Florida Senate - 2019 SB 1350
By Senator Hutson
7-01592-19 20191350__
1 A bill to be entitled
2 An act relating to local government fiscal
3 transparency; amending s. 11.40, F.S.; expanding the
4 scope of the Legislative Auditing Committee review to
5 include compliance with local government fiscal
6 transparency requirements; amending s. 11.45, F.S.;
7 providing procedures for the Auditor General and local
8 governments to comply with the local government fiscal
9 transparency requirements; amending ss. 125.045 and
10 166.021, F.S.; revising reporting requirements for
11 certain local government economic development
12 incentives; transferring and renumbering s. 218.80,
13 F.S., relating to the Public Bid Disclosure Act;
14 creating part VIII of ch. 218, F.S., consisting of ss.
15 218.801, 218.803, 218.805, 218.81, 218.82, 218.83,
16 218.84, 218.88, and 218.89, F.S.; providing a short
17 title; providing purpose; providing definitions;
18 requiring local governments to post certain voting
19 record information on their websites; requiring the
20 posting of specified links to related sites if certain
21 documentation or details are available; requiring
22 property appraisers to post certain property tax
23 information and history on their websites; requiring
24 local governments to post certain property tax
25 information and history on their websites; requiring
26 public notices for public hearings and meetings prior
27 to certain increases of local government tax levies or
28 issuance of new tax-supported debt; specifying
29 noticing and advertising requirements for such public
30 hearings and meetings; requiring local governments to
31 conduct certain debt affordability analyses under
32 specified conditions; requiring audits of local
33 governments to include affidavits signed by the chair
34 of the local government governing board; providing
35 specified information to accompany audits of local
36 governments and to be filed with the Auditor General;
37 providing a method for local governments that do not
38 operate a website to post certain required
39 information; amending s. 218.32, F.S.; conforming a
40 cross-reference; declaring that the act fulfills an
41 important state interest; providing an effective date.
42
43 Be It Enacted by the Legislature of the State of Florida:
44
45 Section 1. Subsection (2) of section 11.40, Florida
46 Statutes, is amended to read:
47 11.40 Legislative Auditing Committee.—
48 (2) Following notification by the Auditor General, the
49 Department of Financial Services, or the Division of Bond
50 Finance of the State Board of Administration of the failure of a
51 local governmental entity, district school board, charter
52 school, or charter technical career center to comply with the
53 applicable provisions within s. 11.45(5)-(7), s. 218.32(1), s.
54 218.38, or s. 218.503(3), or part VIII of chapter 218, the
55 Legislative Auditing Committee may schedule a hearing to
56 determine if the entity should be subject to further state
57 action. If the committee determines that the entity should be
58 subject to further state action, the committee shall:
59 (a) In the case of a local governmental entity or district
60 school board, direct the Department of Revenue and the
61 Department of Financial Services to withhold any funds not
62 pledged for bond debt service satisfaction which are payable to
63 such entity until the entity complies with the law. The
64 committee shall specify the date such action shall begin, and
65 the directive must be received by the Department of Revenue and
66 the Department of Financial Services 30 days before the date of
67 the distribution mandated by law. The Department of Revenue and
68 the Department of Financial Services may implement the
69 provisions of this paragraph.
70 (b) In the case of a special district created by:
71 1. A special act, notify the President of the Senate, the
72 Speaker of the House of Representatives, the standing committees
73 of the Senate and the House of Representatives charged with
74 special district oversight as determined by the presiding
75 officers of each respective chamber, the legislators who
76 represent a portion of the geographical jurisdiction of the
77 special district, and the Department of Economic Opportunity
78 that the special district has failed to comply with the law.
79 Upon receipt of notification, the Department of Economic
80 Opportunity shall proceed pursuant to s. 189.062 or s. 189.067.
81 If the special district remains in noncompliance after the
82 process set forth in s. 189.0651, or if a public hearing is not
83 held, the Legislative Auditing Committee may request the
84 department to proceed pursuant to s. 189.067(3).
85 2. A local ordinance, notify the chair or equivalent of the
86 local general-purpose government pursuant to s. 189.0652 and the
87 Department of Economic Opportunity that the special district has
88 failed to comply with the law. Upon receipt of notification, the
89 department shall proceed pursuant to s. 189.062 or s. 189.067.
90 If the special district remains in noncompliance after the
91 process set forth in s. 189.0652, or if a public hearing is not
92 held, the Legislative Auditing Committee may request the
93 department to proceed pursuant to s. 189.067(3).
94 3. Any manner other than a special act or local ordinance,
95 notify the Department of Economic Opportunity that the special
96 district has failed to comply with the law. Upon receipt of
97 notification, the department shall proceed pursuant to s.
98 189.062 or s. 189.067(3).
99 (c) In the case of a charter school or charter technical
100 career center, notify the appropriate sponsoring entity, which
101 may terminate the charter pursuant to ss. 1002.33 and 1002.34.
102 Section 2. Present paragraphs (d) through (j) of subsection
103 (7) of section 11.45, Florida Statutes, are renumbered as
104 paragraphs (e) through (k), respectively, and a new paragraph
105 (d) is added to that subsection, to read:
106 11.45 Definitions; duties; authorities; reports; rules.—
107 (7) AUDITOR GENERAL REPORTING REQUIREMENTS.—
108 (d) During the Auditor General’s review of audit reports,
109 he or she shall contact each local government, as defined in s.
110 218.805(2), which is not in compliance with part VIII of chapter
111 218 and request evidence of corrective action. The local
112 government shall provide the Auditor General with evidence of
113 the initiation of corrective action within 45 days after the
114 date it is requested by the Auditor General and evidence of
115 completion of corrective action within 180 days after the date
116 it is requested by the Auditor General. If the local government
117 fails to comply with the Auditor General’s request or is unable
118 to take corrective action within the required timeframe, the
119 Auditor General shall notify the Legislative Auditing Committee.
120 Section 3. Subsection (5) of section 125.045, Florida
121 Statutes, is amended to read:
122 125.045 County economic development powers.—
123 (5)(a) By January 15 of each year By January 15, 2011, and
124 annually thereafter, each county shall report to the Office of
125 Economic and Demographic Research the economic development
126 incentives in excess of $25,000 given to businesses any business
127 during the county’s previous fiscal year. The Office of Economic
128 and Demographic Research shall compile the information from the
129 counties into a report and provide the report to the President
130 of the Senate, the Speaker of the House of Representatives, and
131 the Department of Economic Opportunity. Each county must
132 identify whether the economic development incentives are
133 provided directly by the county or by another entity on behalf
134 of the county, as well as the source of local dollars, and any
135 state or federal dollars obligated for the incentive. Economic
136 development incentives, for purposes of this report, are
137 classified as follows include:
138 1. Class one: Direct Financial incentives of monetary
139 assistance provided to an individual a business from the county
140 or through an organization authorized by the county. Such
141 incentives include, but are not limited to, grants, loans,
142 equity investments, loan insurance and guarantees, and training
143 subsidies.:
144 a. Grants.
145 b. Tax-based credits, refunds, or exemptions.
146 c. Fee-based credits, refunds, or exemptions.
147 d. Loans, loan insurance, or loan guarantees.
148 e. Below-market rate leases or deeds for real property.
149 f. Job training or recruitment.
150 g. Subsidized or discounted government services.
151 h. Infrastructure improvements.
152 2. Class two: General assistance, services, and support
153 provided collectively to businesses with a common interest or
154 purpose. Such incentives include:
155 a. Technical assistance and training.
156 b. Business incubators and accelerators.
157 c. Infrastructure improvements Indirect incentives in the
158 form of grants and loans provided to businesses and community
159 organizations that provide support to businesses or promote
160 business investment or development.
161 3. Class three: Business recruitment, retention, or
162 expansion efforts provided to benefit an individual business or
163 class of businesses. Such incentives include:
164 a. Marketing and market research.
165 b. Trade missions and trade shows.
166 c. Site selection.
167 d. Targeted assistance with the permitting and licensing
168 process.
169 e. Business plan or project development Fee-based or tax
170 based incentives, including, but not limited to, credits,
171 refunds, exemptions, and property tax abatement or assessment
172 reductions.
173 4. Below-market rate leases or deeds for real property.
174 (b) A county shall report its economic development
175 incentives in the format specified by the Office of Economic and
176 Demographic Research.
177 (c) The Office of Economic and Demographic Research shall
178 compile the economic development incentives provided by each
179 county in a manner that shows the total of each class of
180 economic development incentives provided by each county and all
181 counties. To the extent possible, the office shall compare the
182 results of the economic development incentives provided by all
183 counties to the results of state incentives provided in similar
184 classes.
185 Section 4. Paragraph (e) of subsection (8) of section
186 166.021, Florida Statutes, is amended to read:
187 166.021 Powers.—
188 (8)
189 (e)1. By January 15 of each year By January 15, 2011, and
190 annually thereafter, each municipality having annual revenues or
191 expenditures greater than $250,000 shall report to the Office of
192 Economic and Demographic Research the economic development
193 incentives in excess of $25,000 given to businesses any business
194 during the municipality’s previous fiscal year. The Office of
195 Economic and Demographic Research shall compile the information
196 from the municipalities into a report and provide the report to
197 the President of the Senate, the Speaker of the House of
198 Representatives, and the Department of Economic Opportunity.
199 Each municipality must identify whether the economic development
200 incentives are provided directly by the municipality or by
201 another entity on behalf of the municipality, as well as the
202 source of local dollars, and any state or federal dollars
203 obligated for the incentive. Economic development incentives,
204 for purposes of this report, are classified as follows include:
205 a. Class one: Direct Financial incentives of monetary
206 assistance provided to an individual a business from the
207 municipality or through an organization authorized by the
208 municipality. Such incentives include, but are not limited to,
209 grants, loans, equity investments, loan insurance and
210 guarantees, and training subsidies.:
211 (I) Grants.
212 (II) Tax-based credits, refunds, or exemptions.
213 (III) Fee-based credits, refunds, or exemptions.
214 (IV) Loans, loan insurance, or loan guarantees.
215 (V) Below-market rate leases or deeds for real property.
216 (VI) Job training or recruitment.
217 (VII) Subsidized or discounted government services.
218 (VIII) Infrastructure improvements.
219 b. Class two: General assistance, services, and support
220 provided collectively to businesses with a common interest or
221 purpose. Such incentives include:
222 (I) Technical assistance and training.
223 (II) Business incubators and accelerators.
224 (III) Infrastructure improvements Indirect incentives in
225 the form of grants and loans provided to businesses and
226 community organizations that provide support to businesses or
227 promote business investment or development.
228 c. Class three: Business recruitment, retention, or
229 expansion efforts provided to benefit an individual business or
230 class of businesses. Such incentives include:
231 (I) Marketing and market research.
232 (II) Trade missions and trade shows.
233 (III) Site selection.
234 (IV) Targeted assistance with the permitting and licensing
235 process.
236 (V) Business plan or project development Fee-based or tax
237 based incentives, including, but not limited to, credits,
238 refunds, exemptions, and property tax abatement or assessment
239 reductions.
240 d. Below-market rate leases or deeds for real property.
241 2. A municipality shall report its economic development
242 incentives in the format specified by the Office of Economic and
243 Demographic Research.
244 3. The Office of Economic and Demographic Research shall
245 compile the economic development incentives provided by each
246 municipality in a manner that shows the total of each class of
247 economic development incentives provided by each municipality
248 and all municipalities. To the extent possible, the office shall
249 compare the results of the economic development incentives
250 provided by all municipalities to the results of state
251 incentives provided in similar classes.
252 Section 5. Section 218.80, Florida Statutes, is transferred
253 and renumbered as section 218.795, Florida Statutes.
254 Section 6. Part VIII of chapter 218, Florida Statutes,
255 consisting of sections 218.801, 218.803, 218.805, 218.81,
256 218.82, 218.83, 218.84, 218.88, and 218.89, is created to read:
257 PART VIII
258 LOCAL GOVERNMENT FISCAL TRANSPARENCY ACT
259 218.801 Short title.—This part may be cited as the “Local
260 Government Fiscal Transparency Act.”
261 218.803 Purpose.—The purpose of this part is to promote the
262 fiscal transparency of local governments when using public funds
263 by requiring additional public noticing of proposed local
264 government actions that increase taxes, enact new taxes, extend
265 expiring taxes, or issue tax-supported debt and requiring voting
266 records of local governing bodies related to such actions to be
267 easily and readily accessible by the public.
268 218.805 Definitions.—As used in this part, the term:
269 (1) “Debt” means bonds, loans, promissory notes, lease
270 purchase agreements, certificates of participation, installment
271 sales, leases, or any other financing mechanisms or financial
272 arrangements, whether or not a debt for legal purposes, for
273 financing or refinancing the acquisition, construction,
274 improvement, or purchase of capital outlay projects.
275 (2) “Local government” means any county, municipality,
276 school district, special district dependent to a county or
277 municipality, municipal service taxing unit, or independent
278 special district, but does not include special dependent or
279 independent districts established to provide hospital services,
280 provided such special districts do not levy, assess, and collect
281 ad valorem taxes.
282 (3) “Tax increase” means:
283 (a) For ad valorem taxes, any increase in a local
284 government’s millage rate above the rolled-back rate as defined
285 in s. 200.065(1).
286 (b) For all other taxes, a tax enactment, an extension, or
287 an increase in the tax rate.
288 (4) “Tax-supported debt” means debt with a duration of more
289 than 5 years secured in whole or in part by state or local tax
290 levies, whether such security is direct or indirect, explicit or
291 implicit, and includes, but is not limited to, debt for which
292 annual appropriations pledged for payment are from government
293 fund types receiving tax revenues or shared revenues from state
294 tax sources. The term does not include debt secured solely by
295 revenues generated by the project that is financed with the
296 debt.
297 218.81 Voting record access.—
298 (1) Each local government shall post on its website, in a
299 manner that is easily accessible to the public, a history of the
300 voting record of each action taken by the local governing board
301 that addressed a tax increase or new tax-supported debt
302 issuance, except debt that was refinanced or refunded and that
303 did not extend the term or increase the outstanding principal
304 amount of the original debt, as follows:
305 (a) By October 1, 2019, the voting record history from the
306 preceding year;
307 (b) By October 1, 2020, the voting record history from the
308 preceding 2 years;
309 (c) By October 1, 2021, the voting record history from the
310 preceding 3 years; and
311 (d) By October 1, 2022, and thereafter, the voting record
312 history required pursuant to this subsection from the preceding
313 4 years.
314 (2) The website must provide links to allow users to
315 navigate to related sites if supporting details or documentation
316 is available.
317 (3) In any public notice of a tax increase or the issuance
318 of new tax-supported debt, each local government shall include
319 with the public notice the website address where the voting
320 records can be accessed.
321 218.82 Property tax information and history.—
322 (1) Each county property appraiser, as defined in s.
323 192.001, shall maintain a website that includes, in a manner
324 easily accessible to the public, links that provide access to:
325 (a) The notice of proposed property taxes and non-ad
326 valorem assessments required under s. 200.069 for each parcel of
327 property in that county; and
328 (b) A history of the millage rate and the amount of tax
329 levied by each taxing authority on each parcel as follows:
330 1. By October 1, 2019, the history from the 2 preceding
331 years;
332 2. By October 1, 2020, the history from the 3 preceding
333 years; and
334 3. By October 1, 2021, and thereafter, the history from the
335 4 preceding years.
336
337 This subsection does not apply to information that is otherwise
338 exempt from public disclosure.
339 (2) Each local government shall post on its website, in a
340 manner that is easily accessible to the public, links that
341 provide access to a history of each of its millage rates and the
342 total annual amount of revenue generated by each of these
343 levies, as follows:
344 (a) By October 1, 2019, the history from the 2 preceding
345 years;
346 (b) By October 1, 2020, the history from the 3 preceding
347 years; and
348 (c) By October 1, 2021, and thereafter, the history from
349 the 4 preceding years.
350 218.83 Expanded public noticing of tax increases and new
351 tax-supported debt issuance.—
352 (1) For the purpose of this section, the term “tax
353 increase” does not include an ad valorem tax increase.
354 (2) A local government that intends to vote on a proposed
355 tax increase or the issuance of new tax-supported debt shall
356 advertise a public hearing to solicit public input concerning
357 the proposed tax increase or new tax-supported debt issuance.
358 This public hearing must occur at least 14 days before the
359 scheduled date of the local governing board meeting to take a
360 final vote on the tax increase or issuance of new tax-supported
361 debt. Any hearing required under this subsection shall be held
362 after 5 p.m. if scheduled on a day other than Saturday. A
363 hearing may not be held on a Sunday. The general public shall be
364 allowed to speak and to ask questions relevant to the tax
365 increase or the tax-supported debt issuance. The local
366 government shall provide public notice as set forth in
367 subsection (4).
368 (3)(a) If, following the public hearing, the local
369 government intends to proceed with a vote to approve a tax
370 increase or the new issuance of tax-supported debt, the local
371 government shall provide public notice in the manner set forth
372 in subsection (4) at least 10 days before the scheduled public
373 meeting date.
374 (b) For a tax increase, the notice shall also include, at a
375 minimum:
376 1. A statement prominently posted that the local government
377 intends to vote on a proposed new tax enactment, tax extension,
378 or tax rate increase.
379 2. The time and place of the meeting.
380 3. The amount of the tax increase, including both the rate
381 and total amount of annual revenue expected to be generated and
382 the expected annual revenue expressed as a percentage of the
383 government’s general fund revenue.
384 4. A detailed explanation of the intended uses of the levy.
385 5. A statement indicating whether the local government
386 expects to use the proceeds to secure debt.
387 (c) For new tax-supported debt issuance, the notice shall
388 also include, at a minimum:
389 1. A statement prominently posted that the local government
390 intends to vote on a proposed new issuance of tax-supported
391 debt.
392 2. The time and place of the meeting.
393 3. A truth in bonding statement in substantially the
394 following form:
395
396 “The ...(insert local government name)... is proposing to
397 issue $...(insert principal)... of debt or obligation for the
398 purpose of ...(insert purpose).... This debt or obligation is
399 expected to be repaid over a period of ...(insert term of
400 issue)... years. At a forecasted interest rate of ...(insert
401 rate of interest)..., total interest paid over the life of the
402 debt or obligation will be $...(insert sum of interest
403 payments).... The source of repayment or security for this
404 proposal is the ...(insert the local government name)...
405 existing ...(insert fund).... Authorizing this debt or
406 obligation will result in $...(insert the annual amount)... of
407 ...(insert local government name)... ...(insert fund)... moneys
408 not being available to finance the other services of the
409 ...(insert local government name)... each year for ...(insert
410 the length of the debt or obligation)....”
411
412 4. A description of the debt affordability ratios
413 calculated pursuant to s. 218.84, in substantially the following
414 form:
415
416 “The following ratios measure the affordability of
417 outstanding and proposed new long-term, tax-supported debt
418 issued by ...(insert local government name).... The ratios show
419 debt service as a percentage of the revenues available to
420 support that debt, including the new debt being proposed
421 ...(insert 5-year history and 2-year projection of debt
422 affordability ratio)....”
423
424 (4) The notice provided by a local government announcing a
425 public hearing to take public input as set forth in subsection
426 (2) or the public meeting to take a final vote as set forth in
427 subsection (3) must meet the following requirements:
428 (a) The local government must advertise notice in a
429 newspaper of general circulation in the county or counties where
430 the local government exists. A local government may advertise in
431 a geographically limited insert of a general circulation
432 newspaper if the region encompassed by the insert contains the
433 jurisdictional boundaries of the local government. The newspaper
434 must be of general interest with readership in the community and
435 not one of limited subject matter, pursuant to chapter 50. The
436 advertisement:
437 1. Must be at least one-quarter page in size of a standard
438 size newspaper or a half-page in size of a tabloid size
439 newspaper, and the headline in the advertisement shall be in a
440 type no smaller than 18 point.
441 2. May not be placed in that portion of the newspaper where
442 legal notices and classified advertisements appear.
443 3. Must appear in a newspaper that is published at least 5
444 days a week unless the only newspaper in the county is published
445 less than 5 days a week. If the advertisement appears in a
446 geographically limited insert of a general circulation
447 newspaper, the insert must be one that is published at least
448 twice a week throughout the local government’s jurisdiction.
449
450 In lieu of publishing the notice set out in this paragraph, the
451 local government may mail a copy of the notice to each elector
452 residing within the jurisdiction of the local government; and
453 (b) The local government must post on its website, in a
454 manner that is easily accessible to the public, the information
455 required under subsections (2) and (3), as applicable.
456 (5) This section does not apply to the refinancing or
457 refunding of debt that does not extend the term or increase the
458 outstanding principal amount of the original debt.
459 218.84 Local government debt fiscal responsibility.—
460 (1) It is the public policy of this state to encourage
461 local governments to exercise prudence in authorizing and
462 issuing debt. Before a local government authorizes debt, it must
463 consider its ability to meet its total debt service obligation
464 in light of other demands on the local government’s fiscal
465 resources. Each local government shall perform a debt
466 affordability analysis as set forth in subsection (2), and the
467 governing board shall consider the analysis before approving the
468 issuance of new tax-supported debt.
469 (2) The debt affordability analysis shall, at a minimum,
470 consist of the calculation of the local government’s actual debt
471 affordability ratio for the 5 fiscal years prior to the year the
472 debt is expected to be issued and a projection of the ratio for
473 at least the first 2 fiscal years in which the new debt is
474 expected to be issued. The analysis shall include a comparison
475 of the debt affordability ratio with and without the new debt
476 issuance.
477 (3) The debt affordability ratio for a given fiscal year
478 shall be a ratio:
479 (a) The denominator of which is the total annual revenues
480 available to pay debt service on outstanding tax-supported debt
481 of the local government; and
482 (b) The numerator of which is the total annual debt service
483 for outstanding tax-supported debt of the local government.
484 218.88 Audits.—Audits of financial statements of local
485 governments which are performed by a certified public accountant
486 pursuant to s. 218.39 and submitted to the Auditor General must
487 be accompanied by an affidavit executed by the chair of the
488 governing board of the local government stating that the local
489 government has complied with this part and must be filed with
490 the Auditor General or, in the event the local government has
491 not complied with this part, the affidavit shall instead include
492 a description of the noncompliance and corrective action taken
493 by the local government to correct the noncompliance and to
494 prevent such noncompliance in the future.
495 218.89 Local government websites.—If a local government is
496 required under this part to post information on its website, but
497 does not operate an official website, the local government must
498 provide the county or counties within which the local government
499 is located the information required to be posted, and each such
500 county shall post the required information on its website.
501 Section 7. Paragraph (e) of subsection (1) of section
502 218.32, Florida Statutes, is amended to read:
503 218.32 Annual financial reports; local governmental
504 entities.—
505 (1)
506 (e) Each local governmental entity that is not required to
507 provide for an audit under s. 218.39 must submit the annual
508 financial report to the department no later than 9 months after
509 the end of the fiscal year. The department shall consult with
510 the Auditor General in the development of the format of annual
511 financial reports submitted pursuant to this paragraph. The
512 format must include balance sheet information used by the
513 Auditor General pursuant to s. 11.45(7)(g) s. 11.45(7)(f). The
514 department must forward the financial information contained
515 within the annual financial reports to the Auditor General in
516 electronic form. This paragraph does not apply to housing
517 authorities created under chapter 421.
518 Section 8. The Legislature finds that this act fulfills an
519 important state interest.
520 Section 9. This act shall take effect July 1, 2019.