Florida Senate - 2010 SB 1706
By Senator Alexander
17-01901A-10 20101706__
1 A bill to be entitled
2 An act relating to state financial matters; amending
3 s. 216.311, F.S.; defining the terms “contract” and
4 “agreement”; prohibiting an agency or branch of state
5 government from contracting, without legislative
6 authority, to pay liquidated damages or early
7 termination fees resulting from the breach or early
8 termination of a contract or agreement, to pay
9 interest because of insufficient budget authority to
10 pay an obligation in the current year, from obligating
11 the state to make future payments to cover unpaid
12 payments, or from granting to a party the right to
13 collect fees or other revenues from nonparties;
14 providing exceptions for certain agency contracts or
15 agreements; prohibiting an agency from entering into
16 certain lease or lease-purchase agreements unless
17 expressly authorized by the Legislature; providing an
18 exception for the State Board of Administration to
19 enter into contracts and other agreements that are
20 necessary to carry out the investment duties of the
21 board; creating s. 216.312, F.S.; requiring the
22 executive and judicial branch to notify the Governor
23 and the Legislature before entering into contracts or
24 agreements in excess of a certain amount, which
25 authorize expenditures in anticipation of revenues, or
26 for which payment is delayed for a certain time after
27 expenditure; transferring, renumbering, and amending
28 s. 287.0582, F.S.; requiring a state contract to
29 identify the appropriation that funds the contract;
30 providing an exception; expanding the statement that
31 must be included in state contracts to include grounds
32 for terminating the contract based on budget deficits;
33 requiring the judicial branch to include the statement
34 in its contracts; requiring the agency head, executive
35 director, or chief judge, as appropriate, or a
36 designated senior management employee to sign
37 contracts that exceed a certain amount; requiring the
38 agency head, executive director, or chief judge to
39 review certain contracts and certify compliance with
40 ch. 216, F.S.; requiring contracts exceeding a
41 specified amount to require written acceptance or
42 rejection of contract deliverables; providing that
43 contracts in violation of these provisions are null
44 and void; providing penalties; amending s. 287.063,
45 F.S.; prohibiting certain lease or deferred-payment
46 purchases by state agencies unless expressly
47 authorized by the Legislature in the appropriations
48 act; amending s. 287.064, F.S.; prohibiting certain
49 master equipment financing agreements unless expressly
50 authorized by the Legislature in the appropriations
51 act; amending ss. 376.3075 and 403.1837, F.S.;
52 conforming cross-references; providing for
53 application; providing an effective date.
54
55 Be It Enacted by the Legislature of the State of Florida:
56
57 Section 1. Section 216.311, Florida Statutes, is amended to
58 read:
59 216.311 Unauthorized contracts in excess of appropriations;
60 penalty.—
61 (1) As used in this section and ss. 216.312 and 216.313,
62 the terms “contract” and “agreement” include the initial
63 contract or agreement, any amendment to the contract or
64 agreement, and any extension or renewal of the contract or
65 agreement.
66 (2)(1) An No agency or branch of state government may not
67 enter into any shall contract to spend, or enter into any
68 agreement:
69 (a) To spend, any moneys in excess of the amount
70 appropriated to such agency or branch unless specifically
71 authorized by law, and any contract or agreement in violation of
72 this chapter shall be null and void.
73 (b) That requires the state to pay liquidated damages or
74 early termination fees for a breach or early termination of a
75 contract or agreement by such agency or branch due to an act of
76 the Legislature which provides less than full funding for the
77 contract during the fiscal year.
78 (c) That requires the state to pay interest, other than
79 interest paid pursuant to s. 215.422, to another party because
80 the agency or branch has insufficient budget authority to pay
81 the underlying obligation of the contract or agreement in the
82 current year.
83 (d) That binds the state to make future-year payments to
84 offset payments not made in a prior year due to insufficient
85 budget authority, unless the Legislature expressly authorizes
86 the agency or branch to enter into such contract or agreement.
87 (e) To grant to any party the right or privilege to collect
88 and retain fees or other revenues from persons who are not a
89 party to the contract which would otherwise be payable to the
90 state and deposited into the State Treasury, unless the
91 Legislature expressly authorizes the agency or branch to enter
92 into such contract or agreement.
93 (3) Notwithstanding subsection (2), the following agencies
94 may enter into the following contracts or agreements:
95 (a) In order to spend funds appropriated for the approved
96 5-year work program, the Department of Transportation may enter
97 into contracts and other agreements that require the state to
98 pay liquidated damages as a result of a breach of those
99 contracts or agreements.
100 (b) In order to administer the state group insurance
101 program as provided in s. 110.123, the Department of Management
102 Services may enter into contracts and other agreements that
103 permit health care providers, health maintenance organizations,
104 preferred provider organizations, and insurers to collect
105 premiums and copayments from participants in the group insurance
106 program.
107 (c) In order to administer the state Medicaid plan and the
108 Florida Healthy Kids program, the Agency for Health Care
109 Administration may enter into contracts and other agreements
110 that permit health care providers to collect premiums and
111 copayments from participants in the Medicaid plan and the
112 Healthy Kids program.
113 (4) Notwithstanding any law authorizing an agency to enter
114 into a lease, an agency may not enter into a lease or lease
115 purchase agreement for tangible personal property which requires
116 the state to pay more than $500,000 over the term of the lease
117 or agreement if the term of the lease or agreement exceeds 1
118 fiscal year unless such lease or agreement is expressly
119 authorized by the Legislature. However, in order to administer
120 the real estate and other investment portfolios as provided in
121 s. 215.47, the State Board of Administration may enter into
122 contracts and such other agreements as necessary to carry out
123 the investment duties of the board.
124 (5) Any contract or agreement in violation of this section
125 is null and void.
126 (6)(2) Any public officer or employee person who willfully
127 enters into a contract or other agreement in violation of this
128 section commits contracts to spend, or enters into an agreement
129 to spend, any money in excess of the amount appropriated to the
130 agency or branch for whom the contract or agreement is executed
131 is guilty of a misdemeanor of the first degree, punishable as
132 provided in s. 775.082 or s. 775.083.
133 Section 2. Section 216.312, Florida Statutes, is created to
134 read:
135 216.312 Reporting contract expenditures.—
136 (1) At least 30 days before an executive or judicial branch
137 public officer or employee enters into a contract or agreement,
138 or a series of contracts or agreements between the same parties,
139 on behalf of the state which require payments by the state in
140 excess of $10 million in any fiscal or calendar year, the
141 officer or employee must notify the Governor, the President of
142 the Senate, and the Speaker of the House of Representatives of
143 the intent to enter into such contract or agreement or series of
144 contracts or agreements.
145 (2) At least 30 days before an executive or judicial branch
146 public officer or employee enters into a contract or agreement
147 on behalf of the state which requires minimal or no payments by
148 the state or authorizes the other party to make expenditures in
149 anticipation of revenues, the officer or employee must notify
150 the Governor, the President of the Senate, and the Speaker of
151 the House of Representatives of the intent to enter into such
152 contract or agreement.
153 (3) At least 30 days before an executive or judicial branch
154 public officer or employee enters into a contract or agreement
155 on behalf of the state which requires initial expenditures by
156 the other party and for which the other party will not receive
157 payment from the state within 180 days after the expenditure,
158 the officer or employee must notify the Governor, the President
159 of the Senate, and the Speaker of the House of Representatives
160 of the intent to enter into such contract or agreement.
161 (4) The execution of any contract or agreement described in
162 this section is an action or proposed action subject to s.
163 216.177(2)(b).
164 Section 3. Section 287.0582, Florida Statutes, is
165 transferred and renumbered as section 216.313, Florida Statutes,
166 and amended to read:
167 216.313 287.0582 Contract appropriation Contracts which
168 require annual appropriation; contingency statement;
169 requirements; penalty.—
170 (1) An executive or judicial branch public officer or
171 employee may not enter into any contract or agreement on behalf
172 of the state or judicial branch which binds the state or its
173 executive agencies or the judicial branch for the purchase of
174 services or tangible personal property unless the contract
175 identifies the specific appropriation of state funds from which
176 the state will make payment under the contract in the first year
177 of the contract, or unless the Legislature expressly authorizes
178 the agency or the judicial branch to enter into such contract
179 absent a specific appropriation of funds.
180 (2) An No executive or judicial branch public officer or
181 employee may not shall enter into any contract or agreement on
182 behalf of the state, which contract binds the state or its
183 executive agencies for the purchase of services or tangible
184 personal property for a period in excess of 1 fiscal year,
185 unless the following statements are statement is included in the
186 contract:
187 (a) “The State of Florida’s performance and obligation to
188 pay under this contract is contingent upon an annual
189 appropriation by the Legislature.”
190 (b) “This contract may be terminated by the state upon 30
191 days’ written notice if funding for this contract is
192 specifically eliminated pursuant to a deficit reduction plan
193 implemented by:
194 1. The Governor or the Chief Justice or by an act of the
195 Legislature after certification pursuant to section 216.221,
196 Florida Statutes, that a deficit will occur in the General
197 Revenue Fund; or
198 2. The Governor or Chief Justice pursuant to section
199 216.221(10), Florida Statutes, or by an act of the Legislature,
200 after a determination by the Chief Financial Officer that a
201 deficit will occur with respect to appropriations from a
202 specific trust fund in the current fiscal year.”
203 (3) A contract or other agreement that exceeds:
204 (a) The CATEGORY TWO threshold amount provided in s.
205 287.017 must be signed by the agency head, executive director,
206 or chief judge, as appropriate, or a designated senior
207 management employee.
208 (b) A term of 12 months may not be executed by any
209 executive or judicial branch agency unless the agency head,
210 executive director, or chief judge, as appropriate, determines
211 that the contract is in compliance with the requirements of this
212 chapter and certifies such compliance in writing within the
213 contract or agreement.
214 (c) The CATEGORY FIVE threshold amount provided in s.
215 287.017 must require the written acceptance or rejection of
216 contract deliverables.
217 (4) Any contract or other agreement in violation of this
218 section is null and void.
219 (5) Any public officer or employee who willfully enters
220 into a contract or other agreement in violation of this section
221 commits a misdemeanor of the first degree, punishable as
222 provided in s. 775.082 or s. 775.083.
223 Section 4. Subsection (4) of section 287.063, Florida
224 Statutes, is amended to read:
225 287.063 Deferred-payment commodity contracts; preaudit
226 review.—
227 (4) Beginning July 1, 2010, an agency may not enter into a
228 lease or deferred payment purchase arrangement for the
229 acquisition of equipment that has a total cost greater than
230 $500,000 unless the Legislature has expressly authorized such
231 lease or deferred payment purchase arrangement in the General
232 Appropriations Act. For purposes of this section, deferred
233 payment commodity contracts for replacing the state accounting
234 and cash management systems may include equipment, accounting
235 software, and implementation and project management services.
236 Section 5. Subsection (9) of section 287.064, Florida
237 Statutes, is amended to read:
238 287.064 Consolidated financing of deferred-payment
239 purchases.—
240 (9) Beginning July 1, 2010, an agency may not enter into a
241 master equipment financing agreement that has a total cost
242 greater than $500,000 unless the Legislature has expressly
243 authorized such agreement in the General Appropriations Act. For
244 purposes of this section, deferred-payment commodity contracts
245 for replacing the state accounting and cash management systems
246 may include equipment, accounting software, and implementation
247 and project management services.
248 Section 6. Subsections (4) and (9) of section 376.3075,
249 Florida Statutes, are amended to read:
250 376.3075 Inland Protection Financing Corporation.—
251 (4) The corporation may enter into one or more service
252 contracts with the department to provide services to the
253 department in connection with financing the functions and
254 activities provided in ss. 376.30-376.317. The department may
255 enter into one or more such service contracts with the
256 corporation and provide payment for payments under such
257 contracts pursuant to s. 376.3071(4)(o), subject to annual
258 appropriation by the Legislature. The proceeds from such service
259 contracts may be used for the corporation’s administrative costs
260 and expenses after payments as set forth in subsection (5). Each
261 service contract may have a term of up to 20 years. Amounts
262 annually appropriated and applied to make payments under such
263 service contracts may not include any funds derived from
264 penalties or other payments received from any property owner or
265 private party, including payments received under s.
266 376.3071(6)(b). In compliance with s. 216.313 287.0641 and other
267 applicable provisions of law, the obligations of the department
268 under such service contracts do not constitute a general
269 obligation of the state or a pledge of the faith and credit or
270 taxing power of the state nor may such obligations be construed
271 in any manner as an obligation of the State Board of
272 Administration or entities for which it invests funds, other
273 than the department as provided in this section, but are payable
274 solely from amounts available in the Inland Protection Trust
275 Fund, subject to annual appropriation. In compliance with this
276 subsection and s. 287.0582, The service contract must expressly
277 include the statements required under s. 216.313(2). following
278 statement: “The State of Florida’s performance and obligation to
279 pay under this contract is contingent upon an annual
280 appropriation by the Legislature.”
281 (9) The corporation is not a special district for the
282 purposes of chapter 189 or a unit of local government for the
283 purposes of part III of chapter 218. The provisions of chapters
284 120 and 215, except the limitation on interest rates provided by
285 s. 215.84 which applies to obligations of the corporation issued
286 pursuant to this section, and part I of chapter 287, except s.
287 ss. 287.0582 and 287.0641, does do not apply to this section,
288 the corporation, the service contracts entered into pursuant to
289 this section, or debt obligations issued by the corporation as
290 contemplated in this section.
291 Section 7. Subsections (5) and (10) of section 403.1837,
292 Florida Statutes, are amended to read:
293 403.1837 Florida Water Pollution Control Financing
294 Corporation.—
295 (5) The corporation may enter into one or more service
296 contracts with the department under which the corporation shall
297 provide services to the department in connection with financing
298 the functions, projects, and activities provided for in s.
299 403.1835. The department may enter into one or more service
300 contracts with the corporation and provide payment for payments
301 under those contracts pursuant to s. 403.1835(9), subject to
302 annual appropriation by the Legislature. The service contracts
303 may provide for the transfer of all or a portion of the funds in
304 the Wastewater Treatment and Stormwater Management Revolving
305 Loan Trust Fund to the corporation for use by the corporation
306 for costs incurred by the corporation in its operations,
307 including, but not limited to, payment of debt service,
308 reserves, or other costs in relation to bonds issued by the
309 corporation, for use by the corporation at the request of the
310 department to directly provide the types of local financial
311 assistance provided for in s. 403.1835(3), or for payment of the
312 administrative costs of the corporation. The department may not
313 transfer funds under any service contract with the corporation
314 without specific appropriation for such purpose in the General
315 Appropriations Act, except for administrative expenses incurred
316 by the State Board of Administration or other expenses necessary
317 under documents authorizing or securing previously issued bonds
318 of the corporation. The service contracts may also provide for
319 the assignment or transfer to the corporation of any loans made
320 by the department. The service contracts may establish the
321 operating relationship between the department and the
322 corporation and must shall require the department to request the
323 corporation to issue bonds before any issuance of bonds by the
324 corporation, to take any actions necessary to enforce the
325 agreements entered into between the corporation and other
326 parties, and to take all other actions necessary to assist the
327 corporation in its operations. In compliance with s. 287.0641
328 and other applicable provisions of law, the obligations of the
329 department under the service contracts do not constitute a
330 general obligation of the state or a pledge of the faith and
331 credit or taxing power of the state, nor may the obligations be
332 construed in any manner as an obligation of the State Board of
333 Administration or entities for which it invests funds, or of the
334 department except as provided in this section as payable solely
335 from amounts available under any service contract between the
336 corporation and the department, subject to appropriation. The In
337 compliance with this subsection and s. 287.0582, service
338 contracts must expressly include the statements required under
339 s. 216.313(2). following statement: “The State of Florida’s
340 performance and obligation to pay under this contract is
341 contingent upon an annual appropriation by the Legislature.”
342 (10) The corporation is not a special district for purposes
343 of chapter 189 or a unit of local government for purposes of
344 part III of chapter 218. The provisions of chapters 120 and 215,
345 except the limitation on interest rates provided by s. 215.84,
346 which applies to obligations of the corporation issued under
347 this section, and part I of chapter 287, except s. ss. 287.0582
348 and 287.0641, does do not apply to this section, the corporation
349 created in this section, the service contracts entered into
350 under this section, or debt obligations issued by the
351 corporation as provided in this section.
352 Section 8. This act shall take effect July 1, 2010, and
353 applies to initial contracts and agreements, amendments to a
354 contract or agreement, and extensions or renewals of a contract
355 or agreement which are executed on or after that date.