§ 3858. Control period. 1. A control period shall begin as of the
effective date of this title and may be reimposed during an advisory
period if the authority determines at any time that a fiscal crisis is
imminent or that any of the following events has occurred or that there
is a substantial likelihood and imminence of such occurrence: (a) the
city shall have failed to adopt a balanced budget, financial plan or
budget modification as required by sections thirty-eight hundred
fifty-six and thirty-eight hundred fifty-seven of this title, (b) the
city shall have failed to pay the principal of or interest on any of its
bonds or notes when due, (c) the city shall have incurred an operating
deficit of one percent or more in the aggregate results of operations of
any major fund of the city or a covered organization during its fiscal
year assuming all revenues and expenditures are reported in accordance
with generally accepted accounting principles, subject to the provisions
of this title, (d) the chief fiscal officer's certification at any time,
at the request of the authority or on the chief fiscal officer's
initiative, which certification shall be made from time to time as
promptly as circumstances warrant and reported to the authority, that on
the basis of facts existing at such time such officer could not make the
certification described in subdivision one of section thirty-eight
hundred fifty-one of this title, or (e) the city shall have violated any
provision of this title. A control period shall terminate when the
authority has determined that the city qualifies for the onset of an
advisory period as provided under subdivision one of section
thirty-eight hundred fifty-one of this title. After onset of an advisory
period, the authority shall annually consider paragraphs (a) through (e)
of this subdivision and determine whether, in its judgment, any of the
events described in such paragraphs have occurred and the authority
shall publish each such determination. Any certification made by the
chief fiscal officer hereunder shall be based on such officer's written
determination which shall take into account a report and opinion of an
independent expert in the marketing of municipal securities selected by
the authority, and the opinion of such expert and any other information
taken into account shall be made public when delivered to the authority.
Notwithstanding any part of the foregoing to the contrary, in no event
shall any control period continue beyond June thirtieth, two thousand
thirty-seven.

2. In carrying out the purposes of this title during any control
period, the authority:

(a) shall approve or disapprove the financial plan and the financial
plan modifications of the city, as provided in sections thirty-eight
hundred fifty-six and thirty-eight hundred fifty-seven of this title,
and shall formulate and adopt its own modifications to the financial
plan, as necessary; such modifications shall become effective upon their
adoption by the authority;

(b) may set a maximum level of spending for any proposed budget of any
covered organization;

(c) may impose a wage and/or hiring freeze: (i) During a control
period, upon a finding by the authority that a wage and/or hiring freeze
is essential to the adoption or maintenance of a city budget or a
financial plan that is in compliance with this title, the authority
shall be empowered to order that all increases in salary or wages of
employees of the city and employees of covered organizations which will
take effect after the date of the order pursuant to collective
bargaining agreements, other analogous contracts or interest arbitration
awards, now in existence or hereafter entered into, requiring such
salary or wage increases as of any date thereafter are suspended. Such
order may also provide that all increased payments for holiday and
vacation differentials, shift differentials, salary adjustments
according to plan and step-ups or increments for employees of the city
and employees of covered organizations which will take effect after the
date of the order pursuant to collective bargaining agreements, other
analogous contracts or interest arbitration awards requiring such
increased payments as of any date thereafter are, in the same manner,
suspended. For the purposes of computing the pension base of retirement
allowances, any suspended salary or wage increases and any other
suspended payments shall not be considered as part of compensation or
final compensation or of annual salary earned or earnable.

(ii) Notwithstanding the provisions of subparagraph (i) of this
paragraph, this subdivision shall not be applicable to employees of the
city or employees of a covered organization subject to a collective
bargaining agreement or an employee of the city or a covered
organization not subject to a collective bargaining agreement where the
collective bargaining representative or such unrepresented employee has
agreed to a deferment of salary or wage increase, by an instrument in
writing which has been certified by the authority as being an acceptable
and appropriate contribution toward alleviating the fiscal crisis of the
city. Any such agreement to a deferral of salary or wage increase may
provide that for the purposes of computing the pension base of
retirement allowances, any deferred salary or wage increase may be
considered as part of compensation or final compensation or of annual
salary earned or earnable;

(iii) Notwithstanding the provisions of subparagraphs (i) and (ii) of
this paragraph, no retroactive pay adjustments of any kind shall accrue
or be deemed to accrue during the period of wage freeze, and no such
additional amounts shall be paid at the time a wage freeze is lifted, or
at any time thereafter.

(d) shall periodically evaluate the suspension of salary or wage
increases or suspensions of other increased payments or benefits, and
may, if it finds that the fiscal crisis, in the sole judgment of the
authority has abated, terminate such suspensions;

(e) shall review and approve or disapprove any collective bargaining
agreement to be entered into by the city or any covered organization, or
purporting to bind, the city or any covered organization. Prior to
entering into any collective bargaining agreement, the city or any
covered organization shall submit a copy of such collective bargaining
agreement to the authority, accompanied by an analysis of the projected
costs of such agreement and a certification that execution of the
agreement will be in accordance with the financial plan. Such submission
shall be in such form and include such additional information as the
authority may prescribe. The authority shall promptly review the terms
of such collective bargaining agreement and the supporting information
in order to determine compliance with the financial plan, and shall
disapprove any collective bargaining agreement which, in its judgment,
would be inconsistent with the financial plan. No collective bargaining
agreement binding, or purporting to bind, the city or any covered
organization after the effective date of this title shall be valid and
binding upon the city or any covered organization unless first approved
by resolution of the authority.

(f) shall act jointly with the city in selecting members of any
interest arbitration panel. Notwithstanding any other evidence presented
by the city, the covered organization or any recognized employee
organization, the arbitration panel must, prior to issuing any final
decision, provide the authority with the opportunity to present evidence
regarding the fiscal condition of the city;

(g) shall take any action necessary in order to implement the
financial plan should the city or any covered organization have failed
to comply with any material action necessary to fulfill the plan,
provided, however, the authority shall provide seven (7) days notice of
its determination that the city or any covered organization has not
complied prior to taking any such action.

(h) may review and approve or disapprove contracts or other
obligations binding or purporting to bind the city or any covered
organization;

(i) shall, with respect to any proposed borrowing by or on behalf of
the city or any covered organization on or after July first, two
thousand three, review the terms of and comment, within thirty days
after notification by the city or covered organization of a proposed
borrowing, on the prudence of each proposed issuance of bonds or notes
to be issued by the city or covered organization and no such borrowing
shall be made unless first reviewed, commented upon and approved by the
authority. The authority shall comment within thirty days after
notification by the city or covered organization of a proposed borrowing
to the mayor, the comptroller, the council, the director of the budget
and the state comptroller and indicate approval or disapproval of the
proposed borrowing. Notwithstanding the foregoing, neither the city nor
any covered organization shall be prohibited from issuing bonds or notes
to pay outstanding bonds or notes; and, provided further, the first
issuance of debt pursuant to chapter six hundred five of the laws of two
thousand, as amended, shall be excluded from this requirement;

(j) may review the operation, management, efficiency and productivity
of the city and any covered organizations as the authority may
determine, and make reports thereon; examine the potential to enhance
the revenue of the city or any covered organization; audit compliance
with the financial plan in such areas as the authority may determine;
recommend to the city and the covered organizations such measures
relating to their operations, management, efficiency and productivity as
the authority deems appropriate to reduce costs, enhance revenue, and
improve services so as to advance the purposes of this title;

(k) may require the city to undertake certain actions to advance
serious and in-depth exploration of a merger of services with the
county, including identification and analysis of options; development of
a detailed fiscal and programmatic plan; identification of city, county,
and state impediments; and fostering of informed public debate;

(l) may review and approve or disapprove the terms of any proposed
settlement of claims against the city or any covered organization in
excess of fifty thousand dollars;

(m) may obtain from the city, the covered organizations, comptroller,
and the state comptroller, as appropriate, all information required
pursuant to this section, and such other financial statements and
projections, budgetary data and information, and management reports and
materials as the authority deems necessary or desirable to accomplish
the purposes of this title; and inspect, copy and audit such books and
records of the city and the covered organizations as the authority deems
necessary or desirable to accomplish the purposes of this title;

(n) may perform such audits and reviews of the city and any agency
thereof and any covered organizations as it deems necessary; and

(o) may issue, from time to time and to the extent it deems necessary
or desirable in order to accomplish the purposes of this title, to the
appropriate official of the city and each covered organization, such
orders necessary to accomplish the purposes of this title, including,
but not limited to, timely and satisfactory implementation of an
approved financial plan. Any order so issued shall be binding upon the
official to whom it was issued and failure to comply with such order
shall subject the official to the penalties described in subdivision
three of this section.

3. (a) During any control period (i) no officer or employee of the
city or of any of the covered organizations shall make or authorize an
obligation or other liability in excess of the amount available therefor
under the financial plan as then in effect; (ii) no officer or employee
of the city or of any of the covered organizations shall involve the
city or any of the covered organizations in any contract or other
obligation or liability for the payment of money for any purpose
required to be approved by the authority unless such contract has been
so approved and unless such contract or obligation or liability is in
compliance with the approved financial plan as then in effect.

(b) No officer or employee of the city or any of the covered
organizations shall take any action in violation of any valid order of
the authority or shall fail or refuse to take any action required by any
such order or shall prepare, present or certify any information
(including any projections or estimates) or report to the authority or
any of its agents that is false or misleading, or, upon learning that
any such information is false or misleading, shall fail promptly to
advise the authority or its agents thereof.

(c) In addition to any penalty or liability under any other law, any
officer or employee of the city or any of the covered organizations who
shall violate paragraph (a) or (b) of this subdivision shall be subject
to appropriate administrative discipline, including, when circumstances
warrant, suspension from duty without pay or removal from office by
order of either the governor or the mayor; and any officer or employees
of the city or any of the covered organizations who shall knowingly and
willfully violate paragraph (a) or (b) of this subdivision shall, upon
conviction, be guilty of a misdemeanor.

(d) In the case of a violation of paragraph (a) or (b) of this
subdivision by an officer or employee of the city or of a covered
organization, the mayor or the chief executive officer of such covered
organization shall immediately report to the authority all pertinent
facts together with a statement of the action taken thereon.