On Wednesday, February 24, 2016, Florida’s Governor Rick Scott signed two bills which exempt trade secret financial information from the state’s Sunshine Laws. The change is significant in a state known for expansive open records and meetings laws, and should provide comfort to private sector participants pursuing P3 projects and otherwise doing business in Florida. Both acts take effect on October 1, 2016.
SBs 180 and 182
SB 180 amends Section 812.081 of the Florida Statutes by expanding the definition of trade secret to include “financial information.” Financial information is not defined, and has led some to criticize the bill as overly broad.
Among other things, SB 182 exempts financial information comprising a trade secret, as defined under Section 812.081 of the Florida Statutes, from public records inspection and copying laws. It also exempts any portion of a meeting in which a trade secret is discussed from the public meetings and records laws.
In SB 182, the Legislature recognizes that businesses are often required to provide financial information to public entities, and finds that “the need to protect trade secret financial information is sufficiently compelling to override [the State’s] public policy of open government and that the protection of such information cannot be accomplished without these exemptions.”
What Financial Information is Protected?
While SB 180 does not define financial information, it appears that the intent of the Legislature is to protect trade secret information in a broad sense. SB 182 expressly provides that the Legislature’s intent is to protect “trade secret information of a confidential nature which includes, but is not limited to, a formula, a pattern, a device a combination of devices, or a compilation of information used to protect or further a business advantage over those who do not know or use the information, the disclosure of which would injure the affected business in the marketplace.”
Impact on P3 Procurements
These amendments are directly relevant to proposers in the context of P3 procurements. Proposers are typically required to submit detailed financial information to the procuring agency regarding their team members as part of the qualifications phase, as well as detailed financial proposals as part of the proposals phase. Based on the scope of trade secret information described above, it appears likely that financial models submitted with proposals on P3 procurements will be exempt from disclosure. To date, there have been serious concerns over whether the financial models are protected from disclosure, so SB 182 should provide much needed clarity.
If proposers are confident that financial information can be submitted confidentially and be exempt from public disclosure, it may attract qualified players to the Florida market who may otherwise have been wary of participating due to the breadth of Florida’s Sunshine Laws. The extent of the impact of these changes will depend in part on how broadly the meaning of financial information is interpreted going forward.
The exemption of trade secret financial information from open records and meetings laws is a significant development in a state known for prioritizing open government, and will likely increase the private sector’s enthusiasm for pursuing opportunities in Florida.