NY State Senate Bill 2009-S1961

Senate Bill S1961

2009-2010 Legislative Session

Provides for the development of a capital needs plan as part of the state budget process; removes limitations on the time of submission of debt propositions

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Archive: Last Bill Status - In Senate Committee Judiciary Committee

Introduced
- In Committee Assembly
- In Committee Senate
- On Floor Calendar Assembly
- On Floor Calendar Senate
- Passed Assembly
- Passed Senate
Delivered to Governor
Signed By Governor

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Actions

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	Assembly Actions - Lowercase Senate Actions - UPPERCASE
Feb 01, 2010	opinion referred to judiciary
Jan 12, 2010	to attorney-general for opinion
Jan 06, 2010	referred to judiciary
Mar 18, 2009	opinion referred to judiciary
Feb 17, 2009	to attorney-general for opinion
Feb 10, 2009	referred to judiciary

2009-S1961 (ACTIVE) - Details

See Assembly Version of this Bill:: A7533
Current Committee:: Senate Judiciary
Law Section:: Constitution, Concurrent Resolutions to Amend
Laws Affected:: Amd Art 7 §§1, 2, 11 & 12, Constn
Versions Introduced in 2011-2012 Legislative Session:: A4567

2009-S1961 (ACTIVE) - Summary

Provides for the development of a capital needs plan as part of the state budget process; limits the use of certain debt proceeds to specified capital projects; removes limitations on the time of submission of debt propositions to the electorate.

2009-S1961 (ACTIVE) - Sponsor Memo

                                 BILL NUMBER:  S1961

 TITLE OF BILL :  CONCURRENT RESOLUTION OF THE SENATE AND ASSEMBLY
proposing amendments to sections 1, 2, 11 and 12 of article 7 of the
constitution, in relation to the submission of a capital program and
financing plan and the number of ballot propositions authorizing debt
that may be put to the voters in a single election

 PURPOSE :  To open the State's capital planning process to greater
scrutiny and public involvement and permit the electorate to choose
among multiple bond acts in a single year.

 SUMMARY OF PROVISIONS :  Section 1 amends section one of Article 7 of
the State Constitution to require the Governor to hold hearings on the
capital needs of the State, and submit to the Legislature an
assessment of capital assets and needs, at the times and the manner
provided by the Legislature.

Section 2 amends section two of Article 7 to require annual submission
of a detailed multi-year capital program and financing by the
Governor.

Section 3 amends section eleven of Article 7 of the Constitution to
eliminate the prohibition against submitting multiple bonds acts for
consideration by the voters in a single year.

Section 4 amends paragraph six of section twelve of Article 7, the
rule proscribing that funds borrowed by the State shall be used for
the work or purpose specified in the authorizing act or for the
payment of such debt. The amendment specifies that the term work or
purpose is limited to capital projects.

 JUSTIFICATION :  The failure of the November 1995 referendum on the
concurrent resolution passed by the Legislature in 1994 and 1995, to
amend the New York State Constitution to reform the State's borrowing
practices, was attributed to the public's perception that it contained
too many "loopholes." There appeared to be no significant objections
to the parts of the amendment that related to the State's capital
planning process and that authorized more than one bond issue to be
submitted to the voters in a single year. Accordingly, this proposed
amendment addresses those subjects.

The requirements for submission of a detailed capital plan and public
hearing on the State's capital needs are prerequisites for a
responsible State Debt policy. A detailed multi-year capital plan
prepared by the Governor, would provide valuable information about
proposed capital projects and the sources from which they would be
funded. The amendment is broadly worded, as appropriate for
constitutional requirements. The Legislature has already prescribed in
Chapter 204 of the Laws of 1994, the specific details of a capital
program and financing plan, which include among other things the
State' s long-term capital strategy and details of project financing
(borrowing and/or pay as you go), along with a schedule of expected
debt services cost. The Governor has issued capital plans pursuant to
this provision since it has been enacted. Future legislation could
make this requirement more or less comprehensive, but the requirement
itself should be constitutional to guard the basic integrity of the
capital planning process. The proposed authority of the Legislature to
obtain from the Governor periodic updates on the State's capital
assets and needs would improve its ability to oversee implementation
of the plan.

Public hearings on the capital program and financing plan would
provide the opportunity for review and comment on the plan and give
the Legislature important input for its review, modification and
oversight of the plan. Public hearings would help diminish the
perception that decision-making occurs behind closed doors, without
informed public participation.

The provision of the amendment clarifying that the "work or purpose"
for which general obligation bond proceeds may be spent includes only
capital works or purposes would preclude long-term financing of
operating expenses, practice at odds with good budget practices and
one that certainly conflicts with the spirit, if not the letter, of
the Constitution.

Eliminating the constitutional provision preventing more than one bond
act from appearing on a ballot would allow voters to pick and chose
those types of projects to which they think the allocation of general
tax revenues is more important. Permitting multiple issues on the
ballot in any year would encourage the use of voter-approved debt
because there would be a greater chance of voter approval of some
projects, if voters could choose among discrete, well-defined
purposes. Voter-approved debt, is, of course far preferable to
"backdoor" borrowing from a purely economic viewpoint, since voter
approved debt generally has a lower interest rate. In addition, with
backdoor borrowing, there is little accountability to the electorate,
which breeds suspicion and distrust in a public that sees the
circumvention of constitutional standards, notwithstanding that the
courts have pronounced backdoor borrowing legal as a technical matter.

 LEGISLATIVE HISTORY :
2007-08: S.2886 - Referred to Judiciary
2005-06: S.1466 - Referred to Judiciary
2003-04: S.1991 - Referred to Judiciary
2001-02: S.1501 - Referred to Judiciary

 FISCAL IMPLICATIONS :  Undetermined

 EFFECTIVE DATE :  This resolution shall be referred to the first
regular legislative session convening after the next succeeding
general election of members of the assembly, and, in conformity with
section 1 of article 19 of the constitution, be published for 3 months
previous to the time of such election.

2009-S1961 (ACTIVE) - Bill Text download pdf

                            
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                  1961

                       2009-2010 Regular Sessions

                            I N  S E N A T E

                            February 10, 2009
                               ___________

Introduced  by  Sen.  STACHOWSKI  -- read twice and ordered printed, and
  when printed to be committed to the Committee on Judiciary

            CONCURRENT RESOLUTION OF THE SENATE AND ASSEMBLY

proposing amendments to sections 1, 2, 11 and 12 of  article  7  of  the
  constitution,  in  relation to the submission of a capital program and
  financing plan and the number of ballot propositions authorizing  debt
  that may be put to the voters in a single election

  Section 1.  Resolved (if the Assembly concur), That section 1 of arti-
cle 7 of the constitution be amended to read as follows:
  Section 1. For the preparation of the budget, the head of each depart-
ment  of  state  government, except the legislature and judiciary, shall
furnish the governor such estimates and information in such form and  at
such  times as the governor may require, copies of which shall forthwith
be furnished to the appropriate committees  of  the  legislature.    The
governor  shall  hold hearings thereon at which the governor may require
the attendance of heads of departments and their subordinates.    Desig-
nated representatives of such committees shall be entitled to attend the
hearings  thereon  and to make inquiry concerning any part thereof.  THE
GOVERNOR ALSO SHALL HOLD HEARINGS, IN A MANNER PRESCRIBED BY LAW, ON THE
CAPITAL NEEDS OF THE STATE, AND SUBMIT TO THE LEGISLATURE AN  ASSESSMENT
OF  CAPITAL ASSETS AND NEEDS, AT SUCH TIMES AND IN THE MANNER PRESCRIBED
BY LAW.
  Itemized estimates of the financial needs of the  legislature,  certi-
fied  by  the  presiding  officer  of  each house, and of the judiciary,
approved by the court of appeals and certified by the chief judge of the
court of appeals, shall be transmitted to the governor  not  later  than
the first day of December in each year for inclusion in the budget with-
out  revision  but  with  such  recommendations as the governor may deem
proper.  Copies of the itemized estimates of the financial needs of  the
judiciary also shall forthwith be transmitted to the appropriate commit-
tees of the legislature.

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD89098-01-9

S. 1961                             2

  S 2. Resolved (if the Assembly concur), That section 2 of article 7 of
the constitution be amended to read as follows:
  S  2.  Annually,  on  or before the first day of February in each year
following the year fixed by the constitution for the election of  gover-
nor and lieutenant governor, and on or before the second Tuesday follow-
ing the first day of the annual meeting of the legislature, in all other
years,  the governor shall submit to the legislature a budget containing
a complete plan of expenditures proposed to be made before the close  of
the  ensuing  fiscal  year  and  all moneys and revenues estimated to be
available therefor, together with an explanation of the  basis  of  such
estimates  and recommendations as to proposed legislation, if any, which
the governor may deem necessary to provide moneys  and  revenues  suffi-
cient  to  meet  such  proposed expenditures. It shall also contain such
other recommendations and information as the governor  may  deem  proper
and such additional information as may be required by law.
  ANNUALLY,  AS PROVIDED BY LAW, THE GOVERNOR SHALL SUBMIT TO THE LEGIS-
LATURE A DETAILED MULTI-YEAR CAPITAL PROGRAM AND FINANCING PLAN.
  S 3. Resolved (if the Assembly concur), That section 11 of  article  7
of the constitution be amended to read as follows:
  S  11. Except the debts or refunding debts specified in sections 9, 10
and 13 of this article, no debt shall be hereafter contracted by  or  in
behalf  of  the  state, unless such debt shall be authorized by law, for
some single work or purpose, to be distinctly specified therein. No such
law shall take effect until it shall, at a general election,  have  been
submitted  to  the people, and have received a majority of all the votes
cast for and against it at such election nor shall it be submitted to be
voted on within three months after  its  passage  [nor  at  any  general
election  when  any other law or any bill shall be submitted to be voted
for or against].
  The legislature may, at any time after the approval of such law by the
people, if no debt shall have  been  contracted  in  pursuance  thereof,
repeal  the same; and may at any time, by law, forbid the contracting of
any further debt or liability under such law.
  S 4. Resolved  (if the Assembly concur), That subdivision 6 of section
12 of article 7 of the constitution be amended to read as follows:
  6. The money arising from any loan creating  such  debt  or  liability
shall be applied only to CAPITAL PROJECTS FOR the work or purpose speci-
fied  in  the act authorizing such debt or liability, or for the payment
of such debt or liability, including any notes or obligations issued  in
anticipation of the sale of bonds evidencing such debt or liability.
  S  5. Resolved (if the Assembly concur), That the foregoing amendments
be referred to the first regular legislative session convening after the
next succeeding general election of members of  the  assembly,  and,  in
conformity  with  section  1  of  article  19  of  the  constitution, be
published for 3 months previous to the time of such election.

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