'A chilling effect': Some fear new finance law may scare away candidates from local elections

State lawmakers intended a new financial disclosure law to make local government more transparent. Observers say it’s having a decidedly different effect: making elected officials across Florida choose to resign from office.

What’s more, Form 6 will have a chilling effect on whether people choose to run for office, especially lawyers, accountants, financial advisors and others whose professions involve keeping client information private, they say.

The law, which takes effect on Jan. 1, has led 27 elected officials in Palm Beach County to step down ahead of its requirements. A majority of two local government councils — in the Village of North Palm Beach and the Town of Lake Clarke Shores — resigned ahead of it.

Communities across Florida have seen the same pattern. Most resignations have come in smaller municipalities, since county and state government offices already require significant amounts of financial disclosure.

Elected officials in Naples, Dunnellon, Windermere, Longboat Key and other Florida municipalities have resigned over the new requirement, according to media reports.

“It was devastating for us. Form 6 will destroy local government,” said Valentin Rodriguez, an attorney who resigned from the Lake Clarke Shores council on Dec. 12, after 18 years of service.

“It’s hard to believe that you do public service and then you’re expected to reveal this stuff and maybe lose clients because the client doesn't want you to reveal who they are.”

Peter Cruise, a commissioner for the Palm Beach County Commission on Ethics and an ethics professor at Florida Atlantic University in Boca Raton, hopes that the state legislature will consider revising the form starting Tuesday, Jan. 9, when their next session begins.

He said the Florida Legislature is steadily receiving complaints. Observers expect people in and out of government to lobby lawmakers this session for the form’s revision.

The Florida Commission on Ethics will meet on Jan. 26 for “rule making” for Form 6 with respect to the reporting required by attorneys and The Florida Bar’s standards, a commission spokesperson said.

What Form 6 requires, and why some officials think it goes too far

Form 6 requires local elected officials to report exact numbers of their net worth, 401(k) plans and personal assets and liabilities over $1,000.

The Florida Legislature passed Senate Bill 774 “Ethics Requirements for Public Officials” by wide margins during the 2023 legislative session. Gov. Ron DeSantis signed it into law on May 11, despite the opposition of the Florida League of Cities which cited three reasons it shouldn’t have become law:

• It does not consider either the annual budget size or spending authority of the differing municipalities.

• It would deter otherwise qualified individuals from seeking municipal office.

• It changes disclosure rules in the middle of elected officials’ terms.

Once a council member submits their completed Form 6, it becomes a public record and will be posted on the Florida Commission on Ethics website. Those who don’t file face fines starting at $25 per day, and the process could end with them being removed from office.

Those who currently hold office now have a deadline to submit Form 6 by July 1 — with a grace period of no penalties until Sept. 1 — and those running for office must submit Form 6 during their municipality’s qualifying period.

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Officials are not required to file Form 6 if they resign from their roles by Sunday, Dec. 31. Many are faced with making a decision that they never expected to make: keep their seat in public office and potentially jeopardize their day job, or resign as a council member altogether.

Before the Form 6 law passed, local officials had to disclose a limited amount of financial information in a document called “Form 1.” It did not require them to list either their net worth or exact values of their personal property. However, it did require that officials identify any properties they own valued at over $10,000.

Both Form 1 and Form 6 have a “secondary income” section where officials must include names of clients that make up more than 10% of their business’ income if the official owns more than 5% of that business.

Form 6 casts a wider net for this. It requires an official to list the client’s name if they received over $1,000 from the business entity that the client is with. Form 1’s threshold is $5,000.

“Some of the (disclosures) are just really too much for municipal bodies,” said Chuck Huff, the village manager in North Palm Beach.

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Ethics law's sponsor: It brings transparency and won't deter candidates

State Sen. Jason Brodeur, a Republican from Central Florida, was the chief sponsor in his chamber of the bill, which the state Senate Ethics and Elections Committee proposed to lawmakers.

In a statement to The Palm Beach Post this week, he said the Form 6 requirement lines up city and town officials with “everyone else” in public office and it seeks to increase the transparency of local officials who have the authority to potentially spend millions of taxpayer dollars.

“I’m not so much concerned about their pay as I am about their spending authority. It takes 82 votes in the Legislature to spend taxpayer dollars. (A simple majority in both the Senate (21) and in the House (61) ). In a city, you can spend tens of millions of dollars with as little as three votes. Taxpayers deserve transparency. If a simple disclosure that hundreds of other elected officials already do makes someone quit, then voters should be glad."

Brodeur took issue with the idea that Form 6 would deter people from running for local office.

He said during its testimony last session, the ethics commission said more people filed to run for public office in 2022 than ever before. Form 6 met with similar arguments when county commissioners, school boards and constitutional officers became required to complete it, “and we’ve had no shortage of candidates for any of those positions,” his statement said.

Kerrie Stillman, executive director of the state Ethics Commission, said the agency has recommended state lawmakers to require Form 6 for local officials for the past eight years or so.

“I think years ago, (other elected officials) were surprised to find out that city commissioners and mayors didn’t file the same form as county commissioners and other similarly-situated elected officials,” Stillman said. “They felt like that level of transparency was important to the citizens that they serve, given the types of decisions that they make.”

The commission spoke to city council members and mayors about the law change at the League of Cities conference in mid-August, Stillman said.

Cruise said that the higher disclosure expectation intends to eliminate a common issue among local governments: prior relationships that create conflict of interest issues.

“There should be a happy medium where officials disclose enough information but it is not over-the-top intrusive,” Cruise said. “Form 6 appears to be very intrusive. It really increased the disclosure demands to an unusual level. I think (the resignations) are probably unintended consequences. I think the drafters didn't think it through.”

Cruise said that people considering running for local office don’t need any more disincentives.

“It takes a lot of courage to run for office these days because of everything that can be thrown at you,” Cruise said. “We don't need to scare more people away. I'm afraid this is scaring good people out of government and will keep other people from even thinking about running for office.”

Lawyers, financial managers see problems with disclosing client relationships

Yet that is what has happened in Palm Beach County, with those submitting their resignations citing a variety of reasons.

Lake Park Town Council member John Linden said he felt the form would make him more subject to security issues like identity theft because of how public his information would become. He left office on Wednesday, Dec. 20.

Darryl Aubrey stepped down in November after 17 years on the North Palm Beach Village Council. Mark Mullinix, a business owner, served eight years on the five-member North Palm Beach Village Council before he followed Aubrey on Dec. 14, citing Form 6. He said would have to disclose the size of his daughter’s college fund, which he said he “couldn’t fathom” doing.

Rodriguez resigned alongside two other attorneys on the Lake Clarke Shores Council, Robert Shalhoub and Robert Gonzalez on Dec. 12. He said he fears that the Form 6 requirement could be catastrophic for local government by deterring experienced professionals from running.

The Florida Bar holds that a lawyer may not disclose confidential information unless the client consents to it. Rodriguez said he was told either to ask his clients to waive their attorney-client privilege or refer the client to another attorney.

“I think there's going to be a backlash like no other and the legislature is going to be forced to rethink it,” Rodriguez said. “I think we're going to see the quality of local government elected officials decrease because of inexperience and losing people who are otherwise dedicated.”

David Norris, who is a partner at a law firm with offices in North Palm Beach and Boca Raton, broke into tears as he resigned at the same meeting as Mullinix after a total of 27 years on the council.

“I think the new rule is ridiculous and wrong,” said Norris, who most recently was North Palm Beach’s mayor. “It’s something I can’t do. That is forcing me to do something that I don’t want to do, so I am announcing my resignation.”

Peter Sweeney, the incoming chair of the City, County and Local Government Law Section of The Florida Bar, said he thinks the law’s authors did not intend to cause the rush of resignations among attorneys.

Sweeney, an attorney based in Vero Beach, expects to see more resignations in the days before December ends.

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The two surviving North Palm Beach council members were able to turn to a longtime Palm Beach County political figure to give the board a quorum through the March 19 election.

Susan Bickel and Deborah Searcy on Dec. 14, named Karen Marcus, a North Palm Beach resident since age 5, to fill one of the vacant seats. She was a Palm Beach County commissioner from 1984 to 2012.

Marcus had to fill out Form 6 when she was a commissioner, so she is no stranger to the detailed disclosure. She was surprised, however, when she saw the new state law that required members of smaller governments to reveal just as much personal financial information as those who represent larger areas.

“I think (Form 6) is going to have a really harmful effect on the quality of candidates,” Marcus said. “Some really good candidates business-wise and otherwise just won’t do it. In this day and age with all of the social media, it can have a chilling effect.”

The current council members appointed Judy Pierman, the first woman mayor for the village who served from 1989 to 1992, to fill another vacant seat during a special meeting on Thursday, Dec. 21. The fifth seat, however, may well sit vacant until the March election.

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Huff said no other people have stepped forward to fill it and he does not expect anyone else to do so. There was another former council member he hoped would volunteer, but the person decided against it over issues with Form 6.

Maya Washburn covers northern Palm Beach County for The Palm Beach Post, part of the USA TODAY Florida-Network. Reach her at mwashburn@pbpost.com. Support local journalism: Subscribe today

This article originally appeared on Palm Beach Post: Form 6 may scare candidates away from local elections, critics fear