BILL NUMBER:S4726

TITLE OF BILL:  An act authorizing the expenditure and temporary
transfer of reserve funds for expenses related to the storm commonly
known as Sandy

PURPOSE:

The bill allows local governments and school districts impacted by the
storm commonly known as Sandy to expend and temporarily transfer
reserve funds for Sandy-related expenses, notwithstanding certain
restrictions contained in sections of the General Municipal Law and
Education Law.

SUMMARY OF PROVISIONS:

Section one of the bill would authorize local governments and school
districts to expend moneys from capital reserve funds for capital
costs attributable to the storm commonly known as Sandy, without the
referendum requirements that would otherwise apply. Section two of the
bill would authorize local governments and school districts to
temporarily transfer moneys from any reserve fund to pay for
operating, costs attributable to Sandy.  The moneys that are
transferred must be reimbursed from the fund into which they were
transferred back into the reserve fund over a period of not more than
five years. At least twenty percent of the moneys must be reimbursed
              

each year, with interest.

LEGISLATIVE HISTORY:

New bill.

JUSTIFICATION:

It has been projected that the costs for damages from Storm Sandy
could exceed S18 billion for New York State.  Infrastructure,
including highways, airports, seaports and sewer and water systems,
was severely impacted. While much of the cost ultimately may be
covered by insurance or federal assistance, the affected
municipalities need additional flexibility in advancing funds for the
payment of these costs prior to reimbursement or covering those costs
that ultimately are not reimbursed.

This bill would help provide that flexibility by allowing local
governments and school district to expend moneys from their capital
reserve, fund without the need to comply with referendum
requirements.. The public benefit in facilitating prompt access to
these moneys for their intended purposes, in response to the emergency
conditions caused by Sandy, justifies this one-time exception to the
usual referendum requirements. Similarly, the bill would allow local
governments and school districts to readily access capital and other
reserve fund moneys to be temporarily advanced to cover operating
costs attributable to Sandy, notwithstanding that these reserve fund
moneys are statutorily restricted for specified uses. To ensure that
the lending reserve fund is made whole so that the moneys advanced
ultimately will be used for the originally intended purpose; the local


government or school district must reimburse the reserve fund, with
interest, over a period of not more than five years.

RECOMMENDATION:

The Comptroller urges passage of this legislation.