The Florida Senate
BILL ANALYSIS AND FISCAL IMPACT STATEMENT
(This document is based on the provisions contained in the legislation as of the latest date listed below.)
Prepared By: The Professional Staff of the Committee on Fiscal Policy
BILL: CS/SB 302
INTRODUCER: Banking and Insurance Committee and Senator Grall
SUBJECT: Government and Corporate Activism
DATE: April 12, 2023
ANALYST STAFF DIRECTOR REFERENCE ACTION
1. Moody Knudson BI Fav/CS
2. Moody Yeatman FP Pre-meeting
Please see Section IX. for Additional Information:
COMMITTEE SUBSTITUTE - Substantial Changes
I. Summary:
CS/SB 302 addresses the provision of products and services by financial institutions, the
investment of certain state and local government funds, the issuance of environmental, social,
and governance (ESG) bonds, and procurement of and contracting with vendor’s by certain state
and local entities and educational institutions.
Financial Institutions
The bill requires financial institutions, consumer finance lenders, and money services businesses,
to make decisions about the provision or denial of services based on an analysis of risk factors
unique to each customer, and prohibits them from engaging in any “unsafe and unsound
practice” or applying a “social credit score” when making determinations about the provision of
services. Upon application or renewal, such entities to attest must attest to compliance with these
provisions. They are subject to penalties and sanctions for violating any of these provisions.
Government Investments
The bill codifies and expands the program adopted by the State Board of Administration last year
that requires, with limited exceptions, investments of certain state and local funds to be based
solely on pecuniary factors and not on the furtherance of any social, political, or ideological
interests. The expansion applies to all funds of state Treasury, all local government retirement
plans, investments of local government surplus funds, and investment of funds raised by citizen
support or direct-support organizations. The bill prohibits the person or entity responsible for
REVISED: BILL: CS/SB 302 Page 2
making investment decisions from subordinating the interests of the beneficiaries to other
objectives, and requires the weight given to any pecuniary factor to appropriately reflect a
prudent assessment of its impact on risk or returns. Investment policies are required to be
updated to incorporate these requirements.
State and local retirement systems must report compliance with these requirements on a biennial
basis, and provides the Attorney General with authority to seek an injunction against any
violators.
Investment managers who invest public funds on behalf of state and local funds must include a
specified disclaimer in certain external communications that discuss social, political, or
ideological interests. On or after July 1, 2023, contracts with investment managers may be
unilaterally terminated in certain circumstances. Investment managers are subject to sanctions if
they fail to comply with the new provisions under the bill.
Bond Financing
The bill prohibits specified state and local issuers from:
Issuing ESG bonds;
Expending public funds or use money derived from the issuance of bonds to pay a third-party
verifier to certify or verify that bonds may be designated or labeled as ESG bonds;
Entering into a contract with any rating agency whose ESG scores would have a direct,
negative impact on the issuer’s bond ratings.
The bill applies to any bonds issued or to any agreement entered into or any contract executed on
or after July 1, 2023.
Procurement and Contracting with Vendors
Beginning July 1, 2023, certain state and local government entities, and educational institutions,
are prohibited from giving preference to a vendor based on the vendor’s social, political, or
ideological interests when procuring or contracting with them. Such entities may not request
documentation relating to a vendor’s social, political, or ideological interests, and any
solicitation for purchases or leases must notify vendors of these provisions.
The bill reenacts ss. 17.61 and 215.44, F.S.
See Section V. Fiscal Impact Statement.
The bill is effective July 1, 2023.
II. Present Situation:
Environmental, social, and governance (ESG) are non-financial risks that are used by some
institutions and investment managers when making investment decisions. Examples of
environmental factors include greenhouse gases and air or water and ground pollution emissions.
Social practices considered include product liabilities, supply chain labor, and health and safety BILL: CS/SB 302 Page 3
standards. Governance factors include shareholder rights, board diversity, executive
compensation, and corporate board behavior such as anti-competitive practices and corruption.
1
JP Morgan reports that over $500 billion flowed into ESG-integrated funds in 2021.
2
According
to Broadridge Financial Solutions, ESG assets are forecasted to exceed $30 trillion by 2030.
3
Financial Institutions
Dual Oversight of Depository Institutions
An institution must have a federal or state charter to accept deposits. Banks are chartered and
regulated as national banks by the Office of the Comptroller of the Currency within the U.S.
Department of the Treasury or as state banks by a state regulator.
4
The Florida Financial Institutions Codes apply to all state-authorized or state-chartered financial
banks, trust companies, credit unions and related entities.
5
The Office of Financial Regulation
(OFR) licenses and regulates 197 financial entities, including 69 state-chartered banks and 66
state-chartered credit unions.
6
There are also 33 federally-chartered banks and 63 federally
chartered credit unions operating in Florida.
7
Due to federal preemptions, a state’s regulatory powers in relation to federally chartered
institutions is limited. However, the state may exercise powers within their exceptions to
exclusive federal visitorial authority. Such exceptions are those recognized by federal law and
courts of law or created by the U.S. Congress.
8
Once a financial institution obtains a charter, one of the regulator’s primary task is to ensure
solvency which is achieved by conducting financial exams of its licensed entities. Financial
institutions also need approval from their regulator to make changes in their upper management,
merge with another company, pay dividends to shareholders, engage in material transactions
with subsidiaries and affiliates, or make significant changes to their business operations.
9
1
Deloitte, #1 What is ESG?, available at: #1 What is ESG? (deloitte.com) (last visited Mar. 26, 2023).
2
Wu, J., Five Reasons Why the Future of ESG Investing is Long Term, JP Morgan, Jan. 1, 2022, available at: ESG Outlook
2022: The future of ESG investing | J.P. Morgan Asset Management | J.P. Morgan Asset Management (jpmorgan.com) (last
visited Mar. 26, 2023).
3
Green, A., The Future of ESG Investing, Forbes, Feb. 16, 2022, available at: The Future Of ESG Investing (forbes.com)
(last visited Mar. 26, 2023).
4
Congressional Research Service, Introduction to Financial Services: Banking, p. 1, Jan. 5, 2023, available at:
https://crsreports.congress.gov/product/pdf/IF/IF10035 (last visited Mar. 26, 2023).
5
Section 655.005(1)(k), F.S., states that the Financial Institutions Codes includes: Ch. 655, financial institutions generally;
Ch. 657, credit unions; Ch. 658, banks and trust companies; Ch. 660, trust business; Ch. 662, family trust companies; Ch.
663, international banking; Ch. 665, relating to associations; and Ch. 667, savings banks.
6
Office of Financial Regulation, Fast Facts (2021 ed.), available at: FastFacts.pdf (flofr.gov) (last visited Mar. 26, 2023).
7
Id.
8
12 C.F.R. § 7.4000 (2011).
9
For a detailed discussion of the regulatory framework, see, Congressional Research Service, Who Regulates Whom? An
Overview of the U.S. Financial Regulatory Framework, March 10, 2020, available at:
https://crsreports.congress.gov/product/pdf/R/R44918/7 (last visited Feb. 13, 2023). Also see ss. 655.037, 655.0385,
655.0386, 655.03855, and 655.412, F.S. BILL: CS/SB 302 Page 4
Banks chartered by OFR must become a members of the Federal Reserve or obtain insurance
from the Federal Deposit Insurance Corporation.
10
Credit Unions chartered by OFR must insure
their accounts by becoming a member of the National Credit Union Administration.
11
Thus,
state-chartered banks and credit unions are subject to a dual-regulatory system.
OFR must examine the condition of each state-chartered financial institution at least every 18
months, and may conduct more frequent examinations as needed, based on risks associated with
a licensee, such as prior examination results or significant operational changes.
12
When a state-
chartered financial institution also has a federal regulator, OFR may accept an examination
performed by the federal regulator or the regulators may conduct a joint examination.
13
Financial institutions that become insolvent are liquidated by their primary regulator.
14
Authority of OFR
OFR may impose administrative sanctions on financial institutions subject to the Florida
Financial Institutions Codes that engage in an “unsafe or unsound practice.” This term is defined
at s. 655.005(1)(y), F.S., which states:
“Unsafe or unsound practice” means any practice or conduct found by the office
to be contrary to generally accepted standards applicable to a financial institution,
or a violation of any prior agreement in writing or order of a state or federal
regulatory agency, which practice, conduct, or violation creates the likelihood of
loss, insolvency, or dissipation of assets or otherwise prejudices the interest of the
financial institution or its depositors or members. In making this determination,
the office must consider the size and condition of the financial institution, the
gravity of the violation, and the prior conduct of the person or institution
involved.
Possible penalties include: issuance of a cease and desist order,
15
removal of an institution-
affiliated party,
16
administrative fines,
17
and a court-ordered injunction to restrain conduct that
violates a formal enforcement action.
18
When imposing a sanction or requiring a remedy, OFR
must consider “the appropriateness of the penalty with respect to the size of the financial
resources and good faith of the person charged, the gravity of the violation, the history of
previous violations, and such other matters as justice may require.”
19
10
Sections 658.22 and 658.38, F.S.
11
Sections 657.005 and 657.008, F.S.
12
Section 655.045(1), F.S.
13
Section 655.045(1)(a), F.S.
14
Sections 657.063, 657.064, 658.83, and 660.48, F.S.
15
Section 655.033, F.S.
16
Section 655.037, F.S.
17
Section 655.041, F.S.
18
Section 655.034, F.S.
19
Section 655.031(1), F.S. BILL: CS/SB 302 Page 5
OFR may impose monetary fines if a licensee violates a provision of the financial institutions
codes or associated rules, an order of the office, or a written agreement with the office.
20
In
general, administrative fines may not exceed $2,500 per day for each violation.
21
Larger fines are
allowed in the following circumstances:
Up to $10,000 per day for each reckless violation that result in more than a minimal loss to a
financial institution or pecuniary benefit to the person liable for the violation;
22
Up to the lesser of $500,000 per day or 1 percent of the total assets in the case of a financial
institution, or $50,000 per day in any other case, for knowing violations that result in more
than a minimal loss to a financial institution or pecuniary benefit to the person liable for the
violation;
23
and
Up to $10,000 per day for any financial institution that refuses to permit an examination.
24
Criminal violations – like embezzlement and fraud – may be prosecuted under the penal code.
25
OFR has authority to monitor state-chartered banks, to ensure compliance with state and federal
laws, and may enforce state consumer protection laws on federally chartered banks operating
within their boundaries so long as the state law is not pre-empted by federal law.
26
Federal pre-
emption permits federally chartered banks and savings associations to operate under a uniform
set of rules when they operate across state lines.
27
When a state chartered financial institution encounters a competitive disadvantage caused by
state law in relation to the capacities and powers allowed to federally chartered institutions, OFR
may issue an order or a rule waiving the state law causing the competitive imbalance.
28
Non-Depository Financial Institutions
Consumer finance lenders and money services businesses are non-depository lenders that profit
from fees charged on such loans or transactions. OFR has regulatory authority over consumer
finance lenders that offer consumers finance products or services.
29
Consumer finance lenders
are required to obtain a license from OFR that must be renewed every two years to conduct
20
Section 655.041, F.S.
21
Section 655.041(2), F.S.
22
Section 655.041(2)(a), F.S.
23
Section 655.041(2)(b), F.S.
24
Section 655.041(2)(c), F.S. Rule 69U-100.0451, F.A.C, discusses fees that may be assessed to cover the costs of
examinations.
25
Section 655.0322, F.S.
26
12 U.S.C. 25b.
27
U.S. Department of the Treasury, Office of the Comptroller of the Currency, OCC Chief Counsel’s Interpretation: 12
U.S.S. §25b, Dec. 18, 2020, available at: https://www.occ.gov/news-issuances/news-releases/2020/nr-occ-2020-176a.pdf (last
visited Mar. 26, 2023).
28
Section 655.061, F.S.
29
Section 516.01(2), F.S., defines “consumer finance loans” as a loan of money, credit, goods, or choses in action, including,
except as otherwise specifically indicated, provision of a line of credit, in an amount or to a value of $25,000 or less for
which the lender charges, contracts for, collects, or receives interest at a rate greater than 18 percent per annum. BILL: CS/SB 302 Page 6
business in Florida.
30
Each location of a consumer finance company must be licensed by OFR,
even if the separate locations are part of the same business entity.
31
Consumer finance lenders may make secured or unsecured loans of up to $25,000 at interest
rates between 18 and 30 percent per year.
32
OFR investigates consumer complaints to ensure that
consumer finance lenders are licensed to purchase or hold retail installment contracts and comply
with fair lending laws.
33
Administrative sanctions for consumer finance lenders may include
suspension or revocation of a license, a written reprimand, or a fine of up to $1,000 for each
violation.
34
Certain violations, such as violating fair lending laws or operating without a license,
may be prosecuted as a first-degree misdemeanor.
35
OFR also has regulatory authority over money services businesses
36
that assist consumers in
transacting instruments, transmitting money,
37
cashing checks,
38
and exchanging foreign
currency.
39
Examples include check cashers like The Check Cashing Store,
40
money transmitters
like PayPal,
41
and exchangers like Florida Currency Exchange.
42
Money services businesses also
include “payday lenders” who offer short-term, high-interest loans that are due on the
consumer’s next pay day. Two types of payday loans are allowed in Florida:
The lender provides cash in exchange for the borrower’s check (up to $500) and agrees to
hold the check for 7 to 31 days before cashing the check. Fees may not exceed 10 percent of
the payment to the borrower plus a $5 verification fee.
30
Section 516.02(1), F.S.
31
Section 516.05, F.S.
32
Section 516.02(2)(a), F.S.
33
Sections 516.11, 516.15, 516.26, 516.31 and 516.35, F.S.
34
Section 516.07(2), F.S. A first degree misdemeanor is punishable by up to one year in imprisonment or a $1,000 fine as
provide in s. 775.082, F.S., or s. 775.083, F.S.
35
Section 516.19, F.S.
36
Section 560.103(23), F.S., defines “money services businesses” as any person located in or doing business in this state,
from this state, or into this state from locations outside this state or country who acts as a payment instrument seller, foreign
currency exchanger, check casher, or money transmitter.
37
Section 560.105, F.S. Section 560.103(24), F.S., defines “money transmitter” as a corporation, limited liability corporation,
limited liability partnership, or foreign entity qualified to do business in this state which receives currency, monetary value, a
payment instrument, or virtual currency for the purpose of acting as an intermediary to transmit currency, monetary value, a
payment instrument, or virtual currency from one person to another location or person by any means, including transmission
by wire, facsimile, electronic transfer, courier, the Internet, or through bill payment services or other businesses that facilitate
such transfer within this country, or to or from this country. The term includes only an intermediary that has the ability to
unilaterally execute or indefinitely prevent a transaction.
38
Section 560.103(6), F.S., defines “check casher” as a person who sells currency in exchange for payment instruments
received, except travelers checks. Section 560.103(29), F.S., defines “payment instrument” as a check, draft, warrant, money
order, travelers check, electronic instrument, or other instrument used for the transmission, exchange, or payment of currency
or monetary value, regardless of whether it is negotiable. The term does not include an instrument that is redeemable by the
issuer in merchandise or service, a credit card voucher, or a letter of credit.
39
Section 560.103(18), F.S., defines “foreign currency exchanger” as a person who exchanges, for compensation, currency of
the United States or a foreign government to currency of another government.
40
The Check Cashing Store, Home, available at: The Check Cashing Store®: Check Cashing, Mobile Check Cashing, Loans,
Personal and Small Business services, Money Orders, Pre Paid Debit Cards, and Western Union Money Transfers (last
visited Mar. 26, 2023).
41
PayPal, Home, available at: Digital Wallets, Money Management, and More | PayPal US (last visited Mar. 26, 2023).
42
Florida Currency Exchange, Home, available at: Florida, Texas, Utah Currency Exchange | Foreign Currency Exchange
(flcurrencyexchange.com) (last visited Mar. 26, 2023). BILL: CS/SB 302 Page 7
The lender provides cash in exchange for the borrower’s check (up to $1,000) and the
borrower repays the loan in installments. The term of the loan is 60-90 days. The lender may
charge a $5 verification fee and 8 percent of the balance on a biweekly basis.
43
Money services businesses must maintain accounts in permissible investments that equals at least
the amount of all outstanding money transmissions and payment instruments sold by the licensee
or an authorized vendor.
44,45
OFR also monitors the check cashing practices of money services
businesses to verify corporate records, determine compliance with workers’ compensation
laws,
46
and to ensure compliance with fair debt collection laws.
47
Administrative sanctions for
money services businesses may include issuance of a Cease and Desist Order, removal of an
Institution-Affiliated Party, suspension or revocation of a license, an injunction, or a fine of at
least $1,000 but not more than $10,000 for each violation.
48
Money laundering may be
prosecuted under state or federal law.
49
Qualified Public Depositories
Unless a specific exemption applies, state and local governments must deposit public funds in a
bank or savings association that has been designated as a qualified public depository (QPD)
under the Florida Security for Public Deposits Act.
50
To be designated as a QPD by the CFO, a bank, savings bank, or savings association must:
Have authority to accept deposits because it has been chartered and regulated by the state or
federal government;
Have its principal place of business in Florida, or a branch office in Florida;
Have deposit insurance pursuant to the Federal Deposit Insurance Act;
51
Have procedures and practices for accurate identification, classification, reporting, and
collateralization of public deposits; and
Meet all the requirements of ch. 280, F.S., relating to security for public deposits.
52
QPDs must secure public deposits with a pledge of eligible collateral, to protect the deposit
against losses that could occur in the event of insolvency or default.
53
The amount collateral
required is based on statutory guidelines and the QPD’s overall financial condition.
54
43
Section 560.404, F.S.
44
Section 560.103(3), F.S., defines “authorized vendor” as a person designated by a money services business licensed under
part II of ch. 560, F.S., to act on behalf of the licensee at locations in Florida pursuant to a written contract with the licensee.
45
Section 560.210, F.S.
46
Section 560.310(5)(b), F.S.
47
Section 560.309, F.S.
48
Sections 560.114 and 560.113, F.S.
49
Sections 560.111 and 560.123, F.S
50
Sections 280.01 and 280.03(1)(b), F.S. Certain public deposits, including those that are fully collateralized under other
laws and moneys contributions to the state retirement system that are held in the System Trust Fund, are exempt pursuant to
s. 280.03(3), F.S.
51
12 U.S.C. ss. 1811 et. seq.
52
Section 280.02(26), F.S.
53
Sections 280.04 and 280.041(6), F.S.
54
Section 280.04, F.S., and Rule 69C-2.024, F.A.C. BILL: CS/SB 302 Page 8
Public deposits include, but are not limited to, time deposit accounts, demand deposit accounts,
and nonnegotiable certificates of deposits; they do not include moneys in deposit notes,
securities, mutual funds, and similar investments.
55
A bank or savings association must guaranty public depositors against losses caused by the
default or insolvency of other QPDs.
56
Any shortfall that is not covered by the maximum federal
deposit insurance of $250,000, the CFO must demand payment under letters of credit or the sale
of pledged or deposited collateral by the defaulting depository. The CFO may assess QPDs for
the total loss if the demand for payment or sale cannot be accomplished within 7 days.
57
As of May 20, 2022, Florida had 118 authorized QPDs.
58
These QPDs include 23 of the 28
federally chartered banks and trusts that operate in Florida.
59
Government Investments
State Board of Administration
The State Board of Administration (SBA) was created by the Florida Constitution and serves as
the state’s independent investment management organization, with authority over 30 funds
collectively valued at about $228 billion as of June 30, 2022, including the state’s pension and
investment plans for public employees, which accounts for 79 percent of assets under
management.
60
Other funds under management include the Florida Hurricane Catastrophe Fund,
Department of the Lottery Fund, Florida Prepaid College and Florida College Investment Plan,
FSU Research Foundation, Florida PRIME (surplus funds of local governments) and the Police
and Firefighters’ Premium Tax Trust Fund.
61
The Governor, Chief Financial Officer, and
Attorney General serve as the SBA’s Board of Trustees (Trustees), and delegate operational
authority to an executive director and chief investment officer, who oversee about 200
employees.
62
A nine-member Investment Advisory Council provides guidance on investment
policy and strategy.
63
55
Section 280.02(23), F.S.
56
Section 280.07, F.S.
57
Section 280.08, F.S.
58
Florida Department of Financial Services, Division of the Treasury, List of Active QPDs, May 20, 2022, available at: List of
Active QPDs.xlsx (myfloridacfo.com) (last visited Mar. 26, 2023).
59
U.S. Department of the Treasury, Office of the Comptroller of the Currency, Financial Institution Lists, available at:
https://www.occ.treas.gov/topics/charters-and-licensing/financial-institution-lists/index-financial-institution-lists.html (last visited
Mar. 26, 2023).
60
Art. IV, s. 4(e) Fla. Const. (1968); State Board of Administration, Summary Overview of the State Board of Administration
of Florida, available at: https://www.sbafla.com/fsb/Portals/FSB/Content/Topics/SBAOverview_20211025.pdf?ver=2021-
10-28-120954-217 (last visited Mar. 26, 2023); State Board of Administration, Performance Report Month Ending June 30,
2022, available at:
https://www.sbafla.com/fsb/Portals/FSB/Content/Trustees/2022/June%202022%20Monthly%20Trustee%20Report.pdf?ver=
2022-08-24-133206-397 (last visited Mar. 26, 2023).
61
A full list of SBA-managed investment funds is available at https://www.sbafla.com/fsb/FundsWeManage.aspx (last
visited Mar. 26, 2023).
62
Section 215.44, F.S.; Summary Overview of the State Board of Administration of Florida, supra footnote 60.
63
Section 215.444(2), F.S. BILL: CS/SB 302 Page 9
In August 2022, the Trustees directed the SBA to invest funds in a manner that prioritizes the
highest return on investment, without consideration of social, political, or ideological interests.
64
A resolution adopted by the Trustees directed the SBA to amend the Investment Policy
Statement (IPS) for the Florida Retirement System Defined Benefit Plan to require that
investment decisions be based solely on pecuniary factors.
65
By law, the IPS must clearly state its
investment objectives, identify the types of securities the plan may invest in, and the evaluation
criteria that will be used to measure fund performance.
66
Investment managers who invest public
funds on behalf of the board certify compliance with the IPS annually.
67
The resolution further
states that the Trustees, when exercising shareholder rights, including the voting of proxies, may
not subordinate the interests of the participants and beneficiaries to other objectives and may not
sacrifice investment return or take on additional investment risk to promote non-pecuniary
factors.
68
In December 2021, the Trustees directed the SBA to reclaim proxy voting authority that had
been given to large financial firms and provide additional guidance to employees who are
responsible for proxy voting and investment decisions.
69
During fiscal year 2021, SBA staff cast
votes at 10,174 companies in 76 countries, voting on ballot items including director elections,
audit firm ratification, executive compensation plans, mergers and acquisitions, and a variety of
other management and shareowner proposals.
70
Of all votes cast, 17.5 percent were “against” the
recommendation of company management.
71
State General Revenue and Trust Funds
The Chief Financial Officer (CFO) is responsible for the investment of state general revenue and
trust funds.
72
Interest earnings are allocated to the general revenue fund, trust funds, and Special
Purpose Investment accounts.
73
A five-member Treasury Investment Council provides guidance
on investment policy and strategy.
74
64
The State Board of Administration, A Resolution Directing an Update to the Investment Policy Statement and Proxy Voting
Policies for the Florida Retirement System Defined Benefit Plan, and Directing the Organization and Execution of an
Internal Review, Aug. 23, 2022, available at: ESG-Resolution-Final.pdf (flgov.com) last visited (Mar. 26, 2023).
65
Office of the Governor, Governor DeSantis Eliminates ESG Considerations from State Pension Investments, Aug. 23,
2022, available at: https://www.flgov.com/2022/08/23/governor-ron-desantis-eliminates-esg-considerations-from-state-
pension-investments/ (last visited Mar. 26, 2023).
66
Section 215.475, F.S.
67
Section 215.4755(1), F.S.
68
Officer of the Governor, Governor DeSantis Eliminates ESG Considerations from State Pension Investments, supra
footnote 64.
69
Office of the Governor, Governor Ron DeSantis Takes Action Against Communist China and Woke Corporations, Dec. 20,
2021, available at: https://www.flgov.com/2021/12/20/governor-ron-desantis-takes-action-against-communist-china-and-
woke-corporations/ (last visited Mar. 26, 2023).
70
State Board of Administration, 2022 Corporate Governance Summary Report, available at: 2020-2021_AIR.pdf
(sbafla.com) (last visited Mar. 26, 2023).
71
Id.
72
Section 17.61, F.S. This includes funds of each state agency and of the judicial branch; and funds of all boards,
associations, and entities created by the Florida Constitution or by law.
73
Florida Department of Financial Services, Treasury Investment Pool, available at:
https://www.myfloridacfo.com/division/treasury/treasury-investment-pool (last visited Mar. 26, 2023).
74
Id. BILL: CS/SB 302 Page 10
Local Government Retirement Plans
The Department of Management Services (DMS) monitors and oversees 487 retirement plans of
municipalities, special districts, and school boards, to ensure they are actuarially sound.
75
Local
governments must adopt a written investment policy that is structured to maximize the financial
return on investments and complies with the investment limitations that apply to funds managed
by the SBA and to establish and maintain appropriate diversification of assets.
76
State law
includes special requirements for police and firefighter retirement plans; investments for these
trust funds are managed by the local board of trustees and are subject to similar investment
policies applicable to state funds.
77
Local Government Surplus Funds
There are several investment vehicles for surplus funds of local governments.
78
The SBA manages Florida PRIME (the Local Government Surplus Funds Trust Fund), which
invests surplus funds of 756 units of local government in accordance with the investment
restrictions that apply to the investment of state funds.
79
Two other investment pools were created by interlocal agreements.
80
The Florida Association of
Counties and the Florida Court Clerks & Comptrollers created the Florida Local Government
Investment Trust, which offers public entities the choice of two professionally managed
investment funds.
81
The cities of Bradenton, Lauderhill, and Palatka created The Florida
Municipal Investment Trust, which offers local governments the choice of a real estate portfolio,
three equity portfolios, and six fixed income portfolios.
82
Local government surplus funds must be invested consistent with the written investment plan
adopted by a governing board or principal officer of the local government entity. In accordance
with the written investment plan, local government entities may by resolution only invest surplus
public funds in Florida PRIME, an intergovernmental investment pool, registered money market
funds, interest bearing time deposits or savings accounts in qualified public depositories
designated by the CFO, direct obligations of the U.S. Treasury, federal agencies and
instrumentalities, rated or unrated bonds, notes, or instruments backed by Israel, or certain
securities of investment companies or investment trusts.
83
75
Florida Department of Management Services, Florida Local Government Retirement Systems 2022 Annual Report,
available at: 2022_Local_Report.pdf (fl.gov) (last visited Mar. 26, 2023).
76
Section 112.661, F.S.
77
Sections 175.071 and 185.06, F.S.
78
Section 218.403(11), F.S., states: “‘Unit of local government’ means any governmental entity within the state not part of
state government and shall include, but not be limited to, the following and the officers thereof: any county, municipality,
school district, special district, clerk of the circuit court, sheriff, property appraiser, tax collector, supervisor of elections,
authority, board, public corporations, or any other political subdivision of the state.”
79
Section 218.405(16)(a), F.S. Also see, State Board of Administration, Florida PRIME Monthly Summary Report, available
at: monthly_summary_report_01_31_23final.pdf (sbafla.com) (last visited Mar. 26, 2023).
80
See sections 163.01, F.S. and 218.415, F.S.
81
Florida Local Government Investment Trust, About, available at: About – Florida Local Government Investment Trust
(floridatrustonline.com) (last visited Mar. 26, 2023).
82
Florida League of Cities, Florida Municipal Investment Trust, available at:
https://www.floridaleagueofcities.com/services/investments-(fmivt) (last visited Mar. 26, 2023).
83
Section 218.415(16), F.S. BILL: CS/SB 302 Page 11
Citizen Support and Direct-support Organizations
Citizen support organizations (CSO) (such as the Florida Department of Environmental
Protection (DEP) holds agreements with 97 CSOs) and direct-support organizations (DSO) (such
as the DSO for the Statewide Council on Human Trafficking) are created to raise funds to
support causes that are in the public interest and often enter into a contract with a government
entity to define the terms of the organizations’ support to that government entity.
84
By August 1
of each year, such organizations must submit annual reports describing their activities to the
appropriate government agency.
85
By August 15 each year, each CSO and DSO must report to
the Governor, the Legislature, and the Office of Program Policy Analysis and Government
Accountability which must include a recommendation on whether to continue, terminate, or
modify the agency’s association with each organization.
86
Bond Financing
State and local government entities issue bonds to finance public projects. Investors are paid tax-
exempt interest during the lifetime of the bond and are repaid the face value of the bond upon
maturity.
The Division of Bond Finance (which is administratively housed within the SBA) issues general
obligation bonds, revenue bonds, and appropriation-based bonds on behalf of local governments
and state agencies. General obligation bonds are secured by the taxing power of the bond issuer.
The investor relies on the full faith and credit of the issuer, and the issuer can impose a tax on the
public to repay the bond. Revenue bonds are backed by revenues that come from a specific
source or revenue stream, like a local stadium or highway tolls. Interest rates are higher because
these bonds depend on the success of the specific venture that is financed. Appropriation-based
bonds are secured by a commitment of the state to pay the debt service on the bonds via annual
appropriations of the Legislature.
87
The Governor, the Chief Financial Officer, and the Attorney
General serve as the governing board of the Division of Bond Finance.
88
Local governments may also issue bonds through the Florida League of Cities, investment banks
or other financial firms.
89
In such cases, the local government must provide notice of proposed
bond sales and detailed information about bonds that have been issued to the Division of Bond
Finance, which serves as a clearinghouse for government bonds issued in Florida.
90
The local
government also must provide adequate notice to the public about the cost of bond financing and
the terms under which bonds are issued.
91
84
See ss. 258.015 and 16.618(1), F.S.; DeCerchio, A., Citizen Support Organization 2022 Annual Report, the DEP, Aug. 12,
2022, available at: 8.12.22 2022 DEP Annual CSO Report FINAL.pdf (floridadep.gov) (last visited Mar. 26, 2023).
85
Section 20.058(1), F.S.
86
Section 20.058(3), F.S.
87
Division of Bond Finance, Bond Program Overview, available at: https://www.sbafla.com/bondfinance/Bond-Programs
(last visited Mar. 26, 2023).
88
Section 215.62(1), F.S.
89
See Florida League of Cities, Bond Issue Program, available at:
https://www.floridaleagueofcities.com/services/loans/bond-issue-program (last visited Mar. 26, 2023).
90
Sections 218.37 and 218.38, F.S.
91
Sections 218.385, F.S. BILL: CS/SB 302 Page 12
The Division is issuing state revenue bonds totaling $24.3 million for the Florida International
University Parking Facility, and recently issued state revenue bonds in the amounts of
approximately $98.9 million, $76 million, and $174.6 million for the Department of
Transportation (DOT) Seaport Investment Program, Florida Polytechnic University Dormitory,
and DOT Turnpike, respectively.
92
Procurement and Contracting with Vendors
The DMS sources and adopts contracts for the purchase, lease, or acquisition of goods and
services frequently used by multiple state agencies, such as office supplies, vehicles, computers,
and furniture.
93
The DMS has authority to remove vendors from its vendor list for failure to
fulfill its contractual duties and may reinstate a vendor when it is satisfied that no further defaults
will occur.
94
Agencies must purchase goods and contractual services from the agreements and
state term contracts established by the DMS.
95
A competitive solicitation process set out in s.
287.057, F.S., must be used for the procurement of commodities or contractual services over a
certain amount. Unless an exception applies, the procurement of certain contractual services in
excess of a specified amount must include certain information, such as specifying scope of work
and allowing for unilateral cancellation by the agency in some instances.
96
School districts, Florida College System institutions, and state universities must to comply with
State Board of Education laws and rules relating to purchases and leases.
97
Such entities must
review the DMS purchasing agreements and state term contracts to determine whether there is an
economic advantage to use them for nonacademic purchases.
98
School districts and Florida
College System Institutions must adopt rules, and state universities must adopt regulations, that
must be complied with when making purchases.
99
III. Effect of Proposed Changes:
Financial Institutions
Section 25 adds the term “unsafe and unsound practice” to the section of the Florida Financial
Institutions Codes that defines “unsafe or unsound practice” for banks, trust companies, and
credit unions. Sections 21 and 22 add the term “unsafe and unsound practice” to laws governing
consumer finance loans and money services businesses. The definition in sections 21, 22, and 25
of the bill echoes the reference found to “unsafe or unsound practice” in section 14 of the bill
relating to qualified public depositories, and states:
92
Division of Bond Finance, Bond Sales, available at: Bond Sales (sbafla.com) (last visited Mar. 26, 2023).
93
Section 287.042(1)(a), F.S.; The DMS, State Contracts and Agreements, available at: State Contracts and Agreements /
State Purchasing / Business Operations / Florida Department of Management Services - DMS (myflorida.com) (last visited
Mar. 26, 2023).
94
Section 287.042(1)(b), F.S.
95
Section 287.056(1), F.S.
96
Section 287.058(1), F.S.
97
Section 1010.04(1)(a) and (c), F.S.
98
Section 1010.04(1)(b), F.S.
99
Section 1010.04(2), F.S. BILL: CS/SB 302 Page 13
It is an unsafe and unsound practice for a licensee to deny or cancel its services to a person, or to
otherwise discriminate against a person, on the basis of:
The person's political opinions, speech, or affiliations;
The person's religious beliefs, exercise, or affiliations;
Any other factor that is not a quantitative, impartial, and risk-based standard; or
A social credit score.
100
The bill states that financial institutions operating in Florida (such as banks, trust companies, and
credit unions), consumer finance lenders and money services businesses, must make
determinations about the provision or denial of services “based on an analysis of risk factors
unique to each individual customer or member.”
Upon application for a license or license renewal, financial institutions, consumer finance
lenders, and money services businesses regulated by the OFR must provide an attestation stating
that the financial institution’s practices comply with the applicable requirements and limitations
created by the bill.
Sections 21 to 23 and 25 provide that if a financial institution, consumer finance lender, or
money services business licensed by OFR engages in an “unsafe or unsound practice” or fails to
make the required attestation, the OFR may impose administrative penalties, including an order
requiring corrective action, a financial penalty, and suspension or revocation of a license.
Sections 21, 22, and 25 provide that financial institutions, consumer finance lenders, and money
services businesses licensed by OFR that engage in an “unsafe or unsound practice,” have also
violated the Florida Deceptive and Unfair Trade Practices Act. This makes banks, trust
companies, credit unions, consumer finance lenders, and money service businesses subject to the
enforcement actions identified in part II of chapter 501, F.S., which include civil actions brought
by the Attorney General and criminal prosecution by a State Attorney in the appropriate judicial
circuit. Civil actions may include an injunction, an action seeking damages, or a civil penalty up
to $10,000 per violation.
100
The bill provides that a “social credit score” includes, but is not limited to, using any rating, scoring, analysis, tabulation,
or action that considers a social credit score based on factors including, but not limited to: the person's political opinions,
speech, or affiliations; the person's religious beliefs, religious exercise, or religious affiliations; the person's lawful ownership
of a firearm; the person's engagement in the lawful manufacture, distribution, sale, purchase, or use of firearms or
ammunition; the person's engagement in the exploration, production, utilization, transportation, sale, or manufacture of fossil
fuel-based energy, timber, mining, or agriculture; the person's support of the state or federal government in combatting illegal
immigration, drug trafficking, or human trafficking; the person's engagement with, facilitation of, employment by, support of,
business relationship with, representation of, or advocacy for any person described in this paragraph; the person's failure to
meet or commit to meet, or expected failure to meet, any of the following as long as such person is in compliance with
applicable state or federal law:
Environmental standards, including emissions standards, benchmarks, requirements, or disclosures;
Social governance standards, benchmarks, or requirements, including, but not limited to, environmental or social justice;
Corporate board or company employment composition standards, benchmarks, requirements, or disclosures based on
characteristics protected under the Florida Civil Rights Act of 1992; or
Policies or procedures requiring or encouraging employee participation in social justice programming, including, but not
limited to, diversity, equity, or inclusion training. BILL: CS/SB 302 Page 14
The bill prohibits the waiver of state laws under by OFR and the Financial Services Commission
in relation to unsafe and unsound business practices by financial institutions.
101
Section 24 amends the definition of “unsafe or unsound practice” in the financial institutions
code to include the definition of “unsafe and unsound practice” created in the bill.
Qualified Public Depositories
Section 14 amends the definition of a QPD to prohibit the CFO from qualifying a bank or
savings association that engages in an “unsafe and unsound practice.”
It is an unsafe and unsound practice for a licensee to deny or cancel its services to a person, or to
otherwise discriminate against a person, on the basis of:
The person's political opinions, speech, or affiliations;
The person's religious beliefs, exercise, or affiliations;
Any other factor that is not a quantitative, impartial, and risk-based standard; or
A social credit score.
102
Section 15 provides that, beginning July 1, 2023, banks and savings associations must certify
compliance with this requirement when filing an application to be designated or re-designated as
a QPD. Section 17 provides that failure to file the required attestation is grounds for suspension
or disqualification of a QPD, and Section 18 provides that failure to timely file the attestation is
deemed a knowing and willful violation of the law.
Sections 16, 18, and 19 of the bill gives the CFO authority to verify the attestation and impose
penalties if a QPD fails to timely file the attestation. The CFO can impose an administrative
penalty, issue a cease and desist order to require compliance with the law, and suspend or revoke
a QPD’s qualification.
Section 16 provides that if the CFO determines that an affidavit is materially false, the CFO
must report the finding to the Attorney General, who may bring a civil or administrative action
against the QPD, and recover attorney fees and costs if the enforcement action is successful.
The bill does not give the CFO “visitorial powers” to inspect, examine, supervise, or regulate the
affairs of federally-chartered banks or savings associations. Only the federal regulator has
visitorial powers.
103
The bill’s QPD-related provisions are not preempted by federal law because the QPD program is
a creature of Florida law, in which the federally chartered institutions voluntarily participate. To
participate in the program, they must accept the conditions of QPD eligibility.
101
The Financial Services Commission is the Governor, Attorney General, Commissioner of Agriculture, and Chief Financial
Officer. The Commission is the agency head over OFR. Section 20.121(3), F.S.
102
Supra, note 93.
103
12 U.S.C. 484 and 12 CFR § 7.400. BILL: CS/SB 302 Page 15
Investments
Sections 1 to 8 and 13 codifies and extends, except for prohibited investments in Cuba and
Venezuela, the policy adopted by the SBA, requiring that all investment decisions relating to the
state retirement system be based solely on pecuniary factors, to all funds managed by the SBA,
all funds of the state Treasury, all local government retirement plans, investments of local
government surplus funds, and investments of funds raised by CSOs and DSOs. Investment
restrictions do not apply to individual member-directed investment accounts established as part
of a defined contribution plan. Investment managers who invest public funds on behalf of any of
these entities may not sacrifice investment return or take additional investment risk to promote
any non-pecuniary factor.
The term “pecuniary factor” is defined as a factor that is expected “to have a material effect on
the risk or return of an investment based on appropriate investment horizons consistent with
applicable investment objectives and funding policy. The term does not include the consideration
of the furtherance of any social, political, or ideological interests.” Further, the “weight given to
any pecuniary factor must appropriately reflect a prudent assessment of its impact on risk or
returns.”
Section 9 amends the IPS to require that it comply with the new provision requiring investments
be made based on pecuniary factors.
Section 3 and 4 requires that written investment policies and investment decisions of local
government retirement systems to be based solely on pecuniary factors.
Section 3 to 7 require state and local retirement systems to report compliance with the law on a
biennial basis, beginning December 15, 2023. Local government retirement plans must report to
the DMS; the SBA, on behalf of the Florida Retirement System, must report to the Governor, the
Attorney General, the CFO, and the Legislature. Reports must describe governance policies and
standards for the exercise of shareholder rights. DMS is directed to report incidents of
noncompliance to the Attorney General, who may seek an injunction against any agency
violating the reporting provisions and recover attorney fees and costs when an enforcement
action is successful.
Section 12 requires investment managers
104
who invest public funds
105
on behalf of a state or
local government entity
106
to include a disclaimer in an external communication, if the
communication is to a company in which the investment manager has invested public funds and
discusses social, political, or ideological interests; subordinates the interests of the company’s
shareholders to the interests of another entity; or advocates for an entity other than the
104
Section 12 of the bill defines “investment manager” as a private sector company that offers one or more investment
products or services to a governmental entity and that has the discretionary investment authority for direct holdings.
105
Section 12 of the bill defines “public funds” as all moneys under the jurisdiction of a governmental entity and includes all
manner of pension and retirement funds and all other funds held, as trust funds or otherwise, for any public purpose, subject
to investment.
106
Section 12 of the bill defines “government entity” as a state, regional, county, municipal, special district, or other political
subdivision whether executive, judicial, or legislative, including, but not limited to, a department, division, board, bureau,
commission, authority, district, or agency thereof, or a public school, Florida College System institution, state university, or
associated board. BILL: CS/SB 302 Page 16
company’s shareholders. This applies to the investment of general revenue, surplus funds, trust
funds, and retirement plans.
The required disclaimer must state: “The views and opinions expressed in this communication
are those of the sender and do not necessarily reflect the views and opinions of the people of the
state of Florida.”
All contracts with investment managers executed, amended, or renewed on or after July 1, 2023,
may be unilaterally terminated if certain communications of an investment manager include
discussion of social, political, or ideological interests and omit the required disclaimer described
above.
Section 10 provides that investment managers, who are required to certify compliance with the
fiduciary standards set forth in the state’s investment policy annually, would be subject to
sanction if they fail to timely file the required certification or if they submit a certification that is
materially false. The Attorney General may bring a civil or administrative action against such
persons and recover attorney fees and costs when an enforcement action is successful.
Bond Financing
Section 11 provides that bond issuers are prohibited from issuing any ESG bond. An ESG bond
is defined as any bond that has been designated or labeled as a bond that will be used to finance a
project with an ESG purpose, including, but not limited to, green bonds, Certified Climate
Bonds, GreenStar designated bonds, and other environmental bonds marketed as promoting a
generalized or global environmental objective; social bonds marketed as promoting a social
objective; and sustainability bonds and sustainable development goal bonds marketed as
promoting both environmental and social objectives. It includes bonds self-designated by the
issuer as ESG-labeled bonds and those designated as ESG-labeled bonds by a third-party verifier.
The reference to “generalized or global” has the effect that bond issuers may issue bonds for
specific governmental environmental projects, but they are prohibited from being marketed as a
generalized or global ESG bond.
The bill also prohibits paying for a third-party verifier
107
that certifies or verifies that a bond
108
may be designated or labeled as an ESG bond, renders opinions or produces a report on ESG
compliance, among other ESG-related services. Issuers are also prohibited from contracting with
a rating agency
109
whose ESG scores for the issuer will have a direct, negative impact on the
issuer’s bond ratings.
The following bond issuers are affected by the bill:
107
Section 11 of the bill defines “third-party verifier” as any entity that contracts with an issuer to conduct an external review
and independent assessment of proposed ESG bonds to ensure that such bonds may be designated or labeled as ESG bonds or
will be used to finance a project that will comply with applicable ESG standards.
108
The bill defines “bond” as any note, general obligation bond, revenue bond, special assessment bond, special obligation
bond, private activity bond, certificate of participation, or other evidence of indebtedness or obligation, in either temporary or
definitive form.
109
Section 11 of the bill defines “rating agency” as any nationally recognized rating service or nationally recognized
statistical rating organization. BILL: CS/SB 302 Page 17
The Division of Bond Finance, acting on behalf of any entity;
Any local government, educational entity, or entity of higher education,
110
or other political
subdivision granted the power to issue bonds;
Any public body corporate and politic authorized or created by general or special law and
granted the power to issue bonds, including, but not limited to:
Water and sewer districts created under ch. 153, F.S.,
Health facilities authorities,
111
Industrial development authorities created under ch. 159, F.S.,
Housing financing authorities,
112
Research and development authorities,
113
Legal or administrative entities created by interlocal agreement pursuant to s. 163.01(7), F.S.,
Community redevelopment agencies,
114
Regional transportation authorities created under chapter 163, F.S.,
Community development districts,
115
Educational facilities authorities,
116
The Higher Educational Facilities Financing Authority created pursuant to s. 243.53, F.S.,
The Florida Development Finance Corporation created pursuant to s. 288.9604, F.S.,
Port district or port authorities,
117
The South Florida Regional Transportation Authority created pursuant to s. 343.53, F.S.,
The Central Florida Regional Transportation Authority created pursuant to s. 343.63, F.S.,
The Tampa Bay Area Regional Transit Authority created pursuant to s. 343.92, F.S.,
The Greater Miami Expressway Agency created pursuant to s. 348.0304, F.S.,
The Tampa-Hillsborough County Expressway Authority created pursuant to s. 348.52, F.S.,
The Central Florida Expressway Authority created pursuant to s. 348.753, F.S.,
The Jacksonville Transportation Authority created pursuant to s. 349.03, F.S., and
The Florida Housing Finance Corporation created pursuant to s. 420.504, F.S.
The bill provides that notwithstanding s. 655.0323, F.S., a financial institution may purchase and
underwrite bonds issued by a governmental entity.
The bill expressly applies to bonds issued and agreements made and contracts executed on or
after July 1, 2023.
Procurement and Contracting with Vendors
Sections 20 and 26 provide that state and local government entities, school districts, Florida
College System institutions, and state universities are prohibited from considering social,
110
As defined in s. 215.89(2)(c), (d), and (e), F.S.
111
As defined in s. 154.205, F.S.
112
As defined in s. 159.603(3), F.S.
113
As defined in s. 159.702(1)(c), F.S.
114
As defined in s. 163.340(1), F.S.
115
As defined in s. 190.003, F.S.
116
As defined in s. 243.52(1), F.S.
117
As defined in s. 315.02(1) and (2), F.S. BILL: CS/SB 302 Page 18
political, or ideological beliefs in contracting and procuring commodities or contractual services.
Section 20 explicitly notes that this includes all political subdivisions of the state. To do this, the
bill creates a new section within ch. 287, F.S., which currently addresses contracting only at the
state level.
An awarding body
118
and the specified educational institutions may not: 1) request
documentation or consider a vendor’s social, political, or ideological beliefs when determining if
the vendor is a responsible vendor; or 2) give a preference to a vendor based on the vendor’s
social, political, or ideological beliefs.
Beginning July 1, 2023, all solicitations for commodities or contractual services must include
notice of these requirements.
Sections 27 and 28 reenact ss. 17.61 and 215.44, F.S., for purposes of amendments made to ss.
17.57 and 215.47, F.S., respectively.
Section 29 provides the effective date is July 1, 2023.
IV. Constitutional Issues:
A. Municipality/County Mandates Restrictions:
The county/municipality mandates provision of Art. VII, section 18, of the Florida
Constitution may apply because this bill requires local governments to make investments,
issue bonds, conduct procurements, and provide reports in compliance with the
provisions of the bill, which may be at some expense; however, an exemption may apply.
The expenditures required to comply with the bill are estimated to be insignificant.
B. Public Records/Open Meetings Issues:
None.
C. Trust Funds Restrictions:
None.
D. State Tax or Fee Increases:
None.
E. Other Constitutional Issues:
The provisions of the bill relating to contracts with investment managers and vendors are
prospective. The bill refers to contracts that are solicited or awarded on or after July 1,
118
Section 20 of the bill defines “awarding body” as (a) for state contracts, an agency or the department, and (b) for local
government contracts, the governing body of a county, a municipality, a special district, or any other political subdivision of
the state. BILL: CS/SB 302 Page 19
2023. The bill does not modify or render unenforceable any contract that exists prior to
July 1, 2023.
V. Fiscal Impact Statement:
A. Tax/Fee Issues:
None.
B. Private Sector Impact:
The bill may:
Ensure that financial entities focus on pecuniary factors and safe and sound practices
that will protect their businesses;
Increase access to financial products and services that would otherwise be limited by
ESG-related discrimination.
Expand who can receive government procurement awards;
Limit the ability of some financial firms to provide services to units of state and local
government;
Limit the ability of some banks to be certified as QPDs and accept deposits from units
of state and local government; and
Impose administrative costs on banks, trusts, and credit unions operating in Florida if
they must revise investment policies and train staff to comply with the provisions set
forth in the bill.
C. Government Sector Impact:
The bill may increase administrative costs of state agencies that must revise policies or
practices relating to investments, bond financing, contracts, QPDs, and banking, and train
staff accordingly. Enforcement costs of state agencies are recoverable through the
imposition of administrative fines. Enforcement costs of the Attorney General may be
recovered through awards of attorney fees and costs, so long as an enforcement action is
successful.
The bill may increase administrative costs of local governments that must revise policies
relating to investments, bond financing, and contracts, and train staff accordingly. Such
costs could be absorbed within ongoing operating budgets.
VI. Technical Deficiencies:
None.
VII. Related Issues:
None. BILL: CS/SB 302 Page 20
VIII. Statutes Affected:
This bill substantially amends the following sections of the Florida Statutes: 17.57, 20.058,
112.656, 112.661, 175.071, 185.06, 215.47, 215.475, 215.4755, 218.415, 280.02, 280.05,
280.051, 280.054, 280.055, 560.114, 655.005, and 1010.04.
This bill creates the following sections of the Florida Statutes: 112.662, 215.681, 215.855,
280.025, 287.05701, 516.037, 560.1115, and 655.0323.
This bill re-enacts the following sections of the Florida Statutes: 17.61 and 215.44.
IX. Additional Information:
A. Committee Substitute – Statement of Substantial Changes:
(Summarizing differences between the Committee Substitute and the prior version of the bill.)
CS by Banking and Insurance Committee on March 29, 2023:
Clarifies that the definition of “pecuniary factor” does not include considering the
furtherance of social, political, or ideological interests, rather than consideration
“or” furtherance of such factors;
Provides that the provisions contained in s. 215.472, F.S., relating to prohibited
investments by state agencies, will control if there is a conflict with the provisions
in s. 17.57, F.S., to ensure that state investment prohibitions related to Cuba and
Venezuela remain in place;
Clarifies that the investment restrictions do not apply to individual member-
directed investment accounts established as part of a defined contribution plan;
Amends the cross-reference in section 8 of the bill to s. 215.471, F.S., to refer to
the provisions relating to the SBA’s prohibited investments in Cuba and
Venezuela;
Clarifies that bonds may be issued for specific governmental environmental
projects, but are prohibited from being marketed as generalized or global
environmental bonds;
Clarifies that the prohibitions on third-party verifier services applies to ESG bond
labels; and
Specifies that financial institutions are subject to sanctions and penalties for
failure to timely make the required attestation.
B. Amendments:
None.
This Senate Bill Analysis does not reflect the intent or official position of the bill’s introducer or the Florida Senate.