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Bureau of State Accounting Operations

Bureau of State Accounting Operations. Tom Mahoney Director tmahoney@osc.state.ny.us State Government Budget Overview Appropriations State’s Financial Condition. Melody Goetz Assistant Director mgoetz@osc.state.ny.us Revenue Accounting Fund Accounting OSC Website STIP.

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Bureau of State Accounting Operations

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  1. Bureau of State Accounting Operations Tom Mahoney Director tmahoney@osc.state.ny.us State Government Budget Overview Appropriations State’s Financial Condition Melody Goetz Assistant Director mgoetz@osc.state.ny.us Revenue Accounting Fund Accounting OSC Website STIP

  2. Central Accounting System (CAS) • The Office of the State Comptroller (OSC) is responsible for the operation and development of the NYS Central Accounting System (CAS). • The CAS is the hub of financial activity in the State; it is used for accounting for all revenues of the State, controlling agency appropriations and spending levels, processing 18 million financial transactions annually, issuing 15,000 payments daily, reflecting the results of these transactions in more than 700 reports for a wide range of users, and generating critical input to the audited financial statements for the State.

  3. State Government Structure • Executive – ALL State Departments and Agencies • Legislative – Assembly and Senate • Judicial – Court Administration

  4. Statutes That Guide Us • The State Constitution • State Finance Law • Article VII Appropriation Bills • Article VII Language Bills • Other Consolidated Laws • Federal Laws and Regulations

  5. State Constitution • Requires Annual Budget Submission • Restricts Payments From State Treasury • Restricts Payments from Agency (sole custody) Accounts • Defines Appropriation and Reappropriation

  6. State Finance Law – Key Fiscal Provisions • Article 2 - GENERAL FISCAL PROVISIONS § 2 - Definitions § 2A - Additional Definitions § 3 - Fiscal Year § 4 - Payments, Transfers and Deposits § 7 - Duties of Dept of Taxation and Finance § 8 - Duties of the Comptroller § 8B - Additional Duties of the Comptroller §40 – Period of Appropriations

  7. State Finance Law – Key Fiscal Provisions - continued • Article 6 - (§ 70 - 99-S) FUNDS OF THE STATE • Article 7 - (§100-122-A) ACCOUNTS AND AUDITS

  8. State Finance LawArticle 3 – The Budget • § 20. Division of the Budget • § 21. Auxiliary Powers of Executive Department • § 22. The Budget; Contents • § 22-a. Synopsis of Requests for Appropriations; Submittal by Budget Director • § 22-b. Report of the Legislature on the Enacted Budget • § 22-c. Capital Program and Financing Plan • § 23. Plans and Estimates • § 24. Budget Bills • § 25. Reappropriation Bills • § 26. Maintaining Capital Assets • § 27. Scheduled Maintenance Appropriations

  9. Appropriation Accounting In this segment, we will: • Discuss Executive Budget Submission • Discuss Fundamental Principles for accounting and controlling authorized State spending • Examine the nature of an appropriation, its characteristics and underlying principles

  10. Executive Budget Submission Quick Start Budget Discussion • November 5th Legislative Session Begins • Legislature convenes on the first Wednesday after the first Monday in January.

  11. Executive Budget Submission - continued Budget Due • On or before the 2nd Tuesday following the annual meeting of the legislature. • On or before the February 1st in each year following the election of Governor and Lieutenant Governor. Bottom Line • Third Tuesday after the first Monday in January, except in years following gubernatorial elections when it must be submitted by February 1.

  12. Article VII Bills As part of the Executive Budget, the Governor presents to the Legislature a number of appropriation and language bills which provide the legal authorization for spending from Funds of the State and the means to finance such spending.

  13. Article VII Appropriation Bills • Public Protection and General Government • Legislature and Judiciary • Debt Service • Education, Labor and Family Assistance • Health and Mental Hygiene • Transportation, Economic Development and Environmental Conservation

  14. Article VII Language Bills • Along with the submission of the Appropriation Bills, the Governor also submits legislation to amend State laws governing programs and revenues. • This Legislation is needed to implement the State’s Financial Plans for the upcoming fiscal year, and beyond.

  15. Budget Amendments The State Constitution permits the Governor to amend or supplement the Executive Budget within 30 calendar days after its submission or, with the consent of the Legislature, at any time before the close of the legislative session. Such revisions, additions or deletions, conveyed to the heads of the fiscal committees in a memorandum, reflect necessary corrections or responses to new situations or conditions arising after the preparation of the Executive Budget.

  16. Appropriation Bills Become Law Executive Budget Appropriations (those recommended by the Governor) are Law Immediately Upon Enactment by the Legislature EXCEPT • Legislature and Judiciary • Additions by the Legislature • These must be signed by the Governor

  17. Appropriation - Defined An appropriation is a statutory authorization to make expenditures during a specific State fiscal year, and to make disbursements for the purposes designated, up to the stated amount of the appropriation: • By a State Dept or Agency • For a Named Program • Payable From A Specified Fund/Account • For Specified Purposes, Activities or Projects

  18. Appropriation Periods • State Constitution – 2 Year Life Maximum • State Finance Law - Section 40 Provides Liability Periods, Appropriation Periods and Lapse Dates • Budget Bills Oftentimes NOTWITHSTAND State Finance Law and Permit Liabilities ‘Heretofore’ Or ‘Hereafter’ To Be Paid From Current Year Appropriations

  19. Deficiency Appropriation • A deficiency appropriation is used to meet actual or anticipated obligations not foreseen when the annual budget and any supplemental budgets were enacted. • It might add to a previously authorized appropriation anticipated to be inadequate, or provide a new appropriation to finance an existing or anticipated liability for which no appropriation exists. • A deficiency appropriation typically applies to the fiscal year during which it is made.

  20. OSC – Appropriation Management The Appropriation (Budget) Management function ensures that agencies do not obligate or disburse funds in excess of those appropriated or segregated. This function also provides agencies with tools for managing appropriations, for example, organization, program, project and cost center levels. Appropriation Managementconsists of structuring the budget and allocating and controlling funds In Accordance With State Laws.

  21. Budget Certificates Required • Pursuant to State Law – No Spending From an Appropriation Can Occur Until Approved by The Budget Director • Exceptions – Courts and Legislature

  22. Budget Certificate EXECUTIVE DEPARTMENT - DIVISION OF BUDGET CERTIFICATE OF APPROVAL OF AVAILABILITY Purpose __ Appropriation Add (SGR) Originating Organization: 01060 __ Appropriation Change (SGC) Batch No(s): 123456 __ Interchange (ITR) ______ Certificate Date: 04/01/09Amends Certificate Dated: MM/DD/YY Orig Chapter/Section/Law: 0050/01/09Bill Page & Line: 233/1-12 Reapprop Chapter/Section/Law: cccc/ss/200x Bill Page & Line:PPP/LL Program Name:POLICING THE THRUWAY State Operations Program Total $49,939,000 Interchange From Internal # 123456 $0 Suballocations & Transfers $0 Total Certificate Amount $49,939,000 For services and expenses . . . in accordance APPROPRIATION ATTRIBUTES with the following schedule: Organization Code: 01060 Fund/Subfund: 339-08 Program Code: A13600010 Authority: 090 Internal No. 1234567 Project Code:01PROJECT

  23. Budget Certificate (continued)

  24. State Finance Law: Section 24 • For all non-federal state operations appropriations • by fund type, which at a minimum shall include general fund, special revenue-other funds, capital projects funds, and debt service funds; • for personal service appropriations, separate appropriations shall be made for regular personal service, temporary personal service, and holiday and overtime pay;

  25. SFL: Section 24 (continued) • for nonpersonal service appropriations, separate appropriations shall be made for supplies and materials, travel, contractual services, equipment, and fringe benefits, as appropriate.

  26. Budget Reform Appropriation Model – Personal Service

  27. Budget Reform Appropriation Model – Non Personal Service

  28. Current CAS • Program Line is Appropriation • Details below are Segregations ADMINISTRATION PROGRAM ....................... 4,911,000 Special Revenue Funds - Other / State Operations Miscellaneous Special Revenue Fund - 339 Alcoholic Beverage Account PERSONAL SERVICE Personal service--regular ..................... 1,340,000 Holiday/overtime compensation .................. 5,000 Amount available for personal service …… 1,345,000

  29. Budget Reform ModelIn SFS - Each of these is an Appropriation

  30. Appropriation Types – Local Assistance Used for GRANT Payments to: • Local Governments • School Districts • Not-for-Profit Organizations • Financial Assistance To, Or On Behalf Of, Individuals

  31. Local Assistance Appropriation ADMINISTRATION PROGRAM…………….... 467,000 General Fund / Aid to Localities Local Assistance Account - 001 For services and expenses of stabilization grants of up to $50,000 to support the operating expenses of small and mid-sized arts organizations .. 467,000

  32. Appropriation Types – Debt Service • Principal and Interest on State Debt • Principal and Interest on Public Authority Debt • Lease-Purchase and Contractual Obligations for State Facilities and Programs Financed with Non-State Debt • Debt-Related Expenses

  33. Debt Service Appropriation DEBT SERVICE FUND-GENERAL DEBT SERVICE FUND--311 For payment to the Housing Finance Agency and the Urban Development Corporation for payment of bonds issued to finance the State's housing programs……………..63,000,000

  34. Appropriation Types – Capital Projects • State Construction Projects • State Assistance for Local Government Projects • Construction Management (e.g. Design & Supervision)

  35. Capital Projects Appropriation Federal Capital Projects Fund - 291 Hazardous Waste Purpose DEPARTMENT OF ENVIRONMENTAL CONSERVATION For the federal share of the cleanup of hazardous waste sites pursuant to the provision of the federal comprehensive environmental response, compensation and liability act of 1980 reauthorization or amendments thereto including personal service (and other incidental expenses) and suballocation to other state departments and agencies (09FS04F7)……………………………………………10,000,000

  36. Budget Certificate (continued) FEDERAL SECTION: FEDERAL GRANT AWARD GGGGGGGGGG CFDA NUMBER NNNNN PRIMARY INTERNAL NO. NNNNNN CAPITAL PROJECTS SECTION: CCP CODE CCP ACTIVITY AND CLASS CODE CCxxxxxxxxxx PERIOD OF USE 20YR (Note: CCP Code is assigned by DOB, Class Code is provided in appropriation act.)

  37. Transactions That Affect Appropriation Records • Contract Encumbrance – Reservation of Unspent Balance • Voucher Payments – Reduce Unspent Appropriation/Segregation Balance • Payroll Transactions • Journal Vouchers - Transfer expenditures • Refunds of Appropriation Expense (AC1286) • Repayment of Appropriated Loan Receivable • Bondable Capital Projects (Activity Codes)

  38. Restrictive Language MUST Make Sense • Embedded in Appropriations • Added to Language Bills

  39. Movement of Appropriation Authority There are 4 types: • Suballocations • Interchanges • Transfers • Allocations (New in 2011) It is important to understand the differences between these and the proper way to reappropriate the available funds if necessary.

  40. Suballocations • Authorizes the movement of authority between agencies within the same fund and for the same program expenditures as appropriated. • The appropriation authority maintains its original appropriation identity including program name and program code. • It is not added to an existing appropriation within the receiving agency. • To continue the availability of funds, the original appropriation must be reappropriated. OSC will extend the lapse date of the original appropriation and all suballocations associated with it.

  41. Interchanges • Movement of authority between appropriations within an agency and fund. • Appropriation authority which has been interchanged takes on the identity of the receiving appropriation. • To continue the availability of funds, the appropriation receiving the interchange must be reappropriated (rather than the donor appropriation).

  42. Interchanges • State Operations and Aid to Localities interchanges are authorized by Section 51 of State Finance Law. • Allows for interchanges within the same agency, fund/subfund and program without limit. • Allows for interchanges among programs within the same agency and fund/subfund as long as the total amount appropriated for any program does not increase or decrease by more than the aggregate of 5% of the first $5 million, 4% of the second $5 million and 3% of the amounts in excess of $10 million.

  43. Interchanges • Capital Project interchanges are authorized by Section 93 of State Finance Law. • Allows for interchanges within the same agency, comprehensive construction program (CCP) and purpose without limit. • Allows for interchanges among purposes within the same agency and CCP as long as the total amount appropriated for such purpose does not increase or decrease by more than the aggregate of 25% of the first $5 million, 20% of the second $5 million, 15% of the third $5 million and 10% of the amounts in excess of $15 million.

  44. Transfers Transfers authorize the movement of appropriation authority between appropriations within or between agencies, funds and/or programs. • Transfers between two enacted appropriations • The amount transferred-in is additive to the receiving program appropriation. • The appropriation attributes and period of availability (including lapse date) of the receiving appropriation remain unchanged.

  45. Transfers (continued) • Transfers requiring the creation of a new appropriation record in the receiving fund or agency • The receiving appropriation will be assigned a lapse date pursuant to §40 of the State Finance Law that made may be different than the lapse date of the appropriation from which the transfer was made. • These types of transfers are problematic to administer and should be discouraged.

  46. Transfers (continued) • To continue the availability of funds, the appropriation receiving the transfer must be reappropriated (rather than the donor appropriation).

  47. Apportionments(NEW in 2011) • Needed to accommodate special language in Appropriations that cannot be assigned to Rulesets established within SFS. • These do not have specific statutory authority but are necessary to satisfy SFS Committment Control rules.

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