Florida Senate - 2019                                    SB 1024
       By Senator Gruters
       23-01936-19                                           20191024__
    1                        A bill to be entitled                      
    2         An act relating to blockchain technology; providing
    3         legislative findings; establishing the Florida
    4         Blockchain Working Group in the Agency for State
    5         Technology; providing for membership and duties of the
    6         working group; requiring the working group to submit a
    7         report to the Governor and the Legislature and make
    8         presentations; requiring the agency to provide support
    9         staff and other assistance to the working group;
   10         providing for termination of the working group;
   11         providing an effective date.
   13         WHEREAS, blockchain has the ability to improve processes,
   14  increase efficiency, and promote transparency in government, in
   15  businesses, and for consumers, and it is imperative that
   16  blockchain benefits and applications are studied so that its
   17  potential can be fully realized, and
   18         WHEREAS, investments in blockchain companies and projects
   19  have skyrocketed from millions of dollars in 2015 to billions of
   20  dollars in 2018, with venture capital funds and other private
   21  investors investing $1.3 billion between January and May of 2018
   22  in blockchain and blockchain-adjacent early stage companies, and
   23         WHEREAS, increasing legislative activity has occurred at
   24  the state and federal levels examining and supporting the
   25  benefits of blockchain technology, and a working group is an
   26  important first step in coordinating information and technology
   27  among industry and legislators to develop real proposals that
   28  can be acted upon, and
   29         WHEREAS, a cornerstone of any blockchain initiative is the
   30  exploration and understanding of blockchain and distributed
   31  ledger technology, as these technologies are often complex and
   32  must be properly understood and tested before implementation,
   33  and a working group can determine applications of blockchain
   34  that could cut costs for taxpayers and provide a gateway for
   35  entrepreneurs to best understand the laws of their state and
   36  surrounding blockchain and virtual currencies, and
   37         WHEREAS, establishing a working group is the first step in
   38  unlocking the transformative possibilities of blockchain and its
   39  tremendous positive impact for economic advancement, NOW,
   42  Be It Enacted by the Legislature of the State of Florida:
   44         Section 1. (1)The Legislature finds that:
   45         (a)Blockchain technology and distributed ledger technology
   46  allow the secure recording of transactions through cryptographic
   47  algorithms and distributed record sharing, and such technology
   48  has reached a point where the opportunities for efficiency, cost
   49  savings, and cybersecurity deserve study.
   50         (b)Blockchain technology is a promising way to facilitate
   51  more efficient government service delivery models and economies
   52  of scale, including facilitating safe paperless transactions and
   53  recordkeeping that are nearly impervious to cyberattacks and
   54  data destruction.
   55         (c)Blockchain technology can reduce the prevalence of
   56  disparate government computer systems, databases, and custom
   57  built software interfaces; reduce costs associated with
   58  maintenance and implementation; streamline information sharing;
   59  and allow more areas of the state to electronically participate
   60  in government services.
   61         (d)Nations, other states, and municipalities across the
   62  world are studying and implementing government reforms that
   63  bolster trust and reduce bureaucracy through verifiable open
   64  source blockchain technology in a variety of areas, including,
   65  but not limited to, medical and health records, land records,
   66  banking, tax and fee payments, smart contracts, professional
   67  accrediting, and property auctions.
   68         (e)It is in the public interest to establish a Florida
   69  Blockchain Working Group comprised of government and industry
   70  representatives to study the ways in which state, county, and
   71  municipal governments can benefit from a transition to a
   72  blockchain-based system for recordkeeping, security, and service
   73  delivery and to develop and submit recommendations to the
   74  Governor and the Legislature concerning the potential for
   75  implementation of blockchain-based systems that promote
   76  government efficiencies, better services for citizens, economic
   77  development, and safer cyber-secure interaction between
   78  government and the public.
   79         (2)There is established in the Agency for State Technology
   80  the Florida Blockchain Working Group to explore and develop a
   81  master plan for fostering the expansion of the blockchain
   82  industry in the state, to recommend policies and state
   83  investments to help make this state a leader in blockchain
   84  technology, and to issue a report to the Legislature. The
   85  working group shall study if and how state, county, and
   86  municipal governments can benefit from a transition to a
   87  blockchain-based system for recordkeeping, data security,
   88  financial transactions, and service delivery and to identify
   89  ways to improve government interaction with businesses and the
   90  public. The working group shall comply with the requirements of
   91  s. 20.052, Florida Statutes, except as otherwise provided in
   92  this section.
   93         (a)The master plan shall:
   94         1.Identify the economic growth and development
   95  opportunities presented by blockchain technology.
   96         2.Assess the existing blockchain industry in the state.
   97         3.Identify innovative and successful blockchain
   98  applications currently used by industry and other governments to
   99  determine viability for state applications.
  100         4.Review workforce needs and academic programs required to
  101  build blockchain technology expertise across all relevant
  102  industries.
  103         5.Make recommendations to the Governor and the Legislature
  104  that will promote innovation and economic growth by reducing
  105  barriers to and expedite the expansion of the state’s blockchain
  106  industry.
  107         (b)The working group shall consist of 19 members. Members
  108  must demonstrate an interest in, familiarity with, or knowledge
  109  of blockchain technology. Membership shall be as follows:
  110         1.Two members appointed by the Governor.
  111         2.Two members appointed by the President of the Senate.
  112         3.Two members appointed by the Speaker of the House of
  113  Representatives.
  114         4.One member appointed by the Minority Leader of the
  115  Senate.
  116         5.One member appointed by the Minority Leader of the House
  117  of Representatives.
  118         6.One member appointed by the Chief Financial Officer.
  119         7.One member appointed by the Attorney General.
  120         8.The Secretary of the Department of Management Services
  121  or his or her designee.
  122         9.The executive director of the Agency for State
  123  Technology or his or her designee.
  124         10.One member of the Florida Technology Council, appointed
  125  by the Florida Technology Council.
  126         11.One member appointed by the Florida League of Cities.
  127         12.One member appointed by the Florida Association of
  128  Counties.
  129         13.One member appointed by the Florida Local Government
  130  Information Systems Association.
  131         14.One member appointed by the Florida City and County
  132  Management Association.
  133         15.One member of the Florida Chamber of Commerce,
  134  appointed by the Florida Chamber of Commerce.
  135         16.One member appointed by the Chancellor of the State
  136  University System.
  137         (c)At least 10 members of the working group must have
  138  knowledge and experience in blockchain technology.
  139         (d)Within 90 days after the effective date of this act, a
  140  majority of the members of the working group must be appointed
  141  and the working group shall hold its first meeting. The working
  142  group shall elect one of its members to serve as chair. Members
  143  of the working group shall serve for the duration of the
  144  existence of the working group. Any vacancy that occurs shall be
  145  filled in the same manner as the original appointment. Working
  146  group members shall serve without compensation but may be
  147  reimbursed for necessary expenses incurred in the performance of
  148  their duties and shall be allowed per diem and travel expenses
  149  as provided in s. 112.061, Florida Statutes.
  150         (e)The working group shall study blockchain technology,
  151  including, but not limited to, the following:
  152         1.Opportunities and risks associated with using blockchain
  153  and distributed ledger technology for state and local
  154  government.
  155         2.Different types of blockchains, both public and private,
  156  and different consensus algorithms.
  157         3.Projects and cases currently under development in other
  158  states and local governments, and how these cases could be
  159  applied in this state.
  160         4.Ways the Legislature can modify general law to support
  161  secure, paperless recordkeeping, increase cybersecurity, improve
  162  interactions with citizens, and encourage blockchain innovation
  163  for businesses in the state.
  164         5.Identifying potential economic incentives for companies
  165  investing in blockchain technologies in collaboration with the
  166  state.
  167         6.Recommending projects for potential blockchain
  168  solutions, including, but not limited to, use cases for state
  169  agencies that would improve services for citizens or businesses.
  170         7.Identifying the technical skills necessary to develop
  171  blockchain technology and ensuring that instruction in such
  172  skills is available at secondary and postsecondary educational
  173  institutions in this state.
  174         (3)The working group shall submit a report to the
  175  Governor, the President of the Senate, and the Speaker of the
  176  House of Representatives and present its findings to the
  177  appropriate legislative committees in each house of the
  178  Legislature within 180 days after the initial meeting of the
  179  working group. The report must include:
  180         (a)A general description of the costs and benefits of
  181  state and local government agencies using blockchain technology.
  182         (b)Recommendations concerning the feasibility of
  183  implementing blockchain technology in the state and the best
  184  approach to finance the cost of implementation.
  185         (c)Recommendations for specific implementations to be
  186  developed by relevant state agencies.
  187         (d)Any draft legislation the working group deems
  188  appropriate to implement such blockchain technologies.
  189         (e)Identification of one pilot project that may be
  190  implemented in the state.
  191         (f)Any other information deemed relevant by the working
  192  group.
  193         (4)The working group is entitled to the assistance and
  194  services of any state agency, board, bureau, or commission as
  195  necessary and available for the purposes of this act.
  196         (5)The Agency for State Technology shall provide support
  197  staff for the working group and any relevant studies, data, and
  198  materials in its possession to assist the working group in the
  199  performance of its duties.
  200         (6)The working group shall terminate upon submission of
  201  the report and the presentation of findings.
  202         Section 2. This act shall take effect upon becoming a law.