CS/CS/CS/HB 1061 2024 CODING: Words stricken are deletions; words underlined are additions. hb1061-03-c3 Page 1 of 23 F L O R I D A H O U S E O F R E P R E S E N T A T I V E S A bill to be entitled 1 An act relating to community -based child welfare 2 agencies; amending s. 409.016, F.S.; defining the term 3 "management functions"; amending s. 409.987, F.S.; 4 authorizing the Department of Children and Families to 5 extend contracts with community -based care lead 6 agencies under certain circumstances; revising 7 requirements for an entity to serve as a lead agency; 8 providing duties for board members and board of 9 directors of lead agencies; requiring that lead 10 agencies ensure that board members participate in 11 certain annual training; revising the definition of 12 the term "conflict of interest"; defining the term 13 "related party"; requiring the lead agency's board of 14 directors to disclose any known or potential conflicts 15 of interest; prohibiting a lead agency from enterin g 16 into a contract or being a party to any transaction 17 with related parties if a conflict of interest is not 18 properly disclosed; prohibiting a lead agency from 19 entering into a contract or being a party to any 20 transaction with related parties for officer or 21 director level staffing to perform management 22 functions; removing obsolete language; authorizing a 23 lead agency to enter into certain contracts or be a 24 party to certain transactions under certain 25 CS/CS/CS/HB 1061 2024 CODING: Words stricken are deletions; words underlined are additions. hb1061-03-c3 Page 2 of 23 F L O R I D A H O U S E O F R E P R E S E N T A T I V E S circumstances; requiring department contracts with 26 lead agencies to include certain contractual penalty 27 provisions; specifying the contractual penalties; 28 providing applicability; requiring certain contracts 29 to be reprocured; requiring the department to recoup 30 lead agency expenses for the execution of certain 31 contracts; amending s. 409.988, F.S.; revising lead 32 agency duties and authority; repealing s. 409.991, 33 F.S., relating to allocation of funds for community -34 based care lead agencies; creating s. 409.9913, F.S.; 35 providing definitions; requiring the department, in 36 collaboration with the lead agencies and providers of 37 child welfare services, to develop a specific funding 38 methodology for the allocation of core services which 39 meets certain criteria; requiring the lead agencies 40 and providers of child welfare services to s ubmit to 41 the department certain financial information for the 42 development of the funding methodology; requiring the 43 department to submit to the Governor and the 44 Legislature certain reports by the established 45 deadlines; subjecting the allocation of core ser vices 46 to the requirements of ch. 216, F.S.; authorizing the 47 department to include certain rates and total 48 allocations in certain reports; requiring the 49 Legislature to allocate funding to the lead agencies 50 CS/CS/CS/HB 1061 2024 CODING: Words stricken are deletions; words underlined are additions. hb1061-03-c3 Page 3 of 23 F L O R I D A H O U S E O F R E P R E S E N T A T I V E S with due consideration of the funding methodology, 51 beginning with the 2025 -2026 fiscal year; prohibiting 52 the department from changing a lead agency's 53 allocation of funds provided in the General 54 Appropriations Act without legislative approval; 55 authorizing the department to approve certain risk 56 pool funding for a lead agency; requiring the 57 department to submit to the Governor and the 58 Legislature certain reports by the established 59 deadlines; amending s. 409.992, F.S.; revising 60 requirements for lead agency practices in the 61 procurement of commodities and contrac tual services; 62 requiring the department to impose certain penalties 63 for a lead agency's noncompliance with applicable 64 procurement law; requiring a contract between the 65 department and a lead agency to specify the rights and 66 obligations to real property held by the lead agency 67 during the term of the contract; providing 68 applicability; providing applicability of certain 69 limitations on the salaries of community -based care 70 lead agency administrative employees; amending s. 71 409.994, F.S.; revising the conditions un der which the 72 department may petition a court for the appointment of 73 a receiver for a community -based care lead agency; 74 amending s. 409.996, F.S.; revising requirements for 75 CS/CS/CS/HB 1061 2024 CODING: Words stricken are deletions; words underlined are additions. hb1061-03-c3 Page 4 of 23 F L O R I D A H O U S E O F R E P R E S E N T A T I V E S contracts between the department and lead agencies; 76 making a technical change; prov iding duties of the 77 department; providing reporting requirements; 78 requiring the department to convene a working group to 79 submit a certain report to the Governor and the 80 Legislature by a certain date; providing membership 81 and termination of the working grou p; providing an 82 effective date. 83 84 Be It Enacted by the Legislature of the State of Florida: 85 86 Section 1. Subsections (3) and (4) of section 409.016, 87 Florida Statutes, are renumbered as subsections (4) and (5), 88 respectively, and a new subsection (3) i s added to that section, 89 to read: 90 409.016 Definitions. —As used in this chapter: 91 (3) "Management functions" means: 92 (a) Planning, directing, organizing, coordinating, and 93 carrying out oversight duties of the lead agency; or 94 (b) Contracting for office r or director level staffing in 95 performance of the planning, directing, organizing, 96 coordinating, and carrying out oversight duties of the lead 97 agency. 98 Section 2. Subsections (3) and (4) and paragraphs (a) and 99 (b) of subsection (7) of section 409.987, Florida Statutes, are 100 CS/CS/CS/HB 1061 2024 CODING: Words stricken are deletions; words underlined are additions. hb1061-03-c3 Page 5 of 23 F L O R I D A H O U S E O F R E P R E S E N T A T I V E S amended, and paragraph (g) is added to subsection (7) of that 101 section, to read: 102 409.987 Lead agency procurement; boards; conflicts of 103 interest.— 104 (3) Notwithstanding s. 287.057, the department shall use 105 5-year contracts with lead a gencies. The department may extend a 106 contract for 1 to 5 years, in accordance with s. 287.057, only 107 if a lead agency has met performance expectations within the 108 monitoring evaluation. 109 (4) In order to serve as a lead agency, an entity must: 110 (a) Be organized as a Florida corporation or a 111 governmental entity. 112 (b) Be governed by a board of directors or a board 113 committee composed of board members. The board of directors or 114 board committee shall provide oversight and ensure 115 accountability and transparency f or the system of care. The 116 board of directors or board committee shall provide fiduciary 117 oversight to prevent conflicts of interest, promote 118 accountability and transparency, and protect state and federal 119 funding from misuse. The board of directors shall ac t in 120 accordance with s. 617.0830. The membership of the board of 121 directors or board committee must be described in the bylaws or 122 articles of incorporation of each lead agency, which must 123 provide that at least 75 percent of the membership of the board 124 of directors or board committee must be composed consist of 125 CS/CS/CS/HB 1061 2024 CODING: Words stricken are deletions; words underlined are additions. hb1061-03-c3 Page 6 of 23 F L O R I D A H O U S E O F R E P R E S E N T A T I V E S persons residing in this state, and at least 51 percent of the 126 state residents on the board of directors must reside within the 127 service area of the lead agency. The lead agency shall ensure 128 that its board members, directors, and officers participate in 129 annual training related to their responsibilities. The 130 department shall set forth minimum training criteria in the 131 contracts with the lead agencies. However, for procurements of 132 lead agency contracts init iated on or after July 1, 2014: 133 1. At least 75 percent of the membership of the board of 134 directors must be composed consist of persons residing in this 135 state, and at least 51 percent of the membership of the board of 136 directors must be composed consist of persons residing within 137 the service area of the lead agency. If a board committee 138 governs the lead agency, 100 percent of its membership must be 139 composed consist of persons residing within the service area of 140 the lead agency. 141 2. The powers of the board of directors or board committee 142 include, but are not limited to, approving the lead agency's 143 budget and setting the lead agency's operational policy and 144 procedures. A board of directors must additionally have the 145 power to hire the lead agency's executive d irector, unless a 146 board committee governs the lead agency, in which case the board 147 committee must have the power to confirm the selection of the 148 lead agency's executive director. 149 (c) Demonstrate financial responsibility through an 150 CS/CS/CS/HB 1061 2024 CODING: Words stricken are deletions; words underlined are additions. hb1061-03-c3 Page 7 of 23 F L O R I D A H O U S E O F R E P R E S E N T A T I V E S organized plan for regular fiscal audits and the posting of a 151 performance bond. 152 (7)(a) As used in this subsection, the term: 153 1. "Activity" includes, but is not limited to, a contract 154 for goods and services, a contract for the purchase of any real 155 or tangible property, or an agreement to engage with a lead 156 agency for the benefit of a third party in exchange for an 157 interest in real or tangible property, a monetary benefit, or an 158 in-kind contribution. 159 2. "Conflict of interest" means when a board member , 160 director, or an officer, or a relative of a board member , 161 director, or an officer, of a lead agency does any of the 162 following: 163 a. Enters into a contract or other transaction for goods 164 or services with the lead agency. 165 b. Holds a direct or indirect interest in a corporati on, 166 limited liability corporation, partnership, limited liability 167 partnership, or other business entity that conducts business 168 with the lead agency or proposes to enter into a contract or 169 other transaction with the lead agency. For purposes of this 170 paragraph, the term "indirect interest" has the same meaning as 171 in s. 112.312. 172 c. Knowingly obtains a direct or indirect personal, 173 financial, professional, or other benefit as a result of the 174 relationship of such board member , director, or officer, or 175 CS/CS/CS/HB 1061 2024 CODING: Words stricken are deletions; words underlined are additions. hb1061-03-c3 Page 8 of 23 F L O R I D A H O U S E O F R E P R E S E N T A T I V E S relative of the board member, director, or officer, with the 176 lead agency. For purposes of this paragraph, the term "benefit" 177 does not include per diem and travel expenses paid or reimbursed 178 to board members, directors, or officers of the lead agency in 179 connection with their service on the board. 180 3. "Related party" means any entity of which a director or 181 an officer of the entity is also directly or indirectly related 182 to, or has a direct or indirect financial or other material 183 interest in, the lead agency. The term also includes any 184 subsidiary firm or joint venture. 185 4.3. "Relative" means a relative within the third degree 186 of consanguinity by blood or marriage. 187 (b)1. For any activity that is presented to the board of a 188 lead agency for its initial consideration and approval after 189 July 1, 2021, or any activity that involves a contract that is 190 being considered for renewal on or after July 1, 2021, but 191 before January 1, 2022 , a board member, a director, or an 192 officer of a lead agency shall disclose to the board any 193 activity that may reasonably be construed to be a conflict of 194 interest before such activity is initially considered and 195 approved or a contract is renewed by the board. A rebuttable 196 presumption of a conflict of interest exists if the activity was 197 acted on by the board without prior notice as required under 198 paragraph (c). The board shall disclose any known actual or 199 potential conflicts to the department. 200 CS/CS/CS/HB 1061 2024 CODING: Words stricken are deletions; words underlined are additions. hb1061-03-c3 Page 9 of 23 F L O R I D A H O U S E O F R E P R E S E N T A T I V E S 2. A lead agency may not enter into a contract or be a 201 party to any transaction with related parties if a c onflict of 202 interest is not properly disclosed. A lead agency may not enter 203 into a contract with a related party for officer or director 204 level staffing to perform management functions. The contract 205 with the department and lead agency must specify the 206 administrative functions and services that the lead agency will 207 subcontract For contracts with a lead agency which are in 208 existence on July 1, 2021, and are not subject to renewal before 209 January 1, 2022, a board member or an officer of the lead agency 210 shall disclose to the board any activity that may reasonably be 211 construed to be a conflict of interest under this section by 212 December 31, 2021. 213 3. Subject to the requirements of subparagraph 2., a lead 214 agency may enter into a contract or be a party to any 215 transaction with related parties as long as the fee, rate, or 216 price paid by the lead agency for the commodities or services 217 being procured does not exceed the fair market value for such 218 commodities or services. The lead agency shall disclose any 219 known actual or potential conflicts to the department. 220 (g) All department contracts with lead agencies must 221 contain the following contractual penalty provisions: 222 1. Penalties in the amount of $5,000 per occurrence shall 223 be imposed for each known and potential conflict o f interest, as 224 described in paragraph (b), which is not disclosed to the 225 CS/CS/CS/HB 1061 2024 CODING: Words stricken are deletions; words underlined are additions. hb1061-03-c3 Page 10 of 23 F L O R I D A H O U S E O F R E P R E S E N T A T I V E S department. 226 2. If a contract is executed for which a conflict of 227 interest was not disclosed to the department before execution of 228 the contract, the following penalties apply: 229 a. A penalty in the amount of $10,000 for a first offense. 230 b. A penalty in the amount of $15,000 for a second or 231 subsequent offense. 232 3. The penalties for failure to disclose a conflict of 233 interest under subparagraphs 1. and 2. apply to any contract 234 entered into, regardless of the method of procurement, 235 including, but not limited to, formal procurement, single -source 236 contracts, and contracts that do not meet the minimum threshold 237 for formal procurement. 238 4. A contract procured for which a conflict of intere st 239 was not disclosed to the department before execution of the 240 contract shall be reprocured. The department shall recoup from 241 the lead agency expenses related to a contract that was executed 242 without disclosure of a conflict of interest. 243 Section 3. Paragraphs (c), (j), and (k) of subsection (1) 244 of section 409.988, Florida Statutes, are amended to read: 245 409.988 Community-based care lead agency duties; general 246 provisions.— 247 (1) DUTIES.—A lead agency: 248 (c) Shall follow the financial guidelines developed by the 249 department and shall comply with regular, independent auditing 250 CS/CS/CS/HB 1061 2024 CODING: Words stricken are deletions; words underlined are additions. hb1061-03-c3 Page 11 of 23 F L O R I D A H O U S E O F R E P R E S E N T A T I V E S of its financial activities, including any requests for records 251 associated with such financial audits within the timeframe 252 established by the department or its contracted vendors provide 253 for a regular independent auditing of its financial activities . 254 The results of the financial audit must Such financial 255 information shall be provided to the community alliance 256 established under s. 20.19(5). 257 (j) May subcontract for the provision of services, 258 excluding with a related party for officer or director level 259 staffing to perform management functions, required by the 260 contract with the lead agency and the department; however, the 261 subcontracts must specify how the provider will contribute to 262 the lead agency meeting the performance standards established 263 pursuant to the child welfare results -oriented accountability 264 system required by s. 409.997. The lead agency shall directly 265 provide no more than 35 percent of all child welfare services 266 provided unless it can demonstrate a need , within the lead 267 agency's geographic service area in which there is a lack of 268 qualified providers available to perform the necessary services. 269 The approval period to exceed the threshold must be limited to 2 270 years and must be renewed following the process outlined in this 271 section, to exceed this threshold . The local community alliance 272 in the geographic service area in which the lead agency is 273 seeking to exceed the threshold shall review the lead agency's 274 justification for ne ed and recommend to the department whether 275 CS/CS/CS/HB 1061 2024 CODING: Words stricken are deletions; words underlined are additions. hb1061-03-c3 Page 12 of 23 F L O R I D A H O U S E O F R E P R E S E N T A T I V E S the department should approve or deny the lead agency's request 276 for an exemption from the services threshold. If there is not a 277 community alliance operating in the geographic service area in 278 which the lead agency is seeking to exceed the threshold, such 279 review and recommendation shall be made by representatives of 280 local stakeholders, including at least one representative from 281 each of the following: 282 1. The department. 283 2. The county government. 284 3. The school district. 285 4. The county United Way. 286 5. The county sheriff's office. 287 6. The circuit court corresponding to the county. 288 7. The county children's board, if one exists. 289 (k) Shall publish on its website by the 15th day of each 290 month at a minimum the data specified in subparagraphs 1.-10. 291 1.-5., calculated using a standard methodology determined by the 292 department, for the preceding calendar month regarding its case 293 management services. The following information shall be reported 294 by each individual subcontracted case management provider, by 295 the lead agency, if the lead agency provides case management 296 services, and in total for all case management services 297 subcontracted or directly provided by the lead agency: 298 1. The average caseload of case managers, including only 299 filled positions; 300 CS/CS/CS/HB 1061 2024 CODING: Words stricken are deletions; words underlined are additions. hb1061-03-c3 Page 13 of 23 F L O R I D A H O U S E O F R E P R E S E N T A T I V E S 2. The total number and percentage of case managers who 301 have 25 or more cases on their caseloads; 302 3. The turnover rate for case managers an d case management 303 supervisors for the previous 12 months; 304 4. The percentage of required home visits completed; and 305 5. Performance on outcome measures required pursuant to s. 306 409.997 for the previous 12 months ;. 307 6. The number of unlicensed placements for the previous 308 month; 309 7. The percentages and trends for foster parent and group 310 home recruitment and licensure for the previous month; 311 8. The percentage of families being served through family 312 support, in-home, and out-of-home services for the previo us 313 month; 314 9. The percentage of cases that converted from nonjudicial 315 to judicial for the previous month; and 316 10. Children's legal service staffing rates. 317 Section 4. Section 409.991, Florida Statutes, is repealed. 318 Section 5. Section 409.9913, Fl orida Statutes, is created 319 to read: 320 409.9913 Funding methodology to allocate funding to lead 321 agencies.— 322 (1) As used in this section, the term: 323 (a) "Core services funding" means all funds allocated to 324 lead agencies. The term does not include any of th e following: 325 CS/CS/CS/HB 1061 2024 CODING: Words stricken are deletions; words underlined are additions. hb1061-03-c3 Page 14 of 23 F L O R I D A H O U S E O F R E P R E S E N T A T I V E S 1. Funds appropriated for independent living services. 326 2. Funds appropriated for maintenance adoption subsidies. 327 3. Funds allocated by the department for child protective 328 investigation service training. 329 4. Nonrecurring funds. 330 5. Designated mental health wrap -around service funds. 331 6. Funds for special projects for a designated lead 332 agency. 333 7. Funds appropriated for the Guardianship Assistance 334 Program established under s. 39.6225. 335 (b) "Operational and fixed costs" means: 336 1. Administrative expenditures, including, but not limited 337 to, information technology and human resources functions. 338 2. Lease payments. 339 3. Asset depreciation. 340 4. Utilities. 341 5. Administrative components of case management. 342 6. Mandated activities such as training, quality 343 improvement, or contract management. 344 (2) The department shall develop, in collaboration with 345 lead agencies and providers of child welfare services, a funding 346 methodology for allocating core services funding to lead 347 agencies which, at a minimum: 348 (a) Is actuarially sound. 349 (b) Is reimbursement based. 350 CS/CS/CS/HB 1061 2024 CODING: Words stricken are deletions; words underlined are additions. hb1061-03-c3 Page 15 of 23 F L O R I D A H O U S E O F R E P R E S E N T A T I V E S (c) Is designed to incentivize efficient and effective 351 lead agency operation, prevention, family preservation, and 352 permanency. 353 (d) Considers variable costs, including, but not limited 354 to, direct costs for in -home and out-of-home care for children 355 served by the lead agencies, prevention services, and 356 operational and fixed costs. 357 (e) Is scaled regionally for cost -of-living factors. 358 (3) The lead agencies and providers of child welfare 359 services shall submit any detailed cost and expenditure data 360 that the department requests for the development of the funding 361 methodology. 362 (4) The department shall submit a report to the Governor, 363 the President of the Senate, and the Speaker of the House o f 364 Representatives by December 1, 2024, which, at a minimum: 365 (a) Describes a proposed funding methodology and formula 366 that will provide for the annual budget of each lead agency, 367 including, but not limited to, how the proposed methodology will 368 meet the criteria in subsection (2). 369 (b) Describes the data used to develop the methodology, 370 and the data that will be used to annually calculate the 371 proposed lead agency budget. 372 (c) Specifies proposed rates and total allocations for 373 each lead agency. The allocations must ensure that the total of 374 all amounts allocated to lead agencies under the funding 375 CS/CS/CS/HB 1061 2024 CODING: Words stricken are deletions; words underlined are additions. hb1061-03-c3 Page 16 of 23 F L O R I D A H O U S E O F R E P R E S E N T A T I V E S methodology does not exceed the total amount appropriated to 376 lead agencies in the General Appropriations Act in the 2024 -2025 377 fiscal year. 378 (d) Provides risk mitigation recommendations that ensure 379 that lead agencies do not experience a reduction in funding that 380 would be detrimental to operations or result in a reduction in 381 services to children. 382 (5) By October 31 of each year, beginning in 2025, the 383 department shall submit a report to the Governor, the President 384 of the Senate, and the Speaker of the House of Representatives 385 which includes recommendations for adjustments to the fundi ng 386 methodology for the next fiscal year, using the criteria in 387 subsection (2) and basing the recommendations on, at a minimum, 388 updated expenditure data, cost -of-living adjustments, market 389 dynamics, or other catchment area variations. The total of all 390 amounts proposed for allocation to lead agencies under the 391 funding methodology for the next fiscal year may not exceed the 392 total amount appropriated for core services funding in the 393 current fiscal year's General Appropriations Act. The funding 394 methodology must include risk mitigation strategies that ensure 395 that lead agencies do not experience a reduction in funding that 396 would be detrimental to operations or result in a reduction in 397 services to children. 398 (6)(a) The requirements of this section do not replace, 399 and must be in addition to, any requirements of chapter 216, 400 CS/CS/CS/HB 1061 2024 CODING: Words stricken are deletions; words underlined are additions. hb1061-03-c3 Page 17 of 23 F L O R I D A H O U S E O F R E P R E S E N T A T I V E S including, but not limited to, submission of final legislative 401 budget requests by the department under s. 216.023. 402 (b) The data and reports required under subsections (4) 403 and (5) may also includ e proposed rates and total allocations 404 for each lead agency which reflect any additional core services 405 funding for lead agencies which is requested by the department 406 under s. 216.023. 407 (7)(a) Beginning with the 2025 -2026 fiscal year, the 408 Legislature shall allocate funding to lead agencies through the 409 General Appropriations Act with due consideration of the funding 410 methodology developed under this section. 411 (b) The department may not change the allocation of funds 412 to a lead agency as provided in the Genera l Appropriations Act 413 without legislative approval. The department may approve 414 additional risk pool funding for a lead agency as provided under 415 s. 409.990. 416 (8) The department shall provide to the Governor, the 417 President of the Senate, and the Speaker of t he House of 418 Representatives monthly reports from July through October 2024, 419 which provide updates on activities and progress in developing 420 the funding methodology. 421 Section 6. Subsections (1) and (3) of section 409.992, 422 Florida Statutes, are amended to read: 423 409.992 Lead agency expenditures. — 424 (1) The procurement of commodities or contractual services 425 CS/CS/CS/HB 1061 2024 CODING: Words stricken are deletions; words underlined are additions. hb1061-03-c3 Page 18 of 23 F L O R I D A H O U S E O F R E P R E S E N T A T I V E S by lead agencies is shall be governed by the financial 426 guidelines developed by the department and must comply with 427 applicable state and federal law and follow good business 428 practices. Pursuant to s. 11.45, the Auditor General may provide 429 technical advice in the development of the financial guidelines. 430 (a)1. Lead agencies shall competitively procure all 431 contracts, consistent with the federal simplified ac quisition 432 threshold. 433 2. Lead agencies shall competitively procure all contracts 434 in excess of $35,000 with related parties. 435 3. Financial penalties or sanctions, as established by the 436 department and incorporated into the contract, shall be imposed 437 by the department for noncompliance with applicable local, 438 state, or federal law for the procurement of commodities or 439 contractual services. 440 (b) The contract between the department and the lead 441 agency for the provision of child protection and child welfare 442 services must delineate the rights and obligations of the 443 parties concerning the acquisition, transfer, or other 444 disposition of real property held by the lead agency during the 445 term of the contract. This paragraph applies prospectively to 446 new contracts entere d into between the department and a lead 447 agency for the provision of child protection and child welfare 448 services on or after July 1, 2024. 449 (3) Notwithstanding any other provision of law, a 450 CS/CS/CS/HB 1061 2024 CODING: Words stricken are deletions; words underlined are additions. hb1061-03-c3 Page 19 of 23 F L O R I D A H O U S E O F R E P R E S E N T A T I V E S community-based care lead agency administrative employee may not 451 receive a salary, whether base pay or base pay combined with any 452 bonus or incentive payments, in excess of 150 percent of the 453 annual salary paid to the secretary of the Department of 454 Children and Families from state -appropriated funds, including 455 state-appropriated federal funds. This limitation applies 456 regardless of the number of community -based care contracts a 457 community-based care lead agency may execute with the 458 department. This subsection does not prohibit any party from 459 providing cash that is not from appropriated state funds to a 460 community-based care lead agency administrative employee. 461 Section 7. Paragraph (d) of subsection (1) of section 462 409.994, Florida Statutes, is amended to read: 463 409.994 Community-based care lead agencies; receivership. — 464 (1) The Department of Children and Families may petition a 465 court of competent jurisdiction for the appointment of a 466 receiver for a community -based care lead agency established 467 pursuant to s. 409.987 if any of the following conditions exist: 468 (d) The lead agency cannot meet, or is unlikely to meet, 469 its current financial obligations to its employees, contractors, 470 or foster parents. Issuance of bad checks or the existence of 471 delinquent obligations for payment of salaries, utilities, or 472 invoices for essential services or commodities constitutes shall 473 constitute prima facie evidence that the lead agency lacks the 474 financial ability to meet its financial obligations. 475 CS/CS/CS/HB 1061 2024 CODING: Words stricken are deletions; words underlined are additions. hb1061-03-c3 Page 20 of 23 F L O R I D A H O U S E O F R E P R E S E N T A T I V E S Section 8. Paragraph (d) of subsection (1) of section 476 409.996, Florida Statutes, is amended t o read: 477 409.996 Duties of the Department of Children and 478 Families.—The department shall contract for the delivery, 479 administration, or management of care for children in the child 480 protection and child welfare system. In doing so, the department 481 retains responsibility for the quality of contracted services 482 and programs and shall ensure that, at a minimum, services are 483 delivered in accordance with applicable federal and state 484 statutes and regulations and the performance standards and 485 metrics specified in the strategic plan created under s. 486 20.19(1). 487 (1) The department shall enter into contracts with lead 488 agencies for the performance of the duties by the lead agencies 489 established in s. 409.988. At a minimum, the contracts must do 490 all of the following: 491 (d) Provide for contractual actions tiered interventions 492 and graduated penalties for failure to comply with contract 493 terms or in the event of performance deficiencies , as determined 494 appropriate by the department . 495 1. Such contractual actions must interventions and 496 penalties shall include, but are not limited to: 497 a.1. Enhanced monitoring and reporting. 498 b.2. Corrective action plans. 499 c.3. Requirements to accept technical assistance and 500 CS/CS/CS/HB 1061 2024 CODING: Words stricken are deletions; words underlined are additions. hb1061-03-c3 Page 21 of 23 F L O R I D A H O U S E O F R E P R E S E N T A T I V E S consultation from the department under subsection (6). 501 d.4. Financial penalties, as a matter of contract. The 502 financial penalties assessed by the department on the lead 503 agency revert to the state which shall require a lead agency to 504 reallocate funds from administrative costs to direct care for 505 children. 506 e.5. Early termination of contracts, as provided in s. 507 402.7305(3)(f) s. 402.1705(3)(f). 508 2. No later than January 1, 2025, the department shall 509 ensure that each lead agency contract executed includes a list 510 of financial penalties for failure to comply with contractual 511 requirements. 512 Section 9. The Department of Children and Families shall 513 submit a report to the Governor, the President of the Senate, 514 and the Speaker of the House of Representatives on rules and 515 policies adopted and other actions taken to implement the 516 requirements of this act. The first such report must be due 517 September 30, 2024, and the second such report must be due 518 February 1, 2025. 519 Section 10. There is established the Future of Child 520 Protection Contracting and Funding Working Group. The Department 521 of Children and Families shall convene the working group and 522 shall be responsible for producing and submitting a report to 523 the Governor, the President of the Senate, and the Speaker of 524 the House of Representatives by October 15, 2025. 525 CS/CS/CS/HB 1061 2024 CODING: Words stricken are deletions; words underlined are additions. hb1061-03-c3 Page 22 of 23 F L O R I D A H O U S E O F R E P R E S E N T A T I V E S (1) The report must, at a minimum: 526 (a) Examine the current contracting methods for the 527 provision of all foster care and related services. 528 (b) Identify any barriers or deficiencies in creating 529 local ownership and governance of such services. 530 (c) Assess the implications of a 10 percent cap on 531 administrative costs. 532 (d) Evaluate barriers to entry in the procurement of 533 managed care networks. 534 (e) Consider the unique regional needs of children and 535 families at risk of abuse and neglect. 536 (f) Recommend changes to existing law s, rules, and 537 policies necessary to implement the working group's 538 recommendations. 539 (2) The secretary of the Department of Children and 540 Families, or his or her designee, shall chair the working group 541 and shall invite the following persons to participate a s a 542 member of the working group: 543 (a) The Secretary of the Agency for Health Care 544 Administration, or his or her designee. 545 (b) The secretary of the Department of Management 546 Services, or his or her designee. 547 (c) A member of the Florida Coalition for Chi ldren, Inc., 548 or his or her designee. 549 (d) A current contractor for lead agency child protection 550 CS/CS/CS/HB 1061 2024 CODING: Words stricken are deletions; words underlined are additions. hb1061-03-c3 Page 23 of 23 F L O R I D A H O U S E O F R E P R E S E N T A T I V E S services. 551 (e) Two representatives of a direct provider of child 552 protection or child welfare services. 553 (f) A member of the Family Law Section of The Florida Bar 554 or a member of the court exercising jurisdiction over family law 555 matters. 556 (g) A representative of a for -profit managed care entity. 557 (h) A representative from a State University System school 558 of business. 559 (i) A representative from the Florida Ins titute for Child 560 Welfare. 561 (j) Any additional members as the department deems 562 appropriate. 563 (3) The working group shall terminate immediately after 564 the Secretary of the Department of Children and Families submits 565 the report to the Governor, the President of the Senate, and the 566 Speaker of the House of Representatives. 567 Section 11. This act shall take effect July 1, 2024. 568