Bill A10926-2009

Clarifies the definition of the term liabilities with respect to the period for which an appropriation remains in full force and effect

Clarifies the definition of the term liabilities with respect to the period for which an appropriation remains in full force and effect.

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  • May 3, 2010: referred to ways and means

Memo

BILL NUMBER:A10926

TITLE OF BILL: An act to amend the state finance law, in relation to clarifying the definition of the term liabilities with respect to the period for which an appropriation remains in full force and effect

PURPOSE: The purpose of this legislation is to authorize the continued payment for contracts that have already been entered into by the state.

SUMMARY OF PROVISIONS: This legislation amends paragraph (c) of subdivision 3 of section 40 of the state finance law by clarifying the definition of the term liability.

JUSTIFICATION: Section 40 of the State Finance Law outlines the timeframe for which appropriations included in the State budget remain in full force and effect and the date by which such appropriations shall lapse. Pursuant to subdivision 3 of such section, all appropriations made for any purpose currently cease to have force and effect - except for any liabilities already incurred at the close of the fiscal year. In the case of existing liabilities incurred pursuant to a capital projects appropriation, paragraph (c) of subdivision 3 provides that the final lapse date for such appropriations is the 15th of September following the close of the fiscal year. Thus, liabilities for capital projects made pursuant to existing budget appropriations may continue to be paid out until September of the following fiscal year. However, current law provides no clear definition of the term "liabilities" as utilized in subdivision 3 of Section 40 of the State Finance Law. As a result of this ambiguity, it is unclear exactly what types of obligations may be construed as a liability against an existing capital projects budget appropriation. The provisions of this bill would clarify that liabilities shall include payments for work performed or materials furnished both during the fiscal year and in the timeframe prior to the official lapse of the capital projects appropriations under which such liabilities are made.

Since April 1, 2010 contractors working on projects throughout the state of New York have not been getting paid for their work. These contractors are working with signed agreements between themselves and the state of New York with the understanding that they would be paid for the work they are doing. The purpose of this legislation is to ensure that those payments that have already been agreed to - and planned for - continue regardless of a late budget. Those workers who are out on our roads and bridges working to make them safer deserve to be paid for the work they are doing. Without moving these projects forward, New York's unemployment rate will approach double digits, and its transportation infrastructure will continue to lie in disrepair. For example, funding for Federal Stimulus projects has helped slow construction job losses from 33,400 in February to 25,400 in March - not authorizing payments to our contractors threatens to reverse these numbers as contractors cannot

continue to work 'at risk' and may begin to lay-off workers. The prime duty of government is to protect the people's interests - by withholding payments to workers who are keeping our roads and bridges safe for travel we are not accomplishing that goal. It is imperative that this legislation be adopted in order to ensure that payment for critical infrastructure work will continue this year and in future years - even if a budget is not adopted by the April 1st deadline.

LEGISLATIVE HISTORY: New Bill.

FISCAL IMPLICATIONS: The provisions of this bill would result in no additional costs to the State.

EFFECTIVE DATE: Immediate and shall be deemed to have been in full force and effect on and after March 31, 2010.


Text

STATE OF NEW YORK ________________________________________________________________________ 10926 IN ASSEMBLY May 3, 2010 ___________
Introduced by M. of A. V. LOPEZ -- read once and referred to the Commit- tee on Ways and Means AN ACT to amend the state finance law, in relation to clarifying the definition of the term liabilities with respect to the period for which an appropriation remains in full force and effect THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. Subdivision 3 of section 40 of the state finance law, as amended by chapter 169 of the laws of 1994, is amended to read as follows: 3. Every appropriation for whatever purpose which at the close of the fiscal year shall cease to have force and effect except as to liabil- ities already incurred thereunder shall as to such liabilities continue in force and effect until the dates specified in paragraphs (a), (b), (c) and (d) of this subdivision, on which dates such appropriation shall lapse and no money shall thereafter be paid out of the state treasury or any of its funds or any of the funds under its management pursuant to such appropriation. (a) Except for appropriations made to THE city university of New York and the state university of New York, all state operations appropri- ations including special revenue funds-federal appropriations continued pursuant to paragraph (d) of subdivision two of this section shall lapse on the thirtieth day of June immediately following the close of the fiscal year. The appropriations made to the city university of New York or the state university of New York shall lapse on the thirtieth day of September immediately following the close of the fiscal year. (b) All aid to localities appropriations including special revenue funds-federal appropriations continued pursuant to paragraph (d) of subdivision two of this section shall lapse on the fifteenth day of September immediately following the close of the fiscal year. (c) All capital projects appropriations shall lapse on the fifteenth day of September immediately following the close of the fiscal year; PROVIDED THAT FOR SUCH APPROPRIATIONS, LIABILITIES INCURRED PURSUANT TO SUCH APPROPRIATIONS SHALL BE DEEMED TO INCLUDE PAYMENTS FOR WORK
PERFORMED AND/OR MATERIALS FURNISHED, DURING THE FISCAL YEAR AND IN THE PERIOD FROM THE CLOSE OF SUCH FISCAL YEAR UNTIL THE FIFTEENTH DAY OF SEPTEMBER IMMEDIATELY FOLLOWING THE CLOSE OF THE FISCAL YEAR, PURSUANT TO CONTRACTS MADE AND AWARDED BY THE STATE. (d) All other appropriations shall lapse on the fifteenth day of September immediately following the close of the fiscal year. S 2. This act shall take effect immediately and shall be deemed to have been in full force and effect on and after March 31, 2010.

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