Title: Pay-for-success Contracts

Summary: Establishes pay-for-success contract program within DMS; authorizes DMS to negotiate & enter into pay-for-success contracts pursuant to which certain not-for-profit entities are paid for contractual services to address certain public problems if successfully achieved according to independent evaluation; directs EDR to provide certain assistance to DMS; exempts pay-for-success contracts from competitive procurement requirements; authorizes DMS to develop model contracts & adopt rules.

Full Text:
An act relating to pay-for-success contracts; creating s. 287.05715, F.S.; establishing the pay-for-success contract program within the Department of Management Services; authorizing the department to negotiate and enter into pay-for-success contracts pursuant to which certain not-for-profit entit ies are paid for contractual services to address certain public problems if successfully achieved according to an independent evaluation; providing contract requirements; directing the Office of Economic and Demographic Research to provide certain assistance to the department; exempting pay-for-success contracts from competitive procurement requirements; authorizing the department to develop model contracts and adopt rules; providing an effective date. Be It Enacted by the Legislature of the State of Florida: Section 1. Section 287.05715, Florida Statutes, is created to read: 287.05715 Pay-for-success contracts.-(1) There is established within the department the pay for-success contract program. Subject to legislative appropriation and express authorization in the General Appropriations Act, the department, in consultation with the HB 1049 2016 appropriate agency, may nego tiate and enter into a pay-for-success contract with a private, not-for-profit entity exempt from federal income taxation pursuant to s. 501(c)(3) of the Internal Revenue Code of 1986, as amended, pursuant to which: (a) The Legislature identifies a criti cal public problem with historically poor outcomes. (b) The private, not-for-profit entity underwrites or secures upfront capital from private funders, such as foundations, banks, or businesses, to underwrite a project to address the public problem. (c) The private, not-for-profit entity administers the project by subcontracting with one or more service providers to perform contractual services to address the public problem. (d) The department contracts with an independent, nationally recognized evalu ator to evaluate the project 's success. (e) The department, in consultation with the agency but through the independent evaluator, evaluates the project's success at addressing the public problem through achievement of performance outcome measures establ ished in the contract. (f) The department timely pays the private, not-for-profit entity pursuant to the contract based on the extent to which the project achieved the performance outcome measures according to the independent evaluation of the project's success. If any funds appropriated for the project are not authorized to be paid under the contract due to the project's failure to achieve HB 1049 2016 performance outcome measures, the remaining funds shall revert to the fund from which the appropriation was made. (2) In approving a pay-for-success contract, the department must require that: (a) The private, not-for-profit entity is prohibited from receiving or viewing a project participant's personal identifying information. (b) Project participants, or their parents or guardians, give written permission for the participant's personal identifying information to be shared with an independent evaluator for research and evaluation purposes and that the private, not-for-profit entity maintain documentation of such permission. (c) The private, not-for-profit entity submit an annual report to the department in the format and containing the data prescribed by the department. (3) A pay-for-success contract may be initiated in any one fiscal year and extend into the next fiscal year, and appropriations from either or both fiscal years may be expended pursuant to the contract. (4) The Office of Economic and Demographic Research, upon request by the department, shall provide assistance in the development of performance outcome measures for a pay-for-success contract and shall estimate the cost savings to the state of the implementation of a pay-for-success contract. (5) The procurement requirements of s. 287.057 do not HB 1049 2016 apply to funding for a pay-for-success contract. (6) The department may develop model pay-for-success contracts and adopt rules to administer this section. Section 2. This act shall take effect upon becoming a law.