House Bill 1885er

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    ENROLLED

    1999 Legislature                     HB 1885, Second Engrossed



  1

  2         An act relating to trust funds; creating s.

  3         215.5601, F.S.; creating the Lawton Chiles

  4         Endowment Fund for Health and Human Services;

  5         providing definitions; providing legislative

  6         intent; specifying the purposes and uses of

  7         endowment funds; providing for administration

  8         of the endowment by the State Board of

  9         Administration; providing for the availability

10         of endowment funds; providing appropriations;

11         providing for a plan of action when a deficit

12         will occur with respect to appropriations from

13         the Tobacco Settlement Trust Fund; creating s.

14         215.5602, F.S.; establishing the Florida

15         Biomedical Research Program within the Lawton

16         Chiles Endowment Fund; providing the goals of

17         the program; specifying the use of funds

18         appropriated under the program; creating the

19         Biomedical Research Advisory Council within the

20         Department of Health; providing for membership

21         of the council; providing reimbursement for

22         travel and other expenses for council members;

23         providing duties of the council; providing for

24         applications for funding under the program;

25         requiring the Secretary of Health to award

26         grants and fellowships, in consultation with

27         the council; providing for the appointment of a

28         peer review council to review proposals for

29         funding; requiring the Department of Health to

30         contract with an entity to administer the

31         program; providing rulemaking authority;


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    ENROLLED

    1999 Legislature                     HB 1885, Second Engrossed



  1         requiring the council to submit an annual

  2         report to the Governor, the Secretary of

  3         Health, and the Legislature; providing an

  4         effective date.

  5

  6  Be It Enacted by the Legislature of the State of Florida:

  7

  8         Section 1.  Section 215.5601, Florida Statutes, is

  9  created to read:

10         215.5601  Lawton Chiles Endowment Fund.--

11         (1)  SHORT TITLE.--This section may be cited as the

12  "Lawton Chiles Endowment Fund."

13         (2)  DEFINITIONS.--As used in this section:

14         (a)  "Board" means the State Board of Administration

15  established by s. 16, Art. IX of the State Constitution of

16  1885 and incorporated into s. 9(c), Art. XII of the State

17  Constitution of 1968.

18         (b)  "Endowment" means the Lawton Chiles Endowment

19  Fund.

20         (c)  "Earnings" means all income generated by

21  investments and the net change in the market value of assets.

22         (d)  "State agency" or "state agencies" means the

23  Department of Health, the Department of Children and Family

24  Services, the Department of Elderly Affairs, or the Agency for

25  Health Care Administration, or any combination thereof, as the

26  context indicates.

27         (3)  LEGISLATIVE INTENT.--It is the intent of the

28  Legislature to:

29         (a)  Provide a perpetual source of funding for the

30  future of state children's health programs, child welfare

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    ENROLLED

    1999 Legislature                     HB 1885, Second Engrossed



  1  programs, community-based health and human services

  2  initiatives, and biomedical research activities.

  3         (b)  Ensure that enhancement revenues will be available

  4  to finance these important initiatives.

  5         (c)  Use tobacco settlement moneys to ensure the

  6  financial security of vital health and human services

  7  programs.

  8         (d)  Encourage the development of community-based

  9  solutions to strengthen and improve the quality of life of

10  Florida's most vulnerable citizens.

11         (e)  Provide funds for cancer research and

12  public-health research for diseases linked to tobacco use.

13         (4)  LAWTON CHILES ENDOWMENT FUND; CREATION; PURPOSES

14  AND USES.--

15         (a)  There is created the Lawton Chiles Endowment Fund,

16  to be administered by the State Board of Administration. The

17  endowment shall serve as a clearing trust fund not subject to

18  termination pursuant to s. 19(f), Art. III of the State

19  Constitution and shall be funded by settlement moneys received

20  from the tobacco industry. The endowment fund shall be exempt

21  from the service charges imposed by s. 215.20.

22         (b)  Funds from the endowment shall be distributed by

23  the board to trust funds of the state agencies in the amounts

24  indicated by reference to the legislative appropriations for

25  the state agencies, except as otherwise provided in this

26  section.

27         (c)  The state agencies shall use the funds from the

28  endowment to enhance or support increases in clients served or

29  in program costs in health and human services program areas.

30         (d)  The Secretary of Health, the Secretary of Children

31  and Family Services, the Secretary of Elderly Affairs, and the


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    ENROLLED

    1999 Legislature                     HB 1885, Second Engrossed



  1  Director of Health Care Administration shall conduct meetings

  2  to discuss program priorities for endowment funding prior to

  3  submitting their budget requests to the Executive Office of

  4  the Governor and the Legislature. The purpose of the meetings

  5  shall be to gain consensus for priority requests and

  6  recommended endowment funding levels for those priority

  7  requests. An agency head may not designate a proxy for these

  8  meetings.

  9         (e)  Funds from the endowment may not be used to

10  supplant existing revenues.

11         (f)  When advised by the Revenue Estimating Conference

12  that a deficit will occur with respect to the appropriations

13  from the Tobacco Settlement Trust Fund in any fiscal year, the

14  Governor shall develop a plan of action to eliminate the

15  deficit. Before implementing the plan of action, the Governor

16  must comply with the provisions of section 216.177(2), Florida

17  Statutes. In developing the plan of action the Governor shall,

18  to the extent possible, preserve legislative policy and

19  intent, and, absent any specific directions to the contrary in

20  the General Appropriations Act, any reductions in

21  appropriations from the Tobacco Settlement Trust Fund for a

22  fiscal year shall be prorated among the purposes for which

23  funds were appropriated from the Tobacco Settlement Trust Fund

24  for that year.

25         (5)  ADMINISTRATION OF THE ENDOWMENT.--

26         (a)  The board is authorized to invest and reinvest

27  funds of the endowment in those securities listed in s.

28  215.47, in accordance with the fiduciary standards set forth

29  in s. 215.47(9) and consistent with an investment plan

30  developed by the executive director and approved by the board.

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    ENROLLED

    1999 Legislature                     HB 1885, Second Engrossed



  1  Costs and fees of the board for investment services shall be

  2  deducted from the earnings accruing to the endowment.

  3         (b)  The endowment shall be managed as an annuity. The

  4  investment objective shall be long-term preservation of the

  5  real value of the principal and a specified regular annual

  6  cash outflow for appropriation, as nonrecurring revenue. The

  7  schedule of annual cash outflow shall be included within the

  8  investment plan adopted pursuant to paragraph (a).

  9         (c)  The board shall establish a separate account for

10  the funds of the endowment. The board shall design and operate

11  an investment portfolio that maximizes the financial return to

12  the endowment, consistent with the risks inherent in each

13  investment, and that is designed to preserve an appropriate

14  diversification of the portfolio.

15         (d)  No later than February 15, 2000, the board shall

16  report on the financial status of the endowment to the

17  Governor, the Speaker of the House of Representatives, the

18  President of the Senate, the chairs of the respective

19  appropriations and appropriate substantive committees of each

20  chamber, and the Revenue Estimating Conference. Thereafter,

21  the board shall make a status report to such persons no later

22  than August 15 and February 15 of each year.

23         (e)  Accountability for funds from the endowment which

24  have been appropriated to a state agency and distributed by

25  the board shall reside with the state agency. The board is not

26  responsible for the proper expenditure or accountability of

27  funds from the endowment after distribution to a state agency.

28         (f)  The board may collect a fee for service from the

29  endowment no greater than that charged to the Florida

30  Retirement System.

31         (6)  AVAILABILITY OF FUNDS.--


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    ENROLLED

    1999 Legislature                     HB 1885, Second Engrossed



  1         (a)  Funds from the endowment shall not be available

  2  for appropriation to a state agency until July 1, 2000.

  3  Beginning July 1, 2000, the maximum annual amount of endowment

  4  funds that may be appropriated shall be in accordance with the

  5  following, based on earnings averaged over 3 years:

  6         1.  Beginning July 1, 2000, no more than a level of

  7  spending representing earnings at a rate of 3 percent.

  8         2.  Beginning July 1, 2001, no more than a level of

  9  spending representing earnings at a rate of 4 percent.

10         3.  Beginning July 1, 2002, no more than a level of

11  spending representing earnings at a rate of 5 percent.

12         4.  Beginning July 1, 2003, and thereafter, no more

13  than a level of spending representing earnings at a rate of 6

14  percent.

15         (b)  Notwithstanding the provisions of s. 216.301 and

16  pursuant to s. 216.351, all unencumbered balances of

17  appropriations as of June 30 or undisbursed balances as of

18  December 31 shall revert to the endowment's principal.

19         (7)  ENDOWMENT PRINCIPAL; APPROPRIATION OF

20  EARNINGS.--The following amounts are appropriated from the

21  Department of Banking and Finance Tobacco Settlement Clearing

22  Trust Fund to the Lawton Chiles Endowment Fund for Health and

23  Human Services:

24         1.  For Fiscal Year 1999-2000, $1,100,000,000;

25         2.  For Fiscal Year 2000-2001, $200,000,000;

26         3.  For Fiscal Year 2001-2002, $200,000,000; and

27         4.  For Fiscal Year 2002-2003, $200,000,000.

28         Section 2.  Section 215.5602, Florida Statutes, is

29  created to read:

30         215.5602  Florida Biomedical Research Program.--

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    ENROLLED

    1999 Legislature                     HB 1885, Second Engrossed



  1         (1)  There is established within the Lawton Chiles

  2  Endowment Fund the Florida Biomedical Research Program to

  3  support research initiatives that address the health care

  4  problems of Floridians in the areas of cancer, cardiovascular

  5  disease, stroke, and pulmonary disease. The long-term goals of

  6  the program are to:

  7         (a)  Improve the health of Floridians by researching

  8  better treatments for cancer, cardiovascular disease, stroke,

  9  and pulmonary disease.

10         (b)  Expand the foundation of biomedical knowledge

11  relating to the diagnosis and treatment of diseases related to

12  tobacco use, including cancer, cardiovascular disease, stroke,

13  and pulmonary disease.

14         (c)  Improve the quality of the state's academic health

15  centers by bringing the advances of biomedical research into

16  the training of physicians and other health care providers.

17         (d)  Increase the state's per capita funding for

18  biomedical research by undertaking new initiatives in

19  biomedical research that will attract additional funding from

20  outside the state.

21         (e)  Stimulate economic activity in the state in areas

22  related to biomedical research, such as the research and

23  production of pharmaceuticals, biotechnology, and medical

24  devices.

25         (2)  Funds appropriated from the Lawton Chiles

26  Endowment Fund to the Department of Health for the purposes of

27  this section shall be used exclusively for the award of grants

28  and fellowships under the program established in this section;

29  for research relating to the diagnosis and treatment of

30  diseases related to tobacco use, including cancer,

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    ENROLLED

    1999 Legislature                     HB 1885, Second Engrossed



  1  cardiovascular disease, stroke, and pulmonary disease; and for

  2  expenses incurred in the administration of this section.

  3         (3)  There is created within the Department of Health

  4  the Biomedical Research Advisory Council.

  5         (a)  The council shall consist of nine members,

  6  including:  the chief executive officer of the Florida

  7  Division of the American Cancer Society, or a designee; the

  8  chief executive officer of the Florida/Puerto Rico Affiliate

  9  of the American Heart Association, or a designee; and the

10  chief executive officer of the American Lung Association of

11  Florida, or a designee. The Governor shall appoint the

12  remaining six members of the council, as follows:

13         1.  Two members with expertise in the field of

14  biomedical research.

15         2.  One member with expertise in the field of

16  behavioral or social research.

17         3.  One member from a professional medical

18  organization.

19         4.  One member from a research university in the state.

20         5.  One member representing the general population of

21  the state.

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23  In making his appointments, the Governor shall select

24  primarily, but not exclusively, Floridians with biomedical and

25  lay expertise in the general areas of cancer, cardiovascular

26  disease, stroke, and pulmonary disease. The Governor's

27  appointments shall be for a 3-year term and shall reflect the

28  diversity of the state's population. A council member

29  appointed by the Governor may not serve more than two

30  consecutive terms.

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    1999 Legislature                     HB 1885, Second Engrossed



  1         (b)  The council shall adopt internal organizational

  2  procedures as necessary for its efficient organization.

  3         (c)  The department shall provide such staff,

  4  information, and other assistance as is reasonably necessary

  5  to assist the council in carrying out its responsibilities.

  6         (d)  Members of the council shall serve without

  7  compensation, but may receive reimbursement as provided in s.

  8  112.061 for travel and other necessary expenses incurred in

  9  the performance of their official duties.

10         (4)  The council shall advise the Secretary of Health

11  as to the direction and scope of the biomedical research

12  program. The responsibilities of the council may include, but

13  are not limited to:

14         (a)  Providing advice on program priorities and

15  emphases.

16         (b)  Providing advice on the overall program budget.

17         (c)  Participating in periodic program evaluation.

18         (d)  Assisting in the development of guidelines to

19  ensure fairness, neutrality, and adherence to the principles

20  of merit and quality in the conduct of the program.

21         (e)  Assisting in the development of appropriate

22  linkages to nonacademic entities, such as voluntary

23  organizations, health care delivery institutions, industry,

24  government agencies, and public officials.

25         (f)  Developing criteria and standards for the award of

26  research grants.

27         (g)  Developing administrative procedures relating to

28  solicitation, review, and award of research grants and

29  fellowships, to ensure an impartial, high-quality peer review

30  system.

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    1999 Legislature                     HB 1885, Second Engrossed



  1         (h)  Developing and supervising research peer review

  2  panels.

  3         (i)  Reviewing reports of peer review panels and making

  4  recommendations for research grants and fellowships.

  5         (j)  Developing and providing oversight regarding

  6  mechanisms for the dissemination of research results.

  7         (5)(a)  Applications for biomedical research funding

  8  under the program may be submitted from any university or

  9  established research institute in the state. All qualified

10  investigators in the state, regardless of institution

11  affiliation, shall have equal access and opportunity to

12  compete for the research funding.

13         (b)  Grants and fellowships shall be awarded by the

14  Secretary of Health, after consultation with the council, on

15  the basis of scientific merit, as determined by an open

16  competitive peer review process that ensures objectivity,

17  consistency, and high quality. The following types of

18  applications shall be considered for funding:

19         1.  Investigator-initiated research grants.

20         2.  Institutional research grants.

21         3.  Predoctoral and postdoctoral research fellowships.

22         (6)  To ensure that all proposals for research funding

23  are appropriate and are evaluated fairly on the basis of

24  scientific merit, the Secretary of Health, in consultation

25  with the council, shall appoint a peer review panel of

26  independent, scientifically qualified individuals to review

27  the scientific content of each proposal and establish its

28  scientific priority score. The priority scores shall be

29  forwarded to the council and must be considered in determining

30  which proposals shall be recommended for funding.

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  1         (7)  The council and the peer review panel shall

  2  establish and follow rigorous guidelines for ethical conduct

  3  and adhere to a strict policy with regard to conflict of

  4  interest. No member of the council or panel shall participate

  5  in any discussion or decision with respect to a research

  6  proposal by any firm, entity, or agency with which the member

  7  is associated as a member of the governing body or as an

  8  employee, or with which the member has entered into a

  9  contractual arrangement. Meetings of the council and the peer

10  review panels shall be subject to the provisions of chapter

11  119, s. 286.011, and s. 24, Art. I of the State Constitution.

12         (8)  The department may contract on a competitive-bid

13  basis with an appropriate entity to administer the program.

14  Administrative expenses may not exceed 15 percent of the total

15  funds available to the program in any given year.

16         (9)  The department, after consultation with the

17  council, may adopt rules as necessary to implement this

18  section.

19         (10)  The council shall submit an annual progress

20  report on the state of biomedical research in this state to

21  the Governor, the Secretary of Health, the President of the

22  Senate, and the Speaker of the House of Representatives by

23  February 1. The report must include:

24         (a)  A list of research projects supported by grants or

25  fellowships awarded under the program.

26         (b)  A list of recipients of program grants or

27  fellowships.

28         (c)  A list of publications in peer reviewed journals

29  involving research supported by grants or fellowships awarded

30  under the program.

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    1999 Legislature                     HB 1885, Second Engrossed



  1         (d)  The total amount of biomedical research funding

  2  currently flowing into the state.

  3         (e)  New grants for biomedical research which were

  4  funded based on research supported by grants or fellowships

  5  awarded under the program.

  6         (f)  Progress in the treatment of diseases related to

  7  tobacco use, including cancer, cardiovascular disease, stroke,

  8  and pulmonary disease.

  9         Section 3.  This act shall take effect July 1, 1999.

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