Relates to disregarding certain payments from the calculation of total spending for the purposes of adopting contingency budgets

1 Co-sponsor

• John A. DeFrancisco

BILL NUMBER:S4183

Title of bill

An act to amend the education law, in relation to disregarding certain payments required to be made by a board of cooperative educational services from the calculation of total spending for the purposes of adopting contingency budgets

Purpose

This bill permits school districts that are operating on a contingency budget to exclude the expenditure for BOCES capital projects from the statutory cap on contingency budgets.

Summary

Subdivision 4 of Section 2023 of the Education law is amended in the following ways:

Section 1. amends the final subparagraph (vii) of paragraph b which outlines the types of expenditures which are to be disregarded in deter- mining total spending when factoring a levy under contingency budget circumstances to add "; and".

Section 2. renumbers the last subparagraph (vii) of paragraph b because of a redundancy in numbering in the current law. It corrects the number to read "viii" and adds "; and" to the end of the subparagraph to allow for an additional subparagraph.

Section 2. also amends paragraph b to include an additional subparagraph "ix". The new subparagraph adds BOCES capital projects as, outlined in the BOCES law, to the list of expenditures which are to be disregarded in determining total spending when factoring a levy under contingency budget circumstances.

Section 3. This act shall take effect immediately.

Justification

In difficult financial times school districts find it increasingly common to see the qualified voters of their district reject a proposed school budget. Protections in Section 2023 of the Education Law author- ize the school district to create a contingency budget. Districts can increase the contingency budget over the prior year's budget to cover regularly increasing costs by 120% of the Consumer Price Index or 4%, whichever is less.

Paragraph b of Subdivision 4 of the same section outlines the types of expenditures which are to be disregarded in determining total spending when factoring an allowable levy under contingency budget circumstances. Current law provides the exclusion of capital expenditures resulting from the construction, acquisition, reconstruction, rehabilitation or improvement of school facilities, including debt service and lease

expenditures, subject to the approval of the qualified voters where required by law.

However, the law doesn't currently provide the same exclusion for the same capital expenditures when they are part of a BOCES capital project.

This bill allows BOCES capital expenses to be excluded from the types of expenditures which determine total spending in a contingency budget; therefore excluding the expenses from the statutory cap on contingency budgets.

It is clear and reasonable that the intent of Section 2023 of the Educa- tion Law was to exclude capital projects from the types of expenditures which determine total spending in a contingency budget. Without this exclusion in law, school districts which are hurting the most are forced to payout of their administrative budget for BOCES capital projects.

It's important to consider the mandates each piece of legislation we pass imposes on our schools especially as they may relate to budgeting. By enacting this legislation, we provide school districts which are in some of the most desperate need, a necessary tool for survival under contingency budgets.

Legislative history

S4400-A of 2010 - Reported to Finance

Fiscal impact

None to State.

Effective date

This act shall take effect immediately.