September 20, 2019
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Senate Bill 1476

Senate Bill sb1476e1

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    CS for CS for CS for SB 1476             First Engrossed (ntc)



  1                      A bill to be entitled

  2         An act relating to the Department of Children

  3         and Family Services; providing legislative

  4         intent with respect to establishing a structure

  5         by which the department shall monitor and

  6         manage contracts with external service

  7         providers; providing definitions; requiring the

  8         department to competitively procure certain

  9         commodities and contractual services; requiring

10         the department to allow all public

11         postsecondary institutions to bid on contracts

12         intended for any public postsecondary

13         institution; authorizing the department to

14         competitively procure and contract for systems

15         of treatment or service that involve multiple

16         providers; providing requirements if other

17         governmental entities contribute matching

18         funds; requiring that an entity providing

19         matching funds must comply with certain

20         procurement procedures; authorizing the

21         department to independently procure and

22         contract for treatment services; requiring that

23         the department develop a validated business

24         case before outsourcing any service or

25         function; providing requirements for the

26         business case; requiring that the validated

27         business case be submitted to the Legislature

28         for approval; requiring that a contractual

29         service that has previously been outsourced be

30         subject to the requirements for a validated

31         business case; requiring that a procurement of


                                  1

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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1         contractual services equal to or in excess of

 2         the threshold amount for CATEGORY FIVE comply

 3         with specified requirements, including a scope

 4         of work and performance standards; authorizing

 5         the department to adopt incremental penalties

 6         by rule; authorizing the department to include

 7         cost-neutral, performance-based incentives in a

 8         contract; requiring multiyear contracts unless

 9         justification is provided; requiring that a

10         contract in excess of $1 million be negotiated

11         by a contract negotiator who is certified

12         according to standards established by the

13         Department of Management Services; limiting

14         circumstances under which the department may

15         amend a contract; requiring that a proposed

16         contract amendment be submitted to the

17         Executive Office of the Governor for approval;

18         requiring approval of a contract amendment by

19         the Administration Commission under certain

20         circumstances; requiring the department to

21         verify that contractual terms have been

22         satisfied before renewing a contract; requiring

23         certain documentation; requiring the department

24         to develop, in consultation with the Department

25         of Management Services, contract templates and

26         guidelines; requiring that the department

27         establish a contract-management process;

28         specifying the requirements for and components

29         of the contract-management process; providing

30         requirements for resolving performance

31         deficiencies and terminating a contract;


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1         requiring a corrective-action plan under

 2         certain circumstances; requiring the department

 3         to develop standards of conduct and

 4         disciplinary actions; requiring that the

 5         department establish contract-monitoring units

 6         and a contract-monitoring process; requiring

 7         written reports; requiring on-site visits for

 8         contracts involving the provision of direct

 9         client services; requiring the department to

10         make certain documents available to the

11         Legislature; requiring the department to create

12         an electronic database to store the documents;

13         prohibiting contractors from performing certain

14         functions; amending s. 402.73, F.S.; requiring

15         the Agency for Persons with Disabilities to

16         implement systems to ensure quality and fiscal

17         integrity of programs in the developmental

18         services Medicaid waiver system; providing an

19         exemption for health services from competitive

20         bidding requirements; amending s. 409.1671,

21         F.S.; conforming provisions to changes made by

22         the act; requiring that the Office of Program

23         Policy Analysis and Government Accountability

24         conduct two reviews of the contract-management

25         and accountability structures of the department

26         and report to the Legislature and the Auditor

27         General; repealing s. 402.72, F.S., relating to

28         contract-management requirements for the

29         Department of Children and Family Services;

30         providing an appropriation; providing an

31         effective date.


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1  Be It Enacted by the Legislature of the State of Florida:

 2  

 3         Section 1.  Department of Children and Family Services;

 4  procurement of contractual services; outsourcing or

 5  privatization; contract management.--

 6         (1)  LEGISLATIVE INTENT.--The Legislature intends that

 7  the Department of Children and Family Services obtain services

 8  in the manner that is most efficient and cost-effective for

 9  the state, that provides the greatest long-term benefits to

10  the clients receiving services, and that minimizes the

11  disruption of client services. In order to meet these

12  legislative goals, the department shall comply with

13  legislative policy guidelines that require compliance with

14  uniform procedures for procuring contractual services,

15  prescribe how the department must outsource its programmatic

16  and administrative services to external service providers

17  rather than having them provided by the department or another

18  state agency, and establish a contract-management and

19  contract-monitoring process.

20         (2)  DEFINITIONS.--As used in this section, the term:

21         (a)  "Contract manager" means the department employee

22  who is responsible for enforcing the compliance with

23  administrative and programmatic terms and conditions of a

24  contract. The contract manager is the primary point of contact

25  through which all contracting information flows between the

26  department and the contractor. The contract manager is

27  responsible for day-to-day contract oversight, including

28  approval of contract deliverables and invoices. All actions

29  related to the contract shall be initiated by or coordinated

30  with the contract manager. The contract manager maintains the

31  official contract files.


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1         (b)  "Contract monitor" means the department employee

 2  who is responsible for observing, recording, and reporting to

 3  the contract manager and other designated entities the

 4  information necessary to assist the contract manager and

 5  program management in determining whether the contractor is in

 6  compliance with the administrative and programmatic terms and

 7  conditions of the contract.

 8         (c)  "Department" means the Department of Children and

 9  Family Services.

10         (d)  "Outsourcing" means the process of contracting

11  with an external service provider to provide a service, in

12  whole or in part, while the department retains the

13  responsibility and accountability for the service.

14         (e)  "Performance measure" means the quantitative

15  indicators used to assess if the service the external provider

16  is performing is achieving the desired results. Measures of

17  performance include outputs, direct counts of program

18  activities, and outcomes or results of program activities in

19  the lives of the clients served.

20         (f)  "Performance standard" means the quantifiable,

21  specified, and desired level to be achieved for a particular

22  performance measure.

23         (g)  "Privatize" means any process aimed at

24  transferring the responsibility for a service, in whole or in

25  part, from the department to the private sector such that the

26  private sector is solely and fully responsible for the

27  performance of the specific service.

28         (h)  "Service" means all or any portion of a program or

29  program component as defined in section 216.011.

30         (3)  PROCUREMENT OF COMMODITIES AND CONTRACTUAL

31  SERVICES.--


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1         (a)  For the purchase of commodities and contractual

 2  services in excess of the threshold amount established in

 3  section 287.017, Florida Statutes, for CATEGORY TWO, the

 4  department shall comply with the requirements set forth in

 5  section 287.057, Florida Statutes.

 6         (b)  Notwithstanding section 287.057(5)(f)13., Florida

 7  Statutes, whenever the department intends to contract with a

 8  public postsecondary institution to provide a service, the

 9  department must allow all public postsecondary institutions in

10  this state that are accredited by the Southern Association of

11  Colleges and Schools to bid on the contract. Thereafter,

12  notwithstanding any other provision to the contrary, if a

13  public postsecondary institution intends to subcontract for

14  any service awarded in the contract, the subcontracted service

15  must be procured by competitive procedures.

16         (c)  When it is in the best interest of a defined

17  segment of its consumer population, the department may

18  competitively procure and contract for systems of treatment or

19  service that involve multiple providers, rather than procuring

20  and contracting for treatment or services separately from each

21  participating provider. The department must ensure that all

22  providers that participate in the treatment or service system

23  meet all applicable statutory, regulatory, service-quality,

24  and cost-control requirements. If other governmental entities

25  or units of special purpose government contribute matching

26  funds to the support of a given system of treatment or

27  service, the department shall formally request information

28  from those funding entities in the procurement process and may

29  take the information received into account in the selection

30  process. If a local government contributes matching funds to

31  support the system of treatment or contracted service and if


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1  the match constitutes at least 25 percent of the value of the

 2  contract, the department shall afford the governmental match

 3  contributor an opportunity to name an employee as one of the

 4  persons required by section 287.057(17), Florida Statutes, to

 5  evaluate or negotiate certain contracts, unless the department

 6  sets forth in writing the reason why the inclusion would be

 7  contrary to the best interest of the state. Any employee so

 8  named by the governmental match contributor shall qualify as

 9  one of the persons required by section 287.057(17), Florida

10  Statutes. A governmental entity or unit of special purpose

11  government may not name an employee as one of the persons

12  required by section 287.057(17), Florida Statutes, if it, or

13  any of its political subdivisions, executive agencies, or

14  special districts, intends to compete for the contract to be

15  awarded. The governmental funding entity or contributor of

16  matching funds must comply with all procurement procedures set

17  forth in section 287.057, Florida Statutes, when appropriate

18  and required.

19         (d)  The department may procure and contract for or

20  provide assessment and case-management services independently

21  from treatment services.

22         (4)  SOURCING STANDARDS AND REQUIREMENTS.--If the

23  department proposes to outsource a service, the department

24  must comply with the requirements of this section prior to the

25  procurement process provided for in section 287.057, Florida

26  Statutes.

27         (a)  The department shall develop a business case

28  describing and analyzing the service proposed for outsourcing.

29  A business case is part of the solicitation process and is not

30  a rule subject to challenge pursuant to section 120.54,

31  


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1  Florida Statutes. The business case must include, but need not

 2  be limited to:

 3         1.  A detailed description of the services to be

 4  outsourced, a description and analysis of the department's

 5  current performance of the service, and a rationale

 6  documenting how outsourcing the service would be in the best

 7  interest of the state, the department, and its clients.

 8         2.  A cost-benefit analysis documenting the estimated

 9  specific direct and indirect costs, savings, performance

10  improvements, risks, and qualitative and quantitative benefits

11  involved in or resulting from outsourcing the service. The

12  cost-benefit analysis must include a detailed plan and

13  timeline identifying all actions that must be implemented to

14  realize expected benefits. Under section 92.525, Florida

15  Statutes, the Secretary of Children and Family Services shall

16  verify that all costs, savings, and benefits are valid and

17  achievable.

18         3.  A description of the specific performance measures

19  and standards that must be achieved through the outsourcing

20  proposal.

21         4.  A statement of the potential effect on applicable

22  federal, state, and local revenues and expenditures. The

23  statement must specifically describe the effect on general

24  revenue, trust funds, general revenue service charges, and

25  interest on trust funds, together with the potential direct or

26  indirect effect on federal funding and cost allocations.

27         5.  A plan to ensure compliance with public-record

28  laws, which must include components that:

29         a.  Provide public access to public records at a cost

30  that does not exceed that provided in chapter 119, Florida

31  Statutes.


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1         b.  Ensure the confidentiality of records that are

 2  exempt from disclosure or confidential under law.

 3         c.  Meet all legal requirements for record retention.

 4         d.  Allow for transfer to the state, at no cost, all

 5  public records in possession of the external service provider

 6  upon termination of the contract.

 7         6.  A department transition and implementation plan for

 8  addressing changes in the number of agency personnel, affected

 9  business processes, and employee-transition issues. Such a

10  plan must also specify the mechanism for continuing the

11  operation of the service if the contractor fails to perform

12  and comply with the performance measures and standards and

13  provisions of the contract. Within this plan, the department

14  shall identify all resources, including full-time equivalent

15  positions, which are subject to outsourcing. All full-time

16  equivalent positions identified in the plan shall be placed in

17  reserve by the Executive Office of the Governor until the end

18  of the second year of the contract. Notwithstanding the

19  provisions of section 216.262, Florida Statutes, the Executive

20  Office of the Governor shall request authority from the

21  Legislative Budget Commission to reestablish full-time

22  positions above the number fixed by the Legislature when a

23  contract is terminated and the outsourced service must be

24  returned to the department.

25         7.  A listing of assets proposed for transfer to or use

26  by the external service provider, a description of the

27  proposed requirements for maintenance of those assets by the

28  external service provider or the department in accordance with

29  chapter 273, Florida Statutes, a plan for their disposition

30  upon termination of the contract, and a description of how the

31  


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1  planned asset transfer or use by the contractor is in the best

 2  interest of the department and the state.

 3         (b)1.  If the department proposes to outsource the

 4  service in the next fiscal year, the department shall submit

 5  the business case with the department's final legislative

 6  budget request, in the manner and form prescribed in the

 7  legislative budget request instructions under section 216.023,

 8  Florida Statutes. Prior to approval in the General

 9  Appropriations Act, the agency may initiate the procurement

10  process pursuant to section 287.057, Florida Statutes.

11  However, only upon approval in the General Appropriations Act

12  may the agency complete contract execution pursuant to section

13  287.057, Florida Statutes.

14         2.  If a proposed outsourcing initiative would require

15  integration with, or would in any way affect other state

16  information technology systems, the department shall submit

17  the feasibility study documentation required by the

18  legislative budget request instructions under section 216.023,

19  Florida Statutes.

20         (c)  If the department proposes to outsource a service

21  during a fiscal year and the outsourcing provision was not

22  included in the approved operating budget of the department,

23  the department must provide to the Governor, the President of

24  the Senate, the Speaker of the House of Representatives, the

25  chairs of the legislative appropriations committees, and the

26  chairs of the relevant substantive committees the business

27  case that complies with the requirements of paragraph (a) at

28  least 45 days before the release of any solicitation

29  documents, as provided for in section 287.057, Florida

30  Statutes. Any budgetary changes that are inconsistent with the

31  department's approved budget may not be made to existing


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1  programs unless the changes are recommended to the Legislative

 2  Budget Commission by the Governor and the Legislative Budget

 3  Commission expressly approves the program changes.

 4         (d)  The department may not privatize a service without

 5  specific authority provided in general law, the General

 6  Appropriations Act, legislation implementing the General

 7  Appropriations Act, or a special appropriations act.

 8         (5)  CONTRACTING AND PERFORMANCE MEASURES.--In addition

 9  to the requirements of section 287.058, Florida Statutes,

10  every procurement of contractual services by the department

11  which meets or is in excess of the threshold amount provided

12  in section 287.017, Florida Statutes, for CATEGORY FIVE, must

13  comply with the requirements of this subsection.

14         (a)  The department shall execute a contract containing

15  all provisions and conditions, which must include, but need

16  not be limited to:

17         1.  A detailed scope of work that clearly specifies

18  each service and deliverable to be provided, including a

19  description of each deliverable or activity that is

20  quantifiable, measurable, and verifiable by the department and

21  the contractor.

22         2.  Associated costs and savings, specific payment

23  terms and payment schedules, including incentive and penalty

24  provisions, criteria governing payment, and a clear and

25  specific schedule to complete all required activities needed

26  to transfer the service from the state to the contractor.

27         3.  Clear and specific identification of all required

28  performance measures and standards, which must, at a minimum,

29  include:

30         a.  Acceptance criteria for each deliverable and

31  service to be provided to the department under the terms of


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1  the contract which document, to the greatest extent possible,

 2  the required performance level. Acceptance criteria must be

 3  detailed, clear, and unambiguous and shall be used to measure

 4  deliverables and services to be provided under the contract.

 5         b.  A method for monitoring and reporting progress in

 6  achieving specified performance standards and levels.

 7         c.  The sanctions or penalties that shall be assessed

 8  for contract or state nonperformance. The department may

 9  adopt, by rule, provisions for including in its contracts

10  incremental penalties to be imposed by its contract managers

11  on a contractor due to the contractor's failure to comply with

12  a requirement for corrective action. Any financial penalty

13  that is imposed upon a contractor may not be paid from funds

14  being used to provide services to clients, and the contractor

15  may not reduce the amount of services being delivered to

16  clients as a method for offsetting the effect of the penalty.

17  If a financial penalty is imposed upon a contractor that is a

18  corporation, the department shall notify, at a minimum, the

19  board of directors of the corporation. The department may

20  notify any additional parties that the department believes may

21  be helpful in obtaining the corrective action that is being

22  sought. In addition, the rules adopted by the department must

23  include provisions that permit the department to deduct the

24  financial penalties from funds that would otherwise be due to

25  the contractor, not to exceed 10 percent of the amount that

26  otherwise would be due to the contractor for the period of

27  noncompliance. If the department imposes a financial penalty,

28  it shall advise the contractor in writing of the cause for the

29  penalty. A failure to include such deductions in a request for

30  payment constitutes grounds for the department to reject that

31  request for payment. The remedies identified in this paragraph


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1  do not limit or restrict the department's application of any

 2  other remedy available to it in the contract or under law. The

 3  remedies described in this paragraph may be cumulative and may

 4  be assessed upon each separate failure to comply with

 5  instructions from the department to complete corrective

 6  action.

 7         4.  A requirement that the contractor maintain adequate

 8  accounting records that comply with all applicable federal and

 9  state laws and generally accepted accounting principles.

10         5.  A requirement authorizing the department and state

11  to have access to and conduct audits of all records related to

12  the contract and outsourced services.

13         6.  A requirement that ownership of any intellectual

14  property developed in the course of, or as a result of, work

15  or services performed under the contract shall transfer to the

16  state if the contractor ceases to provide the outsourced

17  service.

18         7.  A requirement describing the timing and substance

19  of all plans and status or progress reports that are to be

20  provided. All plans and status or progress reports must comply

21  with any relevant state and federal standards for planning,

22  implementation, operations, and oversight.

23         8.  A requirement that the contractor shall comply with

24  public-record laws. The contractor shall:

25         a.  Keep and maintain the public records that

26  ordinarily and necessarily would be required by the department

27  to perform the service.

28         b.  Provide public access to such public records on the

29  same terms and conditions that the department would and at a

30  cost that does not exceed that provided in chapter 119.

31  


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1         c.  Ensure the confidentiality of records that are

 2  exempt from disclosure or confidential under law.

 3         d.  Meet all legal and auditing requirements for record

 4  retention, and transfer to the state, at no cost to the state,

 5  all public records in possession of the contractor upon

 6  termination of the contract. All records stored electronically

 7  must be provided to the state in the format compatible with

 8  state information technology systems.

 9         9.  A requirement that any state funds provided for the

10  purchase of or improvements to real property are contingent

11  upon the contractor granting to the state a security interest

12  in the property which is at least equal to the amount of the

13  state funds provided for at least 5 years following the date

14  of purchase or the completion of the improvements or as

15  further required by law. The contract must include a provision

16  that, as a condition of receipt of state funding for this

17  purpose, the contractor agrees that, if it disposes of the

18  property before the department's interest is vacated, the

19  contractor must refund the proportionate share of the state's

20  initial investment, as adjusted by depreciation.

21         10.  A provision that the contractor annually submit

22  and verify, under section 92.525, Florida Statutes, all

23  required financial statements.

24         11.  A provision that the contractor will be held

25  responsible and accountable for all work covered under the

26  contract including any work performed by subcontractors. The

27  contract must state that the department may monitor the

28  performance of any subcontractor.

29         (b)  A contract may include cost-neutral,

30  performance-based incentives that may vary according to the

31  extent a contractor achieves or surpasses the performance


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1  standards set forth in the contract. The incentives may be

 2  weighted proportionally to reflect the extent to which the

 3  contractor has demonstrated that it has consistently met or

 4  exceeded the contractual requirements and the performance

 5  standards.

 6         (c) The department shall review the time period for

 7  which it executes contracts and shall execute multiyear

 8  contracts to make the most efficient use of the resources

 9  devoted to contract processing and execution. Whenever the

10  department chooses not to use a multiyear contract, a

11  justification for that decision must be contained in the

12  contract.

13         (d)  When the annualized value of a contract is in

14  excess of $1 million, at least one of the persons conducting

15  negotiations must be certified as a contract negotiator based

16  upon standards established by the Department of Management

17  Services.

18         (e)  The department may not amend a contract without

19  first submitting the proposed contract amendment to the

20  Executive Office of the Governor for approval if the effect of

21  the amendment would be to increase:

22         1.  The value of the contract by $250,000 for those

23  contracts with a total value of at least $250,000 but less

24  than $1 million;

25         2.  The value of the contract by $1 million for those

26  contracts with a total value of at least $1 million but less

27  than $10 million;

28         3.  The value of the contract by 10 percent for those

29  contracts with a total value of $10 million or more; or

30         4.  The term of the contract by 1 year or more.

31  


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1  When the department proposes any contract amendment that meets

 2  the criteria described in this paragraph, it shall submit the

 3  proposed contract amendment to the Executive Office of the

 4  Governor for approval and shall immediately notify the chairs

 5  of the legislative appropriations committees. The Executive

 6  Office of the Governor may not approve the proposed contract

 7  amendment until 14 days following receipt of the notification

 8  to the legislative appropriations chairs. If either chair of

 9  the legislative appropriations committees objects in writing

10  to a proposed contract amendment within 14 days following

11  notification and specifies the reasons for the objection, the

12  Executive Office of the Governor shall disapprove the proposed

13  contract amendment or shall submit the proposed contract

14  amendment to the Administration Commission. The proposed

15  contract amendment may be approved by the Administration

16  Commission by a two-thirds vote of the members present with

17  the Governor voting in the affirmative. In the absence of

18  approval by the commission, the proposed contract amendment

19  shall be automatically disapproved. Otherwise, upon approval

20  by the Governor or Administration Commission, the department

21  may execute the contract amendment.

22         (f)  An amendment that is issued under legislative

23  direction, including funding adjustments annually provided for

24  in the General Appropriations Act or the federal

25  appropriations acts, need not be submitted for approval in

26  accordance with paragraph (d).

27         (g)  In addition to the requirements of subsections

28  287.057(13) and (14), Florida Statutes, the department shall

29  verify, based on the best available data at the point of

30  contract renegotiations, that all specific direct and indirect

31  costs, savings, performance measures and standards, and


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1  qualitative and quantitative benefits identified in the

 2  original contract have been satisfied by a contractor or the

 3  department before the contract is extended or renewed. The

 4  documentation must include an explanation of any differences

 5  between the required performance as identified in the contract

 6  and the actual performance of the contractor. The

 7  documentation must be included in the official contract file.

 8         (h)  The department shall, in consultation with the

 9  Department of Management Services, develop contract templates

10  and guidelines that define the mandatory contract provisions

11  and other requirements identified in this subsection and that

12  must be used for all contractual service contracts meeting the

13  requirements of this subsection. All contract templates and

14  guidelines shall be developed by September 30, 2005.

15         (6)  CONTRACT-MANAGEMENT REQUIREMENTS AND

16  PROCESS.--Notwithstanding section 287.057(15), Florida

17  Statutes, the department is responsible for establishing a

18  contract-management process that requires a member of the

19  department's Senior Management Service to assign in writing

20  the responsibility of a contract to a contract manager. The

21  department shall maintain a set of procedures describing its

22  contract-management process which must minimally include the

23  following requirements:

24         (a)  The contract manager shall maintain the official

25  contract file throughout the duration of the contract and for

26  a period not less than 6 years after the termination of the

27  contract.

28         (b)  The contract manager shall review all invoices for

29  compliance with the criteria and payment schedule provided for

30  in the contract and shall approve payment of all invoices

31  before their transmission to the Department of Financial


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1  Services for payment. Only the contract manager shall approve

 2  the invoices for a specific contract, unless the contract

 3  manager is temporarily unavailable to review an invoice. The

 4  contract file must contain an explanation for any periods of

 5  temporary unavailability of the assigned contract manager. For

 6  any individual invoice in excess of $500,000, a member of the

 7  Selected Exempt Service or Senior Management Service shall

 8  also sign payment approval of the invoice. For any individual

 9  invoice in excess of $1 million, a member of the Senior

10  Management Service shall also sign payment approval of the

11  invoice.

12         (c)  The contract manager shall maintain a schedule of

13  payments and total amounts disbursed and shall periodically

14  reconcile the records with the state's official accounting

15  records.

16         (d)  For contracts involving the provision of direct

17  client services, the contract manager shall periodically visit

18  the physical location where the services are delivered and

19  speak directly to clients receiving the services and the staff

20  responsible for delivering the services.

21         (e)  For contracts for which the contractor is a

22  corporation, the contract manager shall attend at least one

23  board meeting semiannually, if held and if within 100 miles of

24  the contract manager's official headquarters.

25         (f)  The contract manager shall meet at least once a

26  month directly with the contractor's representative and

27  maintain records of such meetings.

28         (g)  The contract manager shall periodically document

29  any differences between the required performance measures and

30  the actual performance measures. If a contractor fails to meet

31  and comply with the performance measures established in the


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1  contract, the department may allow a reasonable period for the

 2  contractor to correct performance deficiencies. If performance

 3  deficiencies are not resolved to the satisfaction of the

 4  department within the prescribed time, and if no extenuating

 5  circumstances can be documented by the contractor to the

 6  department's satisfaction, the department must terminate the

 7  contract. The department may not enter into a new contract

 8  with that same contractor for the services for which the

 9  contract was previously terminated for a period of at least 24

10  months after the date of termination. The contract manager

11  shall obtain and enforce corrective-action plans, if

12  appropriate, and maintain records regarding the completion or

13  failure to complete corrective-action items.

14         (h)  The contract manager shall document any contract

15  modifications, which shall include recording any contract

16  amendments as provided for in this section.

17         (i)  The contract manager shall be properly trained

18  before being assigned responsibility for any contract.

19  

20  The department shall develop standards of conduct and a range

21  of disciplinary actions for its employees which are

22  specifically related to carrying out contract-management

23  responsibilities.

24         (7)  CONTRACT-MONITORING REQUIREMENTS AND PROCESS.--The

25  department shall establish contract-monitoring units staffed

26  by full-time career service employees who report to a member

27  of the Select Exempt Service or Senior Management Service and

28  who have been properly trained to perform contract monitoring.

29  A member of the Senior Management Service shall assign in

30  writing a specific contract to a contract-monitoring unit,

31  with at least one member of the contract-monitoring unit


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1  possessing specific knowledge and experience in the contract's

 2  program area. The department shall establish a

 3  contract-monitoring process that must include, but need not be

 4  limited to, the following requirements:

 5         (a)  Performing a risk assessment at the start of each

 6  fiscal year and preparing an annual contract-monitoring

 7  schedule that includes consideration for the level of risk

 8  assigned. The department may monitor any contract at any time

 9  regardless of whether such monitoring was originally included

10  in the annual contract-monitoring schedule.

11         (b)  Preparing a contract-monitoring plan, including

12  sampling procedures, before performing on-site monitoring at

13  external locations of a service provider. The plan must

14  include a description of the programmatic, fiscal, and

15  administrative components that will be monitored on-site. If

16  appropriate, clinical and therapeutic components may be

17  included.

18         (c)  Conducting analyses of the performance and

19  compliance of an external service provider by means of desk

20  reviews if the external service provider will not be monitored

21  on-site during a fiscal year.

22         (d)  Unless the department sets forth in writing the

23  need for an extension, providing a written report presenting

24  the results of the monitoring within 30 days after the

25  completion of the on-site monitoring or desk review. Report

26  extensions may not exceed 30 days after the original

27  completion date. The department shall develop and use a

28  standard contract-monitoring report format and shall provide

29  access to the reports by means of a website that is available

30  to the Legislature.

31  


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1         (e)  For contracts involving the provision of direct

 2  client services, requiring the contract monitor to visit the

 3  physical location where the services are being delivered and

 4  to speak directly to the clients receiving the services and

 5  with the staff responsible for delivering the services.

 6         (f)  Developing and maintaining a set of procedures

 7  describing the contract-monitoring process.

 8  

 9  The department shall develop standards of conduct and a range

10  of disciplinary actions for its employees which are

11  specifically related to carrying out contract-monitoring

12  responsibilities.

13         (8)  CONTRACTOR PROHIBITIONS.--

14         (a)  A contractor, as defined in chapter 287, Florida

15  Statutes, or its employees, agents, or subcontractors, may not

16  directly or indirectly supervise, direct, or act as an

17  approving authority over any state employee or over the

18  actions committed to the responsibility of a state employee.

19         (b)  A contractor, as defined in chapter 287, Florida

20  Statutes, or its employees, agents, or subcontractors, may not

21  knowingly participate through decision, approval, disapproval,

22  recommendation, preparation of any part of a purchase request,

23  influencing the content of any specification or procurement

24  standard, rendering of advice, investigation, or auditing, or

25  in any other advisory capacity, in the procurement of

26  contractual services from an entity of which the contractor,

27  or its employees, agents, or subcontractors, has a material

28  interest.

29         (9)  REPORTS TO THE LEGISLATURE.--Beginning October 1,

30  2005, the department shall make available to the Legislature

31  electronically all documents associated with the procurement


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1  and contracting functions of the department. The documents in

 2  the database must include, but are not limited to, all:

 3         (a)  Business cases;

 4         (b)  Procurement documents;

 5         (c)  Contracts and any related files, attachments, or

 6  amendments;

 7         (d)  Contract monitoring reports;

 8         (e)  Corrective action plans and reports of corrective

 9  actions taken when contractor performance deficiencies are

10  identified; and

11         (f)  Status reports on all outsourcing initiatives

12  describing the progress by the department towards achieving

13  the business objectives, costs, savings, and quantifiable

14  benefits identified in the business case.

15         Section 2.  Section 402.73, Florida Statutes, is

16  amended to read:

17         402.73  Contracting and performance standards.--

18         (1)  The Department of Children and Family Services

19  shall establish performance standards for all contracted

20  client services. Notwithstanding s. 287.057(5)(f), the

21  department must competitively procure any contract for client

22  services when any of the following occurs:

23         (a)  The provider fails to meet appropriate performance

24  standards established by the department after the provider has

25  been given a reasonable opportunity to achieve the established

26  standards.

27         (b)  A new program or service has been authorized and

28  funded by the Legislature and the annual value of the contract

29  for such program or service is $300,000 or more.

30         (c)  The department has concluded, after reviewing

31  market prices and available treatment options, that there is


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1  evidence that the department can improve the performance

 2  outcomes produced by its contract resources. At a minimum, the

 3  department shall review market prices and available treatment

 4  options biennially. The department shall compile the results

 5  of the biennial review and include the results in its annual

 6  performance report to the Legislature pursuant to chapter

 7  94-249, Laws of Florida. The department shall provide notice

 8  and an opportunity for public comment on its review of market

 9  prices and available treatment options.

10         (2)  The competitive requirements of subsection (1)

11  must be initiated for each contract that meets the criteria of

12  this subsection, unless the secretary makes a written

13  determination that particular facts and circumstances require

14  deferral of the competitive process. Facts and circumstances

15  must be specifically described for each individual contract

16  proposed for deferral and must include one or more of the

17  following:

18         (a)  An immediate threat to the health, safety, or

19  welfare of the department's clients.

20         (b)  A threat to appropriate use or disposition of

21  facilities that have been financed in whole, or in substantial

22  part, through contracts or agreements with a state agency.

23         (c)  A threat to the service infrastructure of a

24  community which could endanger the well-being of the

25  department's clients.

26  

27  Competitive procurement of client services contracts that meet

28  the criteria in subsection (1) may not be deferred for longer

29  than 1 year.

30         (3)  The Legislature intends that the department obtain

31  services in the manner that is most cost-effective for the


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1  state, that provides the greatest long-term benefits to the

 2  clients receiving services, and that minimizes the disruption

 3  of client services. In order to meet these legislative goals,

 4  the department may adopt rules providing procedures for the

 5  competitive procurement of contracted client services which

 6  represent an alternative to the request-for-proposal or

 7  invitation-to-bid process. The alternative competitive

 8  procedures shall permit the department to solicit professional

 9  qualifications from prospective providers and to evaluate such

10  statements of qualification before requesting service

11  proposals. The department may limit the firms invited to

12  submit service proposals to only those firms that have

13  demonstrated the highest level of professional capability to

14  provide the services under consideration, but may not invite

15  fewer than three firms to submit service proposals, unless

16  fewer than three firms submitted satisfactory statements of

17  qualification. The alternative procedures must, at a minimum,

18  allow the department to evaluate competing proposals and

19  select the proposal that provides the greatest benefit to the

20  state while considering the quality of the services,

21  dependability, and integrity of the provider, the

22  dependability of the provider's services, the experience of

23  the provider in serving target populations or client groups

24  substantially identical to members of the target population

25  for the contract in question, and the ability of the provider

26  to secure local funds to support the delivery of services,

27  including, but not limited to, funds derived from local

28  governments. These alternative procedures need not conform to

29  the requirements of s. 287.042 or s. 287.057(1) or (2).

30         (4)  The department shall review the period for which

31  it executes contracts and, to the greatest extent practicable,


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1  shall execute multiyear contracts to make the most efficient

 2  use of the resources devoted to contract processing and

 3  execution.

 4         (5)  When it is in the best interest of a defined

 5  segment of its consumer population, the department may

 6  competitively procure and contract for systems of treatment or

 7  service that involve multiple providers, rather than procuring

 8  and contracting for treatment or services separately from each

 9  participating provider. The department must ensure that all

10  providers that participate in the treatment or service system

11  meet all applicable statutory, regulatory, service-quality,

12  and cost-control requirements. If other governmental entities

13  or units of special purpose government contribute matching

14  funds to the support of a given system of treatment or

15  service, the department shall formally request information

16  from those funding entities in the procurement process and may

17  take the information received into account in the selection

18  process. If a local government contributes match to support

19  the system of treatment or contracted service and if the match

20  constitutes at least 25 percent of the value of the contract,

21  the department shall afford the governmental match contributor

22  an opportunity to name an employee as one of the persons

23  required by s. 287.057(17) to evaluate or negotiate certain

24  contracts, unless the department sets forth in writing the

25  reason why such inclusion would be contrary to the best

26  interest of the state. Any employee so named by the

27  governmental match contributor shall qualify as one of the

28  persons required by s. 287.057(17). No governmental entity or

29  unit of special purpose government may name an employee as one

30  of the persons required by s. 287.057(17) if it, or any of its

31  political subdivisions, executive agencies, or special


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1  districts, intends to compete for the contract to be awarded.

 2  The governmental funding entity or match contributor shall

 3  comply with any deadlines and procurement procedures

 4  established by the department. The department may also involve

 5  nongovernmental funding entities in the procurement process

 6  when appropriate.

 7         (6)  The department may contract for or provide

 8  assessment and case management services independently from

 9  treatment services.

10         (7)  The department shall adopt, by rule, provisions

11  for including in its contracts incremental penalties to be

12  imposed by its contract managers on a service provider due to

13  the provider's failure to comply with a requirement for

14  corrective action. Any financial penalty that is imposed upon

15  a provider may not be paid from funds being used to provide

16  services to clients, and the provider may not reduce the

17  amount of services being delivered to clients as a method for

18  offsetting the impact of the penalty. If a financial penalty

19  is imposed upon a provider that is a corporation, the

20  department shall notify, at a minimum, the board of directors

21  of the corporation. The department may notify, at its

22  discretion, any additional parties that the department

23  believes may be helpful in obtaining the corrective action

24  that is being sought. Further, the rules adopted by the

25  department must include provisions that permit the department

26  to deduct the financial penalties from funds that would

27  otherwise be due to the provider, not to exceed 10 percent of

28  the amount that otherwise would be due to the provider for the

29  period of noncompliance. If the department imposes a financial

30  penalty, it shall advise the provider in writing of the cause

31  for the penalty. A failure to include such deductions in a


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1  request for payment constitutes a ground for the department to

 2  reject that request for payment. The remedies identified in

 3  this subsection do not limit or restrict the department's

 4  application of any other remedy available to it in the

 5  contract or under law. The remedies described in this

 6  subsection may be cumulative and may be assessed upon each

 7  separate failure to comply with instructions from the

 8  department to complete corrective action.

 9         (8)  The department shall develop standards of conduct

10  and a range of disciplinary actions for its employees which

11  are specifically related to carrying out contracting

12  responsibilities.

13         (1)(9)  The Agency for Persons with Disabilities

14  department must implement systems and controls to ensure

15  financial integrity and service provision quality in the

16  developmental services Medicaid waiver service system.

17         (10)  If a provider fails to meet the performance

18  standards established in the contract, the department may

19  allow a reasonable period for the provider to correct

20  performance deficiencies. If performance deficiencies are not

21  resolved to the satisfaction of the department within the

22  prescribed time, and if no extenuating circumstances can be

23  documented by the provider to the department's satisfaction,

24  the department must cancel the contract with the provider. The

25  department may not enter into a new contract with that same

26  provider for the services for which the contract was

27  previously canceled for a period of at least 24 months after

28  the date of cancellation. If an adult substance abuse services

29  provider fails to meet the performance standards established

30  in the contract, the department may allow a reasonable period,

31  not to exceed 6 months, for the provider to correct


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1  performance deficiencies. If the performance deficiencies are

 2  not resolved to the satisfaction of the department within 6

 3  months, the department must cancel the contract with the adult

 4  substance abuse provider, unless there is no other qualified

 5  provider in the service district.

 6         (11)  The department shall include in its standard

 7  contract document a requirement that any state funds provided

 8  for the purchase of or improvements to real property are

 9  contingent upon the contractor or political subdivision

10  granting to the state a security interest in the property at

11  least to the amount of the state funds provided for at least 5

12  years from the date of purchase or the completion of the

13  improvements or as further required by law. The contract must

14  include a provision that, as a condition of receipt of state

15  funding for this purpose, the provider agrees that, if it

16  disposes of the property before the department's interest is

17  vacated, the provider will refund the proportionate share of

18  the state's initial investment, as adjusted by depreciation.

19         (12)  The department shall develop and refine

20  contracting and accountability methods that are

21  administratively efficient and that provide for optimal

22  provider performance.

23         (13)  The department may competitively procure any

24  contract when it deems it is in the best interest of the state

25  to do so. The requirements described in subsection (1) do not,

26  and may not be construed to, limit in any way the department's

27  ability to competitively procure any contract it executes, and

28  the absence of any or all of the criteria described in

29  subsection (1) may not be used as the basis for an

30  administrative or judicial protest of the department's

31  


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1  determination to conduct competition, make an award, or

 2  execute any contract.

 3         (14)  A contract may include cost-neutral,

 4  performance-based incentives that may vary according to the

 5  extent a provider achieves or surpasses the performance

 6  standards set forth in the contract. Such incentives may be

 7  weighted proportionally to reflect the extent to which the

 8  provider has demonstrated that it has consistently met or

 9  exceeded the contractual requirements and the department's

10  performance standards.

11         (2)(15)  Nothing contained in chapter 287 shall require

12  competitive bids for health services involving examination,

13  diagnosis, or treatment.

14         Section 3.  Section 409.1671, Florida Statutes, is

15  amended to read:

16         409.1671  Foster care and related services; outsourcing

17  privatization.--

18         (1)(a)  It is the intent of the Legislature that the

19  Department of Children and Family Services shall outsource

20  privatize the provision of foster care and related services

21  statewide. It is further the Legislature's intent to encourage

22  communities and other stakeholders in the well-being of

23  children to participate in assuring that children are safe and

24  well-nurtured. However, while recognizing that some local

25  governments are presently funding portions of certain foster

26  care and related services programs and may choose to expand

27  such funding in the future, the Legislature does not intend by

28  its outsourcing privatization of foster care and related

29  services that any county, municipality, or special district be

30  required to assist in funding programs that previously have

31  been funded by the state. Counties that provide children and


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1  family services with at least 40 licensed residential group

 2  care beds by July 1, 2003, and provide at least $2 million

 3  annually in county general revenue funds to supplement foster

 4  and family care services shall continue to contract directly

 5  with the state and shall be exempt from the provisions of this

 6  section. Nothing in this paragraph prohibits any county,

 7  municipality, or special district from future voluntary

 8  funding participation in foster care and related services. As

 9  used in this section, the term "outsource" "privatize" means

10  to contract with competent, community-based agencies. The

11  department shall submit a plan to accomplish outsourcing

12  privatization statewide, through a competitive process, phased

13  in over a 3-year period beginning January 1, 2000. This plan

14  must be developed with local community participation,

15  including, but not limited to, input from community-based

16  providers that are currently under contract with the

17  department to furnish community-based foster care and related

18  services, and must include a methodology for determining and

19  transferring all available funds, including federal funds that

20  the provider is eligible for and agrees to earn and that

21  portion of general revenue funds which is currently associated

22  with the services that are being furnished under contract. The

23  methodology must provide for the transfer of funds

24  appropriated and budgeted for all services and programs that

25  have been incorporated into the project, including all

26  management, capital (including current furniture and

27  equipment), and administrative funds to accomplish the

28  transfer of these programs. This methodology must address

29  expected workload and at least the 3 previous years'

30  experience in expenses and workload. With respect to any

31  district or portion of a district in which outsourcing


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1  privatization cannot be accomplished within the 3-year

 2  timeframe, the department must clearly state in its plan the

 3  reasons the timeframe cannot be met and the efforts that

 4  should be made to remediate the obstacles, which may include

 5  alternatives to total outsourcing privatization, such as

 6  public-private partnerships. As used in this section, the term

 7  "related services" includes, but is not limited to, family

 8  preservation, independent living, emergency shelter,

 9  residential group care, foster care, therapeutic foster care,

10  intensive residential treatment, foster care supervision, case

11  management, postplacement supervision, permanent foster care,

12  and family reunification. Unless otherwise provided for, the

13  state attorney shall provide child welfare legal services,

14  pursuant to chapter 39 and other relevant provisions, in

15  Pinellas and Pasco Counties. When a private nonprofit agency

16  has received case management responsibilities, transferred

17  from the state under this section, for a child who is

18  sheltered or found to be dependent and who is assigned to the

19  care of the outsourcing privatization project, the agency may

20  act as the child's guardian for the purpose of registering the

21  child in school if a parent or guardian of the child is

22  unavailable and his or her whereabouts cannot reasonably be

23  ascertained. The private nonprofit agency may also seek

24  emergency medical attention for such a child, but only if a

25  parent or guardian of the child is unavailable, his or her

26  whereabouts cannot reasonably be ascertained, and a court

27  order for such emergency medical services cannot be obtained

28  because of the severity of the emergency or because it is

29  after normal working hours. However, the provider may not

30  consent to sterilization, abortion, or termination of life

31  support. If a child's parents' rights have been terminated,


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1  the nonprofit agency shall act as guardian of the child in all

 2  circumstances.

 3         (b)  It is the intent of the Legislature that the

 4  department will continue to work towards full outsourcing

 5  privatization in a manner that assures the viability of the

 6  community-based system of care and best provides for the

 7  safety of children in the child protection system. To this

 8  end, the department is directed to continue the process of

 9  outsourcing privatizing services in those counties in which

10  signed startup contracts have been executed. The department

11  may also continue to enter into startup contracts with

12  additional counties. However, no services shall be transferred

13  to a community-based care lead agency until the department, in

14  consultation with the local community alliance, has determined

15  and certified in writing to the Governor and the Legislature

16  that the district is prepared to transition the provision of

17  services to the lead agency and that the lead agency is ready

18  to deliver and be accountable for such service provision. In

19  making this determination, the department shall conduct a

20  readiness assessment of the district and the lead agency.

21         1.  The assessment shall evaluate the operational

22  readiness of the district and the lead agency based on:

23         a.  A set of uniform criteria, developed in

24  consultation with currently operating community-based care

25  lead agencies and reflecting national accreditation standards,

26  that evaluate programmatic, financial, technical assistance,

27  training and organizational competencies; and

28         b.  Local criteria reflective of the local

29  community-based care design and the community alliance

30  priorities.

31  


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1         2.  The readiness assessment shall be conducted by a

 2  joint team of district and lead agency staff with direct

 3  experience with the start up and operation of a

 4  community-based care service program and representatives from

 5  the appropriate community alliance. Within resources available

 6  for this purpose, the department may secure outside audit

 7  expertise when necessary to assist a readiness assessment

 8  team.

 9         3.  Upon completion of a readiness assessment, the

10  assessment team shall conduct an exit conference with the

11  district and lead agency staff responsible for the transition.

12         4.  Within 30 days following the exit conference with

13  staff of each district and lead agency, the secretary shall

14  certify in writing to the Governor and the Legislature that

15  both the district and the lead agency are prepared to begin

16  the transition of service provision based on the results of

17  the readiness assessment and the exit conference. The document

18  of certification must include specific evidence of readiness

19  on each element of the readiness instrument utilized by the

20  assessment team as well as a description of each element of

21  readiness needing improvement and strategies being implemented

22  to address each one.

23         (c)  The Auditor General and the Office of Program

24  Policy Analysis and Government Accountability (OPPAGA), in

25  consultation with The Child Welfare League of America and the

26  Louis de la Parte Florida Mental Health Institute, shall

27  jointly review and assess the department's process for

28  determining district and lead agency readiness.

29         1.  The review must, at a minimum, address the

30  appropriateness of the readiness criteria and instruments

31  applied, the appropriateness of the qualifications of


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1  participants on each readiness assessment team, the degree to

 2  which the department accurately determined each district and

 3  lead agency's compliance with the readiness criteria, the

 4  quality of the technical assistance provided by the department

 5  to a lead agency in correcting any weaknesses identified in

 6  the readiness assessment, and the degree to which each lead

 7  agency overcame any identified weaknesses.

 8         2.  Reports of these reviews must be submitted to the

 9  appropriate substantive and appropriations committees in the

10  Senate and the House of Representatives on March 1 and

11  September 1 of each year until full transition to

12  community-based care has been accomplished statewide, except

13  that the first report must be submitted by February 1, 2004,

14  and must address all readiness activities undertaken through

15  June 30, 2003. The perspectives of all participants in this

16  review process must be included in each report.

17         (d)  In communities where economic or demographic

18  constraints make it impossible or not feasible to

19  competitively contract with a lead agency, the department

20  shall develop an alternative plan in collaboration with the

21  local community alliance, which may include establishing

22  innovative geographical configurations or consortia of

23  agencies. The plan must detail how the community will continue

24  to implement community-based care through competitively

25  procuring either the specific components of foster care and

26  related services or comprehensive services for defined

27  eligible populations of children and families from qualified

28  licensed agencies as part of its efforts to develop the local

29  capacity for a community-based system of coordinated care. The

30  plan must ensure local control over the management and

31  administration of the service provision in accordance with the


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1  intent of this section and may include recognized best

 2  business practices, including some form of public or private

 3  partnerships.

 4         (e)  As used in this section, the term "eligible lead

 5  community-based provider" means a single agency with which the

 6  department shall contract for the provision of child

 7  protective services in a community that is no smaller than a

 8  county. The secretary of the department may authorize more

 9  than one eligible lead community-based provider within a

10  single county when to do so will result in more effective

11  delivery of foster care and related services. To compete for

12  an outsourcing a privatization project, such agency must have:

13         1.  The ability to coordinate, integrate, and manage

14  all child protective services in the designated community in

15  cooperation with child protective investigations.

16         2.  The ability to ensure continuity of care from entry

17  to exit for all children referred from the protective

18  investigation and court systems.

19         3.  The ability to provide directly, or contract for

20  through a local network of providers, all necessary child

21  protective services. Such agencies should directly provide no

22  more than 35 percent of all child protective services

23  provided.

24         4.  The willingness to accept accountability for

25  meeting the outcomes and performance standards related to

26  child protective services established by the Legislature and

27  the Federal Government.

28         5.  The capability and the willingness to serve all

29  children referred to it from the protective investigation and

30  court systems, regardless of the level of funding allocated to

31  


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1  the community by the state, provided all related funding is

 2  transferred.

 3         6.  The willingness to ensure that each individual who

 4  provides child protective services completes the training

 5  required of child protective service workers by the Department

 6  of Children and Family Services.

 7         7.  The ability to maintain eligibility to receive all

 8  federal child welfare funds, including Title IV-E and IV-A

 9  funds, currently being used by the Department of Children and

10  Family Services.

11         8.  Written agreements with Healthy Families Florida

12  lead entities in their community, pursuant to s. 409.153, to

13  promote cooperative planning for the provision of prevention

14  and intervention services.

15         9.  A board of directors, of which at least 51 percent

16  of the membership is comprised of persons residing in this

17  state. Of the state residents, at least 51 percent must also

18  reside within the service area of the lead community-based

19  provider.

20         (f)1.  The Legislature finds that the state has

21  traditionally provided foster care services to children who

22  have been the responsibility of the state. As such, foster

23  children have not had the right to recover for injuries beyond

24  the limitations specified in s. 768.28. The Legislature has

25  determined that foster care and related services need to be

26  outsourced privatized pursuant to this section and that the

27  provision of such services is of paramount importance to the

28  state. The purpose for such outsourcing privatization is to

29  increase the level of safety, security, and stability of

30  children who are or become the responsibility of the state.

31  One of the components necessary to secure a safe and stable


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1  environment for such children is that private providers

 2  maintain liability insurance. As such, insurance needs to be

 3  available and remain available to nongovernmental foster care

 4  and related services providers without the resources of such

 5  providers being significantly reduced by the cost of

 6  maintaining such insurance.

 7         2.  The Legislature further finds that, by requiring

 8  the following minimum levels of insurance, children in

 9  outsourced privatized foster care and related services will

10  gain increased protection and rights of recovery in the event

11  of injury than provided for in s. 768.28.

12         (g)  In any county in which a service contract has not

13  been executed by December 31, 2004, the department shall

14  ensure access to a model comprehensive residential services

15  program as described in s. 409.1677 which, without imposing

16  undue financial, geographic, or other barriers, ensures

17  reasonable and appropriate participation by the family in the

18  child's program.

19         1.  In order to ensure that the program is operational

20  by December 31, 2004, the department must, by December 31,

21  2003, begin the process of establishing access to a program in

22  any county in which the department has not either entered into

23  a transition contract or approved a community plan, as

24  described in paragraph (d), which ensures full outsourcing

25  privatization by the statutory deadline.

26         2.  The program must be procured through a competitive

27  process.

28         3.  The Legislature does not intend for the provisions

29  of this paragraph to substitute for the requirement that full

30  conversion to community-based care be accomplished.

31  


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1         (h)  Other than an entity to which s. 768.28 applies,

 2  any eligible lead community-based provider, as defined in

 3  paragraph (e), or its employees or officers, except as

 4  otherwise provided in paragraph (i), must, as a part of its

 5  contract, obtain a minimum of $1 million per claim/$3 million

 6  per incident in general liability insurance coverage. The

 7  eligible lead community-based provider must also require that

 8  staff who transport client children and families in their

 9  personal automobiles in order to carry out their job

10  responsibilities obtain minimum bodily injury liability

11  insurance in the amount of $100,000 per claim, $300,000 per

12  incident, on their personal automobiles. In any tort action

13  brought against such an eligible lead community-based provider

14  or employee, net economic damages shall be limited to $1

15  million per liability claim and $100,000 per automobile claim,

16  including, but not limited to, past and future medical

17  expenses, wage loss, and loss of earning capacity, offset by

18  any collateral source payment paid or payable. In any tort

19  action brought against such an eligible lead community-based

20  provider, noneconomic damages shall be limited to $200,000 per

21  claim. A claims bill may be brought on behalf of a claimant

22  pursuant to s. 768.28 for any amount exceeding the limits

23  specified in this paragraph. Any offset of collateral source

24  payments made as of the date of the settlement or judgment

25  shall be in accordance with s. 768.76. The lead

26  community-based provider shall not be liable in tort for the

27  acts or omissions of its subcontractors or the officers,

28  agents, or employees of its subcontractors.

29         (i)  The liability of an eligible lead community-based

30  provider described in this section shall be exclusive and in

31  place of all other liability of such provider. The same


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1  immunities from liability enjoyed by such providers shall

 2  extend as well to each employee of the provider when such

 3  employee is acting in furtherance of the provider's business,

 4  including the transportation of clients served, as described

 5  in this subsection, in privately owned vehicles. Such

 6  immunities shall not be applicable to a provider or an

 7  employee who acts in a culpably negligent manner or with

 8  willful and wanton disregard or unprovoked physical aggression

 9  when such acts result in injury or death or such acts

10  proximately cause such injury or death; nor shall such

11  immunities be applicable to employees of the same provider

12  when each is operating in the furtherance of the provider's

13  business, but they are assigned primarily to unrelated works

14  within private or public employment. The same immunity

15  provisions enjoyed by a provider shall also apply to any sole

16  proprietor, partner, corporate officer or director,

17  supervisor, or other person who in the course and scope of his

18  or her duties acts in a managerial or policymaking capacity

19  and the conduct that caused the alleged injury arose within

20  the course and scope of those managerial or policymaking

21  duties. Culpable negligence is defined as reckless

22  indifference or grossly careless disregard of human life.

23         (j)  Any subcontractor of an eligible lead

24  community-based provider, as defined in paragraph (e), which

25  is a direct provider of foster care and related services to

26  children and families, and its employees or officers, except

27  as otherwise provided in paragraph (i), must, as a part of its

28  contract, obtain a minimum of $1 million per claim/$3 million

29  per incident in general liability insurance coverage. The

30  subcontractor of an eligible lead community-based provider

31  must also require that staff who transport client children and


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1  families in their personal automobiles in order to carry out

 2  their job responsibilities obtain minimum bodily injury

 3  liability insurance in the amount of $100,000 per claim,

 4  $300,000 per incident, on their personal automobiles. In any

 5  tort action brought against such subcontractor or employee,

 6  net economic damages shall be limited to $1 million per

 7  liability claim and $100,000 per automobile claim, including,

 8  but not limited to, past and future medical expenses, wage

 9  loss, and loss of earning capacity, offset by any collateral

10  source payment paid or payable. In any tort action brought

11  against such subcontractor, noneconomic damages shall be

12  limited to $200,000 per claim. A claims bill may be brought on

13  behalf of a claimant pursuant to s. 768.28 for any amount

14  exceeding the limits specified in this paragraph. Any offset

15  of collateral source payments made as of the date of the

16  settlement or judgment shall be in accordance with s. 768.76.

17         (k)  The liability of a subcontractor of an eligible

18  lead community-based provider that is a direct provider of

19  foster care and related services as described in this section

20  shall be exclusive and in place of all other liability of such

21  provider. The same immunities from liability enjoyed by such

22  subcontractor provider shall extend as well to each employee

23  of the subcontractor when such employee is acting in

24  furtherance of the subcontractor's business, including the

25  transportation of clients served, as described in this

26  subsection, in privately owned vehicles. Such immunities shall

27  not be applicable to a subcontractor or an employee who acts

28  in a culpably negligent manner or with willful and wanton

29  disregard or unprovoked physical aggression when such acts

30  result in injury or death or such acts proximately cause such

31  injury or death; nor shall such immunities be applicable to


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1  employees of the same subcontractor when each is operating in

 2  the furtherance of the subcontractor's business, but they are

 3  assigned primarily to unrelated works within private or public

 4  employment. The same immunity provisions enjoyed by a

 5  subcontractor shall also apply to any sole proprietor,

 6  partner, corporate officer or director, supervisor, or other

 7  person who in the course and scope of his or her duties acts

 8  in a managerial or policymaking capacity and the conduct that

 9  caused the alleged injury arose within the course and scope of

10  those managerial or policymaking duties. Culpable negligence

11  is defined as reckless indifference or grossly careless

12  disregard of human life.

13         (l)  The Legislature is cognizant of the increasing

14  costs of goods and services each year and recognizes that

15  fixing a set amount of compensation actually has the effect of

16  a reduction in compensation each year. Accordingly, the

17  conditional limitations on damages in this section shall be

18  increased at the rate of 5 percent each year, prorated from

19  the effective date of this paragraph to the date at which

20  damages subject to such limitations are awarded by final

21  judgment or settlement.

22         (2)(a)  The department may contract for the delivery,

23  administration, or management of protective services, the

24  services specified in subsection (1) relating to foster care,

25  and other related services or programs, as appropriate. The

26  department shall retain responsibility for the quality of

27  contracted services and programs and shall ensure that

28  services are delivered in accordance with applicable federal

29  and state statutes and regulations. The department must adopt

30  written policies and procedures for monitoring the contract

31  for delivery of services by lead community-based providers.


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1  These policies and procedures must, at a minimum, address the

 2  evaluation of fiscal accountability and program operations,

 3  including provider achievement of performance standards,

 4  provider monitoring of subcontractors, and timely followup of

 5  corrective actions for significant monitoring findings related

 6  to providers and subcontractors. These policies and procedures

 7  must also include provisions for reducing the duplication of

 8  the department's program monitoring activities both internally

 9  and with other agencies, to the extent possible. The

10  department's written procedures must ensure that the written

11  findings, conclusions, and recommendations from monitoring the

12  contract for services of lead community-based providers are

13  communicated to the director of the provider agency as

14  expeditiously as possible.

15         (b)  Persons employed by the department in the

16  provision of foster care and related services whose positions

17  are being outsourced under privatized pursuant to this statute

18  shall be given hiring preference by the provider, if provider

19  qualifications are met.

20         (3)(a)  In order to help ensure a seamless child

21  protection system, the department shall ensure that contracts

22  entered into with community-based agencies pursuant to this

23  section include provisions for a case-transfer process to

24  determine the date that the community-based agency will

25  initiate the appropriate services for a child and family. This

26  case-transfer process must clearly identify the closure of the

27  protective investigation and the initiation of service

28  provision. At the point of case transfer, and at the

29  conclusion of an investigation, the department must provide a

30  complete summary of the findings of the investigation to the

31  community-based agency.


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1         (b)  The contracts must also ensure that each

 2  community-based agency shall furnish information on its

 3  activities in all cases in client case records.

 4         (c)  The contract between the department and

 5  community-based agencies must include provisions that specify

 6  the procedures to be used by the parties to resolve

 7  differences in interpreting the contract or to resolve

 8  disputes as to the adequacy of the parties' compliance with

 9  their respective obligations under the contract.

10         (d)  Each contract with an eligible lead

11  community-based provider shall provide for the payment by the

12  department to the provider of a reasonable administrative cost

13  in addition to funding for the provision of services.

14         (e)  Each contract with an eligible lead

15  community-based provider must include all performance outcome

16  measures established by the Legislature and that are under the

17  control of the lead agency. The standards must be adjusted

18  annually by contract amendment to enable the department to

19  meet the legislatively established statewide standards.

20         (4)(a)  The department, in consultation with the

21  community-based agencies that are undertaking the outsourced

22  privatized projects, shall establish a quality assurance

23  program for privatized services. The quality assurance program

24  shall be based on standards established by the Adoption and

25  Safe Families Act as well as by a national accrediting

26  organization such as the Council on Accreditation of Services

27  for Families and Children, Inc. (COA) or CARF--the

28  Rehabilitation Accreditation Commission. Each program operated

29  under contract with a community-based agency must be evaluated

30  annually by the department. The department shall, to the

31  extent possible, use independent financial audits provided by


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1  the community-based care agency to eliminate or reduce the

 2  ongoing contract and administrative reviews conducted by the

 3  department. The department may suggest additional items to be

 4  included in such independent financial audits to meet the

 5  department's needs. Should the department determine that such

 6  independent financial audits are inadequate, then other

 7  audits, as necessary, may be conducted by the department.

 8  Nothing herein shall abrogate the requirements of s. 215.97.

 9  The department shall submit an annual report regarding quality

10  performance, outcome measure attainment, and cost efficiency

11  to the President of the Senate, the Speaker of the House of

12  Representatives, the minority leader of each house of the

13  Legislature, and the Governor no later than January 31 of each

14  year for each project in operation during the preceding fiscal

15  year.

16         (b)  The department shall use these findings in making

17  recommendations to the Governor and the Legislature for future

18  program and funding priorities in the child welfare system.

19         (5)(a)  The community-based agency must comply with

20  statutory requirements and agency rules in the provision of

21  contractual services. Each foster home, therapeutic foster

22  home, emergency shelter, or other placement facility operated

23  by the community-based agency or agencies must be licensed by

24  the Department of Children and Family Services under chapter

25  402 or this chapter. Each community-based agency must be

26  licensed as a child-caring or child-placing agency by the

27  department under this chapter. The department, in order to

28  eliminate or reduce the number of duplicate inspections by

29  various program offices, shall coordinate inspections required

30  pursuant to licensure of agencies under this section.

31  


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1         (b)  Substitute care providers who are licensed under

 2  s. 409.175 and have contracted with a lead agency authorized

 3  under this section shall also be authorized to provide

 4  registered or licensed family day care under s. 402.313, if

 5  consistent with federal law and if the home has met the

 6  requirements of s. 402.313.

 7         (c)  A dually licensed home under this section shall be

 8  eligible to receive both an out-of-home care payment and a

 9  subsidized child care payment for the same child pursuant to

10  federal law. The department may adopt administrative rules

11  necessary to administer this paragraph.

12         (6)  Beginning January 1, 1999, and continuing at least

13  through June 30, 2000, the Department of Children and Family

14  Services shall outsource privatize all foster care and related

15  services in district 5 while continuing to contract with the

16  current model programs in districts 1, 4, and 13, and in

17  subdistrict 8A, and shall expand the subdistrict 8A pilot

18  program to incorporate Manatee County. Planning for the

19  district 5 outsourcing privatization shall be done by

20  providers that are currently under contract with the

21  department for foster care and related services and shall be

22  done in consultation with the department.  A lead provider of

23  the district 5 program shall be competitively selected, must

24  demonstrate the ability to provide necessary comprehensive

25  services through a local network of providers, and must meet

26  criteria established in this section. Contracts with

27  organizations responsible for the model programs must include

28  the management and administration of all outsourced privatized

29  services specified in subsection (1). However, the department

30  may use funds for contract management only after obtaining

31  written approval from the Executive Office of the Governor.


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1  The request for such approval must include, but is not limited

 2  to, a statement of the proposed amount of such funds and a

 3  description of the manner in which such funds will be used. If

 4  the community-based organization selected for a model program

 5  under this subsection is not a Medicaid provider, the

 6  organization shall be issued a Medicaid provider number

 7  pursuant to s. 409.907 for the provision of services currently

 8  authorized under the state Medicaid plan to those children

 9  encompassed in this model and in a manner not to exceed the

10  current level of state expenditure.

11         (7)  The Florida Coalition for Children, Inc., in

12  consultation with the department, shall develop a plan based

13  on an independent actuarial study regarding the long-term use

14  and structure of a statewide community-based care risk pool

15  for the protection of eligible lead community-based providers,

16  their subcontractors, and providers of other social services

17  who contract directly with the department. The plan must also

18  outline strategies to maximize federal earnings as they relate

19  to the community-based care risk pool. At a minimum, the plan

20  must allow for the use of federal earnings received from child

21  welfare programs to be allocated to the community-based care

22  risk pool by the department, which earnings are determined by

23  the department to be in excess of the amount appropriated in

24  the General Appropriations Act. The plan must specify the

25  necessary steps to ensure the financial integrity and

26  industry-standard risk management practices of the

27  community-based care risk pool and the continued availability

28  of funding from federal, state, and local sources. The plan

29  must also include recommendations that permit the program to

30  be available to entities of the department providing child

31  welfare services until full conversion to community-based care


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1  takes place. The final plan shall be submitted to the

 2  department and then to the Executive Office of the Governor

 3  and the Legislative Budget Commission for formal adoption

 4  before January 1, 2005. Upon approval of the plan by all

 5  parties, the department shall issue an interest-free loan that

 6  is secured by the cumulative contractual revenue of the

 7  community-based care risk pool membership, and the amount of

 8  the loan shall equal the amount appropriated by the

 9  Legislature for this purpose. The plan shall provide for a

10  governance structure that assures the department the ability

11  to oversee the operation of the community-based care risk pool

12  at least until this loan is repaid in full.

13         (a)  The purposes for which the community-based care

14  risk pool shall be used include, but are not limited to:

15         1.  Significant changes in the number or composition of

16  clients eligible to receive services.

17         2.  Significant changes in the services that are

18  eligible for reimbursement.

19         3.  Scheduled or unanticipated, but necessary, advances

20  to providers or other cash-flow issues.

21         4.  Proposals to participate in optional Medicaid

22  services or other federal grant opportunities.

23         5.  Appropriate incentive structures.

24         6.  Continuity of care in the event of failure,

25  discontinuance of service, or financial misconduct by a lead

26  agency.

27         7.  Payment for time-limited technical assistance and

28  consultation to lead agencies in the event of serious

29  performance or management problems.

30         8.  Payment for meeting all traditional and

31  nontraditional insurance needs of eligible members.


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1         9.  Significant changes in the mix of available funds.

 2         (b)  After approval of the plan in the 2004-2005 fiscal

 3  year and annually thereafter, the department may also request

 4  in its annual legislative budget request, and the Governor may

 5  recommend, that the funding necessary to carry out paragraph

 6  (a) be appropriated to the department. Subsequent funding of

 7  the community-based care risk pool shall be supported by

 8  premiums assessed to members of the community-based care risk

 9  pool on a recurring basis. The community-based care risk pool

10  may invest and retain interest earned on these funds. In

11  addition, the department may transfer funds to the

12  community-based care risk pool as available in order to ensure

13  an adequate funding level if the fund is declared to be

14  insolvent and approval is granted by the Legislative Budget

15  Commission. Such payments for insolvency shall be made only

16  after a determination is made by the department or its actuary

17  that all participants in the community-based care risk pool

18  are current in their payments of premiums and that assessments

19  have been made at an actuarially sound level. Such payments by

20  participants in the community-based care risk pool may not

21  exceed reasonable industry standards, as determined by the

22  actuary. Money from this fund may be used to match available

23  federal dollars. Dividends or other payments, with the

24  exception of legitimate claims, may not be paid to members of

25  the community-based care risk pool until the loan issued by

26  the department is repaid in full. Dividends or other payments,

27  with the exception of legitimate claims and other purposes

28  contained in the approved plan, may not be paid to members of

29  the community-based care risk pool unless, at the time of

30  distribution, the community-based care risk pool is deemed

31  actuarially sound and solvent. Solvency shall be determined by


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1  an independent actuary contracted by the department. The plan

 2  shall be developed in consultation with the Office of

 3  Insurance Regulation.

 4         1.  Such funds shall constitute partial security for

 5  contract performance by lead agencies and shall be used to

 6  offset the need for a performance bond. Subject to the

 7  approval of the plan, the community-based care risk pool shall

 8  be managed by the Florida Coalition for Children, Inc., or the

 9  designated contractors of the Florida Coalition for Children,

10  Inc. Nonmembers of the community-based care risk pool may

11  continue to contract with the department but must provide a

12  letter of credit equal to one-twelfth of the annual contract

13  amount in lieu of membership in the community-based care risk

14  pool.

15         2.  The department may separately require a bond to

16  mitigate the financial consequences of potential acts of

17  malfeasance, misfeasance, or criminal violations by the

18  provider.

19         (8)  Notwithstanding the provisions of s. 215.425, all

20  documented federal funds earned for the current fiscal year by

21  the department and community-based agencies which exceed the

22  amount appropriated by the Legislature shall be distributed to

23  all entities that contributed to the excess earnings based on

24  a schedule and methodology developed by the department and

25  approved by the Executive Office of the Governor. Distribution

26  shall be pro rata based on total earnings and shall be made

27  only to those entities that contributed to excess earnings.

28  Excess earnings of community-based agencies shall be used only

29  in the service district in which they were earned. Additional

30  state funds appropriated by the Legislature for

31  community-based agencies or made available pursuant to the


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1  budgetary amendment process described in s. 216.177 shall be

 2  transferred to the community-based agencies. The department

 3  shall amend a community-based agency's contract to permit

 4  expenditure of the funds.

 5         (9)  Each district and subdistrict that participates in

 6  the model program effort or any future outsourcing

 7  privatization effort as described in this section must

 8  thoroughly analyze and report the complete direct and indirect

 9  costs of delivering these services through the department and

10  the full cost of outsourcing privatization, including the cost

11  of monitoring and evaluating the contracted services.

12         (10)  The lead community-based providers and their

13  subcontractors shall be exempt from state travel policies as

14  set forth in s. 112.061(3)(a) for their travel expenses

15  incurred in order to comply with the requirements of this

16  section.

17         Section 4.  The Office of Program Policy Analysis and

18  Government Accountability shall conduct two reviews of the

19  contract-management and accountability structures of the

20  Department of Children and Family Services, including, but not

21  limited to, whether the department is adequately monitoring

22  and managing its outsourced or privatized functions and

23  services. The office shall report its findings and

24  recommendations to the President of the Senate, the Speaker of

25  the House of Representatives, and the Auditor General by

26  February 1 of 2006 and 2007, respectively.

27         Section 5.  Section 402.72, Florida Statutes, is

28  repealed.

29         Section 6.  The nonrecurring sum of $102,232 is

30  appropriated from the General Revenue Fund to the Department

31  of Children and Family Services for the 2005-2006 fiscal year,


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    CS for CS for CS for SB 1476             First Engrossed (ntc)



 1  to comply with the electronic-reporting requirements in

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