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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
A bill to be entitled 1
An act relating to fiscal accountability for 2
nongovernmental entities; creating s. 215.986, F.S.; 3
providing definitions; requiring nongovernmental 4
entities to use state funds in a specified manner; 5
prohibiting nongovernmental entities from using state 6
funds for specified purposes; requiring certain people 7
at designated intervals to complete operational audits 8
of certain nongovernmental entities under specified 9
circumstances; specifying items that do not need to be 10
reported; requiring certain nongovernmental entities 11
to provide an annual report that includes certain 12
information; requiring state agencies to provide the 13
reports in a format prescribed by the Chief In spector 14
General to certain entities; requiring the Chief 15
Inspector General to adopt rules relating to the 16
annual report; requiring nongovernmental entities to 17
submit certain attestations before receiving state 18
funds; prohibiting state agencies from releasi ng or 19
transferring specified funds to certain 20
nongovernmental agencies until certain criteria are 21
met; providing an effective date. 22
23
Be It Enacted by the Legislature of the State of Florida: 24
25
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
Section 1. Section 215.986, Florida Statutes, is created 26
to read: 27
215.986 Fiscal accountability for certain nongovernmental 28
entities.— 29
(1) DEFINITIONS.— 30
(a) "Administrative expenses" means expenditures that are 31
considered indirect operating costs of a nongovernmental entity, 32
including, but not limited to: 33
1. General administration and general expenses such as 34
accounting and support services. 35
2. Personnel expenses, including all compensation earned 36
by or awarded to such personnel, whether paid or accrued, 37
regardless of contingency, unless the compensati on is explicitly 38
included in the General Appropriations Act or the compensation 39
relates to the employment of an employee whose services are 40
integral to a project or activity of the nongovernmental entity. 41
However, compensation earned by or awarded to a mem ber of the 42
board of directors, chief executive officer, chief financial 43
officer, chief operating officer, or other person performing 44
equivalent functions, whether paid or accrued, regardless of 45
contingency, shall not be considered integral to a project or 46
activity of the nongovernment entity. 47
3. Equipment and capital improvements, depreciation on 48
buildings, interest on debt associated with such buildings, and 49
operations and maintenance expenses. 50
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
(b) "Nongovernmental entity" means a nonprofit corporation 51
that receives at least 50 percent of its revenue, in any fiscal 52
year of the nongovernmental entity, from state funds. The term 53
does not include a citizen support organization or a direct -54
support organization created or authorized pursuant to law and 55
created, approved, or administered by a state agency. 56
(c) "Operational audit" has the same meaning as s. 57
11.45(1). 58
(d) "State agency" means any official, officer, 59
commission, board, authority, council, committee, or department 60
of the executive branch of sta te government; the Justice 61
Administrative Commission; and the Public Service Commission. 62
(e) "State funds" means state -appropriated funds, 63
including state-appropriated federal funds. 64
(2) PROHIBITIONS ON THE USE OF STATE FUNDS. —A 65
nongovernmental entity must use state funds in accordance with 66
their stated purpose and for the benefit of the public. A 67
nongovernmental entity may not use state funds for any of the 68
following purposes: 69
(a) To loan such funds to another entity for any purpose. 70
(b) To donate such funds as charitable or political 71
contributions. 72
(c) To pay for bonuses, exit bonuses, incentive payments, 73
or severance payments to employees of the nongovernmental 74
entity. 75
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
(d) To retain a lobbyist to represent the nongovernmental 76
entity before the legislative or executive branch. However, a 77
full-time employee of a nongovernmental entity may register as a 78
lobbyist and represent the entity before the legislative or 79
executive branch. Except as a full -time employee of the 80
nongovernmental entity, a pers on may not accept state funds from 81
a nongovernmental entity. 82
(3) OPERATIONAL AUDIT REQUIREMENTS. — 83
(a) A nongovernmental entity that receives state funds 84
equal to or greater than $500,000 each fiscal year for 5 85
consecutive fiscal years must have an oper ational audit 86
completed no later than 6 months after the end of the entity's 87
fifth fiscal year. The operational audit must be conducted by an 88
independent auditor or certified public accountant in accordance 89
with auditing standards stated in the rules of th e Auditor 90
General. An audit under this paragraph is not required more 91
frequently than once every 5 fiscal years. 92
(b) For purposes of this subsection, the term "state 93
funds" does not include the receipt of state or federal Medicaid 94
funds. 95
(4) ANNUAL REPORTS.— 96
(a) Beginning September 15, 2023, and each September 15 97
thereafter, each nongovernmental entity must submit an annual 98
report addressing the immediately preceding fiscal year to the 99
state agency from which the entity received state funds, which 100
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
includes all of the following information: 101
1. The name, position, and all compensation earned or 102
awarded, whether paid or accrued, regardless of contingency, to 103
each member of the board of directors, chief executive officer, 104
chief financial officer, chief o perating officer, or other 105
person performing equivalent functions. 106
2. A copy of the entity's most recent federal Internal 107
Revenue Service Return of Organization Exempt from Income Tax 108
Form (Form 990). 109
3. A detailed summary of the nongovernmental entity 's 110
administrative expenses, including the percentage of such 111
administrative expenses relative to all other expenses of the 112
entity. 113
4. The percentage of state funds relative to the 114
nongovernmental entity's revenue. 115
(b) Beginning December 15, 2023, and each December 15 116
thereafter, each state agency must report annually to the Chief 117
Inspector General, created in s. 14.32, and the Office of 118
Program Policy Analysis and Government Accountability, the 119
information reported by each nongovernmental entity in a format 120
prescribed by the Chief Inspector General. 121
(c) The Chief Inspector General shall adopt rules by 122
December 31, 2022, to implement this subsection. The rules shall 123
prescribe: 124
1. The format nongovernmental entities must use when 125
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
submitting their annual report required in paragraph (a). 126
2. Guidelines for nongovernmental entities to follow for 127
purposes of calculating their administrative expenses relative 128
to all other expenses of the entity as described in paragraph 129
(a). 130
3. The format state agenc ies must use when generating the 131
report required in paragraph (b). 132
(d) Beginning September 15, 2023, and annually thereafter, 133
before a nongovernmental entity receives state funds from a 134
state agency, a nongovernmental entity that: 135
1. Received at least 50 percent of its revenue from state 136
funds in the immediately preceding fiscal year must submit to 137
the state agency an attestation verified as provided in s. 138
92.525 that the nongovernmental entity has submitted the report 139
required in paragraph (a); or 140
2. Did not receive funding amounting to at least 50 141
percent of its revenue from state funds in the entity's 142
immediately preceding fiscal year must submit to the state 143
agency an attestation verified as provided in s. 92.525 that the 144
nongovernmental entity did not receive at least 50 percent of 145
its revenue from state funds in the entity's immediately 146
preceding fiscal year and therefore was not required to submit 147
the report required in paragraph (a). 148
(e) A state agency may not release or transfer funds to a 149
nongovernmental entity until the nongovernmental entity has 150
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F L O R I D A H O U S E O F R E P R E S E N T A T I V E S
complied with the requirements in paragraph (d). 151
Section 2. This act shall take effect July 1, 2022. 152