Bill S5865-2013

Establishes the financial restructuring board for local governments and relates to public arbitration panels determinations of whether public employers are fiscally eligible

Establishes the financial restructuring board for local governments; relates to public arbitration panels for deciding whether public employers are fiscally eligible.

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  • Jun 21, 2013: SUBSTITUTED BY A8086
  • Jun 20, 2013: ORDERED TO THIRD READING CAL.1568
  • Jun 18, 2013: REFERRED TO RULES

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Memo

BILL NUMBER:S5865

TITLE OF BILL: An act to amend the state finance law, the local finance law and the civil service law, in relation to the financial restructuring board for local governments; and to amend the civil service law, in relation to public arbitration panels determinations of whether public employers are fiscally eligible

Purpose:

This bill would establish a permanent Financial Restructuring Board for Local Governments that would provide a meaningful, substantive avenue for fiscally eligible municipalities to reform and restructure and provide public services in a cost-effective manner. It would also extend current provisions of the binding interest arbitration law and reform that arbitration process by setting forth new parameters for arbitration awards.

Summary of Provisions:

Section 1 of the bill would amend the State Finance Law to empower the newly created Financial Restructuring Board for Local Governments ("the Board") to award currently authorized Local Government Performance and Efficiency grants, in its discretion, for financial restructuring and related purposes.

Section 2 of the bill would amend the Local Finance Law to create a permanent Financial Restructuring Board for Local Governments composed of ten members: the Director of the Budget (who would serve as chair), the State Comptroller, the Attorney General and the Secretary of State (each of whom could designate an individual to serve on their behalf) and six members appointed by the Governor, one of whom upon recommendation of the Speaker of the Assembly, one of whom upon the recommendation of the Temporary President of the Senate, one with experience in municipal financial and restructuring matters and three other members.

The Board, at the request of a "fiscally eligible municipality" (eligibility to be determined by the Board and not including New York City), would be empowered to seek information and make necessary queries in order to comprehensively review government operations, finances, management practices, a municipality's economic base and any other factors it deemed relevant to-make findings and recommendations on reforming and restructuring the operations of such municipality. It would have the discretion to, among other things, award grants, and prescribe loans (as provided in section one of the bill), the terms of which it would formulate, as well as make other recommendations. The Board's recommendations would not bind a municipality, but if the municipality agrees to the Board's

proposals, it would be contractually bound to fulfill those terms. The Board would be mandated to complete its work and issue recommendations within six months of receiving a request to convene.

Section 3 of the bill would amend Civil Service L. § 209 to provide an alternative "for fiscally eligible municipalities" to the current binding arbitration law. The municipality, with the consent of an impacted union (subject to Civil Service L. § 209, subd. 4), would have the opportunity to present an impasse in collective bargaining for a final determination to the Board. In such case, the Board would operate in the same manner as an arbitration panel under subdivisions 4 and 6 of Civil Service L. § 209 and issue a binding ruling which would have to be rendered within six months of convening.

Section 4 of the bill would extend the current statute for binding interest arbitration in Civil Service L. § 209 from July 1, 2013 to July 1, 2016.

Section 5 of the bill would establish criteria by which a local government (a county, city, town, or village) subject to the "Property Tax Cap" in General Municipal L. § 3-c could be deemed a fiscally eligible municipality for which it's "ability to pay" would be the lead factor in an arbitrator's award under Civil Service L. 209. For any such local government entering binding interest arbitration, the arbitration panel must first and foremost, give 70% of its weight and consideration to the local government's "ability to pay". All other factors and consideration would receive the remaining 30% weight. In addition, for these local governments, arbitrators would have to factor in the constraints and limitations imposed by the "Property Tax Cap".

For purposes of this bill, a local government would be deemed a fiscally eligible municipality for arbitration purposes if one of the following two fiscal tests are met: (1) if the local government's average full value property tax rate is above the 75th percentile for all municipalities statewide, as averaged over the most recent five fiscal years, or, (2) if the local government's five year average general fund balance equals less than five percent of its budget, and the government has received certification from the State comptroller verifying total fund balance availability. If a local government failed to report any of the data necessary to compute these two tests, it would not be considered fiscally eligible and could not avail itself of the associated provisions.

Section 5 of the bill is a severability clause.

Section 6 of the bill provides the effective date.

Existing Law:

There is no permanent body empowered by law to inquire into and make recommendations called for in this legislation with respect to

municipalities. In addition, Civil Service Law § 209, subd. 4 provides the only avenue for resolving impasses between municipalities and certain uniformed employee organizations.

Justification:

Municipalities, when faced with a fiscal crisis, often have nowhere to turn except for the extraordinary remedies of bankruptcy or the appointment of a financial control board - or do nothing. There is no standing body under State or federal law to which they can turn for help. This proposal fills that void. Provided that such municipalities are prepared to make the often hard choices required to maintain solvency and fiscal viability while still providing the services to which their residents are entitled, the newly constituted Financial Restructuring Board for Local Governments would provide those municipalities with a resource so that their restructuring efforts can be coordinated and effective. The Board would be available all year and not tied to a legislative session. Moreover, it would have to make recommendations within six months of being asked, a significantly shorter time than proceeding in court. As a public body, it would be subject to New York's Open Meetings Law and Freedom of Information Law.

One incentive already available for participating municipalities is the Local Government Performance Efficiency Program which would be amended to allow financial assistance as approved by the Board. Under this program, up to $80 million would be available this year. The primary purpose for such assistance would be to help fund the restructuring initiatives and recommendations provided by the Board. The Board would have discretion to determine what other form of assistance to provide (grant, loan, or combination). Specific loan terms and conditions would be determined by the Board - including allowable uses for loan proceeds.

In instances when public employers and their represented police and fire employees are at an impasse in their contractual negotiations, current law provides the terms by which an interest arbitration panel can make awards and settle the dispute. While current law requires an arbitrator to consider a local government's "ability to pay", this concept is neither defined nor emphasized. These amendments to New York State's Taylor Law would remedy that shortcoming by letting eligible municipalities have their ability to pay given a specific, leading weight in determining an arbitration award.

Finally, a fiscally eligible municipality and its labor unions subject to the Taylor Law's provisions authorizing interest arbitration can jointly ask the Board to act as the arbitration panel to decide contract disputes at any point that the parties agree that they are at impasse. The Board, when so acting as an arbitration panel, must render its decision within six months of being so requested, a substantially shorter time period than the length of most interest arbitrations.

Legislative History:

This is a new bill. Civil Service L. § 209, subd. 4 was last extended in 2009.

Budget Implications:

There will be minimal fiscal impacts associated with this bill. Costs associated with the operation of the Financial Restructuring Board for Local Governments would be borne by existing appropriations, and funding for any new financial assistance to localities would come from appropriations contained in the enacted 2013-14 State Budget.

Effective Date:

The bill would take effect immediately, but sections one, two and three would take effect on the ninetieth day after it the bill would become a law and sections four and five would be deemed to have been in full force and effect on and after April 1, 2013; and sections three, four and five would apply to all agreements and interest arbitration determinations that expire before, on or after April 1, 2013 except those (a) where the public employment relations board received a petition to refer the dispute to a public arbitration panel pursuant to subdivision 4 of Civil Service L. § 209 before June 14, 2013 or (b) where the public employment relations board received a declaration of impasse pursuant to subdivision 4 of Civil Service L. § 209 on or after April 1, 2013 but on or before June 14, 2013.


Text

STATE OF NEW YORK ________________________________________________________________________ S. 5865 A. 8086 2013-2014 Regular Sessions S E N A T E - A S S E M B L Y June 18, 2013 ___________
IN SENATE -- Introduced by Sens. MARTINS, VALESKY -- (at request of the Governor) -- read twice and ordered printed, and when printed to be committed to the Committee on Rules IN ASSEMBLY -- Introduced by M. of A. FARRELL -- (at request of the Governor) -- read once and referred to the Committee on Ways and Means AN ACT to amend the state finance law, the local finance law and the civil service law, in relation to the financial restructuring board for local governments; and to amend the civil service law, in relation to public arbitration panels determinations of whether public employ- ers are fiscally eligible THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. Paragraph t of subdivision 10 of section 54 of the state finance law, as added by section 3 of part K of chapter 57 of the laws of 2011 and as relettered by section 3 of part K of chapter 55 of the laws of 2013, and subparagraph (vii) as added and subparagraph (viii) as renumbered by section 3-a of part K of chapter 55 of the laws of 2013, is amended to read as follows: t. Local government performance and efficiency program. (i) (1) Defi- nitions. For the purposes of this [paragraph] SUBPARAGRAPH, "munici- pality" shall mean a county, city, town, or village, but shall not include the individual counties contained in the city of New York. [(ii)] (2) Purpose. [There is hereby established a local government performance and efficiency program.] The purpose of [this program] AWARDS MADE PURSUANT TO THIS SUBPARAGRAPH is to recognize municipalities that have undertaken significant and innovative actions to improve the overall efficiency of governmental operations and produce quantifiable recurring financial savings that reduce the municipal tax burden on residents.
[(iii)] (3) Eligibility. All municipalities in New York state are eligible to apply individually or jointly, provided however that if an action was undertaken jointly, municipalities must apply jointly for such an action. The actions for which they apply must already have been implemented. [(iv)] (4) Use of awards. Awards received [pursuant to the program] shall be used by municipalities for general municipal purposes. [(v)] (5) Application. The secretary of state shall develop an appli- cation for municipalities seeking to receive awards and a process by which the applications will be evaluated. Such application shall require municipalities to demonstrate how the action for which they have applied has resulted in quantifiable recurring savings, efficiencies, and perma- nent improvements to municipal services. The secretary of state may focus the [program] AWARDS in specific functional service areas, in which case such areas of focus shall be detailed in a request for appli- cations. No application shall be considered for actions that commenced prior to January first, two thousand ten. [(vi)] (6) Awards. The secretary of state may make awards to appli- cants based on factors including, but not limited to, the amount of current and future savings, the impact of such action upon the municipal property tax levy, the size and complexity of the action, and the abili- ty for the action to be replicated by other municipalities. Awards shall only be made to municipalities for actions that have been fully imple- mented, that clearly resulted in quantifiable savings and efficiencies, and that produced permanent and quantifiable improvements to municipal efficiency or services. The maximum amount awarded per application shall not exceed the lesser of five million dollars or twenty-five dollars per resident of the applying municipalities as of the most recent federal decennial census, provided, however, that if the boundaries of munici- palities jointly applying for such funding overlap, the residents in overlapping areas shall only be counted once, and provided, further, that if a county jointly applies with some but not all of the other municipalities therein, only the residents in such other municipalities shall be counted. [(vii)] (7) Written notice shall be provided to an applicant of a decision regarding the grant or denial of an award under this paragraph, within thirty days after such decision. [(viii)] (8) Regulation. The secretary of state shall, prior to the establishment of applications, promulgate rules and regulations on the [program] AWARDS, including but not limited to award eligibility crite- ria and application, review and approval procedures. (II)(1) DEFINITIONS. FOR THE PURPOSES OF THIS SUBPARAGRAPH, "FISCALLY ELIGIBLE MUNICIPALITY" SHALL HAVE THE SAME MEANING AS "FISCALLY ELIGIBLE MUNICIPALITY" AS DEFINED BY SECTION 160.05 OF THE LOCAL FINANCE LAW. FOR THE PURPOSES OF THIS SUBPARAGRAPH, "FINANCIAL RESTRUCTURING BOARD FOR LOCAL GOVERNMENTS" OR "BOARD" SHALL MEAN THE FINANCIAL RESTRUCTURING BOARD FOR LOCAL GOVERNMENTS AS AUTHORIZED BY SECTION 160.05 OF THE LOCAL FINANCE LAW. (2) IN ADDITION TO AWARDS MADE PURSUANT TO SUBPARAGRAPH (I) OF THIS PARAGRAPH, THE BOARD MAY AWARD FUNDING TO FISCALLY ELIGIBLE MUNICI- PALITIES FOR FINANCIAL RESTRUCTURING AND RELATED PURPOSES, AS DETERMINED BY THE BOARD. THIS FUNDING MAY BE STRUCTURED AS A LOAN, A GRANT, OR COMBINATION THEREOF. THE AMOUNT OF SUCH FUNDING TO BE PROVIDED TO A FISCALLY ELIGIBLE MUNICIPALITY, THE STRUCTURE OF SUCH FUNDING, ANY CONDITIONS TO BE PLACED ON A FISCALLY ELIGIBLE MUNICIPALITY THAT ACCEPTS SUCH FUNDING, AND ANY OTHER ASPECTS OF FUNDING AWARDED PURSUANT TO THIS
SUBPARAGRAPH SHALL BE DETERMINED BY AN AFFIRMATIVE VOTE OF A MAJORITY OF THE TOTAL NUMBER OF MEMBERS OF THE BOARD AND MAY DIFFER FOR EACH AWARD OF FUNDING. SUCH LOANS SHALL NOT BE BOUND BY THE LOCAL FINANCE LAW WITH RESPECT TO TERMS AND REPAYMENT LIMITATIONS BUT IN NO EVENT MAY THE SUM OF ALL AWARDS PURSUANT TO THIS SUBPARAGRAPH BE GREATER THAN FIVE MILLION DOLLARS FOR ANY SINGLE MUNICIPALITY NOR MAY ANY LOAN BE FOR A TERM LONG- ER THAN TEN YEARS. FURTHER, ANY SUCH LOANS SHALL NOT BE CONSIDERED DEBT FOR PURPOSES OF CALCULATING CONSTITUTIONAL LIMIT PROVISIONS. NOTWITH- STANDING ANY OTHER LAW TO THE CONTRARY, THE DIRECTOR OF THE BUDGET MAY DIRECT THE STATE COMPTROLLER TO WITHHOLD ANY STATE AID PAYMENTS DUE TO A FISCALLY ELIGIBLE MUNICIPALITY IN ORDER TO SATISFY THE REPAYMENT CONDI- TIONS OF THE FUNDING AWARDED PURSUANT TO THIS SUBPARAGRAPH. S 2. The local finance law is amended by adding a new section 160.05 to read as follows: S 160.05. FINANCIAL RESTRUCTURING BOARD FOR LOCAL GOVERNMENTS. 1. THERE SHALL BE A FINANCIAL RESTRUCTURING BOARD FOR LOCAL GOVERNMENTS WHICH SHALL CONSIST OF TEN MEMBERS: THE DIRECTOR OF THE BUDGET WHO SHALL BE CHAIR OF THE BOARD, THE ATTORNEY GENERAL, THE STATE COMPTROLLER, AND THE SECRETARY OF STATE, EACH OF WHOM MAY DESIGNATE A REPRESENTATIVE TO ATTEND SESSIONS OF THE BOARD ON HIS OR HER BEHALF, AND SIX MEMBERS APPOINTED BY THE GOVERNOR, ONE OF WHOM UPON THE RECOMMENDATION OF THE TEMPORARY PRESIDENT OF THE SENATE, ONE OF WHOM UPON THE RECOMMENDATION OF THE SPEAKER OF THE ASSEMBLY, AND FOUR OTHER MEMBERS APPOINTED BY THE GOVERNOR, ONE OF WHOM SHALL HAVE SIGNIFICANT EXPERIENCE IN MUNICIPAL FINANCIAL AND RESTRUCTURING MATTERS. IN MAKING SUCH APPOINTMENTS, THE GOVERNOR SHALL CONSIDER REGIONAL DIVERSITY. APPOINTEES SHALL SERVE AT THE PLEASURE OF HIS OR HER APPOINTING AUTHORITY. THE APPOINTEE OF THE GOVERNOR WHO HAS BEEN DESIGNATED AS HAVING SIGNIFICANT EXPERIENCE IN MUNICIPAL FINANCIAL AND RESTRUCTURING MATTERS SHALL RECEIVE FAIR COMPEN- SATION FOR HIS OR HER SERVICES PERFORMED PURSUANT TO THIS SECTION IN AN AMOUNT TO BE DETERMINED BY THE DIRECTOR OF THE BUDGET AND ALL MEMBERS SHALL BE REIMBURSED FOR ALL REASONABLE EXPENSES ACTUALLY AND NECESSARILY INCURRED BY HIM OR HER IN THE PERFORMANCE OF HIS OR HER DUTIES. THE BOARD SHALL HAVE THE POWER TO ACT BY AN AFFIRMATIVE VOTE OF A MAJORITY OF THE TOTAL NUMBER OF MEMBERS AND SHALL RENDER ITS FINDINGS AND RECOM- MENDATIONS WITHIN SIX MONTHS OF BEING REQUESTED TO ACT BY A FISCALLY ELIGIBLE MUNICIPALITY. THE PROVISIONS OF SECTION SEVENTEEN OF THE PUBLIC OFFICERS LAW SHALL APPLY TO MEMBERS OF THE BOARD. NO MEMBER OF THE BOARD SHALL BE HELD LIABLE FOR THE PERFORMANCE OF ANY FUNCTION OR DUTY AUTHOR- IZED BY THIS SECTION. THE WORK OF THE BOARD SHALL BE CONDUCTED WITH SUCH STAFF AS THE DIRECTOR OF THE BUDGET, THE SECRETARY OF STATE, THE ATTORNEY GENERAL AND THE STATE COMPTROLLER SHALL MAKE AVAILABLE. ALL PROCEEDINGS, MEETINGS AND HEARINGS CONDUCTED BY THE BOARD SHALL BE HELD IN THE CITY OF ALBANY. 2. A "FISCALLY ELIGIBLE MUNICIPALITY" SHALL MEAN ANY COUNTY, CITY, EXCLUDING A CITY WITH A POPULATION GREATER THAN ONE MILLION, TOWN, OR VILLAGE THAT THE BOARD, ON A CASE BY CASE BASIS, DETERMINES WOULD BENE- FIT FROM THE SERVICES AND ASSISTANCE WHICH THE BOARD HAS LEGAL AUTHORITY TO OFFER. IN EVALUATING WHETHER A MUNICIPALITY IS A FISCALLY ELIGIBLE MUNICIPALITY, THE BOARD SHALL CONSIDER THE AVERAGE FULL VALUE PROPERTY TAX RATE OF SUCH PUBLIC EMPLOYER AND THE AVERAGE FUND BALANCE PERCENTAGE OF SUCH PUBLIC EMPLOYER AND SUCH OTHER CRITERIA AS THE BOARD DEEMS RELE- VANT. FOR PURPOSES OF THIS SECTION, "FULL VALUE PROPERTY TAX RATE" SHALL MEAN THE AMOUNT TO BE RAISED BY TAX ON REAL ESTATE BY A LOCAL GOVERNMENT IN A GIVEN FISCAL YEAR DIVIDED BY THE FULL VALUATION OF TAXA- BLE REAL ESTATE FOR THAT SAME FISCAL YEAR AS REPORTED TO THE OFFICE OF
THE STATE COMPTROLLER; "AVERAGE FULL VALUE PROPERTY TAX RATE" SHALL MEAN THE SUM OF THE FULL VALUE PROPERTY TAX RATES FOR THE FIVE MOST RECENT FISCAL YEARS DIVIDED BY FIVE; "FUND BALANCE PERCENTAGE" SHALL MEAN THE TOTAL FUND BALANCE IN THE GENERAL FUND OF A LOCAL GOVERNMENT IN A GIVEN FISCAL YEAR DIVIDED BY THE TOTAL EXPENDITURES FROM THE GENERAL FUND FOR THAT SAME FISCAL YEAR AS REPORTED TO THE OFFICE OF THE STATE COMP- TROLLER; AND "AVERAGE FUND BALANCE PERCENTAGE" SHALL MEAN THE SUM OF THE FUND BALANCE PERCENTAGES FOR THE FIVE MOST RECENTLY COMPLETED FISCAL YEARS DIVIDED BY FIVE. (A) IF THE AVERAGE FULL VALUE PROPERTY TAX RATE OF SUCH MUNICIPALITY IS GREATER THAN THE AVERAGE FULL VALUE PROPERTY TAX RATE OF SEVENTY-FIVE PERCENT OF COUNTIES, CITIES, TOWNS, AND VILLAGES, WITH LOCAL FISCAL YEARS ENDING IN THE SAME CALENDAR YEAR AS OF THE MOST RECENTLY AVAILABLE INFORMATION, THE BOARD MUST FIND THAT SUCH MUNICIPALITY IS A FISCALLY ELIGIBLE MUNICIPALITY. THE OFFICE OF THE STATE COMPTROLLER SHALL MAKE PUBLICLY AVAILABLE THE LIST OF COUNTIES, CITIES, TOWNS, AND VILLAGES THAT HAVE AN AVERAGE FULL VALUE PROPERTY TAX RATE THAT MEETS SUCH CRITE- RIA IN EACH LOCAL FISCAL YEAR. IF A MUNICIPALITY HAS NOT REPORTED TO THE OFFICE OF THE STATE COMPTROLLER THE INFORMATION NECESSARY TO CALCULATE ITS AVERAGE FULL VALUE PROPERTY TAX RATE, SUCH MUNICIPALITY MAY NOT BE DEEMED A FISCALLY ELIGIBLE MUNICIPALITY AND THE PROVISIONS OF THIS SECTION SHALL NOT APPLY. (B) IF THE AVERAGE FUND BALANCE PERCENTAGE OF SUCH MUNICIPALITY IS LESS THAN FIVE PERCENT, THE BOARD MUST FIND THAT SUCH MUNICIPALITY IS A FISCALLY ELIGIBLE MUNICIPALITY. THE OFFICE OF THE STATE COMPTROLLER SHALL MAKE PUBLICLY AVAILABLE THE LIST OF COUNTIES, CITIES, TOWNS, AND VILLAGES THAT HAVE AN AVERAGE FUND BALANCE PERCENTAGE THAT MEETS SUCH CRITERIA IN EACH LOCAL FISCAL YEAR. IF A MUNICIPALITY HAS NOT REPORTED TO THE OFFICE OF THE STATE COMPTROLLER THE INFORMATION NECESSARY TO CALCULATE ITS AVERAGE FUND BALANCE PERCENTAGE, SUCH MUNICIPALITY MAY NOT BE DEEMED A FISCALLY ELIGIBLE MUNICIPALITY AND THE PROVISIONS OF THIS SECTION SHALL NOT APPLY. 3. UPON THE REQUEST OF A FISCALLY ELIGIBLE MUNICIPALITY, BY RESOLUTION OF THE GOVERNING BODY OF SUCH MUNICIPALITY WITH THE CONCURRENCE OF THE CHIEF EXECUTIVE OF SUCH MUNICIPALITY, THE FINANCIAL RESTRUCTURING BOARD FOR LOCAL GOVERNMENTS MAY UNDERTAKE A COMPREHENSIVE REVIEW OF THE OPER- ATIONS, FINANCES, MANAGEMENT PRACTICES, ECONOMIC BASE AND ANY OTHER FACTORS THAT IN ITS SOLE DISCRETION IT DEEMS RELEVANT TO BE ABLE TO MAKE FINDINGS AND RECOMMENDATIONS ON REFORMING AND RESTRUCTURING THE OPER- ATIONS OF THE FISCALLY ELIGIBLE MUNICIPALITY. AS PART OF SUCH RECOMMEN- DATIONS, THE BOARD MAY PROPOSE THAT SUCH MUNICIPALITY AGREE TO FISCAL ACCOUNTABILITY MEASURES, AS DETERMINED BY THE BOARD, INCLUDING, BUT NOT LIMITED TO, MULTI-YEAR FINANCIAL PLANNING. IT MAY ALSO IDENTIFY COST-SAVING MEASURES, RECOMMEND CONSOLIDATION OF FUNCTIONS OR AGENCIES WITHIN SUCH MUNICIPALITY OR BETWEEN SUCH MUNICIPALITY AND OTHER MUNICI- PALITIES, CONSISTENT WITH EXISTING LAW, IDENTIFY AND MAKE AVAILABLE, TO THE EXTENT OTHERWISE PERMITTED BY LAW, GRANTS AND LOANS ON SUCH TERMS AND CONDITIONS AS IT DEEMS APPROPRIATE, AND MAKE SUCH OTHER RECOMMENDA- TIONS AS THE BOARD MAY DEEM JUST AND PROPER BUT IN NO EVENT SHALL THE SUM OF ALL AWARDS MADE BY THE BOARD TO A SINGLE FISCALLY ELIGIBLE MUNI- CIPALITY BE GREATER THAN FIVE MILLION DOLLARS. IF SUCH AWARD IS A LOAN, IT MAY NOT BE FOR A TERM LONGER THAN TEN YEARS. IN THE EVENT A GRANT OR LOAN IS MADE, THE BOARD MAY CONDITION SUCH AWARD ON THE FISCALLY ELIGI- BLE MUNICIPALITY SUBMITTING A REPORT OR REPORTS ON SUCH ACTIONS TAKEN BY THE FISCALLY ELIGIBLE MUNICIPALITY PURSUANT TO THE BOARD'S RECOMMENDA- TIONS, AND THE BOARD SHALL REQUIRE THAT THE ELIGIBLE MUNICIPALITY MUST
ADOPT AND IMPLEMENT ALL THE BOARD'S RECOMMENDATIONS AS A CONDITION TO RECEIVING AN AWARD OR AWARDS. BEFORE MAKING FINAL RECOMMENDATIONS, THE BOARD SHALL CONSULT WITH THE FISCALLY ELIGIBLE MUNICIPALITY. SUCH RECOMMENDATIONS SHALL NOT BE FINAL AND BINDING ON A FISCALLY ELIGIBLE MUNICIPALITY UNLESS IT FORMALLY AGREES TO ABIDE BY AND IMPLEMENT SUCH RECOMMENDATIONS IN WHICH EVENT SUCH RECOMMENDATIONS AND THE TERMS PROVIDED THEREUNDER SHALL BE FINAL AND BINDING ON SUCH MUNICIPALITY. 4. THE BOARD MAY HOLD HEARINGS AND SHALL HAVE AUTHORITY TO REQUIRE THE PRODUCTION OF ANY INFORMATION THAT IT DEEMS NECESSARY TO UNDERTAKE ITS COMPREHENSIVE REVIEW. THE BOARD SHALL POST ON A PUBLICLY AVAILABLE WEBSITE ALL RECOMMENDATIONS AND FINDINGS MADE PURSUANT TO THIS SECTION. 5. THE BOARD SHALL ALSO BE AUTHORIZED TO RESOLVE AN IMPASSE PURSUANT TO SUBDIVISION FOUR-A OF SECTION TWO HUNDRED NINE OF THE CIVIL SERVICE LAW. S 3. Section 209 of the civil service law is amended by adding a new subdivision 4-a to read as follows: 4-A. (A) NOTWITHSTANDING ANYTHING IN SUBDIVISION FOUR OF THIS SECTION TO THE CONTRARY, A PUBLIC EMPLOYER THAT IS A FISCALLY ELIGIBLE MUNICI- PALITY, AS DEFINED IN SECTION 160.05 OF THE LOCAL FINANCE LAW, AND IS OTHERWISE SUBJECT TO SUBDIVISION FOUR OF THIS SECTION, UPON RESOLUTION OF ITS GOVERNING BODY WITH THE CONCURRENCE OF ITS CHIEF EXECUTIVE OFFI- CER, AND A PUBLIC EMPLOYEE ORGANIZATION SUBJECT TO SUBDIVISION FOUR OF THIS SECTION MAY, JOINTLY, STIPULATE AND AGREE THAT AN IMPASSE EXISTS, AT ANY TIME, WITH RESPECT TO COLLECTIVE NEGOTIATIONS BETWEEN THE PARTIES FOR A COLLECTIVE BARGAINING AGREEMENT AND, IN LIEU OF COMMENCING A PROCEEDING UNDER SUBDIVISION FOUR OF THIS SECTION, MAY JOINTLY REQUEST THAT THE FINANCIAL RESTRUCTURING BOARD FOR LOCAL GOVERNMENTS, ESTAB- LISHED IN SECTION 160.05 OF THE LOCAL FINANCE LAW, RESOLVE SUCH IMPASSE. A JOINT REQUEST PURSUANT TO THIS SUBDIVISION SHALL BE IRREVOCABLE. (B) THE FINANCIAL RESTRUCTURING BOARD FOR LOCAL GOVERNMENTS SHALL RENDER A JUST AND REASONABLE DETERMINATION OF THE MATTERS IN DISPUTE BY AN AFFIRMATIVE VOTE OF A MAJORITY OF THE TOTAL NUMBER OF ITS MEMBERS. IN ARRIVING AT SUCH DETERMINATION, IT SHALL SPECIFY THE BASIS FOR ITS FINDINGS, TAKING INTO CONSIDERATION, IN ADDITION TO ANY OTHER RELEVANT FACTORS, THOSE FACTORS SET FORTH IN SUBDIVISION SIX OF THIS SECTION. IN ALL MATTERS REGARDING PUBLIC DISCLOSURE OF ITS PROCEEDINGS AND FINDINGS, IT SHALL BE TREATED THE SAME AS THE PANEL CONVENED PURSUANT TO SUBDIVI- SION FOUR OF THIS SECTION. IT SHALL RENDER A DETERMINATION WITHIN SIX MONTHS OF BEING FORMALLY REQUESTED BY THE PARTIES TO CONVENE. (C) EACH PARTY BEFORE THE FINANCIAL RESTRUCTURING BOARD FOR LOCAL GOVERNMENTS MAY BE HEARD EITHER IN PERSON, BY COUNSEL, OR BY OTHER REPRESENTATIVES, AS THEY MAY RESPECTIVELY DESIGNATE AND MAY PRESENT, EITHER ORALLY OR IN WRITING, OR BOTH, STATEMENTS OF FACT, SUPPORTING WITNESSES AND OTHER EVIDENCE, AND ARGUMENT OF THEIR RESPECTIVE POSITIONS WITH RESPECT TO EACH CASE. THE BOARD SHALL HAVE AUTHORITY TO REQUIRE THE PRODUCTION OF ADDITIONAL EVIDENCE, EITHER ORAL OR WRITTEN, AS IT MAY DESIRE FROM THE PARTIES. ALL PROCEEDINGS, MEETINGS AND HEARINGS CONDUCTED BY THE BOARD SHALL BE HELD IN THE CITY OF ALBANY. (D) THE DETERMINATION OF THE FINANCIAL RESTRUCTURING BOARD FOR LOCAL GOVERNMENTS WITH RESPECT TO THE CONDITIONS OF EMPLOYMENT PRESENTED TO IT PURSUANT TO THIS SECTION SHALL BE FINAL AND BINDING UPON THE PARTIES FOR THE PERIOD PRESCRIBED BY SUCH BOARD, BUT IN NO EVENT SHALL SUCH PERIOD EXCEED FOUR YEARS FROM THE TERMINATION DATE OF ANY PREVIOUS COLLECTIVE BARGAINING AGREEMENT OR IF THERE IS NO PREVIOUS COLLECTIVE BARGAINING AGREEMENT THEN FOR A PERIOD NOT TO EXCEED FOUR YEARS FROM THE DATE OF DETERMINATION BY THE BOARD. SUCH DETERMINATION SHALL NOT BE SUBJECT TO
THE APPROVAL OF ANY LOCAL LEGISLATIVE BODY OR OTHER MUNICIPAL AUTHORITY, AND SHALL ONLY BE SUBJECT TO REVIEW BY A COURT OF COMPETENT JURISDICTION IN THE MANNER PRESCRIBED BY LAW. S 4. Paragraph (d) of subdivision 4 of section 209 of the civil service law, as amended by section 9 of part A of chapter 504 of the laws of 2009, is amended to read as follows: (d) The provisions of this subdivision shall expire [thirty-six] THIR- TY-NINE years from July first, nineteen hundred seventy-seven, and here- after may be renewed every four years. S 5. Section 209 of the civil service law is amended by adding a new subdivision 6 to read as follows: 6. (A) FOR DISPUTES CONCERNING AN IMPASSE PURSUANT TO SUBDIVISION FOUR OF THIS SECTION THAT INVOLVE A COUNTY, CITY, TOWN, OR VILLAGE SUBJECT TO SECTION THREE-C OF THE GENERAL MUNICIPAL LAW, A PUBLIC ARBITRATION PANEL SHALL MAKE A DETERMINATION AS TO WHETHER SUCH COUNTY, CITY, TOWN, OR VILLAGE, IS A PUBLIC EMPLOYER THAT IS A FISCALLY ELIGIBLE MUNICIPALITY AS PART OF ITS ANALYSIS OF THE FINANCIAL ABILITY OF THE PUBLIC EMPLOYER TO PAY. (B) IN EVALUATING WHETHER A PUBLIC EMPLOYER COVERED BY THIS SUBDIVI- SION IS A FISCALLY ELIGIBLE MUNICIPALITY, SUCH PUBLIC ARBITRATION PANEL SHALL CONSIDER THE AVERAGE FULL VALUE PROPERTY TAX RATE OF SUCH PUBLIC EMPLOYER AND THE AVERAGE FUND BALANCE PERCENTAGE OF SUCH PUBLIC EMPLOY- ER. (I) FOR PURPOSES OF THIS SUBDIVISION, "FULL VALUE PROPERTY TAX RATE" SHALL MEAN THE AMOUNT TO BE RAISED BY TAX ON REAL ESTATE BY A LOCAL GOVERNMENT IN A GIVEN FISCAL YEAR DIVIDED BY THE FULL VALUATION OF TAXA- BLE REAL ESTATE FOR THAT SAME FISCAL YEAR AS REPORTED TO THE OFFICE OF THE STATE COMPTROLLER. (II) FOR PURPOSES OF THIS SUBDIVISION, "AVERAGE FULL VALUE PROPERTY TAX RATE" SHALL MEAN THE SUM OF THE FULL VALUE PROPERTY TAX RATES FOR THE FIVE MOST RECENT FISCAL YEARS DIVIDED BY FIVE. (III) FOR PURPOSES OF THIS SUBDIVISION, "FUND BALANCE PERCENTAGE" SHALL MEAN THE TOTAL FUND BALANCE IN THE GENERAL FUND OF A LOCAL GOVERN- MENT IN A GIVEN FISCAL YEAR DIVIDED BY THE TOTAL EXPENDITURES FROM THE GENERAL FUND FOR THAT SAME FISCAL YEAR AS REPORTED TO THE OFFICE OF THE STATE COMPTROLLER. (IV) FOR PURPOSES OF THIS SUBDIVISION, "AVERAGE FUND BALANCE PERCENT- AGE" SHALL MEAN THE SUM OF THE FUND BALANCE PERCENTAGES FOR THE FIVE MOST RECENTLY COMPLETED FISCAL YEARS DIVIDED BY FIVE. (C) IF THE AVERAGE FULL VALUE PROPERTY TAX RATE OF SUCH PUBLIC EMPLOY- ER IS GREATER THAN THE AVERAGE FULL VALUE PROPERTY TAX RATE OF SEVENTY- FIVE PERCENT OF COUNTIES, CITIES, TOWNS, AND VILLAGES, WITH LOCAL FISCAL YEARS ENDING IN THE SAME CALENDAR YEAR AS OF THE MOST RECENTLY AVAILABLE INFORMATION, THE PUBLIC ARBITRATION PANEL MUST FIND THAT SUCH PUBLIC EMPLOYER IS A FISCALLY ELIGIBLE MUNICIPALITY. THE OFFICE OF THE STATE COMPTROLLER SHALL MAKE PUBLICLY AVAILABLE THE LIST OF COUNTIES, CITIES, TOWNS, AND VILLAGES THAT HAVE AN AVERAGE FULL VALUE PROPERTY TAX RATE THAT MEETS SUCH CRITERIA IN EACH LOCAL FISCAL YEAR. IF A PUBLIC EMPLOYER HAS NOT REPORTED TO THE OFFICE OF THE STATE COMPTROLLER THE INFORMATION NECESSARY TO CALCULATE ITS AVERAGE FULL VALUE PROPERTY TAX RATE, SUCH PUBLIC EMPLOYER MAY NOT BE DEEMED A FISCALLY ELIGIBLE MUNICIPALITY AND THE PROVISIONS OF THIS SUBDIVISION SHALL NOT APPLY. (D) IF THE AVERAGE FUND BALANCE PERCENTAGE OF SUCH PUBLIC EMPLOYER IS LESS THAN FIVE PERCENT AND THE STATE COMPTROLLER HAS CERTIFIED THAT ANY ADDITIONAL FUND BALANCES IN FUNDS OTHER THAN THE GENERAL FUND AVAILABLE FOR PAYMENT OF ARBITRATION AWARDS IN EACH YEAR, IF ADDED TO THE FUND
BALANCE OF THE GENERAL FUND, WOULD NOT CAUSE THE AVERAGE FUND BALANCE PERCENTAGE OF SUCH PUBLIC EMPLOYER TO EXCEED FIVE PERCENT, THE PUBLIC ARBITRATION PANEL MUST FIND THAT SUCH PUBLIC EMPLOYER IS A FISCALLY ELIGIBLE MUNICIPALITY. THE OFFICE OF THE STATE COMPTROLLER SHALL MAKE PUBLICLY AVAILABLE THE LIST OF COUNTIES, CITIES, TOWNS, AND VILLAGES THAT HAVE AN AVERAGE FUND BALANCE PERCENTAGE THAT IS LESS THAN FIVE PERCENT IN EACH LOCAL FISCAL YEAR. IF A PUBLIC EMPLOYER HAS NOT REPORTED TO THE OFFICE OF THE STATE COMPTROLLER THE INFORMATION NECESSARY TO CALCULATE ITS AVERAGE FUND BALANCE PERCENTAGE, SUCH PUBLIC EMPLOYER MAY NOT BE DEEMED A FISCALLY ELIGIBLE MUNICIPALITY AND THE PROVISIONS OF THIS SUBDIVISION SHALL NOT APPLY. (E) WHEN SUCH PUBLIC EMPLOYER HAS BEEN FOUND TO BE A FISCALLY ELIGIBLE MUNICIPALITY, THE PUBLIC ARBITRATION PANEL SHALL, FIRST AND FOREMOST, CONSIDER ABILITY TO PAY BY ASSIGNING A WEIGHT OF SEVENTY PERCENT TO THAT PORTION OF THE CRITERION CONTAINED WITHIN CLAUSE B OF SUBPARAGRAPH (V) OF PARAGRAPH (C) OF SUBDIVISION FOUR OF THIS SECTION THAT PERTAINS ONLY TO THE PUBLIC EMPLOYER'S ABILITY TO PAY. ALL OTHER CRITERIA CONTAINED IN SUBPARAGRAPH (V) OF PARAGRAPH (C) OF SUBDIVISION FOUR OF THIS SECTION, INCLUDING THAT PORTION OF CLAUSE B OF SUBPARAGRAPH (V) OF PARA- GRAPH (C) OF SUBDIVISION FOUR OF THIS SECTION THAT PERTAINS TO THE INTEREST AND WELFARE OF THE PUBLIC, SHALL CONSTITUTE AN AGGREGATE WEIGHT OF THIRTY PERCENT. ADDITIONALLY, WITH RESPECT TO THE TOTAL MONETARY VALUE OF ANY DETERMINATION, THE PANEL MUST RECOGNIZE AND TAKE INTO ACCOUNT IN ITS DETERMINATION THE CONSTRAINTS, OBLIGATIONS AND REQUIRE- MENTS IMPOSED BY THE REAL PROPERTY TAX CAP PURSUANT TO SECTION THREE-C OF THE GENERAL MUNICIPAL LAW UPON THE PUBLIC EMPLOYER INVOLVED IN THE DISPUTE BEFORE THE PANEL. (F) THE PROVISIONS OF THIS SUBDIVISION SHALL EXPIRE THREE YEARS FROM JULY FIRST, TWO THOUSAND THIRTEEN. S 6. Severability. If any clause, sentence, paragraph, subdivision, section or part of this article shall be adjudged by any court of compe- tent jurisdiction to be invalid, such judgment shall not affect, impair, or invalidate the remainder thereof, but shall be confined in its opera- tion to the clause, sentence, paragraph, subdivision, section or part thereof directly involved in the controversy in which such judgment shall have been rendered. S 7. This act shall take effect immediately, provided that sections one, two and three of this act shall take effect on the ninetieth day after it shall have become a law and sections four and five of this act shall be deemed to have been in full force and effect on and after April 1, 2013; and provided, further, that sections three, four and five of this act shall apply to all agreements and interest arbitration determinations that expire before, on or after April 1, 2013 except those (a) where the public employment relations board received a peti- tion to refer the dispute to a public arbitration panel pursuant to subdivision 4 of section 209 of the civil service law before June 14, 2013 or (b) where the public employment relations board received a declaration of impasse pursuant to subdivision 4 of section 209 of the civil service law on or after April 1, 2013 but on or before June 14, 2013.

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