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 Education Postsecondary
BILL: SB 598
INTRODUCER: Senator Martin
SUBJECT: Higher Educational Facilities Financing
DATE: March 6, 2023
ANALYST STAFF DIRECTOR REFERENCE ACTION
1. Jahnke Bouck HE Pre-meeting
2. GO
3. RC
I. Summary:
SB 598 revises various provisions related to the Higher Educational Facilities Financing
Authority (HEFFA). Specifically, the bill:
Revises the definition of an "institution of higher education" that may participate in the
program.
Clarifies that the term for a new appointee to the HEFFA begins on the later of the dates on
which the current term expires or the date of appointment by the governor.
Authorizes the authority to conduct meetings and workshops by means of communications
media technology, and:
o Provides notice requirements and participation specifications for meetings and workshops
conducted via communication media technology.
o Specifies that majority voting is for members participating in the meeting, rather than
those present.
Authorizes the HEFFA to contract for administrative services.
Modifies the time by which the HEFFA determines the financial responsibility and capability
to fulfill a project to at the time the financial agreement is executed.
Revises the timeframe within which the authority is required to submit a report to the
Governor and the Legislature from 2 months to 6 months after the end of the fiscal year.
The bill is effective July 1, 2023.
REVISED: BILL: SB 598 Page 2
II. Present Situation:
Higher Educational Facilities Financing Authority
The Higher Educational Facilities Financing Authority (HEFFA or authority) was established in
2001
1
as a public corporation to provide assistance to eligible private postsecondary institutions
in financing and refinancing educational facilities construction, and to enable those institutions to
coordinate their budgetary needs with the timing of receipt of tuition revenue.
2
Purpose and Powers
The HEFFA is constituted as a public instrumentality and the exercise of its conferred powers
3
is
considered to be the performance of an essential public function.
4
Among other powers, the
HEFFA may:
5
Exercise general business authority, which includes contracting with an entity as its agent to
assist the HEFFA in screening applications of institutions of higher education for loans.
Implement financing arrangements. The authority may only finance such projects as
dormitories, parking and student service facilities, administration and academic buildings,
libraries, and loans made in anticipation of tuition revenues.
6
However, authority may not
enter into a financing agreement with a participating institution unless the institution
demonstrates that it is financially responsible and capable of fulfilling its obligations under
the agreement.
7
Issue bonds and manage loans. Bonds issued by the authority are privately financed, are not
secured by the full faith and credit of the state, and do not constitute an obligation of the
state.
8
Establish rules for the use of a project, and designate a participating institution as its agent to
establish rules for the use of the project undertaken by the participating institution.
Membership
The 5 members of the HEFFA are appointed by the Governor and are subject to confirmation by
the Senate.
9
The members are appointed for terms of 5 years each a member or members to
succeed those whose terms expire. Additionally, the Governor has the authority to appoint
someone to complete an unexpired term in case of a vacancy. Members of the authority can be
reappointed, but the Governor has the power to remove any member who engages in misconduct
or neglects their duties.
10
1
Ch. 2001-79, Laws of Fla.
2
Section 243.51, F.S.
3
Sections 243.50-243.77, F.S.
4
Section 243.53(1), F.S.
5
Section 243.54, F.S.
6
Section 243.52(3), F.S.
7
Section 243.58(2), F.S.
8
Section 243.64, F.S.
9
Section 245.53(2), F.S.
10
Id. BILL: SB 598 Page 3
Participating Institutions
A “participating institution” is an independent nonprofit college or university which is located in
and chartered by the state, accredited by the Commission on Colleges of the Southern
Association of Colleges and Schools, and grants baccalaureate degrees; and undertakes the
financing and construction or acquisition of a project or undertakes the refunding or refinancing
of obligations or of a mortgage or of advances as provided in an permitted by ss. 243.50-
243.77.”
11
Reports and Audits
The HEFFA is required to submit an annual report to the Governor and the legislature, within 2
months after the end of its fiscal year.
12
The complete and detailed report must consist of the
following:
13
Operations and accomplishments.
Receipts and expenditures during its fiscal year in accordance with the categories or
classifications established by the authority for its operating and capital outlay purposes.
Assets and liabilities at the end of its fiscal year and the status of reserve, special, or other
funds.
A schedule of its bonds outstanding at the end of its fiscal year, together with a statement of
the principal amounts of bonds issued and redeemed during the fiscal year.
Any other information the authority deems appropriate.
In addition to the report, the HEFFA must submit a copy of an annual financial audit of its
accounts and records, and an annual compliance audit of its programs conducted by an
independent certified public accountant.
14
The Auditor General also has the authority to conduct
and audit of the authority or any programs or entities created by the authority.
15
III. Effect of Proposed Changes:
SB 598 amends provisions related to the Higher Educational Facilities Financing Authority
(HEFFA). The bill modifies s. 243.51, F.S., to confirm the declarations of the HEFFA as serving
in the public interest, as determined by the Legislature.
The bill amends s. 243.52, F.S., to revise the definition of an “institution of higher education”
that may participate in the HEFFA. The bill removes the requirement that the institution be
baccalaureate granting and to be accredited by the Commission on Colleges of the Southern
Association of Colleges and Schools, instead simply that the institution is accredited beyond the
high school level. The change in required degree level and specific accrediting agency will open
the HEFFA to a broad range of other private postsecondary institutions that may become eligible
for financing.
11
Section 243.52(6) and (7), F.S.
12
Section 243.73(1), F.S.
13
Id.
14
Section 243.73(2), F.S.
15
Section 243.73(3), F.S. BILL: SB 598 Page 4
The bill modifies s. 243.53, F.S., to revise provisions relating to member appointments and
meetings. The bill:
Specifies the term for a new appointee to the HEFFA to begin on the later of the dates on
which the current term expires or the date of appointment by the Governor. This change will
allow, if the appointment of a new board member is delayed, for the new member to serve a
full five-year term.
Authorizes the HEFFA to meet via telephone conference, video conference or other
communications technology allowing public access. The bill provides noticing requirements
to inform the public of the remote meeting and how persons may access the meeting, and
specifies that participation by an officer, member, or other representative via telephone or
video conference constitutes the individual’s presence at the meeting. Accordingly, the bill
change the voting requirement from a majority of members present in a meeting to the
majority of members participating in the meeting.
The bill modifies s. 243.54, F.S., to expand the authority of the HEFFA to contract for services.
Currently the HEFFA may contract for to assist with screening loan applications by institutions
of higher education; the bill authorizes the HEFFA to contract for administrative services beyond
just the screening.
The bill modifies s. 243.58, F.S., relating to the timing for the HEFFA to determine the financial
responsibility of the applicant. The bill specifies that the HEFFA may not enter into a financing
agreement for project with a participating institution that is not financially responsible and fully
capable of fulfilling the obligations at the time the agreement is executed.
The bill also amends s. 243.73, F.S., revising the timeframe within which the authority is
required to submit an annual report to the Governor and the Legislature from 2 months to 6
months after the end of the fiscal year. Because the annual report must include the annual
financial audit, this timeframe will better reflect the general timeframe for delivery of audited
financial statements.
The bill is effective July 1, 2023.
IV. Constitutional Issues:
A. Municipality/County Mandates Restrictions:
None.
B. Public Records/Open Meetings Issues:
None.
C. Trust Funds Restrictions:
None. BILL: SB 598 Page 5
D. State Tax or Fee Increases:
None.
E. Other Constitutional Issues:
None.
V. Fiscal Impact Statement:
A. Tax/Fee Issues:
None.
B. Private Sector Impact:
None.
C. Government Sector Impact:
None.
VI. Technical Deficiencies:
None.
VII. Related Issues:
None.
VIII. Statutes Affected:
This bill substantially amends the following sections of the Florida Statutes: 243.51, 243.52,
243.53, 243.54, 243.58, and 243.73.
IX. Additional Information:
A. Committee Substitute – Statement of Changes:
(Summarizing differences between the Committee Substitute and the prior version of the bill.)
None.
B. Amendments:
None.
This Senate Bill Analysis does not reflect the intent or official position of the bill’s introducer or the Florida Senate.