BILL NUMBER: S6915

SPONSOR: RAMOS
 
TITLE OF BILL:

An act to amend the state finance law, in relation to establishing the
"reciprocal enforcement of claims on unpaid or reduced state entitle-
ments act"

 
PURPOSE:

This bill would establish a mechanism whereby New York could withhold
payments to the Federal government, in the event that the Federal
government, in contravention of a court decision, fails to pay funds
owed to the State of New York.

 
SUMMARY OF SPECIFIC PROVISIONS:

Section one titles the bill "reciprocal enforcement of claims on unpaid
or reduced state entitlements act", or the "RECOURSE act".

Section two of the bill amends the State finance law to create a new
              

section 6.

The first paragraph of this new section requires the State Comptroller
to issue a report, updated monthly, enumerating funds that the Federal
government has not paid to the State in contravention of a court deci-
sion, and projecting funds to be paid by the State to the Federal
government over the course of the following year.

The second paragraph of this new section grants authority to the Gover-
nor, State Comptroller, and Budget Director, acting jointly and unan-
imously, to withhold funds from the Federal government, not to exceed
the amount of unpaid Federal funds enumerated in the Comptroller's
report.

The third paragraph of this new section makes funds that have been with-
held available for appropriation, not to exceed the amount of unpaid
Federal funds enumerated in the Comptroller's report.

 
JUSTIFICATION:

In its first weeks, the Trump Administration moved to blithely freeze
substantial programs and funding streams on which states depend, and
went on to ignore a Federal court order to unfreeze and disburse funds.
We should expect more of the same in the years ahead, with the potential
for inflicting enormous pain, in particular, on residents of states,
like New York, that have expansive safety nets and large public infras-
tructure systems.

This legislation would give New York State a tool to fight back. In the
event that the Federal government withholds funds the State is owed, and
does so in contravention of a court decision, the State would be author-
ized to respond by withholding funds due to the Federal government. This
would be both a deterrent to such unlawful acts by the Trump Adminis-
tration and would give the State possession of funds that could provide
material leverage in a legal clash with the Federal government.


It is important to note that this legislation would only authorize the
withholding of funds, not dictate it in any scenario, and that the bill
would require the Governor and the Comptroller, two independently
elected officials, to act jointly and unanimously, together with the
Budget Director. This requirement recognizes the extraordinary nature of
such an action, and would, in effect, mean that funds would be withheld
only after exhaustive consideration of the circumstances and potential
repercussions involved.

 
PRIOR LEGISLATIVE HISTORY:

New bill

 
FISCAL IMPLICATIONS:

TBD

 
EFFECTIVE DATE:
This act shall take effect immediately