Florida Senate - 2019                                    SB 1508
       By Senator Simmons
       9-01763-19                                            20191508__
    1                        A bill to be entitled                      
    2         An act relating to neighborhood improvement districts;
    3         amending s. 163.511, F.S.; increasing the maximum
    4         number of directors allowed for boards of special
    5         neighborhood improvement districts; requiring local
    6         planning ordinances to specify the number of directors
    7         and their term lengths and to provide for staggered
    8         terms; deleting a provision requiring directors to
    9         serve for 3 years and a provision relating to term
   10         length for initial director appointments; creating s.
   11         163.5161, F.S.; creating the Safe Neighborhood
   12         Improvement District Revolving Loan Program; providing
   13         legislative purpose; providing definitions;
   14         authorizing the Department of Legal Affairs to provide
   15         loans for specified projects within safe neighborhood
   16         improvement districts; authorizing a safe neighborhood
   17         improvement district to borrow funds made available
   18         under the program and to pledge revenues to repay such
   19         funds; specifying the procedures by which the
   20         department is to administer and manage the loans;
   21         specifying the term of such loans; authorizing the
   22         department to provide financial assistance to small
   23         safe neighborhood improvement districts; requiring the
   24         department to establish by rule the criteria for
   25         determining whether a safe neighborhood improvement
   26         district serves a financially disadvantaged community;
   27         limiting the total amount of money that may be loaned
   28         during a fiscal year; authorizing the department to
   29         adopt rules related to the loan program; requiring the
   30         department to prepare an annual report and submit it
   31         to specified committees in the Legislature; specifying
   32         items that the safe neighborhood improvement districts
   33         must submit to the department before being approved
   34         for loans; requiring the approval of the use of the
   35         revolving loans by the registered voters of the
   36         district by referendum; specifying items to be
   37         included in the referendum; requiring the referendum
   38         to be sent by mail and published; specifying audit
   39         procedures once a loan project is completed;
   40         authorizing the department to charge reasonable
   41         service fees on loans to ensure the Safe Neighborhood
   42         Improvement District Revolving Loan Trust Fund will be
   43         operated in perpetuity; specifying fee amounts;
   44         restricting uses of the trust fund; specifying
   45         procedures if a safe neighborhood improvement district
   46         defaults under the terms of its loan agreement;
   47         authorizing the department to levy penalties for
   48         delinquent loan payments; authorizing the department
   49         to terminate or rescind a financial assistance
   50         agreement under certain conditions; providing an
   51         effective date.
   53  Be It Enacted by the Legislature of the State of Florida:
   55         Section 1. Paragraph (f) of subsection (1) and subsections
   56  (7) and (8) of section 163.511, Florida Statutes, are amended to
   57  read:
   58         163.511 Special neighborhood improvement districts;
   59  creation; referendum; board of directors; duration; extension.—
   60         (1) After a local planning ordinance has been adopted
   61  authorizing the creation of special neighborhood improvement
   62  districts, the governing body of a municipality or county may
   63  declare the need for and create special residential or business
   64  neighborhood improvement districts by the enactment of a
   65  separate ordinance for each district, which ordinance:
   66         (f) Provides for the appointment of a three-, five-, or
   67  seven-member 3-member board of directors for the district.
   68         (7) The business and affairs of a special neighborhood
   69  improvement district must shall be conducted and administered by
   70  a board of three, five, or seven directors who must shall be
   71  landowners in residents of the proposed area and who are subject
   72  to ad valorem taxation in the district. Upon their appointment
   73  and qualification and in January of each year, the directors
   74  shall organize by electing from their number a chair and a
   75  secretary, and may also employ staff and legal representatives
   76  as deemed appropriate, who shall serve at the pleasure of the
   77  board and may receive such compensation as shall be fixed by the
   78  board. The secretary shall keep a record of the proceedings of
   79  the district and shall be custodian of all books and records of
   80  the district. The directors shall not receive any compensation
   81  for their services, nor may they be employed by the district.
   82         (8) Within 30 days of the approval of the creation of a
   83  special neighborhood improvement district, if the district is in
   84  a municipality, a majority of the governing body of the
   85  municipality, or if the district is in the unincorporated area
   86  of the county, a majority of the county commission, shall
   87  appoint the three directors provided for herein, the number of
   88  which must be specified in the local planning ordinance, which
   89  must also provide for staggered terms of 3 years. The initial
   90  appointments shall be as follows: one for a 1-year term, one for
   91  a 2-year term, and one for a 3-year term. Each director shall
   92  hold office until his or her successor is appointed and
   93  qualified unless the director ceases to be qualified to act as a
   94  director or is removed from office. Vacancies on the board shall
   95  be filled for the unexpired portion of a term in the same manner
   96  as the initial appointments were made.
   97         Section 2. Section 163.5161, Florida Statutes, is created
   98  to read:
   99         163.5161Safe Neighborhood Improvement District Revolving
  100  Loan Program; use; rules.—
  101         (1)The purpose of this section is to help implement the
  102  legislative public policy of guiding the coordinated, balanced,
  103  and harmonious development of safe neighborhood improvement
  104  districts. This is accomplished by ensuring such districts have
  105  adequate finances to plan and increase crime prevention through
  106  environmental design, environmental security, or defensible
  107  space techniques, or through community policing innovations.
  108         (2)For purposes of this section, the term:
  109         (a)“Bonds” means bonds, certificates, or other obligations
  110  of indebtedness issued by the department under this section.
  111         (b)“Neighborhood improvements” means all facilities,
  112  including land, water, utilities, and roads, necessary for
  113  providing critical infrastructure to implement the crime
  114  prevention plans of a safe neighborhood improvement district.
  115         (3)The department may provide loan guarantees, purchase
  116  loan insurance, and refinance local debt through the issuance of
  117  new loans for projects that are in the plans of a safe
  118  neighborhood improvement district and that have been approved by
  119  the department. A safe neighborhood improvement district may
  120  borrow funds made available pursuant to this section and may
  121  pledge any revenues or other adequate security available to the
  122  district to repay any funds borrowed.
  123         (a)The department shall administer loans so that 15
  124  percent of the amounts credited to the Safe Neighborhood
  125  Improvement District Revolving Loan Trust Fund in any fiscal
  126  year is reserved for small safe neighborhood improvement
  127  districts.
  128         (b)If an insufficient number of the projects for which
  129  funds are reserved under this subsection have been submitted to
  130  the department at the time a funding priority list is adopted,
  131  the reservation of these funds no longer applies. The department
  132  may award the unreserved funds as otherwise provided in this
  133  section.
  134         (4)The term of loans made pursuant to this section may not
  135  exceed the life of the project secured by the bond. The interest
  136  rate on such loans may not exceed that paid on the last bonds
  137  sold pursuant to s. 14, Art. VII of the State Constitution.
  138         (5)(a)The department may provide financial assistance to
  139  small neighborhood improvement districts, as determined by the
  140  department, including providing forgiveness of the loan
  141  principal.
  142         (b)The department shall establish by rule the criteria for
  143  determining whether a safe neighborhood improvement district
  144  serves a financially disadvantaged community. Such criteria must
  145  be based on the median household income of the service
  146  population or other reliably documented measures of
  147  disadvantaged status.
  148         (6)In order to ensure that public moneys are managed in an
  149  equitable, prudent, and cost-effective manner, the total amount
  150  of money loaned to any safe neighborhood improvement district
  151  during a fiscal year may not exceed 25 percent of the total
  152  funds available for making loans during that year.
  153         (7)The department may adopt rules to do all of the
  154  following:
  155         (a)Establish a priority system for loans based on degree
  156  of likelihood of enhancing crime prevention and affordability
  157  within a safe neighborhood improvement district.
  158         (b)Establish the requirements for the award and the
  159  repayment of financial assistance.
  160         (c)Require evidence of credit worthiness and adequate
  161  security, including an identification of revenues to be pledged
  162  and documentation of the sufficiency of revenues for loan
  163  repayment and pledged revenue coverage, to ensure that each loan
  164  recipient can meet its loan repayment requirements.
  165         (d)Require each project receiving financial assistance to
  166  be cost-effective, environmentally sound, implementable, and
  167  self-supporting.
  168         (8)The department shall prepare a report at the end of
  169  each fiscal year which details the financial assistance provided
  170  under this section, service fees collected, interest earned, and
  171  loans outstanding. The report must be provided to the
  172  appropriations committees in the Senate and the House of
  173  Representatives.
  174         (9)Before being approved for a loan, the safe neighborhood
  175  improvement district must, at a minimum:
  176         (a)Provide a repayment schedule.
  177         (b)Submit evidence that the project proposed for financial
  178  assistance can be permitted or implemented.
  179         (c)Submit plans and specifications, biddable contract
  180  documents, or other documentation of appropriate procurement of
  181  goods and services.
  182         (d)Provide assurance that records will be kept using
  183  generally accepted accounting principles and that the department
  184  and the Auditor General will have access to all records
  185  pertaining to the loan.
  186         (e)Provide assurance that the goods and services funded
  187  will be properly operated and maintained.
  188         (10)A safe neighborhood improvement district may not
  189  receive a revolving loan under this section unless the local
  190  government approves a resolution that provides for a referendum,
  191  and the qualified electors of the district have approved the use
  192  of revolving loans by referendum. The referendum must include
  193  the estimated cost of the capital projects that are anticipated
  194  to be funded by the revolving loan funds and the amount of the
  195  loan.
  196         (a)The referendum to approve the loan funds must be by
  197  mail ballot.
  198         (b)Within 45 days after the date the city or county
  199  commission enacts an ordinance calling a referendum, the city
  200  clerk or the supervisor of elections, as appropriate, shall
  201  compile a list of the names and last known addresses of the
  202  electors within the safe neighborhood improvement district from
  203  the list of registered voters of the municipality or county, as
  204  appropriate, as of the last day of the preceding month, which
  205  must be the registration list for the referendum. A resident of
  206  the district whose name does not appear on the registration list
  207  may register to vote in the referendum as otherwise provided by
  208  law.
  209         (c)Within 45 days after compilation of the voter
  210  registration list, the city clerk or the supervisor of
  211  elections, as appropriate, shall notify each qualified elector
  212  of the provisions of the ordinance and the date of the upcoming
  213  referendum. Notification shall be by first-class mail and a one
  214  time publication in a newspaper of general circulation in the
  215  municipality or county, as appropriate, in which the district is
  216  located.
  217         (d)The registration list must remain open for 75 days
  218  after the date of the mailing of the notices to the electors as
  219  provided in paragraph (c).
  220         (e)Within 15 days after closing the registration list, the
  221  city clerk or the supervisor of elections, as appropriate, shall
  222  send a ballot to each elector at his or her last known mailing
  223  address by first-class mail. The ballot must include:
  224         1.A description of the capital projects to be funded by
  225  the loan and the revenue sources that will be used to repay the
  226  loan.
  227         2.The following statement:
  229         “Do you favor authorizing the .... Safe Neighborhood
  230  Improvement District to use revolving loan funds in the amount
  231  of $............ to finance capital projects that are estimated
  232  to cost $............ as provided by section 163.5161, Florida
  233  Statutes?
  235         ....Yes, I favor authorizing the use of revolving loan
  236  funds for district purposes.
  237         ....No, I am opposed to authorizing the use of revolving
  238  loan funds for district purposes.
  240         (f)Ballots must be returned by mail or by personal
  241  delivery.
  242         (g)All ballots received within 60 days after the closing
  243  of the registration list shall be tabulated by the city clerk or
  244  the supervisor of elections, as appropriate, who shall certify
  245  the results thereof to the city or county commission, as
  246  appropriate, no later than 5 days thereafter.
  247         (h)The use of revolving loan funds is deemed to have been
  248  approved only upon the affirmative vote of a majority of the
  249  registered voters in the district voting on the issue.
  250         (11)The department may conduct an audit of the loan
  251  project upon completion, or may require that a separate project
  252  audit, prepared by an independent certified public accountant,
  253  be submitted.
  254         (12)The department may require reasonable service fees on
  255  loans made to safe neighborhood improvement districts to ensure
  256  that the Safe Neighborhood Improvement District Revolving Loan
  257  Trust Fund will be operated in perpetuity and to implement the
  258  purposes authorized under this section. Service fees may not be
  259  less than 2 percent nor greater than 4 percent of the loan
  260  amount exclusive of the service fee. Service fee revenues shall
  261  be deposited into the department’s Grants and Donations Trust
  262  Fund. The fee revenues, and interest earnings thereon, shall be
  263  used exclusively to carry out the purposes of this section.
  264         (13)The Safe Neighborhood Improvement District Revolving
  265  Loan Trust Fund must be used exclusively to carry out the
  266  purposes of this section. Any funds that are not needed
  267  immediately for financial assistance must be invested pursuant
  268  to s. 215.49. The principal and interest of all loans repaid and
  269  investment earnings thereon shall be deposited into the fund.
  270         (14)(a)If a safe neighborhood improvement district
  271  defaults under the terms of its loan agreement, the department
  272  must so certify to the Chief Financial Officer, who shall
  273  forward the amount delinquent to the department from any
  274  unobligated funds due to the safe neighborhood improvement
  275  district under any revenue-sharing or tax-sharing fund
  276  established by the state, except as otherwise provided by the
  277  State Constitution. Certification of delinquency may not limit
  278  the department from pursuing other remedies available for
  279  default on a loan, including accelerating loan repayments,
  280  eliminating all or part of the interest rate subsidy on the
  281  loan, and requesting a court appoint a receiver to manage the
  282  safe neighborhood improvement district.
  283         (b)The department may impose a penalty for delinquent loan
  284  payments in the amount of 6 percent of the amount due, in
  285  addition to charging the cost to handle and process the debt.
  286  Penalty interest shall accrue on any amount due and payable
  287  beginning on the 30th day following the date upon which payment
  288  is due.
  289         (15)The department may terminate or rescind a financial
  290  assistance agreement if the recipient fails to comply with the
  291  terms and conditions of the agreement.
  292         Section 3. This act shall take effect upon becoming a law.