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A bill to be entitled 1
An act relating to community -based child welfare 2
agencies; amending s. 409.987, F.S.; revising 3
requirements for contracts the Department of Children 4
and Families has with community -based care lead 5
agencies; revising requirements for an entity to serve 6
as a lead agency; providing duties for board members 7
of lead agencies; requiring that lead agencies ensure 8
that board members participate in certain annual 9
training; revising the definition of the term 10
"conflict of interest"; defining the term "related 11
party"; requiring the lead agency's board of directors 12
to disclose any known or potential conflicts of 13
interest; prohibiting a lead agency from entering into 14
a contract or being a party to a transaction that 15
creates a conflict of interest; imposing civil 16
penalties on lead agencies for undisclosed conflicts 17
of interest; providing applicability; requiring 18
certain contracts to be reprocured; authorizing the 19
department to prohibit execution of certain contracts; 20
amending s. 409.988, F.S.; revising lead agency 21
duties; creating s. 409.9913, F.S.; providing 22
definitions; requiring the department, in 23
collaboration with lead agencies and providers of 24
child welfare services, to develop a funding 25
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methodology for allocating certain funding to lead 26
agencies; providing requiremen ts for the methodology; 27
requiring lead agencies and providers to submit 28
certain data to the department for a specified 29
purpose; providing reporting requirements; providing 30
construction; providing duties for the Legislature 31
relating to funding for lead agen cies; prohibiting the 32
department from changing allocations of funds to lead 33
agencies without legislative approval; authorizing the 34
department to approve certain risk pool funding for 35
lead agencies; amending s. 409.992, F.S.; revising 36
requirements for lead agency practices in the 37
procurement of commodities and contractual services; 38
requiring the department to impose certain penalties 39
for a lead agency's noncompliance with applicable 40
procurement law; requiring lead agencies to comply 41
with established purchasi ng practices for the 42
procurement of real property and professional 43
services; requiring the department to retain all 44
rights to and ownership of real property procured upon 45
termination of contracts; requiring certain funds to 46
be returned to the department; p roviding applicability 47
of certain limitations on the salaries of community -48
based care lead agency administrative employees; 49
amending s. 409.994, F.S.; revising the conditions 50
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under which the department may petition a court for 51
the appointment of a receiver for a community-based 52
care lead agency; amending s. 409.996, F.S.; revising 53
requirements for contracts between the department and 54
lead agencies; revising the actions the department may 55
take under certain circumstances; making a technical 56
change; providing duties of the department; providing 57
reporting requirements; providing an effective date. 58
59
Be It Enacted by the Legislature of the State of Florida: 60
61
Section 1. Subsections (3) and (4) and paragraphs (a) and 62
(b) of subsection (7) of section 409.9 87, Florida Statutes, are 63
amended, and paragraph (g) is added to subsection (7) of that 64
section, to read: 65
409.987 Lead agency procurement; boards; conflicts of 66
interest.— 67
(3) Notwithstanding s. 287.057, the department shall use 68
5-year contracts with le ad agencies. The 5-year contract must be 69
reprocured at the end of each 5 -year contract term. The contract 70
may be extended at the discretion of the department for up to 1 71
year, based on department needs. 72
(4) In order to serve as a lead agency, an entity m ust: 73
(a) Be organized as a Florida corporation or a 74
governmental entity. 75
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(b) Be governed by a board of directors or a board 76
committee composed of board members. Board members shall provide 77
oversight and ensure accountability and transparency for the 78
system of care. The board of directors shall provide fiduciary 79
oversight to prevent conflicts of interest, promote 80
accountability and transparency, and protect state and federal 81
funding from misuse. The board of directors shall act in 82
accordance with s. 617. 0830. The membership of the board of 83
directors or board committee must be described in the bylaws or 84
articles of incorporation of each lead agency, which must 85
provide that at least 75 percent of the membership of the board 86
of directors or board committee m ust be composed consist of 87
persons residing in this state, and at least 51 percent of the 88
state residents on the board of directors must reside within the 89
service area of the lead agency. The lead agency shall ensure 90
that board members participate in annua l training related to 91
their responsibilities. However, for procurements of lead agency 92
contracts initiated on or after July 1, 2014: 93
1. At least 75 percent of the membership of the board of 94
directors must be composed consist of persons residing in this 95
state, and at least 51 percent of the membership of the board of 96
directors must be composed consist of persons residing within 97
the service area of the lead agency. If a board committee 98
governs the lead agency, 100 percent of its membership must be 99
composed consist of persons residing within the service area of 100
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the lead agency. 101
2. The powers of the board of directors or board committee 102
include, but are not limited to, approving the lead agency's 103
budget and setting the lead agency's operational policy and 104
procedures. A board of directors must additionally have the 105
power to hire the lead agency's executive director, unless a 106
board committee governs the lead agency, in which case the board 107
committee must have the power to confirm the selection of the 108
lead agency's executive director. 109
(c) Demonstrate financial responsibility through an 110
organized plan for regular fiscal audits and the posting of a 111
performance bond. 112
(7)(a) As used in this subsection, the term: 113
1. "Activity" includes, but is not limited to, a contract 114
for goods and services, a contract for the purchase of any real 115
or tangible property, or an agreement to engage with a lead 116
agency for the benefit of a third party in exchange for an 117
interest in real or tangible property, a monetary benefit, or an 118
in-kind contribution. 119
2. "Conflict of interest" means when a board member , 120
director, or an officer, or a relative of a board member , 121
director, or an officer, of a lead agency does any of the 122
following: 123
a. Enters into a contract or other transaction for goods 124
or services with the lead agency. 125
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b. Holds a direct or indirect interest in a corporation, 126
limited liability corporation, partnership, limited liability 127
partnership, or other business entity that conducts business 128
with the lead agency or propos es to enter into a contract or 129
other transaction with the lead agency. For purposes of this 130
paragraph, the term "indirect interest" has the same meaning as 131
in s. 112.312. 132
c. Knowingly obtains a direct or indirect personal, 133
financial, professional, or oth er benefit as a result of the 134
relationship of such board member , director, or officer, or 135
relative of the board member , director, or officer, with the 136
lead agency. For purposes of this paragraph, the term "benefit" 137
does not include per diem and travel expe nses paid or reimbursed 138
to board members or officers of the lead agency in connection 139
with their service on the board. 140
3. "Related party" means any entity of which a director or 141
an officer of the entity is also directly or indirectly related 142
to, or has a direct or indirect financial or other material 143
interest in, the lead agency. The term also includes any 144
subsidiary, parent entity, associate firm, or joint venture, or 145
any entity that is controlled, influenced, or managed by another 146
entity or an individua l related to such entity, including an 147
individual who is, or was within the immediately preceding 3 148
years, an executive officer or a board member of the entity. 149
4.3. "Relative" means a relative within the third degree 150
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of consanguinity by blood or marriag e. 151
(b)1. For any activity that is presented to the board of a 152
lead agency for its initial consideration and approval after 153
July 1, 2021, or any activity that involves a contract that is 154
being considered for renewal on or after July 1, 2021, but 155
before January 1, 2022, a board member, a director, or an 156
officer of a lead agency shall disclose to the board any 157
activity that may reasonably be construed to be a conflict of 158
interest before such activity is initially considered and 159
approved or a contract is rene wed by the board. A rebuttable 160
presumption of a conflict of interest exists if the activity was 161
acted on by the board without prior notice as required under 162
paragraph (c). The board shall disclose any known actual or 163
potential conflicts to the department. 164
2. A lead agency may not enter into a contract or be a 165
party to any transaction that creates a conflict of interest, 166
including with related parties for the provision of management 167
or administrative services or oversight For contracts with a 168
lead agency which are in existence on July 1, 2021, and are not 169
subject to renewal before January 1, 2022, a board member or an 170
officer of the lead agency shall disclose to the board any 171
activity that may reasonably be construed to be a conflict of 172
interest under this section by December 31, 2021 . 173
(g)1. Civil penalties in the amount of $5,000 per 174
occurrence shall be imposed for each known and potential 175
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conflict of interest, as described in paragraph (b), which is 176
not disclosed to the department. Civil penalties shall be paid 177
by the board and not from any state or federal funds. 178
2. If a contract is executed for which a conflict of 179
interest was not disclosed to the department before execution of 180
the contract, the following penalties apply: 181
a. A civil penalty in the a mount of $50,000 for a first 182
offense. 183
b. A civil penalty in the amount of $100,000 for a second 184
or subsequent offense. 185
3. The civil penalties for failure to disclose a conflict 186
of interest under subparagraphs 1. and 2. apply to any contract 187
entered into, regardless of the method of procurement, 188
including, but not limited to, formal procurement, single -source 189
contracts, and contracts that do not meet the minimum threshold 190
for formal procurement. 191
4. A contract procured for which a conflict of interest 192
was not disclosed to the department before execution of the 193
contract shall be reprocured. 194
5. The department may, at its sole discretion, prohibit 195
execution of a contract for which a conflict of interest exists, 196
or will exist after execution. 197
Section 2. Paragraphs (c), (j), and (k) of subsection (1) 198
of section 409.988, Florida Statutes, are amended to read: 199
409.988 Community-based care lead agency duties; general 200
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provisions.— 201
(1) DUTIES.—A lead agency: 202
(c) Shall follow the financial guidelines dev eloped by the 203
department and shall comply with regular, independent auditing 204
of its financial activities, including any requests for records 205
associated with such financial audits within the timeframe 206
established by the department or its contracted vendors provide 207
for a regular independent auditing of its financial activities . 208
The results of the financial audit must Such financial 209
information shall be provided to the community alliance 210
established under s. 20.19(5). 211
(j) May subcontract for the provision of services, 212
excluding management and oversight functions, required by the 213
contract with the lead agency and the department; however, the 214
subcontracts must specify how the provider will contribute to 215
the lead agency meeting the performance standards establis hed 216
pursuant to the child welfare results -oriented accountability 217
system required by s. 409.997. The lead agency shall directly 218
provide no more than 35 percent of all child welfare services 219
provided unless it can demonstrate a need , within the lead 220
agency's geographic service area where there is a lack of 221
qualified providers available to perform the necessary services. 222
The approval period to exceed the threshold shall be limited to 223
2 years. If a lead agency wishes to continue its exemption from 224
the services threshold, it must submit a new request with 225
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updated evidence to the department and the community alliance 226
showing its efforts to recruit providers and that conditions 227
have not changed, to exceed this threshold . The local community 228
alliance in the geographic service area in which the lead agency 229
is seeking to exceed the threshold shall review the lead 230
agency's justification for need and recommend to the department 231
whether the department should approve or deny the lead agency's 232
request for an exemption from the services threshold. I f there 233
is not a community alliance operating in the geographic service 234
area in which the lead agency is seeking to exceed the 235
threshold, such review and approval or denial of the lead 236
agency's request for an exemption from the services threshold 237
must be made by the department and the department must specify 238
the duration of the exemption recommendation shall be made by 239
representatives of local stakeholders, including at least one 240
representative from each of the following: 241
1. The department. 242
2. The county government. 243
3. The school district. 244
4. The county United Way. 245
5. The county sheriff's office. 246
6. The circuit court corresponding to the county. 247
7. The county children's board, if one exists. 248
(k) Shall publish on its website by the 15th day of each 249
month at a minimum the data specified in subparagraphs 1.-9. 1.-250
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5., calculated using a standard methodology determined by the 251
department, for the preceding calendar month regarding its case 252
management services. The following information must shall be 253
reported by each individual subcontracted case management 254
provider, by the lead agency, if the lead agency provides case 255
management services, and in total for all case management 256
services subcontracted or directly provided by the lead agency: 257
1. The average caseload of case managers, including only 258
filled positions; 259
2. The total number and percentage of case managers who 260
have 25 or more cases on their caseloads; 261
3. The turnover rate for case managers and case management 262
supervisors for the previous 12 months; 263
4. The percentage of required home visits completed; and 264
5. Performance on outcome measures required pursuant to s. 265
409.997 for the previous 12 months ;. 266
6. The number of unlicensed placements for the previous 267
month; 268
7. The percentages an d trends for foster parent and group 269
home recruitment and licensure for the previous month; 270
8. The percentage of families being served through family 271
support, in-home, and out-of-home services for the previous 272
month; and 273
9. The percentage of cases that converted from nonjudicial 274
to judicial for the previous month. 275
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Section 3. Section 409.9913, Florida Statutes, is created 276
to read: 277
409.9913 Funding methodology to allocate funding to lead 278
agencies.— 279
(1) As used in this section, the term: 280
(a) "Core services funding" means all funds allocated to 281
lead agencies. The term does not include any of the following: 282
1. Funds appropriated for independent living services. 283
2. Funds appropriated for maintenance adoption subsidies. 284
3. Funds allocated by the department for child protective 285
investigation service training. 286
4. Nonrecurring funds. 287
5. Designated mental health wrap -around service funds. 288
6. Funds for special projects for a designated lead 289
agency. 290
7. Funds appropriated for the Guardianship As sistance 291
Program established under s. 39.6225. 292
(b) "Operational and fixed costs" means: 293
1. Administrative expenditures, including, but not limited 294
to, information technology and human resources functions. 295
2. Lease payments. 296
3. Asset depreciation. 297
4. Utilities. 298
5. Administrative components of case management. 299
6. Mandated activities such as training, quality 300
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improvement, or contract management. 301
(2) The department shall develop, in collaboration with 302
lead agencies and providers of child welfare services, a funding 303
methodology for allocating core services funding to lead 304
agencies which, at a minimum: 305
(a) Is actuarially sound. 306
(b) Is reimbursement based. 307
(c) Is designed to incentivize efficient and effective 308
lead agency operation, prevention , family preservation, and 309
permanency. 310
(d) Considers variable costs, including, but not limited 311
to, direct costs for in -home and out-of-home care for children 312
served by the lead agencies, prevention services, and 313
operational and fixed costs. 314
(e) Is scaled regionally for cost -of-living factors. 315
(3) The lead agencies and providers shall submit any 316
detailed cost and expenditure data that the department requests 317
for the development of the funding methodology. 318
(4) The department shall submit a report to the Governor, 319
the President of the Senate, and the Speaker of the House of 320
Representatives by December 1, 2024, which, at a minimum: 321
(a) Describes a proposed funding methodology and formula 322
that will provide for the annual budget of each lead agency, 323
including, but not limited to, how the proposed methodology will 324
meet the criteria in subsection (2). 325
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(b) Describes the data used to develop the methodology, 326
and the data that will be used to annually calculate the 327
proposed lead agency budget. 328
(c) Specifies proposed rates and total allocations for 329
each lead agency. The allocations must ensure that the total of 330
all amounts allocated to lead agencies under the funding 331
methodology does not exceed the total amount appropriated to 332
lead agencies in the Genera l Appropriations Act in the 2024 -2025 333
fiscal year. 334
(d) Provides risk mitigation recommendations that ensure 335
that lead agencies do not experience a reduction in funding that 336
would be detrimental to operations or result in a reduction in 337
services to children. 338
(5) By October 31 of each year, beginning in 2025, the 339
department shall submit a report to the Governor, the President 340
of the Senate, and the Speaker of the House of Representatives 341
which includes recommendations for adjustments to the funding 342
methodology for the next fiscal year, using the criteria in 343
subsection (2) and basing the recommendations on, at a minimum, 344
updated expenditure data, cost -of-living adjustments, market 345
dynamics, or other catchment area variations. The total of all 346
amounts proposed for allocation to lead agencies under the 347
funding methodology for the next fiscal year may not exceed the 348
total amount appropriated for core services funding in the 349
current fiscal year's General Appropriations Act. The funding 350
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methodology must include r isk mitigation strategies that ensure 351
that lead agencies do not experience a reduction in funding that 352
would be detrimental to operations or result in a reduction in 353
services to children. 354
(6)(a) The requirements of this section do not replace, 355
and must be in addition to, any requirements of chapter 216, 356
including, but not limited to, submission of final legislative 357
budget requests by the department under s. 216.023. 358
(b) The data and reports required under subsections (4) 359
and (5) may also include propose d rates and total allocations 360
for each lead agency which reflect any additional core services 361
funding for lead agencies which is requested by the department 362
under s. 216.023. 363
(7)(a) Beginning with the 2025 -2026 fiscal year, the 364
Legislature shall allocate funding to lead agencies through the 365
General Appropriations Act with due consideration of the funding 366
methodology developed under this section. 367
(b) The department may not change the allocation of funds 368
to a lead agency as provided in the General Appropr iations Act 369
without legislative approval. The department may approve 370
additional risk pool funding for a lead agency as provided under 371
s. 409.990. 372
(8) The department shall provide to the Governor, the 373
President of the Senate, and the Speaker of the House of 374
Representatives monthly reports from July through October 2024 375
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which provide updates on activities and progress in developing 376
the funding methodology. 377
Section 4. Subsections (1) and (3) of section 409.992, 378
Florida Statutes, are amended to read: 379
409.992 Lead agency expenditures. — 380
(1) The procurement of commodities or contractual services 381
by lead agencies is shall be governed by the financial 382
guidelines developed by the department and must comply with 383
applicable state and federal law and follow goo d business 384
practices. Pursuant to s. 11.45, the Auditor General may provide 385
technical advice in the development of the financial guidelines. 386
(a)1. Lead agencies shall competitively procure all 387
contracts, consistent with the federal simplified acquisition 388
threshold. 389
2. Lead agencies shall competitively procure all contracts 390
in excess of $35,000 with related parties. 391
3. Financial penalties or sanctions, as established by the 392
department and incorporated into the contract, shall be imposed 393
by the department for noncompliance with applicable local, 394
state, or federal law for the procurement of commodities or 395
contractual services. 396
(b) Notwithstanding s. 402.73, for procurement of real 397
property or professional services, lead agencies shall comply 398
with established purchasing practices, including the provisions 399
of s. 287.055, as required, for professional services, including 400
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engineering or construction design. Upon termination of the 401
contract, the department shall immediately retain all rights to 402
and ownership of real property procured. Any funds from the 403
sale, transfer, or other dispossession of such property during 404
the contract term shall be returned to the department. 405
(3) Notwithstanding any other provision of law, a 406
community-based care lead agency adminis trative employee may not 407
receive a salary, whether base pay or base pay combined with any 408
bonus or incentive payments from the lead agency or any related 409
party, in excess of 150 percent of the annual salary paid to the 410
secretary of the Department of Childr en and Families from state -411
appropriated funds, including state -appropriated federal funds. 412
This limitation applies regardless of the number of contracts a 413
community-based care lead agency may execute with the 414
department. This subsection does not prohibit a ny party from 415
providing cash that is not from appropriated state funds to a 416
community-based care lead agency administrative employee. 417
Section 5. Paragraphs (c) and (d) of subsection (1) of 418
section 409.994, Florida Statutes, are amended to read: 419
409.994 Community-based care lead agencies; receivership. — 420
(1) The Department of Children and Families may petition a 421
court of competent jurisdiction for the appointment of a 422
receiver for a community -based care lead agency established 423
pursuant to s. 409.987 i f any of the following conditions exist: 424
(c) The department determines that conditions exist in the 425
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lead agency which present a an imminent danger to the health, 426
safety, or welfare of the dependent children under that agency's 427
care or supervision. Whenev er possible, the department shall 428
make a reasonable effort to facilitate the continued operation 429
of the program. 430
(d) The lead agency cannot meet , or is unlikely to meet, 431
its current financial obligations to its employees, contractors, 432
or foster parents. Issuance of bad checks or the existence of 433
delinquent obligations for payment of salaries, utilities, or 434
invoices for essential services or commodities constitutes shall 435
constitute prima facie evidence that the lead agency lacks the 436
financial ability to me et its financial obligations. 437
Section 6. Paragraph (d) of subsection (1) of section 438
409.996, Florida Statutes, is amended to read: 439
409.996 Duties of the Department of Children and 440
Families.—The department shall contract for the delivery, 441
administration, or management of care for children in the child 442
protection and child welfare system. In doing so, the department 443
retains responsibility for the quality of contracted services 444
and programs and shall ensure that, at a minimum, services are 445
delivered in accordance with applicable federal and state 446
statutes and regulations and the performance standards and 447
metrics specified in the strategic plan created under s. 448
20.19(1). 449
(1) The department shall enter into contracts with lead 450
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agencies for the performance of the duties by the lead agencies 451
established in s. 409.988. At a minimum, the contracts must do 452
all of the following: 453
(d) Provide for contractual actions tiered interventions 454
and graduated penalties for failure to comply with contract 455
terms or in the event of performance deficiencies , as determined 456
appropriate by the department . 457
1. Such contractual actions must interventions and 458
penalties shall include, but are not limited to: 459
a.1. Enhanced monitoring and reporting. 460
b.2. Corrective action plans. 461
c.3. Requirements to accept technical assistance and 462
consultation from the department under subsection (6). 463
d.4. Financial penalties, which shall require a lead 464
agency to direct reallocate funds from administrative costs to 465
the department. The departme nt shall use the funds collected to 466
support service delivery of quality improvement activities for 467
children in the lead agency's care to direct care for children . 468
These penalties may be imposed for failure to provide timely, 469
sufficient resolution of deficiencies resulting in a corrective 470
action plan or other performance improvement plan issued by the 471
department. Financial penalties may include liquidated damages. 472
e.5. Early termination of contracts, as provided in s. 473
402.7305(3)(f) s. 402.1705(3)(f). 474
2. The department shall include in each lead agency 475
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contract executed a provision that requires payment to the 476
department of sanctions or disincentives for failure to comply 477
with contractual obligations. The department shall establish a 478
schedule of daily monetary sanctions or disincentives for lead 479
agencies, which schedule shall be incorporated by reference into 480
the contract. The department is solely responsible for 481
determining the monetary value of liquidated damages. 482
Section 7. The Department of Children and Families shall 483
submit a report to the Governor, the President of the Senate, 484
and the Speaker of the House of Representatives on rules and 485
policies adopted and other actions taken to implement the 486
requirements of this act. The first such report must be due 487
September 30, 2024, and the second such report must be due 488
February 1, 2025. 489
Section 8. This act shall take effect July 1, 2024. 490