S T A T E   O F   N E W   Y O R K
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                                  10637

                          I N  A S S E M B L Y

                             April 13, 2010
                               ___________

Introduced  by M. of A. MORELLE -- read once and referred to the Commit-
  tee on Ways and Means

AN ACT to amend the state  finance  law  and  the  legislative  law,  in
  relation  to  enacting  a balanced budget requirement and creating the
  New York state governmental accounting review board

  THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND  ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section  1.  The  state finance law is amended by adding a new article
3-A to read as follows:
                               ARTICLE 3-A
                    BUDGETING ACCORDING TO GENERALLY
                     ACCEPTED ACCOUNTING PRINCIPLES
SECTION 35. DEFINITIONS.
        36. DEVELOPMENT OF THE EXECUTIVE BUDGET SUBMISSION  AND  ENACTED
              BUDGET.
        37. NEW YORK STATE GOVERNMENTAL ACCOUNTING REVIEW BOARD.
  S  35.  DEFINITIONS.  AS USED IN THIS ARTICLE, THE FOLLOWING WORDS AND
TERMS SHALL HAVE THE FOLLOWING MEANINGS UNLESS THE CONTEXT  SHALL  INDI-
CATE ANOTHER OR DIFFERENT MEANING OR INTENT.
  1.  "BOARD"  MEANS NEW YORK STATE GOVERNMENTAL ACCOUNTING REVIEW BOARD
PURSUANT TO SECTION THIRTY-SEVEN OF THIS ARTICLE.
  2. "REVENUES" MEAN ALL TAXES,  RENTS,  FEES,  CHARGES,  PAYMENTS,  ALL
PROCEEDS  FROM  BORROWINGS AND OTHER INCOME AND RECEIPTS PAID OR PAYABLE
TO OR FOR THE STATE'S TREASURY.
  3.  "GENERALLY  ACCEPTED  ACCOUNTING  PRINCIPLES"  MEANS  THE  SET  OF
ACCOUNTING  PRINCIPLES FOR FINANCIAL REPORTING ESTABLISHED BY THE FINAN-
CIAL ACCOUNTING STANDARDS ADVISORY BOARD AND GOVERNED  BY  THE  AMERICAN
INSTITUTE  OF  CERTIFIED  PUBLIC ACCOUNTANTS FOR FEDERAL REPORTING ENTI-
TIES.
  4. "EXECUTIVE BUDGET SUBMISSION" MEANS THE DOCUMENT SUBMITTED  BY  THE
GOVERNOR  TO THE LEGISLATURE PURSUANT TO SECTION TWO OF ARTICLE SEVEN OF
THE STATE CONSTITUTION.

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD16545-02-0

              

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  5. "ENACTED BUDGET" MEANS THE DOCUMENT PASSED BY BOTH  HOUSES  OF  THE
LEGISLATURE  PURSUANT  TO  SECTION  FOUR  OF  ARTICLE SEVEN OF THE STATE
CONSTITUTION.
  S 36. DEVELOPMENT OF THE EXECUTIVE BUDGET SUBMISSION AND ENACTED BUDG-
ET.    1. FOR FISCAL YEARS BEGINNING ON AND AFTER APRIL FIRST, TWO THOU-
SAND ELEVEN, THE EXECUTIVE BUDGET  SUBMISSION  AND  THE  ENACTED  BUDGET
COVERING ALL EXPENDITURES OTHER THAN CAPITAL ITEMS SHALL BE PREPARED AND
BALANCED  SO  THE RESULTS THEREOF WOULD NOT SHOW A DEFICIT WHEN REPORTED
IN ACCORDANCE WITH GENERALLY ACCEPTED ACCOUNTING PRINCIPLES.
  2. THE GOVERNOR, THE LEGISLATURE AND THE NEW YORK  STATE  GOVERNMENTAL
ACCOUNTING  REVIEW  BOARD  SHALL  CONFER  CONCERNING  THE REQUIREMENT TO
BALANCE THE BUDGET, AS WELL AS THE PROJECTED EFFECT ON  THE  BUDGETS  BY
ANY  CHANGE IN GENERALLY ACCEPTED ACCOUNTING PRINCIPLES OR CHANGE IN THE
APPLICATION OF GENERALLY ACCEPTED ACCOUNTING PRINCIPLES  TO  THE  STATE.
THE  GOVERNOR  AND/OR  THE  LEGISLATURE MAY PETITION THE BOARD TO EXEMPT
EITHER THE EXECUTIVE BUDGET SUBMISSION OR THE ENACTED  BUDGET  FROM  THE
PROVISIONS OF THIS SECTION.
  S 37. NEW YORK STATE GOVERNMENTAL ACCOUNTING REVIEW BOARD. 1. THERE IS
HEREBY  CREATED THE NEW YORK STATE GOVERNMENTAL ACCOUNTING REVIEW BOARD.
THE BOARD SHALL BE A GOVERNMENTAL AGENCY AND INSTRUMENTALITY AS  IS  SET
FORTH IN THIS ARTICLE.
  2. THE BOARD SHALL HAVE THE FOLLOWING FUNCTIONS:
  A.  TO  CONFER  WITH  THE  GOVERNOR AND THE LEGISLATURE CONCERNING THE
REQUIREMENT TO BALANCE THE BUDGET AS PROVIDED IN SECTION  THIRTY-SIX  OF
THIS  ARTICLE,  THE  PROJECTED  EFFECT  ON  THE BUDGETS BY ANY CHANGE IN
GENERALLY ACCEPTED ACCOUNTING PRINCIPLES, AND CHANGE IN THE  APPLICATION
OF GENERALLY ACCEPTED ACCOUNTING PRINCIPLES TO THE STATE BUDGET;
  B. TO HEAR PETITIONS FROM THE GOVERNOR OR LEGISLATURE WITH RELATION TO
MODIFYING  OR  EXEMPTING  THE EXECUTIVE BUDGET SUBMISSION OR THE ENACTED
BUDGET FROM THE BALANCED BUDGET REQUIREMENT  OF  SECTION  THIRTY-SIX  OF
THIS  ARTICLE  OR  FROM  THE REQUIREMENTS OF ANY NEW OR EXISTING GOVERN-
MENTAL ACCOUNTING STANDARDS, BOARD STATEMENTS, INTERPRETATIONS,  TECHNI-
CAL BULLETINS, AND CONCEPT STATEMENTS; AND
  C.  TO  DETERMINE  WHETHER IMMEDIATE COMPLIANCE WITH THE PROVISIONS OF
SECTION THIRTY-SIX OF THIS ARTICLE WILL HAVE A MATERIAL EFFECT ON  STATE
BUDGETS  OVER A TIME PERIOD INSUFFICIENT TO ACCOMMODATE THE EFFECT WITH-
OUT A SUBSTANTIAL ADVERSE IMPACT ON THE DELIVERY OF ESSENTIAL  SERVICES,
AND, UPON SUCH DETERMINATION, TO AUTHORIZE AND APPROVE A METHOD OF PHAS-
ING THE REQUIREMENTS OF THIS SECTION INTO SUCH BUDGETS OVER SUCH REASON-
ABLY EXPEDITIOUS TIME PERIOD AS THE BOARD DEEMS APPROPRIATE.
  3.  THE  BOARD  SHALL  BE  COMPRISED OF FIVE MEMBERS, ONE OF WHOM WILL
SERVE AS CHAIR; WHO ARE NOMINATED BY THE  GOVERNOR  AND  APPOINTED  WITH
ADVICE  AND CONSENT OF THE SENATE. ALL OF THE APPOINTED MEMBERS SHALL BE
RESIDENTS OF THE STATE. SUCH APPOINTED MEMBERS SHALL  SERVE  A  TERM  OF
FIVE YEARS.  ALL APPOINTED MEMBERS SHALL HAVE ACADEMIC OR BUSINESS EXPE-
RIENCE  IN  GOVERNMENTAL  ACCOUNTING  STANDARDS  AND  GENERALLY ACCEPTED
ACCOUNTING PRINCIPLES. THE BOARD SHALL ACT BY A MAJORITY QUORUM VOTE  OF
THE  ENTIRE  BOARD. THE BOARD SHALL MAINTAIN A RECORD OF ITS PROCEEDINGS
IN SUCH FORM AS IT MAY DETERMINE, BUT SUCH RECORD SHALL INDICATE ATTEND-
ANCE AND ALL VOTES CAST BY EACH MEMBER.
  4. NOTWITHSTANDING ANY INCONSISTENT PROVISIONS OF LAW, NO  OFFICER  OR
EMPLOYEE  OF  THE  STATE,  OR  POLITICAL  SUBDIVISION  OF THE STATE, ANY
GOVERNMENTAL ENTITY OPERATING ANY PUBLIC  SCHOOL  OR  COLLEGE  OR  OTHER
PUBLIC  AGENCY  OR INSTRUMENTALITY OR UNIT OF GOVERNMENT WHICH EXERCISES
GOVERNMENTAL POWERS UNDER THE LAWS  OF  THE  STATE,  SHALL  FORFEIT  HIS
OFFICE  OR  EMPLOYMENT  BY  REASON OF HIS ACCEPTANCE OR APPOINTMENT AS A

A. 10637                            3

MEMBER, REPRESENTATIVE, OFFICER, EMPLOYEE OR  AGENT  OF  THE  BOARD  NOR
SHALL SERVICE AS SUCH MEMBER, OFFICER, EMPLOYEE OR AGENT OF THE BOARD BE
DEEMED INCOMPATIBLE OR IN CONFLICT WITH SUCH OFFICE OR EMPLOYMENT.
  5.  THE  MEMBERS  OF  THE BOARD SHALL SERVE WITHOUT SALARY OR PER DIEM
ALLOWANCE BUT SHALL BE ENTITLED TO REIMBURSEMENT FOR ACTUAL  AND  NECES-
SARY  EXPENSES INCURRED IN THE PERFORMANCE OF OFFICIAL DUTIES UNDER THIS
ACT, PROVIDED HOWEVER THAT SUCH MEMBERS AND REPRESENTATIVES ARE NOT,  AT
THE TIME SUCH EXPENSES ARE INCURRED, PUBLIC EMPLOYEES OTHERWISE ENTITLED
TO SUCH REIMBURSEMENT.
  6.  ALL  AGENCIES,  AUTHORITIES,  AND  INSTITUTIONS OF THE STATE SHALL
COOPERATE WITH AND PROVIDE SUCH ASSISTANCE TO THE BOARD AS THE BOARD MAY
REQUEST.
  7. THE CHAIR, IN CONSULTATION WITH THE BOARD, MAY HIRE OR  APPOINT  AN
EXECUTIVE DIRECTOR FOR THE BOARD IF DEEMED NECESSARY.
  S  2.  Section  22 of the state finance law is amended by adding a new
subdivision 17 to read as follows:
  17. NOTWITHSTANDING ANY PROVISION OF  LAW  TO  THE  CONTRARY,  BUDGETS
SUBMITTED PURSUANT TO THIS SECTION SHALL INCLUDE:
  (A)  A  DESCRIPTION  OF  ALL  OF THE EXPENDITURES ESTIMATED TO BE MADE
BEFORE THE CLOSE OF THE CURRENT FISCAL YEAR AND ALL OF THE  EXPENDITURES
PROPOSED  TO  BE MADE DURING THE ENSUING FISCAL YEAR, BOTH IN ACCORDANCE
WITH GENERALLY ACCEPTED ACCOUNTING  PRINCIPLES  AS  DEFINED  IN  ARTICLE
THREE-A OF THE STATE FINANCE LAW; AND
  (B)  A  DESCRIPTION OF ALL THE REVENUES ESTIMATED TO ACCRUE BEFORE THE
CLOSE OF THE CURRENT FISCAL YEAR AND DURING  THE  ENSUING  FISCAL  YEAR,
INCLUSIVE OF ANY REVENUES WHICH ARE EXPECTED TO RESULT FROM THE PROPOSED
LEGISLATION  WHICH  THE  GOVERNOR  DEEMS  NECESSARY  TO PROVIDE RECEIPTS
SUFFICIENT TO MEET PROPOSED DISBURSEMENTS, ALL IN ACCORDANCE WITH GENER-
ALLY ACCEPTED ACCOUNTING PRINCIPLES AS DEFINED IN ARTICLE THREE-A OF THE
STATE FINANCE LAW.
  S 3. Paragraph (a) of subdivision 2 of section 54 of  the  legislative
law,  as  added  by chapter 1 of the laws of 2007, is amended to read as
follows:
  (a) The legislature shall enact a budget for the upcoming fiscal  year
that it determines is balanced [in the general fund].
  S  4. Subdivision 2 of section 54 of the legislative law is amended by
adding a new paragraph (d) to read as follows:
  (D) NOTWITHSTANDING ANY PROVISION OF  LAW  TO  THE  CONTRARY,  BUDGETS
SUBMITTED PURSUANT TO THIS SECTION SHALL INCLUDE:
  (I)  ALL  OF THE EXPENDITURES ESTIMATED TO BE MADE BEFORE THE CLOSE OF
THE CURRENT FISCAL YEAR AND ALL OF THE EXPENDITURES PROPOSED TO BE  MADE
DURING  THE  ENSUING  FISCAL  YEAR,  BOTH  IN  ACCORDANCE WITH GENERALLY
ACCEPTED ACCOUNTING PRINCIPLES AS DEFINED  IN  ARTICLE  THREE-A  OF  THE
STATE FINANCE LAW; AND
  (II)  A  DESCRIPTION OF ALL OF THE REVENUES ESTIMATED TO ACCRUE BEFORE
THE CLOSE OF THE CURRENT FISCAL YEAR AND DURING THE ENSUING FISCAL YEAR,
INCLUSIVE OF ANY REVENUES WHICH ARE EXPECTED TO RESULT FROM THE PROPOSED
LEGISLATION WHICH THE LEGISLATURE DEEMS NECESSARY  TO  PROVIDE  RECEIPTS
SUFFICIENT TO MEET PROPOSED DISBURSEMENTS, ALL IN ACCORDANCE WITH GENER-
ALLY ACCEPTED ACCOUNTING PRINCIPLES AS DEFINED IN ARTICLE THREE-A OF THE
STATE FINANCE LAW.
  S  5. Separability clause. If any part or provision of this section or
the application thereof to any person is adjudged by a court  of  compe-
tent  jurisdiction  to  be  unconstitutional  or otherwise invalid, such
judgment shall not affect or impair any other part or provision  or  the

A. 10637                            4

application  thereof  to any other person, but shall be confined to such
part or provision.
  S 6. This act shall take effect immediately, provided that if this act
shall  take  effect after April 1, 2011, it shall be deemed to have been
in effect on and after April 1, 2011.