Clarifies the definition of the term liabilities with respect to the period for which an appropriation remains in full force and effect

Justification

Section 40 of the State Finance Law outlines the timeframe for which appropriations included in the State budget remain in full force and effect and the date by which such appropriations shall lapse. Pursuant to subdivision 3 of such section, all appropriations made for any purpose currently cease to have force and effect - except for any liabilities already incurred at the close of the fiscal year. In the case of existing liabilities incurred pursuant to a capital projects appropriation, paragraph (c) of subdivision 3 provides that the final lapse date for such appropriations is the 15th of September following the close of the fiscal year. Thus, liabilities for capital projects made pursuant to existing budget appropriations may continue to be paid out until September of the following fiscal year. However, current law provides no clear definition of the term "liabilities" as utilized in subdivision 3 of Section 40 of the State Finance Law. As a result of this ambiguity, it is unclear exactly what types of obligations may be construed as a liability against an existing capital projects budget appropriation. The provisions of this bill would clarify that liabilities shall include payments for work performed or materials furnished both during the fiscal year and in the timeframe prior to the official lapse of the capital projects appropriations under which such liabilities are made.

Since April 1, 2010 contractors working on projects throughout the state of New York have not been getting paid for their work. These contractors are working with signed agreements between themselves and the state of New York with the understanding that they would be paid for the work they are doing. The purpose of this legislation is to ensure that those payments that have already been agreed to - and planned for - continue regardless of a late budget. Those workers who are out on our roads and bridges working to make them safer deserve to be paid for the work they are doing. Without moving these projects forward, New York's unemployment rate will approach double digits, and its transportation infrastructure will continue to lie in disrepair. For example, funding for Federal Stimulus projects has helped slow construction job losses from 33,400 in February to 25,400 in March - not authorizing payments to our contractors threatens to reverse these numbers as contractors cannot continue to work 'at risk' and may begin to lay-off workers. The prime duty of government is to protect the people's interests - by withholding payments to workers who are keeping our roads and bridges safe for travel we are not accomplishing that goal. It is imperative that this legislation be adopted in order to ensure that payment for critical infrastructure work will continue this year and in future years - even if a budget is not adopted by the April 1st deadline.

Legislative history

New Bill.

Fiscal implications

The provisions of this bill would result in no additional costs to the State.

Effective date

Immediate and shall be deemed to have been in full force and effect on and after March 31, 2010.