Bill Text: FL S1350 | 2019 | Regular Session | Introduced
Bill Title: Local Government Fiscal Transparency
Spectrum: Partisan Bill (Republican 1-0)
Status: (Failed) 2019-05-03 - Died in Community Affairs [S1350 Detail]
Download: Florida-2019-S1350-Introduced.html
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,ors. 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 yearBy January 15, 2011, and124annually thereafter, each county shall report to the Office of 125 Economic and Demographic Researchtheeconomic development 126 incentives in excess of $25,000 given to businessesany business127 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 followsinclude: 138 1. Class one:DirectFinancial incentivesof monetary139assistanceprovided to an individualabusinessfrom the county140or through an organization authorized by the county. Such 141 incentives include, but are not limited to, grants, loans,142equity investments, loan insurance and guarantees, and training143subsidies.: 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 improvementsIndirect incentives in the158form of grants and loans provided to businesses and community159organizations that provide support to businesses or promote160business 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 developmentFee-based or tax170based incentives, including, but not limited to, credits,171refunds, exemptions, and property tax abatement or assessment172reductions. 1734.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 yearBy January 15, 2011, and190annually thereafter, each municipality having annual revenues or 191 expenditures greater than $250,000 shall report to the Office of 192 Economic and Demographic Researchtheeconomic development 193 incentives in excess of $25,000 given to businessesany business194 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 followsinclude: 205 a. Class one:DirectFinancial incentivesof monetary206assistanceprovided to an individualabusinessfrom the207municipality or through an organization authorized by the208municipality. Such incentives include, but are not limited to,209grants, loans, equity investments, loan insurance and210guarantees, 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 improvementsIndirect incentives in225the form of grants and loans provided to businesses and226community organizations that provide support to businesses or227promote 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 developmentFee-based or tax237based incentives, including, but not limited to, credits,238refunds, exemptions, and property tax abatement or assessment239reductions. 240d.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.