Requires the annual establishment of a legislative budget conference committee and subcommittees to resolve difference on the executive budget

On completion of efforts to resolve the differences between each house, each subcommittee shall submit a final report to the General Committee on the results of such efforts and make recommendations for final action to be taken on the budget bills submitted by the Governor for the ensuing fiscal year. Each subcommittee must issue a final report which must indicate the estimated impact that each of the subcommittees recommendations would have on State finances for the ensuing and next two fiscal years. The General Committee must either approve or agree upon modifications of each subcommittee report. The General Committee must issue a written report including all recommendations for final action to be taken on the budget bills submitted by the Governor for the ensuing year. That report must be made available to the public.

Section 2 amends subdivisions 1, 2 and 3 of section 40 of the State Finance Law to require the Executive to submit two separate appropriations for school aid for the upcoming fiscal year and the succeeding fiscal year.

Section 3 amends subdivisions 3 and 4 of section 92 of the State Finance Law by increasing the amount that can be deposited into the Tax Stabilization Reserve Fund from two-tenths of one percent of total General Fund disbursements to one-half of one percent of total General Fund disbursements. This section also increases the maximum balance that can be in the Tax Stabilization Reserve Fund from two percent to five percent of General Fund disbursements.

Section 4 adds a new section 53-a to the Legislative Law which provides that subsequent to the start of the State's April 1st fiscal year, the Legislature may not consider any other legislation until a State Budget has been adopted. An exception to this prohibition is made for appropriation bills submitted to the Legislature on message from the Governor certifying to the necessity of the immediate passage of such bill.

Section 5 amends section 54 of the Legislative Law by adding new subdivisions 3, 4, and 5. This section would require that when both houses are in agreement and prepared to finally act on appropriation bills submitted by the Governor, the Secretary of the Senate Finance Committee and the Secretary of the Assembly Ways and Means Committee must submit a letter to the Division of the Budget which states that both houses are in agreement and which includes information sufficient for the preparation of a plain language summary report of the appropriation bills and related legislation to be enacted by the Legislature. This summary report must be prepared by the Division of the Budget. The summary report shall be in such form as to indicate that anticipated disbursements will not exceed total anticipated receipts. The summary report will further describe the impact for such fiscal year and for the succeeding two fiscal years. The summary report shall be placed on the desks of each member of the Legislature and be made available to the public for a period of at least 48 hours prior to passage of the appropriation bills and related legislation by each house.

Section 6 amends paragraph (a) of subdivision 2 of section 54 of the Legislative Law to specify that the year-to-year increase in ALL FUNDS spending may not exceed the percentage increase in the rate of inflation for the same period. The exception would be in the event the state received unexpected Federal Funds, which would put us over the inflation rate increase.

Section 7 amends section zz of the State Finance Law, to limit the year-to-year increase in ALL FUNDS spending to the percentage increase in the rate of inflation for the same period.

Section 8 prevents the Legislature from funding community projects and organizations through lump sums, thereby providing better visibility of what State resources are supporting.

Section 9 states that this act shall take effect immediately provided that the provisions of section three of this act shall take effect three years after it shall have become a law.

Justification

Reforms are needed to ensure a timely budget and an open process that benefits all taxpayers. This legislation is part of a comprehensive plan for budget reform that will fix the historically flawed budget adoption process. The bill will enhance the State's fiscal stability by increasing the amount of money in the State's Rainy Day fund (Tax Stabilization Reserve fund) from two percent to five percent. Expanding the "rainy day" fund will ensure greater fiscal discipline in these uncertain economic times and will preserve recent improvements to the State's credit rating. Finally, the bill prevents the use of lump sums for member item grants, thereby providing transparency regarding the use of these funds.

Prior legislative history

A.95-A of 2007-08: Held for consideration in Ways and Means A.9749 of 2006: Held for consideration in Ways and Means A.745 of 2005: Held for consideration in Ways and Means A.1283-A of 2003-04: Held for consideration in Ways and Means A.7715 of 2002: Held for consideration in Ways and Means.

Fiscal implications

None to the State.

Effective date

This act shall take effect immediately provided that the provisions of section three of this act shall take effect three years after it shall have become a law.