The NYGFOA Legal and Legislative Committee identify and follow legislation before the State Legislature which could potentially impact government finance. Listed below are significant legislation which was considered during the 2018 Legislative Session.
For more detailed information on any of the laws or bills listed below such as full chapter/bill text, sponsors memos, and prior legislative history, click the link for the New York State Senate or New York State Assembly web site below.
2018 Legislative Watch
Legislation of Interest (as of 7/12/18)
Cash Management
A. 7619 (Zebrowski)/S. 286 (Robach) -- Status: Assembly Banking Committee/Senate Local Government Committee
DEPOSITS WITH CREDIT UNIONS AND SAVINGS BANKS: Credit unions, savings banks, savings and loans and federal savings associations would be authorized to accept deposits from municipal corporations. Currently, only commercial banks (with limited exceptions) can accept deposits from municipal corporations.
A. 6965 (Schimminger)/S. 4755 (Griffo) -- Status: Assembly Banking Committee/Senate Banking Committee
RATE OF INTEREST ON JUDGMENTS AND CLAIMS: The interest rate on judgments and accrued claims, current set in statute at 9%, would be changed to a market-rate of interest.
DEBT MANAGEMENT/LOCAL FINANCE LAW
Chapter 113, Laws of 2018 (A. 10349--Magnarelli)
EXTENDER OF DEBT ISSUANCE AND MANAGEMENT OPTIONS: This bill extends, until 2021, the following series of debt issuance and management options which provide local governments with flexibility in managing their use of debt:
1) Authorization for municipailties to pay the first installment on an issue of serial bonds 2 years after the date of issuance or 2 years after the date of the first BAN or BANs issued in anticipation of serial bonds, whichever is sooner;
2) Authorization to redeem bonds prior to maturity in a manner determined by the local government's governing board;
3) Authorization to issue variable rate bonds and notes;
4) Continues the suspension of the 5% down payment requirement in circumstances set in Section 107 of the NYS Local Finance Law;
5) Extends the ability of local governments to enter into lease contracts (installment purchase contracts), variable rate obligations, original issue discount bonds; and
6) Continues rules set by the Office of the State Comptroller pertaining to negotiated bond sales.
EFFECTIVE DATE: July 10, 2018
A. 2536 (Jenne)/S. 3849 (Valesky) -- Status: Assembly Local Government Committee/Passed Senate
ELECTRONIC OPEN AUCTION PUBLIC BOND SALE PILOT PROGRAM FOR MUNICIPALITIES: This legislation would add a new section to NYS Local Finance Law to establish a three year pilot program for all municipalities to sell municipal bonds via an open auction format instead of by a closed bid format. Such open auction would be conducted via an electronic means instead of being done in person. This pilot program would be used to assess the financial and administrative advantages of selling bonds via an open auction format by a nationally recognized electronic securities bidding platform. Legislation was passed in 2009 giving the County of Westchester similar authority. This legislation builds upon a new law enacted in 2013 which permits local governments to accept public bond bids electronically.
Infrastructure
A. 3907-A (Steck)/S. 3292-A (Tedisco) -- Status: Assembly Environmental Conservation Committee/Passed Senate
SAFE WATER INFRASTRUCTURE ACTION PROGRAM: The Safe Water Infrastructure Action Program (SWAP) would be established to provide funding to municipalities to replace and repair existing municipally-owned and funded drinking water, storm water and sanitary sewer systems through a similar methodology utilized by the Consolidated Local State and Highway Irmprovement Program (CHIPS).
A. 5741 (Rozic)/S. 4175 (Golden) -- Status: Assembly Transportation Committee/Passed Senate
CITY REIMBURSEMENT FOR MAINTENANCE OF STATE ARTERIAL HIGHWAYS: The reimbursement rate New York State pays to cities for the maintenance of State arterial highways within the cities' borders would increase from the existing 85 cents per square yard of pavement to $1.77 per square yard of pavement. The rate would be increased an additional 20 cents (compared to the current 10 cents) when the pavement area in on an elevated bridge. These rates, which were last increased since 1987, would also be adjusted annually based on the Consumer Price Index (CPI)..
InSURANCE
A. 2578-A (Steck)/S. 3660 (Griffo) -- Status: Assembly Insurance Committee/Passed Senate
AUTHORIZATION TO JOIN SELF-FUNDED OR SELF-INSURED HEALTH PLANS: A public entity, with consent of the county and governing body of the public entity, would have the authority to join a county self-funded or self-insured health plan in the county in which the public entity is located (in whole or part).
S. 8118 (Tedisco) -- Status: Passed Both Houses
NOTICE OF CHANGES TO RETIREES HEALTH INSURANCE CONTRACTS: Local governments would be required to give their retired officers, employees and their families a minimum of 30 days notice of any proposed health insurance plan changes prior to the governing board or public corporation authorizing or approving a health insurance contract or contract change. Note: According to the bill sponsor's memo, the Governor vetoed this bill in 2017. This bill (compared to the bill vetoed in 2017) reduces the notice from 45 to 30 days and requires notice only for premium or substantive changes in coverage.
LOCAL GOVERNMENT Finance (REVENUE ENRICHMENT)
A. 1720 (Magnarelli)/S. 3136 (DeFrancisco) -- Status: Assembly Real Property Taxation Committee/Passed Senate
TREATMENT OF UNPAID BUILDING AND FIRE CODE FINES: The real property tax law would be amended to authorize local governments to adopt a local law or resolution allowing for adjudicated fines for building or fire code violations to be deemed delinquent taxes and included in the tax levy of the affected property(ies).
MTA Mobility Tax
S. 4245 (Murphy)/A. 8730 (Thiele) -- Status: Senate Finance Committee/Assembly Ways and Means Committee
EXEMPTION OF LOCAL GOVERNMENTS FROM THE MTA MOBILITY TAX: Local governments outside of New York City located within the Metropolitan Commuter Transportation District would be exempted from paying the Metropolitan Communter Transportation Tax (MTA) Tax. The current tax, in place since 2009, is set at .34% of employees salaries and wages.
Other Post-Employment Benefits (OPEB)
A. 3607 (Butler) -- Status: Held for Consideration in Assembly Local Government Committee
ESTABLISHMENT OF OPEB RESERVE FUNDS: Local governments, school districtrs, BOCES, fire districts and other types of municipal corporations would be authorized under the NYS General Municipal Lawto establish a reserve fund to set aside monies to meet other post employment retirement benefits such as retiree health benefits. BOCES would also be added to the list of entities approved to establish a reserve fund for workers compensation claims.
PROCUREMENT
Chapter 70, Laws of 2018 (A. 10347--Magnarelli)
E-BIDDING EXTENDER: Originally enacted in 2003, this law extends until 2023 the ability for local governments to accept electronic bids for purchase contacts (in addition to paper bids) when soliciting on a competitive basis for products and services. Effective Date: June 1, 2018
S. 6686 (Ranzenhofer) -- Status: Passed Both Houses
PUBLIC ENTITY LIABILITY FOR DAMAGES TO CONTRACTORS: State Finance Law would be amended to allow any contractor, subcontractor, or materialman to make a claim against and be awarded danages from a public entity due to any act or omission attributed to construction delays.
A. 1541-B (Jenne) -- Status: Passed Both Houses
EXTENSION OF COOPERATIVE PURCHASING (PIGGYBACKING) PROCUREMENT: Authorization for political subdivisions to piggyback onto purchase contracts let by political subdivisions throughout the United States would be extended from July 31, 2019 to to July 31, 2021. The contracts are typically for the purchase of appraratus, materials, equipment and supplies.
A. 6572 (Cusick)/S. 4267 (DeFrancisco) -- Status: Assembly Rules Committee/Passed Senate
RETAINAGE ON PUBLIC CONSTRUCTION CONTRACTS: This bill would define substantial completion of a public construction contract (with regard to defining when retainage must be released) as when the public owner may occupy or utilize the work for its intended use.
Real Property Tax Levy Cap
A. 1059 (Galef) -- Status: Assembly Local Government Committee
TAX CAP EXCLUSION FOR CAPITAL PROJECTS: The NYS General Municipal Law would be amended to exempt certain capital projects undertaken by a municipality jointly with another municipal corporation from the real property tax levy cap.
A. 2699 (Steck) and A. 3402 (Abinanti) -- Stati: Assembly Education Committee
SCHOOL DISTRICT TAX CAP OVERRIDES: Under A. 2699 (Steck), school boards would be empowered to override the real property tax levy cap with a supermajority vote of the Board and a majority of qualified school district voters. Under A. 3402 (Abinanti), school boards would be empowered to override the property tax levy cap with 60% of the Board voting to override the cap and a majority of qualified school district voters. Currently a tax cap override for a school district budget requires a 60% approval vote of the budget by qualified school district voters.
S. 826 (Young) -- Status: Senate Education Committee
TAX CAP RESERVE FUNDS FOR SCHOOL DISTRICTS: School districts with low combined wealth ratios would be authorized to establish a reserve fund to ensure compliance with the tax cap in future school years.
A. 3799 (Jaffee)/S. 1707 (Marchione) -- Status: Assembly Ways and Means Committee/Senate Local Government Committee
"TWO PERCENT IS TWO PERCENT PROPERTY TAX CAP ACT": The real property tax levy cap would be set at 2% vs. the current formula which sets the cap at the lesser of 2% or the inflation factor (the inflation factor has been significantly under 2% for several years).
S. 1708 (Marchione) -- Status: Committed to Senate Rules Committee
TAX CAP EXCLUSION FOR MUNICIPAL CAPITAL PROJECTS: Capital projects of a county, city, town or village, including the construction of roads, sewers, waterlines and bridges, would be exempt from the real property tax levy cap if approved by 60% of qualified voters in the municipality.
Retirement
A. 3227-C (McDonald)/S. 3576-B (Tedisco) -- Status: Passed Assembly/Senate Civil Service and Pensions Committee
INCREASE IN RETIREES EARNING CAP: The cap on earnings, which New York State public employee retirees (under the age of 65) can earn without a reduction in pension benefits, would be increased from $30,000 to $35,000 per year beginning in 2019. The $30,000 cap has not been increased since 2007.00 to $250,000.
School District Finance
A. 3231 (Thiele)/S. 3970 (Seward) -- Status: Assembly Ways and Means Committee/Passed Senate
EXPANSION OF BUILDING AID EXCEPTION FOR SMALL PROJECTS: School districts are currently reimbursed in full in the following school year for one capital outlay project that is wholly funded (through capital outlay) for no more than $100,000. This bill would increase the threshold from $100,000 to $250,000.
A. 6566 (Brindisi)/S. 3962 (Seward) -- Status: Assembly Education Committee/Passed Senate
SCHOOL DISTRICT INTERNAL AUDIT FUNCTION: This bill would allow school districts to conduct the risk assessment portion of an internal audit every other year instead of annually.
A. 3823 (Nolan)/S. 515 (Young) -- Status: Assembly Local Government Committee/Passed Senate
WORKERS COMPENSATION RESERVE FUNDS FOR BOCES: Current law allows school districts and other similar entities to establish workers’ compensation reserve funds, but not board of cooperative education services (BOCES). This legislation would give BOCES the authorization to do so.
A. 7211-A (Paulin)/S. 4156-A (Marcellino) -- Status: Passed Assembly/Committed to Senate Rules Committee
PILOT PAYMENTS TO SCHOOL DISTRICTS DUE TO REDUCTION IN ASSESSMENT: The real property tax law would be amended to require that for any payment in lieu of taxes (PILOT), when the assessment of property making PILOT payments is challenged through the grievance process, that any reduction in PILOT payments made to a school district resulting from the challenge would not take effect until the following taxable status year.
A. 7353-B (Buchwald)/S. 4563-A (Golden) -- Status: Passed Assembly/Senate Civil Service and Pensions Committee
RESERVE FUND FOR RETIREMENT CONTRIBUTIONS TO NYSTRS: School districts and BOCES who are participating employers of the New York State Teachers' Retirement System (NYSTRS) would have the option to establish a retirement contribution reserve sub-fund with respect to contributions to NYSTRS. This is currently permitted for contributions to the New York State and Local Retirement System (NYS ERS).
Vetoed 12/18/17, Memo 223 (S. 4723-A--Carlucci)
COLLECTION OF SCHOOL TAXES: This legislation removes the requirement that school districts seek permission from their local town receiver of taxes to collect their own taxes. The school district would be required to notify the town no later than September 1st of each year prior to collecting its own taxes.
A. 2112-A (Nolan) -- Status: Passed Both Houses
RAISING THE CAP ON BOCES DISTRICT SUPERINTENDENT SALARIES: This legislation would increase the cap on BOCES District Superintendent salaries for the 2017-18 and subsequent school years by the lesser of 6% over the salary cap of the preceding school year or 98% of the NYS Commisioner of Education's salary earned in the 2017-18 school year. According to NYSCOSS and NYSSBA, this cap has not been increased since 2003.
Vetoed 12/18/17, Memo 209 (A. 5965--Galef)
EXEMPTING DEBT PAYMENTS ON BOCES CAPITAL PROJECTS FROM THE TAX CAP: Payments on debt made for BOCES capital projects would be excluded from the real property tax levy cap. This would be an expansion of the current debt exclusion provided to school districts (but not other local governments) under the 2011 Real Property Tax Levy Cap legislation.
State Mandates
A. 2922 (Brindisi)/S. 2323 (Griffo) -- Status: Assembly Local Government Committee/Committed to Senate Rules Committee
STATE FUNDING OF LOCAL MANDATES: The State Legislature would be prohibited from enacting any unfunded mandates that would impose a net additional cost on any municipal corporation. If such a mandate is enacted, the State would be responsible for the full amount of the resulting net additional cost.
A. 6874 (Hawley)/ S. 375 (Ortt) -- Status: Held for Consideration in Assembly Governmental Operations Committee/Senate Judiciary Committee
ONLINE PUBLICATION OF PUBLIC NOTICES: Local governments would be permitted to publish official notices (such as proposing a new local law, request for bids or public hearing announcements) online instead of local printed media.