Its hard to find a "reputable" source on this since its not likely to make national news but it appears that if any people on the floats get an erection and there's a possibility a child could see it, the offender will be arrested and charged with a felony. It doesn't specify which felony but I would assume something akin to exposure to a minor.
Here's one link anyways:
http://www.towleroad.com/2013/09/activi ... pride.html
Honestly, I think this is going a bit too far. You have Mardi Gras events in several cities in the country and women are not arrested for flashing. But really this is akin to arresting women participating in a wet T contest and having hard nipples.
I could think of a lot of worse things for a child to see than erect penis, though, honestly, I'm not sure the Gay Pride Parade is a place for children anyways. I view it the same as I do Mardi Gras. If you don't want your kids to see nudity and lots of lewd behavior, you probably shouldn't take them there. If they are there, I assume the parents don't care and if thats the case (and they aren't behind physically harmed), then the PD shouldn't be worried about it either.
Unless we are going to start charging women with felonies for showing breasts in public where a child might see them...