropriations from which the costs of providing the services have been paid or are to be charged.
History.—s. 1, ch. 77-394; s. 20, ch. 81-167; s. 18, ch. 83-55; s. 6, ch. 2008-59; s. 26, ch. 2012-96.
218.412 Rulemaking authority.—The board may adopt rules as it deems necessary to carry out the provisions of this part for the administration of the trust fund.
History.—s. 12, ch. 98-47; s. 7, ch. 2008-59.
218.415 Local government investment policies.—Investment activity by a unit of local government must be consistent with a written investment plan adopted by the governing body, or in the absence of the existence of a governing body, the respective principal officer of the unit of local government and maintained by the unit of local government or, in the alternative, such activity must be conducted in accordance with subsection (17). Any such unit of local government shall have an investment policy for any public funds in excess of the amounts needed to meet current expenses as provided in subsections (1)-(16), or shall meet the alternative investment guidelines contained in subsection (17). Such policies shall be structured to place the highest priority on the safety of principal and liquidity of funds. The optimization of investment returns shall be secondary to the requirements for safety and liquidity. Each unit of local government shall adopt policies that are commensurate with the nature and size of the public funds within its custody.
(1) SCOPE.—The investment policy shall apply to funds under the control of the unit of local government in excess of those required to meet current expenses. The investment policy shall not apply to pension funds, including those funds in chapters 175 and 185, or funds related to the issuance of debt where there are other existing policies or indentures in effect for such funds.
(2) INVESTMENT OBJECTIVES.—The investment policy shall describe the investment objectives of the unit of local government. Investment objectives shall include safety of capital, liquidity of funds, and investment income, in that order.
(3) PERFORMANCE MEASUREMENT.—The investment policy shall specify performance measures as are appropriate for the nature and size of the public funds within the custody of the unit of local government.
(4) PRUDENCE AND ETHICAL STANDARDS.—The investment policy shall describe the level of prudence and ethical standards to be followed by the unit of local government in carrying out its investment activities with respect to funds described in this section. The unit of local government shall adopt the Prudent Person Rule, which states that: “Investments should be made with judgment and care, under circumstances then prevailing, which persons of prudence, discretion, and intelligence exercise in the management of their own affairs, not for speculation, but for investment, considering the probable safety of their capital as well as the probable income to be derived from the investment.”
(5) LISTING OF AUTHORIZED INVESTMENTS.—The investment policy shall list investments authorized by the governing body of the unit of local government, subject to the provisions of subsection (16). Investments not listed in the investment policy are prohibited. If the policy authorizes investments in derivative products, the policy must require that the unit of local government’s officials responsible for making investment decisions or chief financial officer have developed sufficient understanding of the derivative products and have the expertise to manage them. For purposes of this subsection, a “derivative” is defined as a financial instrument the value of which depends on, or is derived from, the value of one or more underlying assets or index or asset values. If the policy authorizes investments in reverse repurchase agreements or other forms of leverage, the policy must limit the investments to transactions in which the proceeds are intended to provide liquidity and for which the unit of local government has sufficient resources and expertise.
(6) MATURITY AND LIQUIDITY REQUIREMENTS.—The investment policy shall require that the investment portfolio is structured in such manner as to provide sufficient liquidity to pay obligations as they come due. To that end, the investment policy should direct that, to the extent possible, an attempt will be made to match investment maturities with known cash needs and anticipated cash-flow requirements.
(7) PORTFOLIO COMPOSITION.—The investment policy shall establish guidelines for investments and limits on security issues, issuers, and maturities. Such guidelines shall be commensurate with the nature and size of the public funds within the custody of the unit of local government.
(8) RISK AND DIVERSIFICATION.—The investment policy shall provide for appropriate diversification of the investment portfolio. Investments held should be diversified to the extent practicable to control the risk of loss resulting from overconcentration of assets in a specific maturity, issuer, instrument, dealer, or bank through which financial instruments are bought and sold. Diversification strategies within the established guidelines shall be reviewed and revised periodically, as deemed necessary by the appropriate management staff.
(9) AUTHORIZED INVESTMENT INSTITUTIONS AND DEALERS.—The investment policy should specify the authorized securities dealers, issuers, and banks from whom the unit of local government may purchase securities.
(10) THIRD-PARTY CUSTODIAL AGREEMENTS.—The investment policy shall provide appropriate arrangements for the holding of assets of the unit of local government. Securities should be held with a third party; and all securities purchased by, and all collateral obtained by, the unit of local government should be properly designated as an asset of the unit of local government. No withdrawal of securities, in whole or in part, shall be made from safekeeping, except by an authorized staff member of the unit of local government. Securities transactions between a broker-dealer and the custodian involving purchase or sale of securities by transfer of money or securities must be made on a “delivery vs. payment” basis, if applicable, to ensure that the custodian will have the security or money, as appropriate, in hand at the conclusion of the transaction.
(11) MASTER REPURCHASE AGREEMENT.—The investment policy shall require all approved institutions and dealers transacting repurchase agreements to execute and perform as stated in the Master Repurchase Agreement. All repurchase agreement transactions shall adhere to the requirements of the Master Repurchase Agreement.
(12) BID REQUIREMENT.—The investment policy shall require that the unit of local government’s staff determine the approximate maturity date based on cash-flow needs and market conditions, analyze and select one or more optimal types of investment, and competitively bid the security in question when feasible and appropriate. Except as otherwise required by law, the bid deemed to best meet the investment objectives specified in subsection (2) must be selected.
(13) INTERNAL CONTROLS.—The investment policy shall provide for a system of internal controls and operational procedures. The unit of local government’s officials responsible for making investment decisions or chief financial officer shall establish a system of internal controls which shall be in writing and made a part of the governmental entity’s operational procedures. The investment policy shall provide for review of such controls by independent auditors as part of any financial audit periodically required of the unit of local government. The internal controls should be designed to prevent losses of funds which might arise from fraud, employee error, misrepresentation by third parties, or imprudent actions by employees of the unit of local government.
(14) CONTINUING EDUCATION.—The investment policy shall provide for the continuing education of the unit of local government’s officials responsible for making investment decisions or chief financial officer. Such officials must annually complete 8 hours of continuing education in subjects or courses of study related to investment practices and products.
(15) REPORTING.—The investment policy shall provide for appropriate annual or more frequent reporting of investment activities. To that end, the governmental entity’s officials responsible for making investment decisions or chief financial officer shall prepare periodic reports for submission to the legislative and governing body of the unit of local government, which shall include securities in the portfolio by class or type, book value, income earned, and market value as of the report date. Such reports shall be available to the public.
(16) AUTHORIZED INVESTMENTS; WRITTEN INVESTMENT POLICIES.—Those units of local government electing to adopt a written investment policy as provided in subsections (1)-(15) may by resolution invest and reinvest any surplus public funds in their control or possession in:
(a) The Local Government Surplus Funds Trust Fund or any intergovernmental investment pool authorized pursuant to the Florida Interlocal Cooperation Act of 1969, as provided in s. 163.01.
(b) Securities and Exchange Commission registered money market funds with the highest credit quality rating from a nationally recognized rating agency.
(c) Interest-bearing time deposits or savings accounts in qualified public depositories as defined in s. 280.02.
(d) Direct obligations of the United States Treasury.
(e) Federal agencies and instrumentalities.
(f) Rated or unrated bonds, notes, or instruments backed by the full faith and credit of the government of Israel.
(g) Securities of, or other interests in, any open-end or closed-end management-type investment company or investment trust registered under the Investment Company Act of 1940, 15 U.S.C. ss. 80a-1 et seq., as amended from time to time, provided that the portfolio of such investment company or investment trust is limited to obligations of the United States Government or any agency or instrumentality thereof and to repurchase agreements fully collateralized by such United States Government obligations, and provided that such investment company or investment trust takes delivery of such collateral either directly or through an authorized custodian.
(h) Other investments authorized by law or by ordinance for a county or a municipality.
(i) Other investments authorized by law or by resolution for a school district or a special district.
(17) AUTHORIZED INVESTMENTS; NO WRITTEN INVESTMENT POLICY.—Those units of local government electing not to adopt a written investment policy in accordance with investment policies developed as provided in subsections (1)-(15) may invest or reinvest any surplus public funds in their control or possession in:
(a) The Local Government Surplus Funds Trust Fund, or any intergovernmental investment pool authorized pursuant to the Florida Interlocal Cooperation Act of 1969, as provided in s. 163.01.
(b) Securities and Exchange Commission registered money market funds with the highest credit quality rating from a nationally recognized rating agency.
(c) Interest-bearing time deposits or savings accounts in qualified public depositories, as defined in s. 280.02.
(d) Direct obligations of the U.S. Treasury.
The securities listed in paragraphs (c) and (d) shall be invested to provide sufficient liquidity to pay obligations as they come due.
(18) SECURITIES; DISPOSITION.—
(a) Every security purchased under this section on behalf of the governing body of a unit of local government must be properly earmarked and:
1. If registered with the issuer or its agents, must be immediately placed for safekeeping in a location that protects the governing body’s interest in the security;
2. If in book entry form, must be held for the credit of the governing body by a depository chartered by the Federal Government, the state, or any other state or territory of the United States which has a branch or principal place of business in this state as defined in s. 658.12, or by a national association organized and existing under the laws of the United States which is authorized to accept and execute trusts and which is doing business in this state, and must be kept by the depository in an account separate and apart from the assets of the financial institution; or
3. If physically issued to the holder but not registered with the issuer or its agents, must be immediately placed for safekeeping in a secured vault.
(b) The unit of local government’s governing body may also receive bank trust receipts in return for investment of surplus funds in securities. Any trust receipts received must enumerate the various securities held, together with the specific number of each security held. The actual securities on which the trust receipts are issued may be held by any bank depository chartered by the Federal Government, this state, or any other state or territory of the United States which has a branch or principal place of business in this state as defined in s. 658.12, or by a national association organized and existing under the laws of the United States which is authorized to accept and execute trusts and which is doing business in this state.
(19) SALE OF SECURITIES.—When the invested funds are needed in whole or in part for the purposes originally intended or for more optimal investments, the unit of local government’s governing body may sell such investments at the then-prevailing market price and place the proceeds into the proper account or fund of the unit of local government.
(20) PREEXISTING CONTRACT.—Any public funds subject to a contract or agreement existing on October 1, 2000, may not be invested contrary to such contract or agreement.
(21) PREEMPTION.—Any provision of any special act, municipal charter, or other law which prohibits or restricts a local governmental entity from complying with this section or any rules adopted under this section is void to the extent of the conflict.
(22) AUDITS.—Certified public accountants conducting audits of units of local government pursuant to s. 218.39 shall report, as part of the audit, whether or not the unit of local government has complied with this section.
(23) AUTHORIZED DEPOSITS.—In addition to the investments authorized for local governments in subsections (16) and (17) and notwithstanding any other provisions of law, a unit of local government may deposit any portion of surplus public funds in its control or possession in accordance with the following conditions:
(a) The funds are initially deposited in a qualified public depository, as defined in s. 280.02, selected by the unit of local government.
(b) The selected depository arranges for depositing the funds in financial deposit instruments insured by the Federal Deposit Insurance Corporation in one or more federally insured banks or savings and loan associations, wherever located, for the account of the unit of local government.
(c) The full amount of the principal and accrued interest of each financial deposit instrument is insured by the Federal Deposit Insurance Corporation.
(d) The selected depository acts as custodian for the unit of local government with respect to each financial deposit instrument issued for its account.
History.—s. 1, ch. 95-194; s. 2, ch. 97-9; s. 3, ch. 2000-264; ss. 66, 141, ch. 2001-266; s. 2, ch. 2005-126; s. 1, ch. 2007-89; s. 42, ch. 2008-4; s. 2, ch. 2009-140.
PART V
LOCAL GOVERNMENTAL ENTITY AND DISTRICTSCHOOL BOARD FINANCIAL EMERGENCIES
218.50 Short title.
218.501 Purposes.
218.502 Definition.
218.503 Determination of financial emergency.
218.5031 Ratification of certain municipal parking surcharges.
218.504 Cessation of state action.
218.50 Short title.—Sections 218.50-218.504 may be cited as the “Local Governmental Entity, Charter School, Charter Technical Career Center, and District School Board Financial Emergencies Act.”
History.—s. 8, ch. 79-183; s. 32, ch. 2004-305; s. 3, ch. 2006-190; s. 3, ch. 2009-214.
218.501 Purposes.—The purposes of ss. 218.50-218.504 are:
(1) To promote the fiscal responsibility of local governmental entities, charter schools, charter technical career centers, and district school boards.
(2) To assist local governmental entities, charter schools, charter technical career centers, and district school boards in providing essential services without interruption and in meeting their financial obligations.
(3) To assist local governmental entities, charter schools, charter technical career centers, and district school boards through the improvement of local financial management procedures.
History.—s. 8, ch. 79-183; s. 25, ch. 96-324; s. 33, ch. 2004-305; s. 4, ch. 2006-190; s. 4, ch. 2009-214.
218.502 Definition.—As used in ss. 218.50-218.504, the term “local governmental entity” means a county, municipality, or special district.
History.—s. 8, ch. 79-183; s. 26, ch. 96-324; s. 24, ch. 99-333; s. 34, ch. 2004-305.
218.503 Determination of financial emergency.—
(1) Local governmental entities, charter schools, charter technical career centers, and district school boards shall be subject to review and oversight by the Governor, the charter school sponsor, the charter technical career center sponsor, or the Commissioner of Education, as appropriate, when any one of the following conditions occurs:
(a) Failure within the same fiscal year in which due to pay short-term loans or failure to make bond debt service or other long-term debt payments when due, as a result of a lack of funds.
(b) Failure to pay uncontested claims from creditors within 90 days after the claim is presented, as a result of a lack of funds.
(c) Failure to transfer at the appropriate time, due to lack of funds:
1. Taxes withheld on the income of employees; or
2. Employer and employee contributions for:
a. Federal social security; or
b. Any pension, retirement, or benefit plan of an employee.
(d) Failure for one pay period to pay, due to lack of funds:
1. Wages and salaries owed to employees; or
2. Retirement benefits owed to former employees.
(2) A local governmental entity shall notify the Governor and the Legislative Auditing Committee; a charter school shall notify the charter school sponsor, the Commissioner of Education, and the Legislative Auditing Committee; a charter technical career center shall notify the charter technical career center sponsor, the Commissioner of Education, and the Legislative Auditing Committee; and a district school board shall notify the Commissioner of Education and the Legislative Auditing Committee, when one or more of the conditions specified in subsection (1) have occurred or will occur if action is not taken to assist the local governmental entity, charter school, charter technical career center, or district school board. In addition, any state agency must, within 30 days after a determination that one or more of the conditions specified in subsection (1) have occurred or will occur if action is not taken to assist the local governmental entity, charter school, charter technical career center, or district school board, notify the Governor, charter school sponsor, charter technical career center sponsor, or the Commissioner of Education, as appropriate, and the Legislative Auditing Committee.
(3) Upon notification that one or more of the conditions in subsection (1) have occurred or will occur if action is not taken to assist the local governmental entity or district school board, the Governor or his or her designee shall contact the local governmental entity or the Commissioner of Education or his or her designee shall contact the district school board, as appropriate, to determine what actions have been taken by the local governmental entity or the district school board to resolve or prevent the condition. The information requested must be provided within 45 days after the date of the request. If the local governmental entity or the district school board does not comply with the request, the Governor or his or her designee or the Commissioner of Education or his or her designee shall notify the Legislative Auditing Committee, which may take action pursuant to s. 11.40(2). The Governor or the Commissioner of Education, as appropriate, shall determine whether the local governmental entity or the district school board needs state assistance to resolve or prevent the condition. If state assistance is needed, the local governmental entity or district school board is considered to be in a state of financial emergency. The Governor or the Commissioner of Education, as appropriate, has the authority to implement measures as set forth in ss. 218.50-218.504 to assist the local governmental entity or district school board in resolving the financial emergency. Such measures may include, but are not limited to:
(a) Requiring approval of the local governmental entity’s budget by the Governor or approval of the district school board’s budget by the Commissioner of Education.
(b) Authorizing a state loan to a local governmental entity and providing for repayment of same.
(c) Prohibiting a local governmental entity or district school board from issuing bonds, notes, certificates of indebtedness, or any other form of debt until such time as it is no longer subject to this section.
(d) Making such inspections and reviews of records, information, reports, and assets of the local governmental entity or district school board as are needed. The appropriate local officials shall cooperate in such inspections and reviews.
(e) Consulting with officials and auditors of the local governmental entity or the district school board and the appropriate state officials regarding any steps necessary to bring the books of account, accounting systems, financial procedures, and reports into compliance with state requirements.
(f) Providing technical assistance to the local governmental entity or the district school board.
(g)1. Establishing a financial emergency board to oversee the activities of the local governmental entity or the district school board. If a financial emergency board is established for a local governmental entity, the Governor shall appoint board members and select a chair. If a financial emergency board is established for a district school board, the State Board of Education shall appoint board members and select a chair. The financial emergency board shall adopt such rules as are necessary for conducting board business. The board may:
a. Make such reviews of records, reports, and assets of the local governmental entity or the district school board as are needed.
b. Consult with officials and auditors of the local governmental entity or the district school board and the appropriate state officials regarding any steps necessary to bring the books of account, accounting systems, financial procedures, and reports of the local governmental entity or the district school board into compliance with state requirements.
c. Review the operations, management, efficiency, productivity, and financing of functions and operations of the local governmental entity or the district school board.
d. Consult with other governmental entities for the consolidation of all administrative direction and support services, including, but not limited to, services for asset sales, economic and community development, building inspections, parks and recreation, facilities management, engineering and construction, insurance coverage, risk management, planning and zoning, information systems, fleet management, and purchasing.
2. The recommendations and reports made by the financial emergency board must be submitted to the Governor for local governmental entities or to the Commissioner of Education and the State Board of Education for district school boards for appropriate action.
(h) Requiring and approving a plan, to be prepared by officials of the local governmental entity or the district school board in consultation with the appropriate state officials, prescribing actions that will cause the local governmental entity or district school board to no longer be subject to this section. The plan must include, but need not be limited to:
1. Provision for payment in full of obligations outlined in subsection (1), designated as priority items, which are currently due or will come due.
2. Establishment of priority budgeting or zero-based budgeting in order to eliminate items that are not affordable.
3. The prohibition of a level of operations which can be sustained only with nonrecurring revenues.
4. Provisions implementing the consolidation, sourcing, or discontinuance of all administrative direction and support services, including, but not limited to, services for asset sales, economic and community development, building inspections, parks and recreation, facilities management, engineering and construction, insurance coverage, risk management, planning and zoning, information systems, fleet management, and purchasing.
(4)(a) Upon notification that one or more of the conditions in subsection (1) have occurred or will occur if action is not taken to assist the charter school, the charter school sponsor or the sponsor’s designee and the Commissioner of Education shall contact the charter school governing body to determine what actions have been taken by the charter school governing body to resolve or prevent the condition. The Commissioner of Education has the authority to require and approve a financial recovery plan, to be prepared by the charter school governing body, prescribing actions that will resolve or prevent the condition.
(b) Upon notification that one or more of the conditions in subsection (1) have occurred or will occur if action is not taken to assist the charter technical career center, the charter technical career center sponsor or the sponsor’s designee and the Commissioner of Education shall contact the charter technical career center governing body to determine what actions have been taken by the governing body to resolve or prevent the condition. The Commissioner of Education may require and approve a financial recovery plan, to be prepared by the charter technical career center governing body, prescribing actions that will resolve or prevent the condition.
(c) The Commissioner of Education shall determine if the charter school or charter technical career center needs a financial recovery plan to resolve the condition. If the Commissioner of Education determines that a financial recovery plan is needed, the charter school or charter technical career center is considered to be in a state of financial emergency.
The Department of Education, with the involvement of sponsors, charter schools, and charter technical career centers, shall establish guidelines for developing a financial recovery plan.
(5) A local governmental entity or district school board may not seek application of laws under the bankruptcy provisions of the United States Constitution except with the prior approval of the Governor for local governmental entities or the Commissioner of Education for district school boards.
(6) The failure of the members of the governing body of a local governmental entity or the failure of the members of a district school board to resolve a state of financial emergency constitutes malfeasance, misfeasance, and neglect of duty for purposes of s. 7, Art. IV of the State Constitution.
History.—s. 8, ch. 79-183; s. 54, ch. 89-169; s. 1180, ch. 95-147; s. 27, ch. 96-324; s. 29, ch. 97-96; s. 132, ch. 99-251; s. 1, ch. 2001-354; s. 35, ch. 2004-305; s. 5, ch. 2006-190; s. 6, ch. 2007-6; s. 5, ch. 2009-214; s. 21, ch. 2011-144; s. 2, ch. 2012-38; s. 23, ch. 2019-15.
218.5031 Ratification of certain municipal parking surcharges.—Any ordinance of any municipality imposing a surcharge pursuant to s. 132, chapter 99-251, Laws of Florida, is hereby ratified. All acts and proceedings, including enforcement procedures, taken in connection with a parking surcharge imposed by a municipality pursuant to s. 132, chapter 99-251, are ratified, validated, and confirmed, and the surcharge is declared to be legal and valid in all respects from the date of enactment of chapter 99-251.
History.—s. 1, ch. 2001-373.
218.504 Cessation of state action.—The Governor or the Commissioner of Education, as appropriate, has the authority to terminate all state actions pursuant to ss. 218.50-218.504. Cessation of state action must not occur until the Governor or the Commissioner of Education, as appropriate, has determined that:
(1) The local governmental entity, charter school, charter technical career center, or district school board:
(a) Has established and is operating an effective financial accounting and reporting system.
(b) Has resolved the conditions outlined in s. 218.503(1).
(2) None of the conditions outlined in s. 218.503(1) exists.
History.—s. 8, ch. 79-183; s. 28, ch. 96-324; s. 36, ch. 2004-305; s. 6, ch. 2006-190; s. 6, ch. 2009-214.
PART VI
PARTICIPATION IN HALF-CENTSALES TAX PROCEEDS
218.60 Definitions.
218.61 Local government half-cent sales tax; designated proceeds; trust fund.
218.62 Distribution formulas.
218.63 Participation requirements.
218.64 Local government half-cent sales tax; uses; limitations.
218.65 Emergency distribution.
218.66 Special distributions for contested property taxes.
218.67 Distribution for fiscally constrained counties.
218.60 Definitions.—
(1) As used in this part, unless the context clearly indicates a different meaning:
(a) “Population” means the latest official state estimate of population certified pursuant to s. 186.901 prior to the beginning of the local government fiscal year.
(b) “Utility tax relief” means a dollar amount which represents a reduction in taxes to be collected pursuant to ss. 166.231 and 166.232 for the upcoming fiscal year compared to such taxes collected in the current year, which reduction results from a reduction in the tax rate.
(2) All definitions and provisions of s. 200.001 are applicable to this part.
History.—s. 10, ch. 82-154; s. 11, ch. 83-204; s. 86, ch. 83-217; s. 60, ch. 87-224; s. 26, ch. 98-136; s. 41, ch. 2005-152.
218.61 Local government half-cent sales tax; designated proceeds; trust fund.—
(1) Each participating county or municipal government shall receive a portion of the local government half-cent sales tax, as provided in this part.
(2) Money remitted by a sales tax dealer located within the county and transferred into the Local Government Half-cent Sales Tax Clearing Trust Fund shall be earmarked for distribution to the governing body of that county and of each municipality within that county. Such distributions shall be made after funding is provided pursuant to s. 218.64(3), if applicable. Such moneys shall be known as the “local government half-cent sales tax.”
(3) There is created in the State Treasury the Local Government Half-cent Sales Tax Clearing Trust Fund. Moneys in the fund are hereby appropriated to the Department of Revenue and shall be distributed monthly to participating units of local government.
History.—s. 10, ch. 82-154; s. 3, ch. 82-399; s. 10, ch. 83-297; s. 68, ch. 85-342; s. 42, ch. 87-548; s. 48, ch. 89-356; s. 3, ch. 2006-262.
218.62 Distribution formulas.—
(1) Each participating county and municipal government shall receive a proportion of moneys earmarked for distribution within that county.
(2) The proportion for each county government shall be computed by dividing the sum of the unincorporated area population plus two-thirds of the incorporated area population by the sum of the total county population plus two-thirds of the incorporated area population.
(3) The proportion for each municipal government shall be computed by dividing the population of that municipality by the sum of the total county population plus two-thirds of the incorporated area population.
(4) Effective October 1, 2000, the apportionment factors shall, except in the case of error in the population certified pursuant to s. 186.901, remain in effect for the fiscal year. Adjustments to distributions to correct errors shall be made subsequent to receipt of a corrected population certified pursuant to s. 186.901.
History.—s. 10, ch. 82-154; s. 1, ch. 2003-33.
218.63 Participation requirements.—
(1) Only those units of local government which meet the eligibility requirements for revenue sharing pursuant to s. 218.23 shall participate in the local government half-cent sales tax. However, a municipality incorporated subsequent to the effective date of chapter 82-154, Laws of Florida, which does not meet the applicable criteria for incorporation pursuant to s. 165.061 shall not participate in the local government half-cent sales tax. In either case, distributions to eligible units of local government in that county shall be made as though the nonparticipating municipality had not incorporated.
(2) The moneys which otherwise would be distributed pursuant to this part to a unit of local government failing to certify compliance as required by s. 218.23(1) or having otherwise failed to meet the requirements of s. 200.065 shall be deposited in the General Revenue Fund for the 12 months following a determination of noncompliance by the department.
(3) A county or municipality may not participate in the distribution of local government half-cent sales tax revenues during the 12 months following a determination of noncompliance by the Department of Revenue as provided in s. 200.065(13)(e).
History.—s. 10, ch. 82-154; s. 14, ch. 83-204; s. 87, ch. 83-217; s. 8, ch. 87-239; s. 4, ch. 2007-321.
218.64 Local government half-cent sales tax; uses; limitations.—
(1) The proportion of the local government half-cent sales tax received by a county government based on two-thirds of the incorporated area population shall be deemed countywide revenues and shall be expended only for countywide tax relief or countywide programs. The remaining county government portion shall be deemed county revenues derived on behalf of the unincorporated area but may be expended on a countywide basis.
(2) Municipalities shall expend their portions of the local government half-cent sales tax only for municipality-wide programs, for reimbursing the state as required pursuant to s. 288.11625, or for municipality-wide property tax or municipal utility tax relief. All utility tax rate reductions afforded by participation in the local government half-cent sales tax shall be applied uniformly across all types of taxed utility services.
(3) Subject to ordinances enacted by the majority of the members of the county governing authority and by the majority of the members of the governing authorities of municipalities representing at least 50 percent of the municipal population of such county, counties may use up to $3 million annually of the local government half-cent sales tax allocated to that county for any of the following purposes:
(a) Funding a certified applicant as a facility for a new or retained professional sports franchise under s. 288.1162 or a certified applicant as defined in s. 288.11621 for a facility for a spring training franchise. It is the Legislature’s intent that the provisions of s. 288.1162, including, but not limited to, the evaluation process by the Department of Economic Opportunity except for the limitation on the number of certified applicants or facilities as provided in that section and the restrictions set forth in s. 288.1162(8), shall apply to an applicant’s facility to be funded by local government as provided in this subsection.
(b) Funding a certified applicant as a “motorsport entertainment complex,” as provided for in s. 288.1171. Funding for each franchise or motorsport complex shall begin 60 days after certification and shall continue for not more than 30 years.
(c) Reimbursing the state as required under s. 288.11625.
(4) A local government is authorized to pledge proceeds of the local government half-cent sales tax for the payment of principal and interest on any capital project.
History.—s. 10, ch. 82-154; s. 4, ch. 2006-262; s. 23, ch. 2007-5; s. 3, ch. 2010-140; s. 34, ch. 2010-147; s. 87, ch. 2011-142; s. 2, ch. 2014-167.
218.65 Emergency distribution.—
(1) Each county government which meets the provisions of subsection (2) or subsection (8) and which participates in the local government half-cent sales tax shall receive a distribution from the Local Government Half-cent Sales Tax Clearing Trust Fund in addition to its regular monthly distribution as provided in this part.
(2) The Legislature hereby finds and declares that a fiscal emergency exists in any county which meets the following criteria:
(a) The county has a population of 65,000 or less; and
(b) The moneys distributed to the county government pursuant to s. 218.62 for the prior fiscal year were less than the current per capita limitation, based on the population of that county.
(3) Qualification under this section shall be determined annually at the start of the fiscal year. Emergency and supplemental moneys shall be distributed monthly with other moneys provided pursuant to this part.
(4) For the fiscal year beginning in 1988, the per capita limitation shall be $24.60. Thereafter, commencing with the fiscal year which begins in 1989, this limitation shall be adjusted annually for inflation. The annual adjustment to the per capita limitation for each fiscal period shall be the percentage change in the state and local government price deflator for purchases of goods and services, all items, 1983 equals 100, or successor reports for the preceding calendar year as initially reported by the United States Department of Commerce, Bureau of Economic Analysis, as certified by the Florida Consensus Estimating Conference.
(5) At the beginning of each fiscal year, the Department of Revenue shall calculate a base allocation for each eligible county equal to the difference between the current per capita limitation times the county’s population, minus prior year ordinary distributions to the county pursuant to ss. 212.20(6)(d)2., 218.61, and 218.62. If moneys deposited into the Local Government Half-cent Sales Tax Clearing Trust Fund pursuant to s. 212.20(6)(d)3., excluding moneys appropriated for supplemental distributions pursuant to subsection (8), for the current year are less than or equal to the sum of the base allocations, each eligible county shall receive a share of the appropriated amount proportional to its base allocation. If the deposited amount exceeds the sum of the base allocations, each county shall receive its base allocation, and the excess appropriated amount, less any amounts distributed under subsection (6), shall be distributed equally on a per capita basis among the eligible counties.
(6) If moneys deposited in the Local Government Half-cent Sales Tax Clearing Trust Fund pursuant to s. 212.20(6)(d)3. exceed the amount necessary to provide the base allocation to each eligible county, the moneys in the trust fund may be used to provide a transitional distribution, as specified in this subsection, to certain counties whose population has increased. The transitional distribution shall be made available to each county that qualified for a distribution under subsection (2) in the prior year but does not, because of the requirements of paragraph (2)(a), qualify for a distribution in the current year. Beginning on July 1 of the year following the year in which the county no longer qualifies for a distribution under subsection (2), the county shall receive two-thirds of the amount received in the prior year, and beginning July 1 of the second year following the year in which the county no longer qualifies for a distribution under subsection (2), the county shall receive one-third of the amount it received in the last year it qualified for the distribution under subsection (2). If insufficient moneys are available in the Local Government Half-cent Sales Tax Clearing Trust Fund to fully provide such a transitional distribution to each county that meets the eligibility criteria in this section, each eligible county shall receive a share of the available moneys proportional to the amount it would have received had moneys been sufficient to fully provide such a transitional distribution to each eligible county.
(7) There is hereby annually appropriated from the Local Government Half-cent Sales Tax Clearing Trust Fund the distribution provided in s. 212.20(6)(d)3. to be used for emergency and supplemental distributions pursuant to this section.
(8)(a) Any county the inmate population of which in any year is greater than 7 percent of the total population of the county is eligible for a supplemental distribution for that year from funds expressly appropriated therefor. At the beginning of each fiscal year, the Department of Revenue shall calculate a supplemental allocation for each eligible county equal to the current per capita limitation pursuant to subsection (4) times the inmate population of the county. If moneys appropriated for distribution pursuant to this section for the current year are less than the sum of supplemental allocations, each eligible county shall receive a share of the appropriated amount proportional to its supplemental allocation. Otherwise, each shall receive an amount equal to its supplemental allocation.
(b) For the purposes of this subsection, the term:
1. “Inmate population” means the latest official state estimate of the number of inmates and patients residing in institutions operated by the Federal Government, the Department of Corrections, or the Department of Children and Families.
2. “Total population” includes inmate population and noninmate population.
History.—s. 10, ch. 82-154; s. 1, ch. 83-299; s. 39, ch. 88-119; s. 1, ch. 90-93; s. 2, ch. 94-245; s. 328, ch. 96-410; s. 10, ch. 98-258; s. 93, ch. 99-2; s. 24, ch. 99-8; s. 3, ch. 2000-206; s. 31, ch. 2001-140; s. 2, ch. 2006-229; s. 8, ch. 2009-68; s. 47, ch. 2014-19.
218.66 Special distributions for contested property taxes.—
(1) In the event that an action to contest a tax assessment is brought by a taxpayer in a county or municipality participating in the distribution of half-cent sales tax proceeds pursuant to s. 218.61 and the difference between the good faith payment made by that taxpayer pursuant to s. 194.171(3) and the taxes that would have been paid on the property appraiser’s tax assessment is greater than 6 percent of the total assessed taxes for the county or municipality, the county or municipality qualifies for a special distribution of funds from the Local Government Half-cent Sales Tax Clearing Trust Fund as provided in this section.
(2) The determination of eligibility for the special distribution pursuant to this section and the amount of the distribution shall be calculated based on the total of districtwide millage levies by the county or municipality. The distribution shall be made upon application to the Department of Revenue by a qualified county or municipality in which the action to contest a tax assessment has not been resolved by July 1 of the year following the year in which the tax was assessed. Distributions shall be made prior to September 30 of that year and shall be in an amount equal to 95 percent of the difference between the good faith payment by the taxpayer and the taxes that would have been paid on the property appraiser’s tax assessment. Counties or municipalities receiving such distributions must use the revenue in the same manner prescribed for the ad valorem revenue which the distribution replaces. In calculating the distribution to participating county and municipal governments pursuant to s. 218.61, the amount earmarked for distribution within each county pursuant to s. 218.61(2) shall be reduced by a portion of the amount required for the special distribution equal to its proportionate share of total moneys remitted for distribution by sales tax dealers located in all counties.
(3) Upon resolution of the action to contest the tax assessment, any county or municipality which received a special distribution pursuant to this section shall immediately repay to the Local Government Half-cent Sales Tax Clearing Trust Fund the full amount of any tax revenues received as a result of the resolution. In calculating the distribution to participating county and municipal governments pursuant to s. 218.61, the amount earmarked for distribution within each county pursuant to s. 218.61(2) shall be increased by a portion of the amount of such repayment equal to its proportionate share of total moneys remitted for distribution by sales tax dealers located in all counties.
History.—s. 2, ch. 98-228.
218.67 Distribution for fiscally constrained counties.—
(1) Each county that is entirely within a rural area of opportunity as designated by the Governor pursuant to s. 288.0656 or each county for which the value of a mill will raise no more than $5 million in revenue, based on the taxable value certified pursuant to s. 1011.62(4)(a)1.a., from the previous July 1, shall be considered a fiscally constrained county.
(2) Each fiscally constrained county government that participates in the local government half-cent sales tax shall be eligible to receive an additional distribution from the Local Government Half-cent Sales Tax Clearing Trust Fund, as provided in s. 202.18(2)(c)1., in addition to its regular monthly distribution provided under this part and any emergency or supplemental distribution under s. 218.65.
(3) The amount to be distributed to each fiscally constrained county shall be determined by the Department of Revenue at the beginning of the fiscal year, using the prior fiscal year’s July 1 taxable value certified pursuant to s. 1011.62(4)(a)1.a., tax data, population as defined in s. 218.21, and millage rate levied for the prior fiscal year. The amount distributed shall be allocated based upon the following factors:
(a) The relative revenue-raising-capacity factor shall be the ability of the eligible county to generate ad valorem revenues from 1 mill of taxation on a per capita basis. A county that raises no more than $25 per capita from 1 mill shall be assigned a value of 1; a county that raises more than $25 but no more than $30 per capita from 1 mill shall be assigned a value of 0.75; and a county that raises more than $30 but no more than $50 per capita from 1 mill shall be assigned a value of 0.5. No value shall be assigned to counties that raise more than $50 per capita from 1 mill of ad valorem taxation.
(b) The local-effort factor shall be a measure of the relative level of local effort of the eligible county as indicated by the millage rate levied for the prior fiscal year. The local-effort factor shall be the most recently adopted countywide operating millage rate for each eligible county multiplied by 0.1.
(c) Each eligible county’s proportional allocation of the total amount available to be distributed to all of the eligible counties shall be in the same proportion as the sum of the county’s two factors is to the sum of the two factors for all eligible counties. The counties that are eligible to receive an allocation under this subsection and the amount available to be distributed to such counties shall not include counties participating in the phaseout period under subsection (4) or the amounts they remain eligible to receive during the phaseout.
(4) For those counties that no longer qualify under the requirements of subsection (1) after the effective date of this act, there shall be a 2-year phaseout period. Beginning on July 1 of the year following the year in which the value of a mill for that county exceeds $5 million in revenue, the county shall receive two-thirds of the amount received in the prior year, and beginning on July 1 of the second year following the year in which the value of a mill for that county exceeds $5 million in revenue, the county shall receive one-third of the amount received in the last year that the county qualified as a fiscally constrained county. Following the 2-year phaseout period, the county shall no longer be eligible to receive any distributions under this section unless the county can be considered a fiscally constrained county as provided in subsection (1).
(5) The revenues received under this section may be used by a county for any public purpose, except that such revenues may not be used to pay debt service on bonds, notes, certificates of participation, or any other forms of indebtedness.
History.—s. 3, ch. 2006-229; s. 29, ch. 2014-218.
PART VII
LOCAL GOVERNMENT PROMPT PAYMENT ACT218.70 Popular name.
218.71 Purpose and policy.
218.72 Definitions.
218.73 Timely payment for nonconstruction services.
218.735 Timely payment for purchases of construction services.
218.74 Procedures for calculation of payment due dates.
218.75 Mandatory interest.
218.76 Improper payment request or invoice; resolution of disputes.
218.77 Payment by federal funds.
218.78 Report of interest.
218.79 Repeal of conflicting laws.
218.80 Public Bid Disclosure Act.
218.70 Popular name.—This part may be cited as the “Local Government Prompt Payment Act.”
History.—s. 4, ch. 89-297; s. 1, ch. 2005-230.
218.71 Purpose and policy.—
(1) The purpose of this part is:
(a) To provide for prompt payments by local governmental entities and their institutions and agencies.
(b) To provide for interest payments on late payments made by local governmental entities and their institutions and agencies.
(c) To provide for a dispute resolution process for payment of obligations.
(2) It is the policy of this state that payment for all purchases by local governmental entities be made in a timely manner.
History.—s. 4, ch. 89-297.
218.72 Definitions.—As used in this part, the term:
(1) “Agent” means the project architect, project engineer, or other agency or person acting on behalf of the local governmental entity. The agent who is required to review invoices or payment requests must be identified in accordance with s. 218.735(1).
(2) “Construction services” means all labor, services, and materials provided in connection with the construction, alteration, repair, demolition, reconstruction, or other improvements to real property.
(3) “Contractor” or “provider of construction services” means the person who contracts directly with a local governmental entity to provide construction services.
(4) “County” means a political subdivision of the state established pursuant to s. 1, Art. VIII of the State Constitution.
(5) “Local governmental entity” means a county or municipal government, school board, school district, authority, special taxing district, other political subdivision, or any office, board, bureau, commission, department, branch, division, or institution thereof.
(6) “Municipality” means a municipality created pursuant to general or special law and metropolitan and consolidated governments as provided in s. 6(e) and (f), Art. VIII of the State Constitution.
(7) “Payment request” means a request for payment for construction services which conforms with all statutory requirements and all requirements specified by the local governmental entity to which the payment request is submitted. Such requirements must be included in the contract for the project for which payment is requested.
(8) “Proper invoice” means an invoice that conforms with all statutory requirements and all requirements specified by the local governmental entity to which the invoice is submitted. Such requirements must be included in the contract for the project for which the invoice is submitted.
(9) “Purchase” means the purchase of goods, services, or construction services; the purchase or lease of personal property; or the lease of real property by a local governmental entity.
(10) “Vendor” means any person who sells goods or services, sells or leases personal property, or leases real property directly to a local governmental entity. The term includes any person who provides waste hauling services to residents or businesses located within the boundaries of a local government pursuant to a contract or local ordinance.
History.—s. 4, ch. 89-297; s. 1, ch. 95-331; s. 1, ch. 2001-169; s. 2, ch. 2005-230; s. 1, ch. 2010-111.
218.73 Timely payment for nonconstruction services.—The time at which payment is due for a purchase other than construction services by a local governmental entity must be calculated from:
(1) The date on which a proper invoice is received by the chief disbursement officer of the local governmental entity after approval by the governing body, if required; or
(2) If a proper invoice is not received by the local governmental entity, the date:
(a) On which delivery of personal property is accepted by the local governmental entity;
(b) On which services are completed;
(c) On which the rental period begins; or
(d) On which the local governmental entity and vendor agree in a contract that provides dates relative to payment periods;
whichever date is latest.
History.—s. 4, ch. 89-297; s. 2, ch. 95-331; s. 2, ch. 2001-169.
218.735 Timely payment for purchases of construction services.—
(1) The due date for payment for the purchase of construction services by a local governmental entity is determined as follows:
(a) If an agent must approve the payment request or invoice before the payment request or invoice is submitted to the local governmental entity, payment is due 25 business days after the date on which the payment request or invoice is stamped as received as provided in s. 218.74(1). The contractor may send the local government an overdue notice. If the payment request or invoice is not rejected within 4 business days after delivery of the overdue notice, the payment request or invoice shall be deemed accepted, except for any portion of the payment request or invoice that is fraudulent or misleading.
(b) If an agent need not approve the payment request or invoice submitted by the contractor, payment is due 20 business days after the date on which the payment request or invoice is stamped as received as provided in s. 218.74(1).
A local governmental entity shall identify the agent or employee of the local governmental entity, or the facility or office, to which the contractor may submit its payment request or invoice. This requirement shall be included in the contract between the local governmental entity and contractor, or shall be provided by the local governmental entity through a separate written notice, as required under the contract, no later than 10 days after the contract award or notice to proceed. A contractor’s submission of a payment request or invoice to the identified agent, employee, facility, or office of the local governmental entity shall be stamped as received as provided in s. 218.74(1) and shall commence the time periods for payment or rejection of a payment request or invoice as provided in this subsection and subsection (2).
(2) If a payment request or invoice does not meet the contract requirements, the local governmental entity must reject the payment request or invoice within 20 business days after the date on which the payment request or invoice is stamped as received as provided in s. 218.74(1). The rejection must be written and must specify the deficiency and the action necessary to make the payment request or invoice proper.
(3) If a payment request or an invoice is rejected under subsection (2) and the contractor submits a payment request or invoice that corrects the deficiency, the corrected payment request or invoice must be paid or rejected on the later of:
(a) Ten business days after the date the corrected payment request or invoice is stamped as received as provided in s. 218.74(1); or
(b) If the local governmental entity is required by ordinance, charter, or other law to approve or reject the corrected payment request or invoice, the first business day after the next regularly scheduled meeting of the local governmental entity held after the corrected payment request or invoice is stamped as received as provided in s. 218.74(1).
(4) If a dispute between the local governmental entity and the contractor cannot be resolved by the procedure in subsection (3), the dispute must be resolved in accordance with the dispute resolution procedure prescribed in the construction contract or in any applicable ordinance, which shall be referenced in the contract. In the absence of a prescribed procedure, the dispute must be resolved by the procedure specified in s. 218.76(2).
(5) If a local governmental entity disputes a portion of a payment request or an invoice, the undisputed portion shall be paid timely, in accordance with subsection (1).
(6) If a contractor receives payment from a local governmental entity for labor, services, or materials furnished by subcontractors and suppliers hired by the contractor, the contractor must remit payment due to those subcontractors and suppliers within 10 days after the contractor’s receipt of payment. If a subcontractor receives payment from a contractor for labor, services, or materials furnished by subcontractors and suppliers hired by the subcontractor, the subcontractor must remit payment due to those subcontractors and suppliers within 7 days after the subcontractor’s receipt of payment. This subsection does not prohibit a contractor or subcontractor from disputing, pursuant to the terms of the relevant contract, all or any portion of a payment alleged to be due to another party if the contractor or subcontractor notifies the party whose payment is disputed, in writing, of the amount in dispute and the actions required to cure the dispute. The contractor or subcontractor must pay all undisputed amounts due within the time limits imposed by this section.
(7) Each contract for construction services between a local governmental entity and a contractor must provide for the development of a single list of items required to render complete, satisfactory, and acceptable the construction services purchased by the local governmental entity.
(a) The contract must specify the process for developing the list, including the responsibilities of the local governmental entity and the contractor in developing and reviewing the list and a reasonable time for developing the list:
1. For construction projects having an estimated cost of Less than $10 million, within 30 calendar days after reaching substantial completion of the construction services purchased as defined in the contract, or, if not defined in the contract, upon reaching beneficial occupancy or use; or
2. For construction projects having an estimated cost of $10 million or more, within 30 calendar days, or, if extended by contract, up to 60 calendar days after reaching substantial completion of the construction services purchased as defined in the contract, or, if not defined in the contract, upon reaching beneficial occupancy or use.
The contract must also specify a date for the delivery of the list of items, not to exceed 5 days after the list of items has been developed and reviewed in accordance with the time periods set forth in subparagraphs 1. and 2.
(b) If the contract between the local governmental entity and the contractor relates to the purchase of construction services on more than one building or structure, or involves a multiphased project, the contract must provide for the development of a list of items required to render complete, satisfactory, and acceptable all the construction services purchased pursuant to the contract for each building, structure, or phase of the project within the time limitations provided in paragraph (a).
(c) The final contract completion date must be at least 30 days after the delivery of the list of items. If the list is not provided to the contractor by the agreed upon date for delivery of the list, the contract time for completion must be extended by the number of days the local governmental entity exceeded the delivery date. Damages may not be assessed against a contractor for failing to complete a project within the time required by the contract, unless the contractor failed to complete the project within the contract period as extended under this paragraph.
(d) The failure to include any corrective work or pending items not yet completed on the list does not alter the responsibility of the contractor to complete all the construction services purchased pursuant to the contract.
(e) Upon completion of all items on the list, the contractor may submit a payment request for all remaining retainage withheld by the local governmental entity pursuant to this section. If a good faith dispute exists as to whether one or more items identified on the list have been completed pursuant to the contract, the local governmental entity may continue to withhold up to 150 percent of the total costs to complete such items.
(f) All items that require correction under the contract and that are identified after the preparation and delivery of the list remain the obligation of the contractor as defined by the contract.
(g) Warranty items or items not included in the list of items required under paragraph (a) may not affect the final payment of retainage as provided in this section or as provided in the contract between the contractor and its subcontractors and suppliers.
(h) Retainage may not be held by a local governmental entity or a contractor to secure payment of insurance premiums under a consolidated insurance program or series of insurance policies issued to a local governmental entity or a contractor for a project or group of projects, and the final payment of retainage as provided in this section may not be delayed pending a final audit by the local governmental entity’s or contractor’s insurance provider.
1(i) If a local governmental entity fails to comply with its responsibilities to develop the list required under paragraph (a) or paragraph (b) within the time limitations provided in paragraph (a), the contractor may submit a payment request for all remaining retainage withheld by the local governmental entity pursuant to this section; and payment of any remaining undisputed contract amount, less any amount withheld pursuant to the contract for incomplete or uncorrected work, must be paid within 20 business days after receipt of a proper invoice or payment request. If the local governmental entity has provided written notice to the contractor specifying the failure of the contractor to meet contract requirements in the development of the list of items to be completed, the local governmental entity need not pay or process any payment request for retainage if the contractor has, in whole or in part, failed to cooperate with the local governmental entity in the development of the list or to perform its contractual responsibilities, if any, with regard to the development of the list or if paragraph (8)(c) applies.
1(8)(a) With regard to any contract for construction services, a local governmental entity may withhold from each progress payment made to the contractor an amount not exceeding 5 percent of the payment as retainage.
(b) This section does not prohibit a local governmental entity from withholding retainage at a rate less than 5 percent of each progress payment, from incrementally reducing the rate of retainage pursuant to a schedule provided for in the contract, or from releasing at any point all or a portion of any retainage withheld by the local governmental entity which is attributable to the labor, services, or materials supplied by the contractor or by one or more subcontractors or suppliers. If a local governmental entity makes any payment of retainage to the contractor which is attributable to the labor, services, or materials supplied by one or more subcontractors or suppliers, the contractor must timely remit payment of such retainage to those subcontractors and suppliers.
(c) This section does not require the local governmental entity to pay or release any amounts that are the subject of a good faith dispute, the subject of a claim brought pursuant to s. 255.05, or otherwise the subject of a claim or demand by the local governmental entity or contractor.
(d) The time limitations set forth in this section for payment of payment requests apply to any payment request for retainage made pursuant to this section.
(e) Paragraph (a) does not apply to construction services purchased by a local governmental entity which are paid for, in whole or in part, with federal funds and are subject to federal grantor laws and regulations or requirements that are contrary to any provision of the Local Government Prompt Payment Act.
(f) This subsection does not apply to any construction services purchased by a local governmental entity if the total cost of the construction services purchased as identified in the contract is $200,000 or less.
(9) All payments due under this section and not made within the time periods specified by this section shall bear interest at the rate of 1 percent per month, or the rate specified by contract, whichever is greater.
History.—s. 3, ch. 95-331; s. 3, ch. 2001-169; s. 3, ch. 2005-230; s. 2, ch. 2010-111; s. 1, ch. 2020-173.
1Note.—Section 5(1), ch. 2020-173, provides that “[t]his act does not apply to any contract for construction services which is entered into or is pending approval by a public entity, as defined in s. 255.072, Florida Statutes, or by a local governmental entity, as defined in s. 218.72, Florida Statutes, or to any construction services project advertised for bid by the public entity or local governmental entity, on or before October 1, 2020.”
218.74 Procedures for calculation of payment due dates.—
(1) Each local governmental entity shall establish procedures whereby each payment request or invoice received by the local governmental entity is marked as received on the date on which it is delivered to an agent or employee of the local governmental entity or of a facility or office of the local governmental entity.
(2) The payment due date for a local governmental entity for the purchase of goods or services other than construction services is 45 days after the date specified in s. 218.73. The payment due date for the purchase of construction services is specified in s. 218.735.
(3) If the terms under which a purchase is made allow for partial deliveries and a payment request or proper invoice is submitted for a partial delivery, the time for payment for the partial delivery must be calculated from the time of the partial delivery and the submission of the payment request or invoice in the same manner as provided in s. 218.73 or s. 218.735.
(4) All payments, other than payments for construction services, due from a local governmental entity and not made within the time specified by this section bear interest from 30 days after the due date at the rate of 1 percent per month on the unpaid balance. The vendor must invoice the local governmental entity for any interest accrued in order to receive the interest payment. Any overdue period of less than 1 month is considered as 1 month in computing interest. Unpaid interest is compounded monthly. For the purposes of this section, the term “1 month” means a period beginning on any day of one month and ending on the same day of the following month.
History.—s. 4, ch. 89-297; s. 4, ch. 95-331; s. 4, ch. 2001-169.
218.75 Mandatory interest.—No contract between a local governmental entity and a vendor or a provider of construction services shall prohibit the collection of late payment interest charges allowable under this part.
History.—s. 4, ch. 89-297; s. 5, ch. 2001-169.
218.76 Improper payment request or invoice; resolution of disputes.—
(1) If an improper payment request or invoice is submitted by a vendor, the local governmental entity shall, within 10 days after the improper payment request or invoice is received, notify the vendor, in writing, that the payment request or invoice is improper and indicate what corrective action on the part of the vendor is needed to make the payment request or invoice proper.
(2)(a) If a dispute arises between a vendor and a local governmental entity concerning payment of a payment request or invoice, the dispute shall be finally determined by the local governmental entity pursuant to a dispute resolution procedure established by the local governmental entity. Such procedure must provide that proceedings to resolve the dispute are commenced within 45 days after the date the payment request or proper invoice was received by the local governmental entity and concluded by final decision of the local governmental entity within 60 days after the date the payment request or proper invoice was received by the local governmental entity. Such procedures are not subject to chapter 120 and do not constitute an administrative proceeding that prohibits a court from deciding de novo any action arising out of the dispute. If the dispute is resolved in favor of the local governmental entity, interest charges begin to accrue 15 days after the local governmental entity’s final decision. If the dispute is resolved in favor of the vendor, interest begins to accrue as of the original date the payment became due.
(b) If the local governmental entity does not commence the dispute resolution procedure within the time required, a contractor may give written notice to the local governmental entity of the failure to timely commence its dispute resolution procedure. If the local governmental entity fails to commence the dispute resolution procedure within 4 business days after such notice, any amounts resolved in the contractor’s favor shall bear mandatory interest, as set forth in s. 218.735(9), from the date the payment request or invoice containing the disputed amounts was submitted to the local governmental entity. If the dispute resolution procedure is not commenced within 4 business days after the notice, the objection to the payment request or invoice shall be deemed waived. The waiver of an objection pursuant to this paragraph does not relieve a contractor of its contractual obligations.
(3) In an action to recover amounts due under this part, the court shall award court costs and reasonable attorney’s fees, including fees incurred through appeal, to the prevailing party.
History.—s. 4, ch. 89-297; s. 6, ch. 2001-169; s. 34, ch. 2002-1; s. 3, ch. 2010-111.
218.77 Payment by federal funds.—A local governmental entity which intends to pay for a purchase with federal funds shall not make such purchase without reasonable assurance that federal funds to cover the cost thereof will be received. Where payment or the time of payment is contingent on receipt of federal funds or federal approval, any contract and any solicitation to bid shall clearly state such contingency.
History.—s. 4, ch. 89-297.
218.78 Report of interest.—If the total amount of interest paid during the preceding fiscal year exceeds $250, each local governmental entity shall, during December of each year, report to the board of county commissioners or the municipal governing body the number of interest payments made by it during the preceding fiscal year and the total amount of such payments made under this part.
History.—s. 4, ch. 89-297; s. 5, ch. 95-331.
218.79 Repeal of conflicting laws.—All laws and parts of laws in conflict with this part are repealed.
History.—s. 4, ch. 89-297.
218.80 Public Bid Disclosure Act.—
(1) This section may be cited as the “Public Bid Disclosure Act.”
(2) It is the intent of the Legislature that a local governmental entity shall disclose all of the local governmental entity’s permits or fees, including, but not limited to, all license fees, permit fees, impact fees, or inspection fees, payable by the contractor to the unit of government that issued the bidding documents or other request for proposal, unless such permits or fees are disclosed in the bidding documents or other request for proposal for the project at the time the project was let for bid. It is further the intent of the Legislature to prohibit local governments from halting construction to collect any undisclosed permits or fees which were not disclosed or included in the bidding documents or other request for proposal for the project at the time the project was let for bid.
(3) Bidding documents or other request for proposal issued for bids by a local governmental entity, or any public contract entered into between a local governmental entity and a contractor shall disclose each permit or fee which the contractor will have to pay before or during construction, the dollar amount or the percentage method or the unit method of all permits or fees which may be required by the local government as a part of the contract, and a listing of all other governmental entities that may have additional permits or fees generated by the project. If the request for proposal does not require the response to include a final fixed price, the local governmental entity is not required to disclose any fees or assessments in the request for proposal. However, at least 10 days prior to requiring the contractor to submit a final fixed price for the project, the local governmental entity shall make the disclosures required in this section. Any of the local governmental entity’s permits or fees that are not disclosed in the bidding documents, other request for proposal, or a contract between a local government and a contractor shall not be assessed or collected after the contract is let. No local government shall halt construction under any public contract or delay completion of the contract in order to collect any permits or fees which were not provided for or specified in the bidding documents, other request for proposal, or the contract.
(4) This section does not require disclosure in the bidding documents of any permits or fees imposed as a result of a change order or a modification to the contract. The local government shall disclose all permits or fees imposed as a result of a change order or a modification to the contract prior to the date the contractor is required to submit a price for the change order or modification.
History.—s. 1, ch. 93-76; s. 1, ch. 2020-154.