Establishes that not-for-profit organizations shall be entitled to all prompt contracting interest due from a state agency at the time of the first payment made to any such organization.
Ayes (32): DeFrancisco, Johnson, Alesi, Bonacic, Farley, Flanagan, Fuschillo, Golden, Griffo, Lanza, Larkin, LaValle, Little, Marcellino, Nozzolio, Robach, Saland, Seward, Young, Krueger, Breslin, Dilan, Duane, Gianaris, Montgomery, Oppenheimer, Peralta, Perkins, Rivera, Stavisky, Stewart-Cousins, Squadron
Nays (1): Parker
Excused (2): Hannon, Diaz
Ayes (49): Addabbo, Alesi, Avella, Ball, Bonacic, Breslin, Carlucci, DeFrancisco, Dilan, Duane, Farley, Flanagan, Fuschillo, Gianaris, Golden, Griffo, Grisanti, Hassell-Thomps, Johnson, Klein, Krueger, Lanza, Larkin, LaValle, Libous, Little, Marcellino, Martins, McDonald, Montgomery, Nozzolio, O'Mara, Oppenheimer, Perkins, Ranzenhofer, Ritchie, Rivera, Robach, Saland, Sampson, Savino, Serrano, Seward, Skelos, Smith, Squadron, Stavisky, Young, Zeldin
Absent (6): Adams, Diaz, Espaillat, Huntley, Peralta, Stewart-Cousin
Excused (6): Gallivan, Hannon, Kennedy, Maziarz, Parker, Valesky
TITLE OF BILL: An act to amend the state finance law, in relation to the payment of interest due to not-for-profit organizations
PURPOSE: To require agencies to pay any prompt contracting interest due with thirty days of the date the payment or payments required under a contract approved late are made to a not-for-profit organization.
SUMMARY OF PROVISIONS: Section 1 of this bill amends Subdivision 2 of
Section 179-v of the State Finance Law to establish that a not-for-profit organization shall be entitled to receive all interest due from a state agency pursuant to this Section within thirty days of the date the payment or payments required under a contract are made to any such organization. Provided, however, if monies from any appropriation or appropriations as described in Subdivision 3 of Section 179-v of the State Finance Law are not available for the payment of such interest, such payment shall be made immediately after such monies become available.
Section 2 of this bill provides for an effective date of immediately after this bill is signed into law.
PRIOR LEGISLATIVE HISTORY: This is a new proposal.
JUSTIFICATION: The Prompt Contracting law (Article 11-B of the State Finance Law) establishes the requirements for interest that is due on late contracts for grants, but does not establish when that interest must be paid. This creates an incentive for agencies to pay interest late in the year or not at all. This situation makes the law ineffective and disadvantages not-for-profits.
The Comptroller urges passage of this legislation.
BUDGET IMPLICATIONS: None
EFFECTIVE DATE: This act shall take effect immediately.
STATE OF NEW YORK ________________________________________________________________________ 6469 IN SENATE February 13, 2012 ___________Introduced by Sen. DeFRANCISCO -- (at request of the State Comptroller) -- read twice and ordered printed, and when printed to be committed to the Committee on Finance AN ACT to amend the state finance law, in relation to the payment of interest due to not-for-profit organizations THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. Subdivision 2 of section 179-v of the state finance law, as added by chapter 166 of the laws of 1991, is amended to read as follows: 2. Such organizations shall receive such interest payments WITHIN THIRTY DAYS OF THE DATE THE PAYMENT OR PAYMENTS REQUIRED UNDER THE CONTRACT ARE MADE TO ANY SUCH ORGANIZATION; PROVIDED, HOWEVER, IF MONIES FROM ANY APPROPRIATION OR APPROPRIATIONS AS DESCRIBED IN SUBDIVISION THREE OF THIS SECTION ARE NOT AVAILABLE FOR THE PAYMENT OF SUCH INTER- EST, SUCH PAYMENT SHALL BE MADE IMMEDIATELY AFTER SUCH MONIES BECOME AVAILABLE. SUCH INTEREST PAYMENTS SHALL BE MADE at a rate equal to the rate set by the commissioner of taxation and finance for corporate taxes pursuant to paragraph one of subsection (e) of section one thousand ninety-six of the tax law. In order for a state agency to approve reimbursement of a not-for-profit organization at a rate other than the interest rate stated in this section the not-for-profit organization shall submit documentation indicating the rate at which such funds were borrowed, the lender of such funds and any other information requested by the state agency, attorney general or the comptroller. The comp- troller may disallow such portions of the interest that the comptroller deems unreasonable. S 2. This act shall take effect immediately.EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets [ ] is old law to be omitted. LBD11124-03-1