Bill Text: NY A01777 | 2009-2010 | General Assembly | Introduced
Bill Title: 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
Spectrum: Partisan Bill (Democrat 21-0)
Status: (Introduced - Dead) 2010-01-06 - referred to ways and means [A01777 Detail]
Download: New_York-2009-A01777-Introduced.html
S T A T E O F N E W Y O R K ________________________________________________________________________ 1777 2009-2010 Regular Sessions I N A S S E M B L Y January 12, 2009 ___________ Introduced by M. of A. MORELLE, DESTITO, CANESTRARI, WEPRIN, DelMONTE, GIANARIS, REILLY, LUPARDO -- Multi-Sponsored by -- M. of A. BENEDETTO, BENJAMIN, BOYLAND, CARROZZA, FIELDS, GALEF, HEVESI, HOYT, KOON, 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 1 Section 1. Resolved (if the Senate concur), That section 10 of article 2 7 of the constitution be amended to read as follows: 3 S 10. In addition to the above limited power to contract debts, the 4 state may contract debts to repel invasion, suppress insurrection, [or] 5 defend the state in war, [or to suppress forest fires] OR TO RESPOND TO 6 ANY OTHER EMERGENCY STEMMING FROM A DISASTER INCLUDING, BUT NOT LIMITED 7 TO, A DISASTER CAUSED BY AN ACT OF TERRORISM; but the money arising from 8 the contracting of such debts shall be applied for the purpose for which 9 it was raised, or to repay such debts, and to no other purpose whatever. 10 NO DEBT SHALL BE CONTRACTED PURSUANT TO THIS SECTION WITHOUT THE CONCUR- 11 RENCE OF THE GOVERNOR, THE COMPTROLLER, THE ATTORNEY GENERAL, AND 12 TWO-THIRDS OF THE MEMBERS ELECTED TO EACH BRANCH OF THE LEGISLATURE; AND 13 THE GOVERNOR SHALL HAVE POWER TO SUMMON THE COMPTROLLER AND THE ATTORNEY 14 GENERAL AND CONVENE THE LEGISLATURE IN EXTRAORDINARY SESSION FOR THE 15 PURPOSE OF CONSIDERING SUCH EMERGENCY DEBT. AT THE TIME, DATE AND PLACE 16 APPOINTED BY THE GOVERNOR, NO OTHER SUBJECT SHALL BE ACTED UPON UNTIL 17 EACH, IN THE FOLLOWING ORDER, HAS GIVEN THEIR APPROVAL OR ANY ONE THERE- 18 OF HAS GIVEN THEIR DISAPPROVAL OF THE DEBT PROPOSED BY THE GOVERNOR TO 19 ENABLE THE STATE TO RESPOND TO SUCH EMERGENCY: THE GOVERNOR, THE COMP- 20 TROLLER, THE ATTORNEY GENERAL, THE SENATE AND THE ASSEMBLY. THE PROPOSAL 21 OF SUCH EMERGENCY DEBT SHALL BE IN THE FORM OF A RESOLUTION PREPARED AND 22 SUBMITTED BY THE GOVERNOR TO THE COMPTROLLER, THE ATTORNEY GENERAL, THE EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets [ ] is old law to be omitted. LBD89048-02-9 A. 1777 2 1 SENATE AND THE ASSEMBLY, WHO SHALL APPROVE OR DISAPPROVE SUCH RESOLUTION 2 WITHOUT ANY CHANGES THERETO; AND IF SUCH RESOLUTION IS APPROVED BY THE 3 GOVERNOR, THE COMPTROLLER, THE ATTORNEY GENERAL, AND TWO-THIRDS OF THE 4 MEMBERS ELECTED TO EACH BRANCH OF THE LEGISLATURE, THEN SUCH LAW OR LAWS 5 SHALL BE ENACTED AS MAY BE NECESSARY OR ADVISABLE TO IMPLEMENT SUCH 6 APPROVAL. 7 S 2. Resolved (if the Senate concur), That section 11 of article 7 of 8 the constitution be amended to read as follows: 9 S 11. 1. Except the debts or refunding debts specified in sections 9, 10 10 and 13 of this article, no debt shall be hereafter contracted by or 11 [in] ON behalf of the state, unless such debt shall be authorized by law 12 PURSUANT TO THIS SECTION, for some single work or purpose, to be 13 distinctly specified therein. DEBT SUBJECT TO THE PROVISIONS OF THIS 14 SECTION SHALL BE ANY DEBT OR OBLIGATION SUPPORTED IN WHOLE OR IN PART BY 15 ANY FINANCING ARRANGEMENT WHEREBY THE STATE AGREES, WHETHER BY LAW, 16 CONTRACT, OR OTHERWISE, TO MAKE PAYMENTS WHICH ARE TO BE USED, DIRECTLY 17 OR INDIRECTLY, FOR THE PAYMENT OF PRINCIPAL, INTEREST, OR RELATED 18 PAYMENTS ON INDEBTEDNESS INCURRED OR CONTRACTED BY THE STATE ITSELF FOR 19 ANY PURPOSE, OR BY ANY STATE AGENCY, MUNICIPALITY, INDIVIDUAL, PUBLIC 20 AUTHORITY OR OTHER PUBLIC OR PRIVATE CORPORATION OR ANY OTHER ENTITY FOR 21 STATE CAPITAL OR OPERATING PURPOSES OR TO FINANCE GRANTS, LOANS OR OTHER 22 ASSISTANCE PAYMENTS MADE OR TO BE MADE BY OR ON BEHALF OF THE STATE FOR 23 ANY PURPOSE. IF THE STATE AGREES TO MAKE FUTURE REVENUES FROM A SPECIFIC 24 STATE SOURCE AVAILABLE FOR THE PURPOSE OF SUPPORTING DEBT OF ANY MUNICI- 25 PALITY, INDIVIDUAL, PUBLIC OR PRIVATE CORPORATION OR ANY OTHER ENTITY, 26 SUCH DEBT SHALL BE CONSIDERED TO BE A DEBT FOR THE PURPOSE OF FINANCING 27 A STATE GRANT, LOAN OR OTHER ASSISTANCE PAYMENT AND SHALL BE SUBJECT TO 28 THE PROVISIONS OF THIS SECTION. THE PROVISIONS OF THIS SECTION SHALL 29 APPLY (I) WHETHER OR NOT THE OBLIGATION OF THE STATE TO MAKE PAYMENTS IS 30 SUBJECT TO APPROPRIATION OR IS OTHERWISE CONTINGENT, OR (II) WHETHER OR 31 NOT DEBT SERVICE IS TO BE PAID FROM A REVENUE STREAM TRANSFERRED BY THE 32 STATE TO ANOTHER PARTY THAT IS RESPONSIBLE FOR MAKING SUCH PAYMENTS. 33 [No] 2. EXCEPT AS PROVIDED IN SUBDIVISION 5 OF THIS SECTION, NO such 34 law shall take effect until it shall, at a general election, have been 35 submitted to the people, and have received a majority of all the votes 36 cast for and against it at such election nor shall it be submitted to be 37 voted on within three months after its passage BY THE LEGISLATURE nor at 38 any general election when any MORE THAN FOUR other [law or any bill] 39 PROPOSITIONS shall be submitted to be voted for or against. 40 3. DURING THE FISCAL YEAR BEGINNING IN CALENDAR YEAR 2017 AND IN EVERY 41 FISCAL YEAR THEREAFTER, NO PROPOSITION CONCERNING SUCH A LAW SHALL BE 42 SUBMITTED TO THE PEOPLE FOR APPROVAL, AND NO SUCH LAW SHALL BE ENACTED 43 PURSUANT TO SUBDIVISION 5 OF THIS SECTION, UNLESS THE TOTAL PRINCIPAL 44 AMOUNT OF DEBT TO BE AUTHORIZED BY SUCH LAW, TOGETHER WITH THE TOTAL 45 PRINCIPAL AMOUNT OF DEBT EITHER ALREADY OUTSTANDING, OR AUTHORIZED TO BE 46 INCURRED PURSUANT TO THIS SECTION, SHALL BE EQUAL TO OR LESS THAN FIVE 47 PERCENT OF THE TOTAL PERSONAL INCOME OF THE STATE. SUCH PERSONAL INCOME 48 IS TO BE DETERMINED BY THE DEBT MANAGEMENT BOARD ESTABLISHED PURSUANT TO 49 SUBDIVISION 4 OF THIS SECTION IN ACCORDANCE WITH SUCH COMMONLY ACCEPTED 50 METHOD OR METHODS OF MEASURING THE ECONOMIC ACTIVITY OF THE STATE AS 51 SHALL BE PRESCRIBED BY A LAW, WHICH SHALL BE ENACTED NOT LATER THAN JUNE 52 30, 2011, AND AS MAY BE AMENDED FROM TIME TO TIME NOT INCONSISTENT WITH 53 THIS SECTION. DEBT SUBJECT TO THE LIMIT IMPOSED BY THIS SECTION SHALL 54 INCLUDE ALL DEBT SUPPORTED BY FINANCING ARRANGEMENTS DESCRIBED IN SUBDI- 55 VISION 1 OF THIS SECTION BUT SHALL NOT INCLUDE THE DEBTS SPECIFIED IN 56 SECTIONS 9, 10 AND 13 OF THIS ARTICLE OR DEBT PREVIOUSLY AUTHORIZED BY A. 1777 3 1 LAW BUT NOT INCURRED BECAUSE OF THE SUBSEQUENT REPEAL OF SUCH AUTHORI- 2 ZATION OR THE SUBSEQUENT PROHIBITION OF SUCH DEBT PURSUANT TO SUBDIVI- 3 SION 10 OF THIS SECTION. 4 4. A DEBT MANAGEMENT BOARD, CONSISTING OF THE GOVERNOR, THE COMP- 5 TROLLER AND A THIRD PERSON JOINTLY SELECTED BY THE GOVERNOR AND THE 6 COMPTROLLER, SHALL BE ESTABLISHED BY LAW. THE DEBT MANAGEMENT BOARD 7 SHALL ANNUALLY DETERMINE, WITHIN THE LIMITS ESTABLISHED PURSUANT TO 8 SUBDIVISION 3 OF THIS SECTION, A DEBT AFFORDABILITY LEVEL WHICH SHALL 9 PRESCRIBE FOR EACH FISCAL YEAR AND FORECAST FOR THE TWO SUCCEEDING 10 FISCAL YEARS THE TOTAL AMOUNT OF ADDITIONAL DEBT THAT MAY BE INCURRED 11 AND THE TOTAL DEBT SERVICE OBLIGATIONS THAT MAY BE UNDERTAKEN BY THE 12 STATE WITHOUT OVERBURDENING PRESENT OR FUTURE GENERATIONS. THE EXECUTIVE 13 BUDGET SUBMITTED PURSUANT TO SECTION 2 OF THIS ARTICLE FOR THE ENSUING 14 FISCAL YEAR AND THE BUDGET BILLS SUBMITTED PURSUANT TO SECTION 3 OF THIS 15 ARTICLE FOR SUCH FISCAL YEAR SHALL NOT PROPOSE ANY ADDITIONAL DEBT OR 16 NEW DEBT SERVICE EXPENSE THAT WOULD CAUSE TOTAL DEBT OR TOTAL DEBT 17 SERVICE EXPENSES TO EXCEED THE DEBT AFFORDABILITY LEVEL PRESCRIBED FOR 18 SUCH FISCAL YEAR, AND NEITHER THE GOVERNOR NOR THE LEGISLATURE SHALL, BY 19 LAW, CONTRACT, OR OTHERWISE, PROVIDE FOR ANY ADDITIONAL DEBT OR NEW DEBT 20 SERVICE EXPENSE THAT WOULD CAUSE TOTAL DEBT OR TOTAL DEBT SERVICE 21 EXPENSES TO EXCEED SUCH LEVEL WITHOUT THE UNANIMOUS APPROVAL OF THE DEBT 22 MANAGEMENT BOARD. DURING THE FISCAL YEAR BEGINNING IN 2017 AND IN EVERY 23 FISCAL YEAR THEREAFTER, THE DEBT MANAGEMENT BOARD SHALL NOT ESTABLISH 24 ANY DEBT AFFORDABILITY LEVEL WHICH WOULD RESULT IN A TOTAL PRINCIPAL 25 AMOUNT OF DEBT IN EXCESS OF THE LIMIT ESTABLISHED PURSUANT TO SUBDIVI- 26 SION 3 OF THIS SECTION. 27 5. DURING ANY FISCAL YEAR, A LAW OR LAWS AUTHORIZING DEBT IN THE 28 COMBINED AGGREGATE AMOUNT OF ONE BILLION DOLLARS, OR THREE PERCENT OF 29 THE LIMIT DETERMINED PURSUANT TO SUBDIVISION 3 OF THIS SECTION, WHICHEV- 30 ER IS GREATER, MAY BE ENACTED WITHOUT BEING SUBMITTED FOR APPROVAL BY 31 THE PEOPLE. HOWEVER, IN NO EVENT SHALL DEBT INCURRED IN FISCAL YEARS 32 BEGINNING IN 2017 AND THEREAFTER PURSUANT TO SUCH LAW OR LAWS RESULT IN 33 A TOTAL PRINCIPAL AMOUNT OF DEBT IN EXCESS OF THE LIMIT DETERMINED 34 PURSUANT TO SUBDIVISION 3 OF THIS SECTION OR THE DEBT AFFORDABILITY 35 LEVEL ESTABLISHED PURSUANT TO SUBDIVISION 4 OF THIS SECTION. 36 6. ALL DEBT SUBJECT TO THE PROVISIONS OF THIS SECTION (I) SHALL, 37 EXCEPT FOR REFUNDING DEBT, BE INCURRED ONLY FOR A CAPITAL PURPOSE 38 AUTHORIZED BY LAW, AND (II) SHALL, IF INCURRED ON OR AFTER THE FIRST DAY 39 OF THE FIRST FISCAL YEAR BEGINNING AT LEAST ONE YEAR AFTER THE EFFECTIVE 40 DATE OF THIS SUBDIVISION, BE IN THE FORM OF OBLIGATIONS ISSUED BY THE 41 COMPTROLLER. 42 7. NOTHING CONTAINED IN THIS SECTION SHALL INVALIDATE DEBT OBLIGATIONS 43 OUTSTANDING ON THE EFFECTIVE DATE OF THIS SUBDIVISION THAT WOULD BE 44 SUBJECT TO THE PROVISIONS OF THIS SECTION IF INCURRED AFTER THE EFFEC- 45 TIVE DATE OF THIS SUBDIVISION, AND THE STATE MAY CONTINUE TO PROVIDE FOR 46 PAYMENTS RELATED TO SUCH DEBT ON THE SAME TERMS UNDER WHICH SUCH DEBT 47 WAS INCURRED; PROVIDED, HOWEVER, THAT NO SUCH DEBT SHALL BE REFUNDED 48 UNLESS (I) SUCH REFUNDING COMPLIES IN ALL RESPECTS WITH THE REQUIREMENTS 49 OF SECTION 13 OF THIS ARTICLE, AND (II) ANY REFUNDING OBLIGATIONS ISSUED 50 ON OR AFTER THE FIRST DAY OF THE FIRST FISCAL YEAR BEGINNING AT LEAST 51 ONE YEAR AFTER THE EFFECTIVE DATE OF THIS SUBDIVISION ARE ISSUED BY THE 52 COMPTROLLER. SUCH OUTSTANDING DEBT OBLIGATIONS AND THE DEBT SERVICE 53 EXPENSES, DIRECT OR INDIRECT, REQUIRED FOR SUCH OBLIGATIONS SHALL BE 54 INCLUDED IN THE DETERMINATION OF THE LIMIT IMPOSED BY SUBDIVISION 3 OF 55 THIS SECTION AND THE DEBT AFFORDABILITY LEVEL REQUIRED BY SUBDIVISION 4 56 OF THIS SECTION. THE PROVISIONS OF SECTION 16 OF THIS ARTICLE SHALL NOT A. 1777 4 1 APPLY TO STATE PAYMENTS WITH RESPECT TO ANY SUCH OBLIGATIONS UNLESS SUCH 2 PROVISIONS WOULD HAVE APPLIED PRIOR TO THE EFFECTIVE DATE OF THIS SUBDI- 3 VISION. 4 8. DEBT OBLIGATIONS ISSUED TO REFUND OUTSTANDING STATE DEBT, REGARD- 5 LESS OF WHETHER SUCH OUTSTANDING DEBT WAS INCURRED PRIOR TO THE EFFEC- 6 TIVE DATE OF THIS SUBDIVISION, SHALL NOT BE COUNTED FOR THE PURPOSES OF 7 THE LIMIT IMPOSED BY SUBDIVISION 3 OF THIS SECTION AND THE DEBT AFFORDA- 8 BILITY LEVEL REQUIRED BY SUBDIVISION 4 OF THIS SECTION IF SUCH REFUNDING 9 COMPLIES IN ALL RESPECTS WITH SECTION 13 OF THIS ARTICLE. DEBT SERVICE 10 EXPENSES ON DEBT THAT HAS BEEN REFUNDED IN ACCORDANCE WITH SECTION 13 OF 11 THIS ARTICLE SHALL BE EXCLUDED FROM THE DEBT AFFORDABILITY LEVEL TO THE 12 EXTENT THAT SUCH DEBT SERVICE EXPENSES ARE TO BE PAID FROM AN ESCROW 13 FUND ESTABLISHED WITH PROCEEDS OF THE REFUNDING DEBT, BUT DEBT SERVICE 14 EXPENSES ON THE REFUNDING DEBT SHALL BE INCLUDED EXCEPT TO THE EXTENT 15 THAT SUCH DEBT SERVICE EXPENSES ARE TO BE PAID FROM SUCH AN ESCROW FUND. 16 FOR PURPOSES OF THIS SUBDIVISION AND SUBDIVISIONS 7 AND 9 OF THIS 17 SECTION, ANY REFUNDING DEBT THAT DOES NOT EXTEND BEYOND THE FINAL MATU- 18 RITY OF THE DEBT BEING REFUNDED SHALL BE DEEMED TO COMPLY WITH THE 19 PROVISIONS OF SUBDIVISION 6 OF SECTION 13 OF THIS ARTICLE, PROVIDED THAT 20 THERE IS AN ACTUAL DEBT SERVICE SAVINGS IN EVERY YEAR TO MATURITY AS A 21 RESULT OF THE ISSUANCE OF THE REFUNDING DEBT. 22 9. AFTER THE EFFECTIVE DATE OF THIS SECTION THE STATE SHALL NOT, 23 EXCEPT AS SPECIFICALLY AUTHORIZED IN SOME OTHER SECTION OF THIS CONSTI- 24 TUTION, AGREE TO MAKE PAYMENTS, DIRECTLY OR INDIRECTLY, WHETHER OR NOT 25 SUBJECT TO APPROPRIATION, THAT ARE TO BE AVAILABLE TO PAY DEBT SERVICE 26 ON ANY DEBT INCURRED BY A MUNICIPALITY, INDIVIDUAL, PUBLIC AUTHORITY OR 27 OTHER PUBLIC OR PRIVATE CORPORATION OR ANY OTHER ENTITY, FOR ANY 28 PURPOSE, IF SUCH PAYMENTS ARE EXPECTED TO BE USED TO PAY DEBT SERVICE 29 ONLY IF OTHER SOURCES AVAILABLE FOR THE PAYMENT OF DEBT SERVICE ARE 30 INADEQUATE. OUTSTANDING DEBT THAT WOULD BE PROHIBITED BY THIS SUBDIVI- 31 SION IF SUCH DEBT HAD BEEN INCURRED AFTER THE EFFECTIVE DATE OF THIS 32 SUBDIVISION MAY BE REFUNDED BY THE ENTITY THAT INCURRED THE OUTSTANDING 33 DEBT PROVIDED THAT ALL PROVISIONS OF SUBDIVISIONS 7 AND 8 OF THIS 34 SECTION ARE COMPLIED WITH EXCEPT THE REQUIREMENT THAT SUCH REFUNDING 35 DEBT OBLIGATIONS BE ISSUED BY THE COMPTROLLER, AND REFUNDING DEBT 36 SERVICE EXPENSES SHALL ONLY BE INCLUDED IN THE DEBT AFFORDABILITY LEVEL 37 IF THE DEBT SERVICE EXPENSES ON THE DEBT BEING REFUNDED WOULD HAVE BEEN 38 INCLUDED. 39 10. The legislature may, at any time after the ENACTMENT OR approval 40 of such law [by the people], if no debt shall have been contracted in 41 pursuance thereof, repeal the same; and may at any time, by law, forbid 42 the contracting of any further debt or liability under such law. 43 S 3. Resolved (if the Senate concur), That subdivisions 6 and 7 of 44 section 13 of article 7 of the constitution be amended to read as 45 follows: 46 6. In no event shall the last annual installment or contribution on 47 any portion of refunding debt, including refunding obligations issued to 48 refund other refunding obligations, be made after THE LAST INSTALLMENT 49 ON THE RELEVANT PORTION OF THE DEBT TO BE REFUNDED OR AFTER the termi- 50 nation of the period of probable life of the projects financed with the 51 proceeds of the relevant portion of the debt to be refunded, or any debt 52 previously refunded with the refunding obligations to be refunded, 53 determined as of the date of issuance of the original obligations pursu- 54 ant to section 12 of this article to finance such projects, or forty 55 years from such date, if earlier; provided, however, that in lieu of the 56 foregoing, an entire refunding issue or portion thereof may be struc- A. 1777 5 1 tured to mature over the remaining weighted average useful life of all 2 projects financed with the obligations being refunded. 3 7. [Subject to the provisions of subdivision 5 of this section, each 4 annual installment or contribution of principal of refunding obligations 5 shall be equal to the amount that would be required by subdivision 1 of 6 section 12 of this article if such installments or contributions were 7 required to be made from the year that the next installment or contrib- 8 ution would have been due on the obligations to be refunded, if they had 9 not been refunded, until the final maturity of the refunding obligations 10 but excluding any year in which no installment or contribution would 11 have been due on the obligations to be refunded or, in the alternative, 12 the] THE total payments of principal and interest on the refunding bonds 13 shall be less in each year to their final maturity than the total 14 payments of principal and interest on the bonds to be refunded in each 15 such year. 16 S 4. Resolved (if the Senate concur), That the foregoing amendments be 17 referred to the first regular legislative session convening after the 18 next succeeding general election of members of the assembly, and, in 19 conformity with section 1 of article 19 of the constitution, be 20 published for 3 months previous to the time of such election.