S T A T E   O F   N E W   Y O R K
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                                  4060

                       2011-2012 Regular Sessions

                          I N  A S S E M B L Y

                            February 1, 2011
                               ___________

Introduced  by M. of A. MORELLE, DESTITO, CANESTRARI, REILLY, LUPARDO --
  Multi-Sponsored by -- M. of  A.  BENEDETTO,  BOYLAND,  GALEF,  HEVESI,
  HOYT,  LAVINE,  MAGEE,  MAYERSOHN,  ROBINSON, SWEENEY -- read once and
  referred to the Committee on Ways and Means

            CONCURRENT RESOLUTION OF THE SENATE AND ASSEMBLY

proposing amendments to article 7 of the constitution,  in  relation  to
  the authorization of debt in times of public emergency, a limit on the
  total  amount  of  state  debt, the establishment of a debt management
  board, and refunding of state debts

  Section 1. Resolved (if the Senate concur), That section 10 of article
7 of the constitution be amended to read as follows:
  S 10. In addition to the above limited power to  contract  debts,  the
state  may contract debts to repel invasion, suppress insurrection, [or]
defend the state in war, [or to suppress forest fires] OR TO RESPOND  TO
ANY  OTHER EMERGENCY STEMMING FROM A DISASTER INCLUDING, BUT NOT LIMITED
TO, A DISASTER CAUSED BY AN ACT OF TERRORISM; but the money arising from
the contracting of such debts shall be applied for the purpose for which
it was raised, or to repay such debts, and to no other purpose whatever.
NO DEBT SHALL BE CONTRACTED PURSUANT TO THIS SECTION WITHOUT THE CONCUR-
RENCE OF THE  GOVERNOR,  THE  COMPTROLLER,  THE  ATTORNEY  GENERAL,  AND
TWO-THIRDS OF THE MEMBERS ELECTED TO EACH BRANCH OF THE LEGISLATURE; AND
THE GOVERNOR SHALL HAVE POWER TO SUMMON THE COMPTROLLER AND THE ATTORNEY
GENERAL  AND  CONVENE  THE  LEGISLATURE IN EXTRAORDINARY SESSION FOR THE
PURPOSE OF CONSIDERING SUCH EMERGENCY DEBT. AT THE TIME, DATE AND  PLACE
APPOINTED  BY  THE  GOVERNOR, NO OTHER SUBJECT SHALL BE ACTED UPON UNTIL
EACH, IN THE FOLLOWING ORDER, HAS GIVEN THEIR APPROVAL OR ANY ONE THERE-
OF HAS GIVEN THEIR DISAPPROVAL OF THE DEBT PROPOSED BY THE  GOVERNOR  TO
ENABLE  THE  STATE TO RESPOND TO SUCH EMERGENCY: THE GOVERNOR, THE COMP-
TROLLER, THE ATTORNEY GENERAL, THE SENATE AND THE ASSEMBLY. THE PROPOSAL
OF SUCH EMERGENCY DEBT SHALL BE IN THE FORM OF A RESOLUTION PREPARED AND
SUBMITTED BY THE GOVERNOR TO THE COMPTROLLER, THE ATTORNEY GENERAL,  THE
SENATE AND THE ASSEMBLY, WHO SHALL APPROVE OR DISAPPROVE SUCH RESOLUTION

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

                                                           LBD89084-01-1

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WITHOUT  ANY  CHANGES THERETO; AND IF SUCH RESOLUTION IS APPROVED BY THE
GOVERNOR, THE COMPTROLLER, THE ATTORNEY GENERAL, AND TWO-THIRDS  OF  THE
MEMBERS ELECTED TO EACH BRANCH OF THE LEGISLATURE, THEN SUCH LAW OR LAWS
SHALL  BE  ENACTED  AS  MAY  BE NECESSARY OR ADVISABLE TO IMPLEMENT SUCH
APPROVAL.
  S 2. Resolved (if the Senate concur), That section 11 of article 7  of
the constitution be amended to read as follows:
  S  11. 1. 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] ON behalf of the state, unless such debt shall be authorized by law
PURSUANT  TO  THIS  SECTION,  for  some  single  work  or purpose, to be
distinctly specified therein. DEBT SUBJECT TO  THE  PROVISIONS  OF  THIS
SECTION SHALL BE ANY DEBT OR OBLIGATION SUPPORTED IN WHOLE OR IN PART BY
ANY  FINANCING  ARRANGEMENT  WHEREBY  THE  STATE AGREES, WHETHER BY LAW,
CONTRACT, OR OTHERWISE, TO MAKE PAYMENTS WHICH ARE TO BE USED,  DIRECTLY
OR  INDIRECTLY,  FOR  THE  PAYMENT  OF  PRINCIPAL,  INTEREST, OR RELATED
PAYMENTS ON INDEBTEDNESS INCURRED OR CONTRACTED BY THE STATE ITSELF  FOR
ANY  PURPOSE,  OR  BY ANY STATE AGENCY, MUNICIPALITY, INDIVIDUAL, PUBLIC
AUTHORITY OR OTHER PUBLIC OR PRIVATE CORPORATION OR ANY OTHER ENTITY FOR
STATE CAPITAL OR OPERATING PURPOSES OR TO FINANCE GRANTS, LOANS OR OTHER
ASSISTANCE PAYMENTS MADE OR TO BE MADE BY OR ON BEHALF OF THE STATE  FOR
ANY PURPOSE. IF THE STATE AGREES TO MAKE FUTURE REVENUES FROM A SPECIFIC
STATE SOURCE AVAILABLE FOR THE PURPOSE OF SUPPORTING DEBT OF ANY MUNICI-
PALITY,  INDIVIDUAL,  PUBLIC OR PRIVATE CORPORATION OR ANY OTHER ENTITY,
SUCH DEBT SHALL BE CONSIDERED TO BE A DEBT FOR THE PURPOSE OF  FINANCING
A  STATE GRANT, LOAN OR OTHER ASSISTANCE PAYMENT AND SHALL BE SUBJECT TO
THE PROVISIONS OF THIS SECTION.  THE PROVISIONS OF  THIS  SECTION  SHALL
APPLY (I) WHETHER OR NOT THE OBLIGATION OF THE STATE TO MAKE PAYMENTS IS
SUBJECT  TO APPROPRIATION OR IS OTHERWISE CONTINGENT, OR (II) WHETHER OR
NOT DEBT SERVICE IS TO BE PAID FROM A REVENUE STREAM TRANSFERRED BY  THE
STATE TO ANOTHER PARTY THAT IS RESPONSIBLE FOR MAKING SUCH PAYMENTS.
  [No]  2.  EXCEPT AS PROVIDED IN SUBDIVISION 5 OF THIS SECTION, 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 BY THE LEGISLATURE nor at
any general election when any MORE THAN FOUR other  [law  or  any  bill]
PROPOSITIONS shall be submitted to be voted for or against.
  3. DURING THE FISCAL YEAR BEGINNING IN CALENDAR YEAR 2019 AND IN EVERY
FISCAL  YEAR  THEREAFTER,  NO PROPOSITION CONCERNING SUCH A LAW SHALL BE
SUBMITTED TO THE PEOPLE FOR APPROVAL, AND NO SUCH LAW SHALL  BE  ENACTED
PURSUANT  TO  SUBDIVISION  5 OF THIS SECTION, UNLESS THE TOTAL PRINCIPAL
AMOUNT OF DEBT TO BE AUTHORIZED BY SUCH LAW,  TOGETHER  WITH  THE  TOTAL
PRINCIPAL AMOUNT OF DEBT EITHER ALREADY OUTSTANDING, OR AUTHORIZED TO BE
INCURRED  PURSUANT  TO THIS SECTION, SHALL BE EQUAL TO OR LESS THAN FIVE
PERCENT OF THE TOTAL PERSONAL INCOME OF THE STATE. SUCH PERSONAL  INCOME
IS TO BE DETERMINED BY THE DEBT MANAGEMENT BOARD ESTABLISHED PURSUANT TO
SUBDIVISION  4 OF THIS SECTION IN ACCORDANCE WITH SUCH COMMONLY ACCEPTED
METHOD OR METHODS OF MEASURING THE ECONOMIC ACTIVITY  OF  THE  STATE  AS
SHALL BE PRESCRIBED BY A LAW, WHICH SHALL BE ENACTED NOT LATER THAN JUNE
30,  2013, AND AS MAY BE AMENDED FROM TIME TO TIME NOT INCONSISTENT WITH
THIS SECTION. DEBT SUBJECT TO THE LIMIT IMPOSED BY  THIS  SECTION  SHALL
INCLUDE ALL DEBT SUPPORTED BY FINANCING ARRANGEMENTS DESCRIBED IN SUBDI-
VISION  1  OF  THIS SECTION BUT SHALL NOT INCLUDE THE DEBTS SPECIFIED IN
SECTIONS 9, 10 AND 13 OF THIS ARTICLE OR DEBT PREVIOUSLY  AUTHORIZED  BY
LAW  BUT  NOT INCURRED BECAUSE OF THE SUBSEQUENT REPEAL OF SUCH AUTHORI-

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ZATION OR THE SUBSEQUENT PROHIBITION OF SUCH DEBT PURSUANT  TO  SUBDIVI-
SION 10 OF THIS SECTION.
  4.  A  DEBT  MANAGEMENT  BOARD,  CONSISTING OF THE GOVERNOR, THE COMP-
TROLLER AND A THIRD PERSON JOINTLY SELECTED  BY  THE  GOVERNOR  AND  THE
COMPTROLLER,  SHALL  BE  ESTABLISHED  BY  LAW. THE DEBT MANAGEMENT BOARD
SHALL ANNUALLY DETERMINE, WITHIN  THE  LIMITS  ESTABLISHED  PURSUANT  TO
SUBDIVISION  3  OF  THIS SECTION, A DEBT AFFORDABILITY LEVEL WHICH SHALL
PRESCRIBE FOR EACH FISCAL YEAR  AND  FORECAST  FOR  THE  TWO  SUCCEEDING
FISCAL  YEARS  THE  TOTAL AMOUNT OF ADDITIONAL DEBT THAT MAY BE INCURRED
AND THE TOTAL DEBT SERVICE OBLIGATIONS THAT MAY  BE  UNDERTAKEN  BY  THE
STATE WITHOUT OVERBURDENING PRESENT OR FUTURE GENERATIONS. THE EXECUTIVE
BUDGET  SUBMITTED  PURSUANT TO SECTION 2 OF THIS ARTICLE FOR THE ENSUING
FISCAL YEAR AND THE BUDGET BILLS SUBMITTED PURSUANT TO SECTION 3 OF THIS
ARTICLE FOR SUCH FISCAL YEAR SHALL NOT PROPOSE ANY  ADDITIONAL  DEBT  OR
NEW  DEBT  SERVICE  EXPENSE  THAT  WOULD  CAUSE TOTAL DEBT OR TOTAL DEBT
SERVICE EXPENSES TO EXCEED THE DEBT AFFORDABILITY LEVEL  PRESCRIBED  FOR
SUCH FISCAL YEAR, AND NEITHER THE GOVERNOR NOR THE LEGISLATURE SHALL, BY
LAW, CONTRACT, OR OTHERWISE, PROVIDE FOR ANY ADDITIONAL DEBT OR NEW DEBT
SERVICE  EXPENSE  THAT  WOULD  CAUSE  TOTAL  DEBT  OR TOTAL DEBT SERVICE
EXPENSES TO EXCEED SUCH LEVEL WITHOUT THE UNANIMOUS APPROVAL OF THE DEBT
MANAGEMENT BOARD. DURING THE FISCAL YEAR BEGINNING IN 2019 AND IN  EVERY
FISCAL  YEAR  THEREAFTER,  THE DEBT MANAGEMENT BOARD SHALL NOT ESTABLISH
ANY DEBT AFFORDABILITY LEVEL WHICH WOULD RESULT  IN  A  TOTAL  PRINCIPAL
AMOUNT  OF  DEBT IN EXCESS OF THE LIMIT ESTABLISHED PURSUANT TO SUBDIVI-
SION 3 OF THIS SECTION.
  5. DURING ANY FISCAL YEAR, A LAW  OR  LAWS  AUTHORIZING  DEBT  IN  THE
COMBINED  AGGREGATE  AMOUNT  OF ONE BILLION DOLLARS, OR THREE PERCENT OF
THE LIMIT DETERMINED PURSUANT TO SUBDIVISION 3 OF THIS SECTION, WHICHEV-
ER IS GREATER, MAY BE ENACTED WITHOUT BEING SUBMITTED  FOR  APPROVAL  BY
THE  PEOPLE.  HOWEVER,  IN  NO EVENT SHALL DEBT INCURRED IN FISCAL YEARS
BEGINNING IN 2019 AND THEREAFTER PURSUANT TO SUCH LAW OR LAWS RESULT  IN
A  TOTAL  PRINCIPAL  AMOUNT  OF  DEBT  IN EXCESS OF THE LIMIT DETERMINED
PURSUANT TO SUBDIVISION 3 OF THIS  SECTION  OR  THE  DEBT  AFFORDABILITY
LEVEL ESTABLISHED PURSUANT TO SUBDIVISION 4 OF THIS SECTION.
  6.  ALL  DEBT  SUBJECT  TO  THE  PROVISIONS OF THIS SECTION (I) SHALL,
EXCEPT FOR REFUNDING DEBT,  BE  INCURRED  ONLY  FOR  A  CAPITAL  PURPOSE
AUTHORIZED BY LAW, AND (II) SHALL, IF INCURRED ON OR AFTER THE FIRST DAY
OF THE FIRST FISCAL YEAR BEGINNING AT LEAST ONE YEAR AFTER THE EFFECTIVE
DATE  OF  THIS  SUBDIVISION, BE IN THE FORM OF OBLIGATIONS ISSUED BY THE
COMPTROLLER.
  7. NOTHING CONTAINED IN THIS SECTION SHALL INVALIDATE DEBT OBLIGATIONS
OUTSTANDING ON THE EFFECTIVE DATE OF  THIS  SUBDIVISION  THAT  WOULD  BE
SUBJECT  TO  THE PROVISIONS OF THIS SECTION IF INCURRED AFTER THE EFFEC-
TIVE DATE OF THIS SUBDIVISION, AND THE STATE MAY CONTINUE TO PROVIDE FOR
PAYMENTS RELATED TO SUCH DEBT ON THE SAME TERMS UNDER  WHICH  SUCH  DEBT
WAS  INCURRED;  PROVIDED,  HOWEVER,  THAT NO SUCH DEBT SHALL BE REFUNDED
UNLESS (I) SUCH REFUNDING COMPLIES IN ALL RESPECTS WITH THE REQUIREMENTS
OF SECTION 13 OF THIS ARTICLE, AND (II) ANY REFUNDING OBLIGATIONS ISSUED
ON OR AFTER THE FIRST DAY OF THE FIRST FISCAL YEAR  BEGINNING  AT  LEAST
ONE  YEAR AFTER THE EFFECTIVE DATE OF THIS SUBDIVISION ARE ISSUED BY THE
COMPTROLLER. SUCH OUTSTANDING DEBT  OBLIGATIONS  AND  THE  DEBT  SERVICE
EXPENSES,  DIRECT  OR  INDIRECT,  REQUIRED FOR SUCH OBLIGATIONS SHALL BE
INCLUDED IN THE DETERMINATION OF THE LIMIT IMPOSED BY SUBDIVISION  3  OF
THIS  SECTION AND THE DEBT AFFORDABILITY LEVEL REQUIRED BY SUBDIVISION 4
OF THIS SECTION. THE PROVISIONS OF SECTION 16 OF THIS ARTICLE SHALL  NOT
APPLY TO STATE PAYMENTS WITH RESPECT TO ANY SUCH OBLIGATIONS UNLESS SUCH

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PROVISIONS WOULD HAVE APPLIED PRIOR TO THE EFFECTIVE DATE OF THIS SUBDI-
VISION.
  8.  DEBT  OBLIGATIONS ISSUED TO REFUND OUTSTANDING STATE DEBT, REGARD-
LESS OF WHETHER SUCH OUTSTANDING DEBT WAS INCURRED PRIOR TO  THE  EFFEC-
TIVE  DATE OF THIS SUBDIVISION, SHALL NOT BE COUNTED FOR THE PURPOSES OF
THE LIMIT IMPOSED BY SUBDIVISION 3 OF THIS SECTION AND THE DEBT AFFORDA-
BILITY LEVEL REQUIRED BY SUBDIVISION 4 OF THIS SECTION IF SUCH REFUNDING
COMPLIES IN ALL RESPECTS WITH SECTION 13 OF THIS ARTICLE.  DEBT  SERVICE
EXPENSES ON DEBT THAT HAS BEEN REFUNDED IN ACCORDANCE WITH SECTION 13 OF
THIS  ARTICLE SHALL BE EXCLUDED FROM THE DEBT AFFORDABILITY LEVEL TO THE
EXTENT THAT SUCH DEBT SERVICE EXPENSES ARE TO BE  PAID  FROM  AN  ESCROW
FUND  ESTABLISHED  WITH PROCEEDS OF THE REFUNDING DEBT, BUT DEBT SERVICE
EXPENSES ON THE REFUNDING DEBT SHALL BE INCLUDED EXCEPT  TO  THE  EXTENT
THAT SUCH DEBT SERVICE EXPENSES ARE TO BE PAID FROM SUCH AN ESCROW FUND.
FOR  PURPOSES  OF  THIS  SUBDIVISION  AND  SUBDIVISIONS  7 AND 9 OF THIS
SECTION, ANY REFUNDING DEBT THAT DOES NOT EXTEND BEYOND THE FINAL  MATU-
RITY  OF  THE  DEBT  BEING  REFUNDED  SHALL BE DEEMED TO COMPLY WITH THE
PROVISIONS OF SUBDIVISION 6 OF SECTION 13 OF THIS ARTICLE, PROVIDED THAT
THERE IS AN ACTUAL DEBT SERVICE SAVINGS IN EVERY YEAR TO MATURITY  AS  A
RESULT OF THE ISSUANCE OF THE REFUNDING DEBT.
  9.  AFTER  THE  EFFECTIVE  DATE  OF  THIS SECTION THE STATE SHALL NOT,
EXCEPT AS SPECIFICALLY AUTHORIZED IN SOME OTHER SECTION OF THIS  CONSTI-
TUTION,  AGREE  TO MAKE PAYMENTS, DIRECTLY OR INDIRECTLY, WHETHER OR NOT
SUBJECT TO APPROPRIATION, THAT ARE TO BE AVAILABLE TO PAY  DEBT  SERVICE
ON  ANY DEBT INCURRED BY A MUNICIPALITY, INDIVIDUAL, PUBLIC AUTHORITY OR
OTHER PUBLIC OR  PRIVATE  CORPORATION  OR  ANY  OTHER  ENTITY,  FOR  ANY
PURPOSE,  IF  SUCH  PAYMENTS ARE EXPECTED TO BE USED TO PAY DEBT SERVICE
ONLY IF OTHER SOURCES AVAILABLE FOR THE  PAYMENT  OF  DEBT  SERVICE  ARE
INADEQUATE.   OUTSTANDING DEBT THAT WOULD BE PROHIBITED BY THIS SUBDIVI-
SION IF SUCH DEBT HAD BEEN INCURRED AFTER THE  EFFECTIVE  DATE  OF  THIS
SUBDIVISION  MAY BE REFUNDED BY THE ENTITY THAT INCURRED THE OUTSTANDING
DEBT PROVIDED THAT ALL PROVISIONS  OF  SUBDIVISIONS  7  AND  8  OF  THIS
SECTION  ARE  COMPLIED  WITH  EXCEPT THE REQUIREMENT THAT SUCH REFUNDING
DEBT OBLIGATIONS BE  ISSUED  BY  THE  COMPTROLLER,  AND  REFUNDING  DEBT
SERVICE  EXPENSES SHALL ONLY BE INCLUDED IN THE DEBT AFFORDABILITY LEVEL
IF THE DEBT SERVICE EXPENSES ON THE DEBT BEING REFUNDED WOULD HAVE  BEEN
INCLUDED.
  10.  The  legislature may, at any time after the ENACTMENT OR 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 3. Resolved (if the Senate concur), That subdivisions  6  and  7  of
section  13  of  article  7  of  the  constitution be amended to read as
follows:
  6. In no event shall the last annual installment  or  contribution  on
any portion of refunding debt, including refunding obligations issued to
refund  other  refunding obligations, be made after THE LAST INSTALLMENT
ON THE RELEVANT PORTION OF THE DEBT TO BE REFUNDED OR AFTER  the  termi-
nation  of the period of probable life of the projects financed with the
proceeds of the relevant portion of the debt to be refunded, or any debt
previously refunded with  the  refunding  obligations  to  be  refunded,
determined as of the date of issuance of the original obligations pursu-
ant  to  section  12  of this article to finance such projects, or forty
years from such date, if earlier; provided, however, that in lieu of the
foregoing, an entire refunding issue or portion thereof  may  be  struc-

A. 4060                             5

tured  to  mature over the remaining weighted average useful life of all
projects financed with the obligations being refunded.
  7.  [Subject  to the provisions of subdivision 5 of this section, each
annual installment or contribution of principal of refunding obligations
shall be equal to the amount that would be required by subdivision 1  of
section  12  of  this article if such installments or contributions were
required to be made from the year that the next installment or  contrib-
ution would have been due on the obligations to be refunded, if they had
not been refunded, until the final maturity of the refunding obligations
but  excluding  any  year  in which no installment or contribution would
have been due on the obligations to be refunded or, in the  alternative,
the] THE total payments of principal and interest on the refunding bonds
shall  be  less  in  each  year  to  their final maturity than the total
payments of principal and interest on the bonds to be refunded  in  each
such year.
  S 4. Resolved (if the Senate 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.