Government Accountability (Oppose – Mandate)

Government Accountability (Oppose – Mandate)

CS/HB 11 (Metz) and CS/CS/SB 354 (Stargel) require local governments to establish and maintain internal controls, and require municipalities to maintain specified budget documents on the government’s website for a designated time. The bills define “abuse,” “fraud” and “waste” to be used in the establishment and maintenance of the internal controls. The bills expand the definition of “local governments” to include tourist development councils and county tourism promotion agencies, and expand the auditor general’s authority for audits to include those entities. The bills prohibit a board or commission from requiring an advance copy of testimony or comments from a member of the public as a precondition to being given the opportunity to be heard at a public meeting. The bills require an independent certified public accountant to determine whether the local government’s annual financial report is in agreement with the audited financial statements. If the report and statement are not in agreement, the accountant shall specify and explain the significant differences. If an audit report includes a recommendation that was included in a previous financial audit report but remains unaddressed, the governing body of the audited entity must indicate, during a regularly scheduled public meeting, the intended corrective action and explain its decision to not take corrective action. The bills change the composition of the audit committee to include at least one member of the governing body and prohibit city employees from serving on the committee. The bills also add additional requirements to the selection of an external auditor. The bills require certain public entities, including municipalities, to report public officer and employee travel information in the “statewide travel management system,” which is to be required by the Department of Management Services. 

CS/CS/SB 354 was amended to include provisions from CS/CS/HB 1019, including changing the deadline for the annual financial report and the annual audit from nine to six months. The bill gives authority to the Department of Financial Services to extend the deadline for the annual financial report and audit report by an additional 90 days if the governor declares a state of emergency. Beginning in the 2018-2019 fiscal year, each municipality is required to have an annual financial audit of its accounts and records. CS/CS/SB 354 requires a municipal budget officer to electronically submit information regarding the final budget to the Office of Economic and Demographic Research (EDR) within 30 days after its adoption. The bill also requires that the budget officer electronically submit to the clerk of the court a copy of the information that was submitted to EDR, a copy of the final budget that was posted on the municipality’s website and a statement certifying that the requirements were completed in a timely fashion. The municipality must also submit to the clerk of the court a copy of its annual financial report and a statement clarifying that the report was timely filed with the department. If a local government entity fails to submit information to the clerk of the court as required, the clerk of the court shall notify the local finance officer to suspend future salary payments for the head of that local government entity. The clerk shall notify the appropriate local fiscal officer to resume payments when the clerk receives the information. CS/CS/SB 354 requires EDR to prepare, by June 15, 2018, forms local governments will use to submit the budget information. By December 1, 2018, EDR also must submit a report to the president of the Senate and the speaker of the House of Representatives identifying a structure to create unique profiles for local governments that would assist the public in making comparisons between those governmental entities, as well as a recommendation for metrics that can be used to rank the local governments based on the final budget information.

CS/CS/SB 354 was also amended to include language contained in CS/CS/CS/HB 1073 (Hager) and CS/CS/CS/SB 1292 (Stargel) that outline the intent of the Legislature to create the Florida Open Financial Statement System, an interactive repository for governmental financial statements. This allows the chief financial officer (CFO), working with stakeholders, to design and implement the Florida Open Financial Statement System. The CFO may choose contractors to build one or more extensible Business Reporting Language (XBRL) taxonomies suitable for state, county, municipal and special district financial filings and to create a software tool that enables financial statement filers to easily create XBRL documents. If the CFO deems the work products adequate, all local governmental financial statements pertaining to fiscal years ending on or after January 1, 2023, must be filed in XBRL format and must meet the validation requirements of the relevant taxonomy.  (Hughes)