Financial Disclosure Law Blocked

By Jim Saunders, The News Service of Florida

TALLAHASSEE — A federal judge has blocked a 2023 Florida law that required municipal elected officials to disclose detailed information about their personal finances, ruling that the law likely violated First Amendment rights.

U.S. District Judge Melissa Damian on Monday issued a preliminary injunction, siding with municipal officials throughout the state who challenged the law. The decision came three weeks before a July 1 deadline for filing the information.

Damian, who is based in Fort Lauderdale, wrote that the Legislature did not adequately justify a need for the law after decades of the state requiring less-detailed financial disclosures by municipal officials. She wrote that a law “compelling speech, as with a statute forbidding speech, falls within the purview of the First Amendment.”

“After a thorough and careful consideration of the record, this court concludes that defendants have failed to establish that the state seriously undertook the consideration of less intrusive means to address the identified interests,” Damian wrote.

The law (SB 774) required mayors and other elected municipal officials, such as members of city councils, to file annual reports detailing issues such as their net worths, incomes and assets. Other elected officials, such as the governor and state legislators, have long faced such requirements.

The requirements caused an uproar among local governments, with more than 125 municipal elected officials resigning in the months after Gov. Ron DeSantis signed the measure in May 2023, according to Damian’s ruling. The law took effect Jan. 1, though the deadline for filing financial-disclosure reports is July 1.

Jamie A. Cole, the lead attorney for the plaintiffs and a partner at the firm Weiss Serota Helfman Cole + Bierman, issued a statement Tuesday praising the preliminary injunction.

“Most municipal elected officials receive little to no compensation for their public service, yet they are being asked to disclose their precise net worth, income and assets,” Cole said in the statement. “This legislative overreach has already resulted in the mass resignation of about 125 municipal elected officials and, if allowed, would discourage many others from serving their communities.”

In the past, municipal officials were required to file what is known as a “Form 1,” which provided less-detailed financial information. The law required them to file a more-detailed “Form 6,” the type of disclosure filed by state elected officials.

Supporters of the law said, in part, that disclosure of detailed information can help show officials’ potential conflicts of interest while conducting government business. The Legislature this year rejected a proposal that would have pushed back the effective date of the requirement for municipal officials to 2025 and exempted officials in communities with 500 people or fewer.

Rep. Spencer Roach, a North Fort Myers Beach Republican who led the effort to prevent changes in the law, said during a March debate that it is an “issue for me of transparency.”

In February, local officials filed the federal lawsuit and a separate challenge to the law in Leon County circuit court. The Leon County case is pending.

Damian’s decision Monday delved into legislative staff analyses and debates before the law passed. She wrote that both sides “agree that SB 774’s goals of deterring corruption, increasing transparency and public trust in government, and avoiding conflicts of interest all constitute compelling state interests.”

But Damian, who was nominated to the federal bench by President Joe Biden, said the state did not show a need for the change.

“Defendants have not demonstrated the need for SB 774’s heightened disclosure requirements for municipal elected officials and candidates by showing, for example, that the disclosure requirements previously in place (Form 1) were not adequate,” she wrote. “This conclusion is borne out by the absence of any evidence, data, or studies in the legislative record indicating that Form 1’s disclosure requirements were inadequate to address the compelling interests at stake here (deterring corruption and conflicts of interest, bolstering public confidence in state government, and educating the public).”