August 26, 2019
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_h1827__
HB 1827

1
A bill to be entitled
2An act relating to the Department of Children and Family
3Services; providing legislative intent with respect to
4establishing a structure by which the department shall
5monitor and manage contracts with external service
6providers; providing definitions; requiring the department
7to competitively procure certain commodities and
8contractual services; requiring the department to allow
9all public postsecondary institutions to bid on contracts
10intended for any public postsecondary institution;
11authorizing the department to competitively procure and
12contract for systems of treatment or service that involve
13multiple providers; providing requirements if other
14governmental entities contribute matching funds; requiring
15that an entity providing matching funds must comply with
16certain procurement procedures; authorizing the department
17to independently procure and contract for treatment
18services; requiring that the department develop a business
19case before outsourcing any service or function; providing
20requirements for the business case; requiring that the
21business case be submitted to the Legislature for
22approval; requiring that a contractual service that has
23previously been outsourced be subject to the requirements
24for a business case; requiring that a procurement of
25contractual services equal to or in excess of the
26threshold amount for CATEGORY FIVE comply with specified
27requirements, including a scope of work and performance
28standards; authorizing the department to adopt incremental
29penalties by rule; authorizing the department to include
30cost-neutral, performance-based incentives in a contract;
31requiring that a contract in excess of $1 million be
32negotiated by a contract negotiator who is certified
33according to standards established by the Department of
34Management Services; limiting circumstances under which
35the department may amend a contract; requiring that a
36proposed contract amendment be submitted to the Executive
37Office of the Governor for approval; requiring approval of
38a contract amendment by the Administration Commission
39under certain circumstances; requiring the department to
40verify that contractual terms have been satisfied before
41renewing a contract; requiring certain documentation;
42requiring the department to develop, in consultation with
43the Department of Management Services, contract templates
44and guidelines; requiring that the department establish a
45contract-management process; specifying the requirements
46for and components of the contract-management process;
47providing requirements for resolving performance
48deficiencies and terminating a contract; requiring a
49corrective-action plan under certain circumstances;
50requiring the department to develop standards of conduct
51and disciplinary actions; requiring that the department
52establish contract-monitoring units and a contract-
53monitoring process; requiring written reports; requiring
54on-site visits for contracts involving the provision of
55direct client services; requiring the department to make
56certain documents available to the Legislature; requiring
57the department to create an electronic database to store
58the documents; amending s. 402.73, F.S.; requiring the
59Agency for Persons with Disabilities to implement systems
60to ensure quality and fiscal integrity of programs in the
61developmental services Medicaid waiver system; providing
62an exemption for health services from competitive bidding
63requirements; amending s. 409.1671, F.S.; conforming
64provisions to changes made by the act; requiring that the
65Office of Program Policy Analysis and Government
66Accountability conduct two reviews of the contract-
67management and accountability structures of the department
68and report to the Legislature and the Auditor General;
69repealing s. 402.72, F.S., relating to contract-management
70requirements for the Department of Children and Family
71Services; providing an effective date.
72
73Be It Enacted by the Legislature of the State of Florida:
74
75     Section 1.  Department of Children and Family Services;
76procurement of contractual services; outsourcing or
77privatization; contract management.--
78     (1)  LEGISLATIVE INTENT.--The Legislature intends that the
79Department of Children and Family Services obtain services in
80the manner that is most efficient and cost-effective for the
81state, that provides the greatest long-term benefits to the
82clients receiving services, and that minimizes the disruption of
83client services. In order to meet these legislative goals, the
84department shall comply with legislative policy guidelines that
85require compliance with uniform procedures for procuring
86contractual services, prescribe how the department must
87outsource its programmatic and administrative services to
88external service providers rather than having them provided by
89the department or another state agency, and establish a
90contract-management and contract-monitoring process.
91     (2)  DEFINITIONS.--As used in this section, the term:
92     (a)  "Contract manager" means the department employee who
93is responsible for enforcing the compliance with administrative
94and programmatic terms and conditions of a contract. The
95contract manager is the primary point of contact through which
96all contracting information flows between the department and the
97contractor. The contract manager is responsible for day-to-day
98contract oversight, including approval of contract deliverables
99and invoices. All actions related to the contract shall be
100initiated by or coordinated with the contract manager. The
101contract manager maintains the official contract files.
102     (b)  "Contract monitor" means the department employee who
103is responsible for observing, recording, and reporting to the
104contract manager and other designated entities the information
105necessary to assist the contract manager and program management
106in determining whether the contractor is in compliance with the
107administrative and programmatic terms and conditions of the
108contract.
109     (c)  "Department" means the Department of Children and
110Family Services.
111     (d)  "Outsourcing" means the process of contracting with an
112external service provider to provide a service, in whole or in
113part, while the department retains the responsibility and
114accountability for the service.
115     (e)  "Performance measure" means the quantitative
116indicators used to assess if the service the external provider
117is performing is achieving the desired results. Measures of
118performance include outputs, direct counts of program
119activities, and outcomes or results of program activities in the
120lives of the clients served.
121     (f)  "Performance standard" means the quantifiable,
122specified, and desired level to be achieved for a particular
123performance measure.
124     (g)  "Privatize" means any process aimed at transferring
125the responsibility for a service, in whole or in part, from the
126department to the private sector such that the private sector is
127solely and fully responsible for the performance of the specific
128service.
129     (h)  "Service" means all or any portion of a program or
130program component as defined in section 216.011, Florida
131Statutes.
132     (3)  PROCUREMENT OF COMMODITIES AND CONTRACTUAL SERVICES.--
133     (a)  For the purchase of commodities and contractual
134services in excess of the threshold amount established in
135section 287.017, Florida Statutes, for CATEGORY TWO, the
136department shall comply with the requirements set forth in
137section 287.057, Florida Statutes.
138     (b)  Notwithstanding section 287.057(5)(f)13., Florida
139Statutes, whenever the department intends to contract with a
140public postsecondary institution to provide a service, the
141department must allow all public postsecondary institutions in
142this state that are accredited by the Southern Association of
143Colleges and Schools to bid on the contract. Thereafter,
144notwithstanding any other provision to the contrary, if a public
145postsecondary institution intends to subcontract for any service
146awarded in the contract, the subcontracted service must be
147procured by competitive procedures.
148     (c)  When it is in the best interest of a defined segment
149of its consumer population, the department may competitively
150procure and contract for systems of treatment or service that
151involve multiple providers, rather than procuring and
152contracting for treatment or services separately from each
153participating provider. The department must ensure that all
154providers that participate in the treatment or service system
155meet all applicable statutory, regulatory, service-quality, and
156cost-control requirements. If other governmental entities or
157units of special purpose government contribute matching funds to
158the support of a given system of treatment or service, the
159department shall formally request information from those funding
160entities in the procurement process and may take the information
161received into account in the selection process. If a local
162government contributes matching funds to support the system of
163treatment or contracted service and if the match constitutes at
164least 25 percent of the value of the contract, the department
165shall afford the governmental match contributor an opportunity
166to name an employee as one of the persons required by section
167287.057(17), Florida Statutes, to evaluate or negotiate certain
168contracts, unless the department sets forth in writing the
169reason why the inclusion would be contrary to the best interest
170of the state. Any employee so named by the governmental match
171contributor shall qualify as one of the persons required by
172section 287.057(17), Florida Statutes. A governmental entity or
173unit of special purpose government may not name an employee as
174one of the persons required by section 287.057(17), Florida
175Statutes, if it, or any of its political subdivisions, executive
176agencies, or special districts, intends to compete for the
177contract to be awarded. The governmental funding entity or
178contributor of matching funds must comply with all procurement
179procedures set forth in section 287.057, Florida Statutes, when
180appropriate and required.
181     (d)  The department may procure and contract for or provide
182assessment and case-management services independently from
183treatment services.
184     (4)  SOURCING STANDARDS AND REQUIREMENTS.--If the
185department proposes to outsource a service, the department must
186comply with the requirements of this section prior to the
187procurement process provided for in section 287.057, Florida
188Statutes.
189     (a)  The department shall develop a business case
190describing and analyzing the service proposed for outsourcing. A
191business case is part of the solicitation process and is not a
192rule subject to challenge pursuant to section 120.54, Florida
193Statutes. The business case must include, but need not be
194limited to:
195     1.  A detailed description of the services to be
196outsourced, a description and analysis of the department's
197current performance of the service, and a rationale documenting
198how outsourcing the service would be in the best interest of the
199state, the department, and its clients.
200     2.  A cost-benefit analysis documenting the estimated
201specific direct and indirect costs, savings, performance
202improvements, risks, and qualitative and quantitative benefits
203involved in or resulting from outsourcing the service. The cost-
204benefit analysis must include a detailed plan and timeline
205identifying all actions that must be implemented to realize
206expected benefits. Under section 92.525, Florida Statutes, the
207Secretary of Children and Family Services shall verify that all
208costs, savings, and benefits are valid and achievable.
209     3.  A description of the specific performance measures and
210standards that must be achieved through the outsourcing
211proposal.
212     4.  A statement of the potential effect on applicable
213federal, state, and local revenues and expenditures. The
214statement must specifically describe the effect on general
215revenue, trust funds, general revenue service charges, and
216interest on trust funds, together with the potential direct or
217indirect effect on federal funding and cost allocations.
218     5.  A plan to ensure compliance with public-record laws,
219which must include components that:
220     a.  Provide public access to public records at a cost that
221does not exceed that provided in chapter 119, Florida Statutes.
222     b.  Ensure the confidentiality of records that are exempt
223from disclosure or confidential under law.
224     c.  Meet all legal requirements for record retention.
225     d.  Allow for transfer to the state, at no cost, all public
226records in possession of the external service provider upon
227termination of the contract.
228     6.  A department transition and implementation plan for
229addressing changes in the number of agency personnel, affected
230business processes, and employee-transition issues. Such a plan
231must also specify the mechanism for continuing the operation of
232the service if the contractor fails to perform and comply with
233the performance measures and standards and provisions of the
234contract. Within this plan, the department shall identify all
235resources, including full-time equivalent positions, which are
236subject to outsourcing. All full-time equivalent positions
237identified in the plan shall be placed in reserve by the
238Executive Office of the Governor until the end of the second
239year of the contract. Notwithstanding the provisions of section
240216.262, Florida Statutes, the Executive Office of the Governor
241shall request authority from the Legislative Budget Commission
242to reestablish full-time positions above the number fixed by the
243Legislature when a contract is terminated and the outsourced
244service must be returned to the department.
245     7.  A listing of assets proposed for transfer to or use by
246the external service provider, a description of the proposed
247requirements for maintenance of those assets by the external
248service provider or the department in accordance with chapter
249273, Florida Statutes, a plan for their disposition upon
250termination of the contract, and a description of how the
251planned asset transfer or use by the contractor is in the best
252interest of the department and the state.
253     (b)1.  If the department proposes to outsource the service
254in the next fiscal year, the department shall submit the
255business case with the department's final legislative budget
256request, in the manner and form prescribed in the legislative
257budget request instructions under section 216.023, Florida
258Statutes. Upon approval in the General Appropriations Act, the
259department may initiate and complete the procurement process
260under section 287.057, Florida Statutes, and shall have the
261authority to enter into contracts with the external service
262provider.
263     2.  If a proposed outsourcing initiative would require
264integration with, or would in any way affect other state
265information technology systems, the department shall submit the
266feasibility study documentation required by the legislative
267budget request instructions under section 216.023, Florida
268Statutes.
269     (c)  If the department proposes to outsource a service
270during a fiscal year and the outsourcing provision was not
271included in the approved operating budget of the department, the
272department must provide to the Governor, the President of the
273Senate, the Speaker of the House of Representatives, the chairs
274of the legislative appropriations committees, and the chairs of
275the relevant substantive committees the business case that
276complies with the requirements of paragraph (a) at least 45 days
277before the release of any solicitation documents, as provided
278for in section 287.057, Florida Statutes. Any budgetary changes
279that are inconsistent with the department's approved budget may
280not be made to existing programs unless the changes are
281recommended to the Legislative Budget Commission by the Governor
282and the Legislative Budget Commission expressly approves the
283program changes.
284     (d)  The department may not privatize a service without
285specific authority provided in general law, the General
286Appropriations Act, legislation implementing the General
287Appropriations Act, or a special appropriations act.
288     (5)  CONTRACTING AND PERFORMANCE MEASURES.--In addition to
289the requirements of section 287.058, Florida Statutes, every
290procurement of contractual services by the department which
291meets or is in excess of the threshold amount provided in
292section 287.017, Florida Statutes, for CATEGORY FIVE, must
293comply with the requirements of this subsection.
294     (a)  The department shall execute a contract containing all
295provisions and conditions, which must include, but need not be
296limited to:
297     1.  A detailed scope of work that clearly specifies each
298service and deliverable to be provided, including a description
299of each deliverable or activity that is quantifiable,
300measurable, and verifiable by the department and the contractor.
301     2.  Associated costs and savings, specific payment terms
302and payment schedules, including incentive and penalty
303provisions, criteria governing payment, and a clear and specific
304schedule to complete all required activities needed to transfer
305the service from the state to the contractor.
306     3.  Clear and specific identification of all required
307performance measures and standards, which must, at a minimum,
308include:
309     a.  Acceptance criteria for each deliverable and service to
310be provided to the department under the terms of the contract
311which document, to the greatest extent possible, the required
312performance level. Acceptance criteria must be detailed, clear,
313and unambiguous and shall be used to measure deliverables and
314services to be provided under the contract.
315     b.  A method for monitoring and reporting progress in
316achieving specified performance standards and levels.
317     c.  The sanctions or penalties that shall be assessed for
318contract or state nonperformance. The department may adopt, by
319rule, provisions for including in its contracts incremental
320penalties to be imposed by its contract managers on a contractor
321due to the contractor's failure to comply with a requirement for
322corrective action. Any financial penalty that is imposed upon a
323contractor may not be paid from funds being used to provide
324services to clients, and the contractor may not reduce the
325amount of services being delivered to clients as a method for
326offsetting the effect of the penalty. If a financial penalty is
327imposed upon a contractor that is a corporation, the department
328shall notify, at a minimum, the board of directors of the
329corporation. The department may notify any additional parties
330that the department believes may be helpful in obtaining the
331corrective action that is being sought. In addition, the rules
332adopted by the department must include provisions that permit
333the department to deduct the financial penalties from funds that
334would otherwise be due to the contractor, not to exceed 10
335percent of the amount that otherwise would be due to the
336contractor for the period of noncompliance. If the department
337imposes a financial penalty, it shall advise the contractor in
338writing of the cause for the penalty. A failure to include such
339deductions in a request for payment constitutes grounds for the
340department to reject that request for payment. The remedies
341identified in this paragraph do not limit or restrict the
342department's application of any other remedy available to it in
343the contract or under law. The remedies described in this
344paragraph may be cumulative and may be assessed upon each
345separate failure to comply with instructions from the department
346to complete corrective action.
347     4.  A requirement that the contractor maintain adequate
348accounting records that comply with all applicable federal and
349state laws and generally accepted accounting principles.
350     5.  A requirement authorizing the department and state to
351have access to and conduct audits of all records related to the
352contract and outsourced services.
353     6.  A requirement that ownership of any intellectual
354property developed in the course of, or as a result of, work or
355services performed under the contract shall transfer to the
356state if the contractor ceases to provide the outsourced
357service.
358     7.  A requirement describing the timing and substance of
359all plans and status or progress reports that are to be
360provided. All plans and status or progress reports must comply
361with any relevant state and federal standards for planning,
362implementation, operations, and oversight.
363     8.  A requirement that the contractor shall comply with
364public-record laws. The contractor shall:
365     a.  Keep and maintain the public records that ordinarily
366and necessarily would be required by the department to perform
367the service.
368     b.  Provide public access to such public records on the
369same terms and conditions that the department would and at a
370cost that does not exceed that provided in chapter 119, Florida
371Statutes.
372     c.  Ensure the confidentiality of records that are exempt
373from disclosure or confidential under law.
374     d.  Meet all legal and auditing requirements for record
375retention, and transfer to the state, at no cost to the state,
376all public records in possession of the contractor upon
377termination of the contract. All records stored electronically
378must be provided to the state in the format compatible with
379state information technology systems.
380     9.  A requirement that any state funds provided for the
381purchase of or improvements to real property are contingent upon
382the contractor granting to the state a security interest in the
383property which is at least equal to the amount of the state
384funds provided for at least 5 years following the date of
385purchase or the completion of the improvements or as further
386required by law. The contract must include a provision that, as
387a condition of receipt of state funding for this purpose, the
388contractor agrees that, if it disposes of the property before
389the department's interest is vacated, the contractor must refund
390the proportionate share of the state's initial investment, as
391adjusted by depreciation.
392     10.  A provision that the contractor annually submit and
393verify, under section 92.525, Florida Statutes, all required
394financial statements.
395     11.  A provision that the contractor will be held
396responsible and accountable for all work covered under the
397contract including any work performed by subcontractors. The
398contract must state that the department may monitor the
399performance of any subcontractor.
400     (b)  A contract may include cost-neutral, performance-based
401incentives that may vary according to the extent a contractor
402achieves or surpasses the performance standards set forth in the
403contract. The incentives may be weighted proportionally to
404reflect the extent to which the contractor has demonstrated that
405it has consistently met or exceeded the contractual requirements
406and the performance standards.
407     (c)  The department shall review the time period for which
408it executes contracts and, to the greatest extent practicable,
409shall execute multiyear contracts to make the most efficient use
410of the resources devoted to contract processing and execution.
411     (d)  When the annualized value of a contract is in excess
412of $1 million, at least one of the persons conducting
413negotiations must be certified as a contract negotiator based
414upon standards established by the Department of Management
415Services.
416     (e)  The department may not amend a contract without first
417submitting the proposed contract amendment to the Executive
418Office of the Governor for approval if the effect of the
419amendment would be to increase:
420     1.  The value of the contract by $250,000 for those
421contracts with a total value of at least $250,000 but less than
422$1 million;
423     2.  The value of the contract by $1 million for those
424contracts with a total value of at least $1 million but less
425than $10 million;
426     3.  The value of the contract by 10 percent for those
427contracts with a total value of $10 million or more; or
428     4.  The term of the contract by 1 year or more.
429
430When the department proposes any contract amendment that meets
431the criteria described in this paragraph, it shall submit the
432proposed contract amendment to the Executive Office of the
433Governor for approval and shall immediately notify the chairs of
434the legislative appropriations committees. The Executive Office
435of the Governor may not approve the proposed contract amendment
436until 14 days following receipt of the notification to the
437legislative appropriations chairs. If either chair of the
438legislative appropriations committees objects in writing to a
439proposed contract amendment within 14 days following
440notification and specifies the reasons for the objection, the
441Executive Office of the Governor shall disapprove the proposed
442contract amendment or shall submit the proposed contract
443amendment to the Administration Commission. The proposed
444contract amendment may be approved by the Administration
445Commission by a two-thirds vote of the members present with the
446Governor voting in the affirmative. In the absence of approval
447by the commission, the proposed contract amendment shall be
448automatically disapproved. Otherwise, upon approval by the
449Governor or Administration Commission, the department may
450execute the contract amendment.
451     (f)  An amendment that is issued under legislative
452direction, including funding adjustments annually provided for
453in the General Appropriations Act or the federal appropriations
454acts, need not be submitted for approval in accordance with
455paragraph (d).
456     (g)  In addition to the requirements of section 287.057(13)
457and (14), Florida Statutes, the department shall verify that all
458specific direct and indirect costs, savings, performance
459measures and standards, and qualitative and quantitative
460benefits identified in the original contract have been satisfied
461by a contractor or the department before the contract is
462extended or renewed. The documentation must include an
463explanation of any differences between the required performance
464as identified in the contract and the actual performance of the
465contractor. The documentation must be included in the official
466contract file.
467     (h)  The department shall, in consultation with the
468Department of Management Services, develop contract templates
469and guidelines that define the mandatory contract provisions and
470other requirements identified in this subsection and that must
471be used for all contractual service contracts meeting the
472requirements of this subsection. All contract templates and
473guidelines shall be developed by September 30, 2005.
474     (6)  CONTRACT-MANAGEMENT REQUIREMENTS AND
475PROCESS.--Notwithstanding section 287.057(15), Florida Statutes,
476the department is responsible for establishing a contract-
477management process that requires a member of the department's
478Senior Management Service to assign in writing the
479responsibility of a contract to a contract manager. The
480department shall maintain a set of procedures describing its
481contract-management process which must minimally include the
482following requirements:
483     (a)  The contract manager shall maintain the official
484contract file throughout the duration of the contract and for a
485period not less than 6 years after the termination of the
486contract.
487     (b)  The contract manager shall review all invoices for
488compliance with the criteria and payment schedule provided for
489in the contract and shall approve payment of all invoices before
490their transmission to the Department of Financial Services for
491payment. Only the contract manager shall approve the invoices
492for a specific contract, unless the contract manager is
493temporarily unavailable to review an invoice. The contract file
494must contain an explanation for any periods of temporary
495unavailability of the assigned contract manager. For any
496individual invoice in excess of $500,000, a member of the
497Selected Exempt Service or Senior Management Service shall also
498sign payment approval of the invoice. For any individual invoice
499in excess of $1 million, a member of the Senior Management
500Service shall also sign payment approval of the invoice.
501     (c)  The contract manager shall maintain a schedule of
502payments and total amounts disbursed and shall periodically
503reconcile the records with the state's official accounting
504records.
505     (d)  For contracts involving the provision of direct client
506services, the contract manager shall periodically visit the
507physical location where the services are delivered and speak
508directly to clients receiving the services and the staff
509responsible for delivering the services.
510     (e)  For contracts for which the contractor is a
511corporation, the contract manager shall attend at least one
512board meeting semiannually, if held and if within 100 miles of
513the contract manager's official headquarters.
514     (f)  The contract manager shall meet at least once a month
515directly with the contractor's representative and maintain
516records of such meetings.
517     (g)  The contract manager shall periodically document any
518differences between the required performance measures and the
519actual performance measures. If a contractor fails to meet and
520comply with the performance measures established in the
521contract, the department may allow a reasonable period for the
522contractor to correct performance deficiencies. If performance
523deficiencies are not resolved to the satisfaction of the
524department within the prescribed time, and if no extenuating
525circumstances can be documented by the contractor to the
526department's satisfaction, the department must terminate the
527contract. The department may not enter into a new contract with
528that same contractor for the services for which the contract was
529previously terminated for a period of at least 24 months after
530the date of termination. The contract manager shall obtain and
531enforce corrective-action plans, if appropriate, and maintain
532records regarding the completion or failure to complete
533corrective-action items.
534     (h)  The contract manager shall document any contract
535modifications, which shall include recording any contract
536amendments as provided for in this section.
537     (i)  The contract manager shall be properly trained before
538being assigned responsibility for any contract.
539
540The department shall develop standards of conduct and a range of
541disciplinary actions for its employees which are specifically
542related to carrying out contract-management responsibilities.
543     (7)  CONTRACT-MONITORING REQUIREMENTS AND PROCESS.--The
544department shall establish contract-monitoring units staffed by
545full-time career service employees who report to a member of the
546Select Exempt Service or Senior Management Service and who have
547been properly trained to perform contract monitoring. A member
548of the Senior Management Service shall assign in writing a
549specific contract to a contract-monitoring unit, with at least
550one member of the contract-monitoring unit possessing specific
551knowledge and experience in the contract's program area. The
552department shall establish a contract-monitoring process that
553must include, but need not be limited to, the following
554requirements:
555     (a)  Performing a risk assessment at the start of each
556fiscal year and preparing an annual contract-monitoring schedule
557that includes consideration for the level of risk assigned. The
558department may monitor any contract at any time regardless of
559whether such monitoring was originally included in the annual
560contract-monitoring schedule.
561     (b)  Preparing a contract-monitoring plan, including
562sampling procedures, before performing on-site monitoring at
563external locations of a service provider. The plan must include
564a description of the programmatic, fiscal, and administrative
565components that will be monitored on-site. If appropriate,
566clinical and therapeutic components may be included.
567     (c)  Conducting analyses of the performance and compliance
568of an external service provider by means of desk reviews if the
569external service provider will not be monitored on-site during a
570fiscal year.
571     (d)  Unless the department sets forth in writing the need
572for an extension, providing a written report presenting the
573results of the monitoring within 30 days after the completion of
574the on-site monitoring or desk review. Report extensions may not
575exceed 30 days after the original completion date. The
576department shall develop and use a standard contract-monitoring
577report format and shall provide access to the reports by means
578of a website that is available to the Legislature.
579     (e)  For contracts involving the provision of direct client
580services, requiring the contract monitor to visit the physical
581location where the services are being delivered and to speak
582directly to the clients receiving the services and with the
583staff responsible for delivering the services.
584     (f)  Developing and maintaining a set of procedures
585describing the contract-monitoring process.
586
587The department shall develop standards of conduct and a range of
588disciplinary actions for its employees which are specifically
589related to carrying out contract-monitoring responsibilities.
590     (8)  REPORTS TO THE LEGISLATURE.--Beginning October 1,
5912005, the department shall make available to the Legislature
592electronically all documents associated with the procurement and
593contracting functions of the department. The documents in the
594database must include, but are not limited to, all:
595     (a)  Business cases;
596     (b)  Procurement documents;
597     (c)  Contracts and any related files, attachments, or
598amendments;
599     (d)  Contract monitoring reports;
600     (e)  Corrective action plans and reports of corrective
601actions taken when contractor performance deficiencies are
602identified; and
603     (f)  Status reports on all outsourcing initiatives
604describing the progress by the department towards achieving the
605business objectives, costs, savings, and quantifiable benefits
606identified in the business case.
607     Section 2.  Section 402.73, Florida Statutes, is amended to
608read:
609     402.73  Contracting and performance standards.--
610     (1)  The Department of Children and Family Services shall
611establish performance standards for all contracted client
612services. Notwithstanding s. 287.057(5)(f), the department must
613competitively procure any contract for client services when any
614of the following occurs:
615     (a)  The provider fails to meet appropriate performance
616standards established by the department after the provider has
617been given a reasonable opportunity to achieve the established
618standards.
619     (b)  A new program or service has been authorized and
620funded by the Legislature and the annual value of the contract
621for such program or service is $300,000 or more.
622     (c)  The department has concluded, after reviewing market
623prices and available treatment options, that there is evidence
624that the department can improve the performance outcomes
625produced by its contract resources. At a minimum, the department
626shall review market prices and available treatment options
627biennially. The department shall compile the results of the
628biennial review and include the results in its annual
629performance report to the Legislature pursuant to chapter 94-
630249, Laws of Florida. The department shall provide notice and an
631opportunity for public comment on its review of market prices
632and available treatment options.
633     (2)  The competitive requirements of subsection (1) must be
634initiated for each contract that meets the criteria of this
635subsection, unless the secretary makes a written determination
636that particular facts and circumstances require deferral of the
637competitive process. Facts and circumstances must be
638specifically described for each individual contract proposed for
639deferral and must include one or more of the following:
640     (a)  An immediate threat to the health, safety, or welfare
641of the department's clients.
642     (b)  A threat to appropriate use or disposition of
643facilities that have been financed in whole, or in substantial
644part, through contracts or agreements with a state agency.
645     (c)  A threat to the service infrastructure of a community
646which could endanger the well-being of the department's clients.
647
648Competitive procurement of client services contracts that meet
649the criteria in subsection (1) may not be deferred for longer
650than 1 year.
651     (3)  The Legislature intends that the department obtain
652services in the manner that is most cost-effective for the
653state, that provides the greatest long-term benefits to the
654clients receiving services, and that minimizes the disruption of
655client services. In order to meet these legislative goals, the
656department may adopt rules providing procedures for the
657competitive procurement of contracted client services which
658represent an alternative to the request-for-proposal or
659invitation-to-bid process. The alternative competitive
660procedures shall permit the department to solicit professional
661qualifications from prospective providers and to evaluate such
662statements of qualification before requesting service proposals.
663The department may limit the firms invited to submit service
664proposals to only those firms that have demonstrated the highest
665level of professional capability to provide the services under
666consideration, but may not invite fewer than three firms to
667submit service proposals, unless fewer than three firms
668submitted satisfactory statements of qualification. The
669alternative procedures must, at a minimum, allow the department
670to evaluate competing proposals and select the proposal that
671provides the greatest benefit to the state while considering the
672quality of the services, dependability, and integrity of the
673provider, the dependability of the provider's services, the
674experience of the provider in serving target populations or
675client groups substantially identical to members of the target
676population for the contract in question, and the ability of the
677provider to secure local funds to support the delivery of
678services, including, but not limited to, funds derived from
679local governments. These alternative procedures need not conform
680to the requirements of s. 287.042 or s. 287.057(1) or (2).
681     (4)  The department shall review the period for which it
682executes contracts and, to the greatest extent practicable,
683shall execute multiyear contracts to make the most efficient use
684of the resources devoted to contract processing and execution.
685     (5)  When it is in the best interest of a defined segment
686of its consumer population, the department may competitively
687procure and contract for systems of treatment or service that
688involve multiple providers, rather than procuring and
689contracting for treatment or services separately from each
690participating provider. The department must ensure that all
691providers that participate in the treatment or service system
692meet all applicable statutory, regulatory, service-quality, and
693cost-control requirements. If other governmental entities or
694units of special purpose government contribute matching funds to
695the support of a given system of treatment or service, the
696department shall formally request information from those funding
697entities in the procurement process and may take the information
698received into account in the selection process. If a local
699government contributes match to support the system of treatment
700or contracted service and if the match constitutes at least 25
701percent of the value of the contract, the department shall
702afford the governmental match contributor an opportunity to name
703an employee as one of the persons required by s. 287.057(17) to
704evaluate or negotiate certain contracts, unless the department
705sets forth in writing the reason why such inclusion would be
706contrary to the best interest of the state. Any employee so
707named by the governmental match contributor shall qualify as one
708of the persons required by s. 287.057(17). No governmental
709entity or unit of special purpose government may name an
710employee as one of the persons required by s. 287.057(17) if it,
711or any of its political subdivisions, executive agencies, or
712special districts, intends to compete for the contract to be
713awarded. The governmental funding entity or match contributor
714shall comply with any deadlines and procurement procedures
715established by the department. The department may also involve
716nongovernmental funding entities in the procurement process when
717appropriate.
718     (6)  The department may contract for or provide assessment
719and case management services independently from treatment
720services.
721     (7)  The department shall adopt, by rule, provisions for
722including in its contracts incremental penalties to be imposed
723by its contract managers on a service provider due to the
724provider's failure to comply with a requirement for corrective
725action. Any financial penalty that is imposed upon a provider
726may not be paid from funds being used to provide services to
727clients, and the provider may not reduce the amount of services
728being delivered to clients as a method for offsetting the impact
729of the penalty. If a financial penalty is imposed upon a
730provider that is a corporation, the department shall notify, at
731a minimum, the board of directors of the corporation. The
732department may notify, at its discretion, any additional parties
733that the department believes may be helpful in obtaining the
734corrective action that is being sought. Further, the rules
735adopted by the department must include provisions that permit
736the department to deduct the financial penalties from funds that
737would otherwise be due to the provider, not to exceed 10 percent
738of the amount that otherwise would be due to the provider for
739the period of noncompliance. If the department imposes a
740financial penalty, it shall advise the provider in writing of
741the cause for the penalty. A failure to include such deductions
742in a request for payment constitutes a ground for the department
743to reject that request for payment. The remedies identified in
744this subsection do not limit or restrict the department's
745application of any other remedy available to it in the contract
746or under law. The remedies described in this subsection may be
747cumulative and may be assessed upon each separate failure to
748comply with instructions from the department to complete
749corrective action.
750     (8)  The department shall develop standards of conduct and
751a range of disciplinary actions for its employees which are
752specifically related to carrying out contracting
753responsibilities.
754     (1)(9)  The Agency for Persons with Disabilities department
755must implement systems and controls to ensure financial
756integrity and service provision quality in the developmental
757services Medicaid waiver service system.
758     (10)  If a provider fails to meet the performance standards
759established in the contract, the department may allow a
760reasonable period for the provider to correct performance
761deficiencies. If performance deficiencies are not resolved to
762the satisfaction of the department within the prescribed time,
763and if no extenuating circumstances can be documented by the
764provider to the department's satisfaction, the department must
765cancel the contract with the provider. The department may not
766enter into a new contract with that same provider for the
767services for which the contract was previously canceled for a
768period of at least 24 months after the date of cancellation. If
769an adult substance abuse services provider fails to meet the
770performance standards established in the contract, the
771department may allow a reasonable period, not to exceed 6
772months, for the provider to correct performance deficiencies. If
773the performance deficiencies are not resolved to the
774satisfaction of the department within 6 months, the department
775must cancel the contract with the adult substance abuse
776provider, unless there is no other qualified provider in the
777service district.
778     (11)  The department shall include in its standard contract
779document a requirement that any state funds provided for the
780purchase of or improvements to real property are contingent upon
781the contractor or political subdivision granting to the state a
782security interest in the property at least to the amount of the
783state funds provided for at least 5 years from the date of
784purchase or the completion of the improvements or as further
785required by law. The contract must include a provision that, as
786a condition of receipt of state funding for this purpose, the
787provider agrees that, if it disposes of the property before the
788department's interest is vacated, the provider will refund the
789proportionate share of the state's initial investment, as
790adjusted by depreciation.
791     (12)  The department shall develop and refine contracting
792and accountability methods that are administratively efficient
793and that provide for optimal provider performance.
794     (13)  The department may competitively procure any contract
795when it deems it is in the best interest of the state to do so.
796The requirements described in subsection (1) do not, and may not
797be construed to, limit in any way the department's ability to
798competitively procure any contract it executes, and the absence
799of any or all of the criteria described in subsection (1) may
800not be used as the basis for an administrative or judicial
801protest of the department's determination to conduct
802competition, make an award, or execute any contract.
803     (14)  A contract may include cost-neutral, performance-
804based incentives that may vary according to the extent a
805provider achieves or surpasses the performance standards set
806forth in the contract. Such incentives may be weighted
807proportionally to reflect the extent to which the provider has
808demonstrated that it has consistently met or exceeded the
809contractual requirements and the department's performance
810standards.
811     (2)(15)  Nothing contained in chapter 287 shall require
812competitive bids for health services involving examination,
813diagnosis, or treatment.
814     Section 3.  Paragraphs (a), (b), (e), (f), and (g) of
815subsection (1), paragraph (b) of subsection (2), paragraph (a)
816of subsection (4), and subsections (6) and (9) of section
817409.1671, Florida Statutes, are amended to read:
818     409.1671  Foster care and related services; outsourcing
819privatization.--
820     (1)(a)  It is the intent of the Legislature that the
821Department of Children and Family Services shall outsource
822privatize the provision of foster care and related services
823statewide. It is further the Legislature's intent to encourage
824communities and other stakeholders in the well-being of children
825to participate in assuring that children are safe and well-
826nurtured. However, while recognizing that some local governments
827are presently funding portions of certain foster care and
828related services programs and may choose to expand such funding
829in the future, the Legislature does not intend by its
830outsourcing privatization of foster care and related services
831that any county, municipality, or special district be required
832to assist in funding programs that previously have been funded
833by the state. Counties that provide children and family services
834with at least 40 licensed residential group care beds by July 1,
8352003, and provide at least $2 million annually in county general
836revenue funds to supplement foster and family care services
837shall continue to contract directly with the state and shall be
838exempt from the provisions of this section. Nothing in this
839paragraph prohibits any county, municipality, or special
840district from future voluntary funding participation in foster
841care and related services. As used in this section, the term
842"outsource" "privatize" means to contract with competent,
843community-based agencies. The department shall submit a plan to
844accomplish outsourcing privatization statewide, through a
845competitive process, phased in over a 3-year period beginning
846January 1, 2000. This plan must be developed with local
847community participation, including, but not limited to, input
848from community-based providers that are currently under contract
849with the department to furnish community-based foster care and
850related services, and must include a methodology for determining
851and transferring all available funds, including federal funds
852that the provider is eligible for and agrees to earn and that
853portion of general revenue funds which is currently associated
854with the services that are being furnished under contract. The
855methodology must provide for the transfer of funds appropriated
856and budgeted for all services and programs that have been
857incorporated into the project, including all management, capital
858(including current furniture and equipment), and administrative
859funds to accomplish the transfer of these programs. This
860methodology must address expected workload and at least the 3
861previous years' experience in expenses and workload. With
862respect to any district or portion of a district in which
863outsourcing privatization cannot be accomplished within the 3-
864year timeframe, the department must clearly state in its plan
865the reasons the timeframe cannot be met and the efforts that
866should be made to remediate the obstacles, which may include
867alternatives to total outsourcing privatization, such as public-
868private partnerships. As used in this section, the term "related
869services" includes, but is not limited to, family preservation,
870independent living, emergency shelter, residential group care,
871foster care, therapeutic foster care, intensive residential
872treatment, foster care supervision, case management,
873postplacement supervision, permanent foster care, and family
874reunification. Unless otherwise provided for, the state attorney
875shall provide child welfare legal services, pursuant to chapter
87639 and other relevant provisions, in Pinellas and Pasco
877Counties. When a private nonprofit agency has received case
878management responsibilities, transferred from the state under
879this section, for a child who is sheltered or found to be
880dependent and who is assigned to the care of the outsourcing
881privatization project, the agency may act as the child's
882guardian for the purpose of registering the child in school if a
883parent or guardian of the child is unavailable and his or her
884whereabouts cannot reasonably be ascertained. The private
885nonprofit agency may also seek emergency medical attention for
886such a child, but only if a parent or guardian of the child is
887unavailable, his or her whereabouts cannot reasonably be
888ascertained, and a court order for such emergency medical
889services cannot be obtained because of the severity of the
890emergency or because it is after normal working hours. However,
891the provider may not consent to sterilization, abortion, or
892termination of life support. If a child's parents' rights have
893been terminated, the nonprofit agency shall act as guardian of
894the child in all circumstances.
895     (b)  It is the intent of the Legislature that the
896department will continue to work towards full outsourcing
897privatization in a manner that assures the viability of the
898community-based system of care and best provides for the safety
899of children in the child protection system. To this end, the
900department is directed to continue the process of outsourcing
901privatizing services in those counties in which signed startup
902contracts have been executed. The department may also continue
903to enter into startup contracts with additional counties.
904However, no services shall be transferred to a community-based
905care lead agency until the department, in consultation with the
906local community alliance, has determined and certified in
907writing to the Governor and the Legislature that the district is
908prepared to transition the provision of services to the lead
909agency and that the lead agency is ready to deliver and be
910accountable for such service provision. In making this
911determination, the department shall conduct a readiness
912assessment of the district and the lead agency.
913     1.  The assessment shall evaluate the operational readiness
914of the district and the lead agency based on:
915     a.  A set of uniform criteria, developed in consultation
916with currently operating community-based care lead agencies and
917reflecting national accreditation standards, that evaluate
918programmatic, financial, technical assistance, training and
919organizational competencies; and
920     b.  Local criteria reflective of the local community-based
921care design and the community alliance priorities.
922     2.  The readiness assessment shall be conducted by a joint
923team of district and lead agency staff with direct experience
924with the start up and operation of a community-based care
925service program and representatives from the appropriate
926community alliance. Within resources available for this purpose,
927the department may secure outside audit expertise when necessary
928to assist a readiness assessment team.
929     3.  Upon completion of a readiness assessment, the
930assessment team shall conduct an exit conference with the
931district and lead agency staff responsible for the transition.
932     4.  Within 30 days following the exit conference with staff
933of each district and lead agency, the secretary shall certify in
934writing to the Governor and the Legislature that both the
935district and the lead agency are prepared to begin the
936transition of service provision based on the results of the
937readiness assessment and the exit conference. The document of
938certification must include specific evidence of readiness on
939each element of the readiness instrument utilized by the
940assessment team as well as a description of each element of
941readiness needing improvement and strategies being implemented
942to address each one.
943     (e)  As used in this section, the term "eligible lead
944community-based provider" means a single agency with which the
945department shall contract for the provision of child protective
946services in a community that is no smaller than a county. The
947secretary of the department may authorize more than one eligible
948lead community-based provider within a single county when to do
949so will result in more effective delivery of foster care and
950related services. To compete for an outsourcing a privatization
951project, such agency must have:
952     1.  The ability to coordinate, integrate, and manage all
953child protective services in the designated community in
954cooperation with child protective investigations.
955     2.  The ability to ensure continuity of care from entry to
956exit for all children referred from the protective investigation
957and court systems.
958     3.  The ability to provide directly, or contract for
959through a local network of providers, all necessary child
960protective services. Such agencies should directly provide no
961more than 35 percent of all child protective services provided.
962     4.  The willingness to accept accountability for meeting
963the outcomes and performance standards related to child
964protective services established by the Legislature and the
965Federal Government.
966     5.  The capability and the willingness to serve all
967children referred to it from the protective investigation and
968court systems, regardless of the level of funding allocated to
969the community by the state, provided all related funding is
970transferred.
971     6.  The willingness to ensure that each individual who
972provides child protective services completes the training
973required of child protective service workers by the Department
974of Children and Family Services.
975     7.  The ability to maintain eligibility to receive all
976federal child welfare funds, including Title IV-E and IV-A
977funds, currently being used by the Department of Children and
978Family Services.
979     8.  Written agreements with Healthy Families Florida lead
980entities in their community, pursuant to s. 409.153, to promote
981cooperative planning for the provision of prevention and
982intervention services.
983     9.  A board of directors, of which at least 51 percent of
984the membership is comprised of persons residing in this state.
985Of the state residents, at least 51 percent must also reside
986within the service area of the lead community-based provider.
987     (f)1.  The Legislature finds that the state has
988traditionally provided foster care services to children who have
989been the responsibility of the state. As such, foster children
990have not had the right to recover for injuries beyond the
991limitations specified in s. 768.28. The Legislature has
992determined that foster care and related services need to be
993outsourced privatized pursuant to this section and that the
994provision of such services is of paramount importance to the
995state. The purpose for such outsourcing privatization is to
996increase the level of safety, security, and stability of
997children who are or become the responsibility of the state. One
998of the components necessary to secure a safe and stable
999environment for such children is that private providers maintain
1000liability insurance. As such, insurance needs to be available
1001and remain available to nongovernmental foster care and related
1002services providers without the resources of such providers being
1003significantly reduced by the cost of maintaining such insurance.
1004     2.  The Legislature further finds that, by requiring the
1005following minimum levels of insurance, children in outsourced
1006privatized foster care and related services will gain increased
1007protection and rights of recovery in the event of injury than
1008provided for in s. 768.28.
1009     (g)  In any county in which a service contract has not been
1010executed by December 31, 2004, the department shall ensure
1011access to a model comprehensive residential services program as
1012described in s. 409.1677 which, without imposing undue
1013financial, geographic, or other barriers, ensures reasonable and
1014appropriate participation by the family in the child's program.
1015     1.  In order to ensure that the program is operational by
1016December 31, 2004, the department must, by December 31, 2003,
1017begin the process of establishing access to a program in any
1018county in which the department has not either entered into a
1019transition contract or approved a community plan, as described
1020in paragraph (d), which ensures full outsourcing privatization
1021by the statutory deadline.
1022     2.  The program must be procured through a competitive
1023process.
1024     3.  The Legislature does not intend for the provisions of
1025this paragraph to substitute for the requirement that full
1026conversion to community-based care be accomplished.
1027     (2)
1028     (b)  Persons employed by the department in the provision of
1029foster care and related services whose positions are being
1030outsourced under privatized pursuant to this statute shall be
1031given hiring preference by the provider, if provider
1032qualifications are met.
1033     (4)(a)  The department, in consultation with the community-
1034based agencies that are undertaking the outsourced privatized
1035projects, shall establish a quality assurance program for
1036privatized services. The quality assurance program shall be
1037based on standards established by the Adoption and Safe Families
1038Act as well as by a national accrediting organization such as
1039the Council on Accreditation of Services for Families and
1040Children, Inc. (COA) or CARF--the Rehabilitation Accreditation
1041Commission. Each program operated under contract with a
1042community-based agency must be evaluated annually by the
1043department. The department shall, to the extent possible, use
1044independent financial audits provided by the community-based
1045care agency to eliminate or reduce the ongoing contract and
1046administrative reviews conducted by the department. The
1047department may suggest additional items to be included in such
1048independent financial audits to meet the department's needs.
1049Should the department determine that such independent financial
1050audits are inadequate, then other audits, as necessary, may be
1051conducted by the department. Nothing herein shall abrogate the
1052requirements of s. 215.97. The department shall submit an annual
1053report regarding quality performance, outcome measure
1054attainment, and cost efficiency to the President of the Senate,
1055the Speaker of the House of Representatives, the minority leader
1056of each house of the Legislature, and the Governor no later than
1057January 31 of each year for each project in operation during the
1058preceding fiscal year.
1059     (6)  Beginning January 1, 1999, and continuing at least
1060through June 30, 2000, the Department of Children and Family
1061Services shall outsource privatize all foster care and related
1062services in district 5 while continuing to contract with the
1063current model programs in districts 1, 4, and 13, and in
1064subdistrict 8A, and shall expand the subdistrict 8A pilot
1065program to incorporate Manatee County. Planning for the district
10665 outsourcing privatization shall be done by providers that are
1067currently under contract with the department for foster care and
1068related services and shall be done in consultation with the
1069department.  A lead provider of the district 5 program shall be
1070competitively selected, must demonstrate the ability to provide
1071necessary comprehensive services through a local network of
1072providers, and must meet criteria established in this section.
1073Contracts with organizations responsible for the model programs
1074must include the management and administration of all outsourced
1075privatized services specified in subsection (1). However, the
1076department may use funds for contract management only after
1077obtaining written approval from the Executive Office of the
1078Governor. The request for such approval must include, but is not
1079limited to, a statement of the proposed amount of such funds and
1080a description of the manner in which such funds will be used. If
1081the community-based organization selected for a model program
1082under this subsection is not a Medicaid provider, the
1083organization shall be issued a Medicaid provider number pursuant
1084to s. 409.907 for the provision of services currently authorized
1085under the state Medicaid plan to those children encompassed in
1086this model and in a manner not to exceed the current level of
1087state expenditure.
1088     (9)  Each district and subdistrict that participates in the
1089model program effort or any future outsourcing privatization
1090effort as described in this section must thoroughly analyze and
1091report the complete direct and indirect costs of delivering
1092these services through the department and the full cost of
1093outsourcing privatization, including the cost of monitoring and
1094evaluating the contracted services.
1095     Section 4.  The Office of Program Policy Analysis and
1096Government Accountability shall conduct two reviews of the
1097contract-management and accountability structures of the
1098Department of Children and Family Services, including, but not
1099limited to, whether the department is adequately monitoring and
1100managing its outsourced or privatized functions and services.
1101The office shall report its findings and recommendations to the
1102President of the Senate, the Speaker of the House of
1103Representatives, and the Auditor General by February 1 of 2006
1104and 2007, respectively.
1105     Section 5.  Section 402.72, Florida Statutes, is repealed.
1106     Section 6.  This act shall take effect July 1, 2005.


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