§ 6-E — Contingency and tax stabilization reserve fund for municipal corporations

§ 6-e. Contingency and tax stabilization reserve fund for municipal\ncorporations. 1. As used in this section:\n a. "Annual budget" means the annual budget or estimate, as finally\nadopted, of a municipal corporation which is required by law to adopt an\nannual budget or estimate of the expenditures to be made for a fiscal\nyear for the general support or for the expenses of the government of\nsuch municipal corporation during such fiscal year.\n b. "Base year" means the most recent fiscal year for which an annual\nreport has been filed with the state comptroller pursuant to section\nthirty of this chapter.\n c. "Chief executive officer" means a chief executive officer as\ndefined in paragraph five-a of section 2.00 of the local finance law.\n d. "Chief fiscal officer" means a chief fiscal officer as defined in\nparagraph five of section 2.00 of the local finance law.\n e. "Eligible portion of the annual budget" means:\n (1) in the case of a contingency and tax stabilization reserve fund\nestablished for a county, city, village or fire district, the general\nfund portion of the annual budget;\n (2) in the case of a contingency and tax stabilization reserve fund\nestablished for a town, the town-wide general fund and highway fund\nportions of the annual budget; and\n (3) in the case of a contingency and tax stabilization reserve fund\nestablished for the part of a town outside any villages, the general\nfund and highway fund portions of the annual budget for such part of the\ntown.\n f. "Estimated revenue" means revenue from a specific source which is\nexpected to be received during a fiscal year and which is included in\nthe annual budget as finally adopted for that fiscal year.\n g. "Governing board" means a governing board as defined in section two\nof this chapter and, in the case of a fire district, shall mean the\nboard of fire commissioners.\n h. "Municipal corporation" means a municipal corporation as defined in\nsection two of this chapter and shall also include a fire district.\n i. "Public emergency" means an epidemic, conflagration, riot, storm,\nflood or other sudden, unforeseen or unexpected occurrence or condition\nwhich requires the immediate expenditure of moneys to protect the public\nhealth, safety or welfare of the inhabitants of the municipal\ncorporation.\n j. "Tentative budget" means the tentative budget prepared pursuant to\nsection three hundred fifty-four of the county law, section one hundred\nsix of the town law or section 5-504 of the village law, the statement\nof expenditures prepared pursuant to section one hundred eighty-one of\nthe town law, or similar document prepared pursuant to general, special\nor local law.\n k. "Unanticipated expenditure" means an expenditure for a specific\npurpose for which there is no or insufficient appropriation or which\nwill cause an appropriation to be insufficient that is necessitated by a\nchange in federal or state laws, rules or regulations, a court order,\njudgement or decree, a public emergency, or an industry-wide price, rate\nor premium increase, which takes effect or occurs after final adoption\nof the annual budget and which could not have been reasonably\nanticipated prior to final adoption of the annual budget.\n l. "Unanticipated revenue loss" means estimated revenue which is\nrendered unreceivable because of a change in federal or state laws,\nrules or regulations, a court order, judgement or decree, or other\ncircumstance, which takes effect or occurs after final adoption of the\nannual budget and which could not have been reasonably anticipated prior\nto final adoption of the annual budget.\n m. "Unappropriated unreserved fund balance" means the difference\nbetween the total assets for a fund and the total liabilities, deferred\nrevenues, encumbered appropriations, amounts appropriated for the\nensuing fiscal year's budget, and amounts reserved for stated purposes\npursuant to law, including reserve funds established pursuant to the\ngeneral municipal law for the fund, as determined through application of\nthe system of accounts prescribed by the state comptroller pursuant to\nsection thirty-six of this chapter.\n n. "Voting strength" means the aggregate number of votes which all the\nmembers of the governing board are entitled to cast.\n 2. The governing board of any municipal corporation, by resolution\nsubject to a permissive referendum, may establish a contingency and tax\nstabilization reserve fund for the municipal corporation and, in the\ncase of a town, also for the part of the town outside any villages. Such\npermissive referendum shall be governed by:\n a. in the case of a county, sections one hundred one through one\nhundred three of the county law;\n b. in the case of a city, sections twenty-four through twenty-six of\nthe municipal home rule law;\n c. in the case of a town or the part of a town outside any villages,\narticle seven of the town law;\n d. in the case of a village, article nine of the village law; and\n e. in the case of a fire district, subdivision four of section six-g\nof this article.\n 3. There may be paid into the contingency and tax stabilization\nreserve fund such amounts as may be provided therefor by budgetary\nappropriation, unappropriated unreserved fund balance in the eligible\nportion of the annual budget, and such revenues as are not required by\nlaw to be paid into any other fund or account; provided, however, that\nno amount may be appropriated for payment into a contingency and tax\nstabilization reserve fund which would cause the balance of the fund to\nexceed ten percent of the eligible portion of the annual budget for the\nfiscal year for which the appropriation would be made.\n 4. a. The moneys in a contingency and tax stabilization reserve fund\nmay be expended only pursuant to an appropriation for a purpose\nauthorized by this subdivision. Except as provided in paragraph e of\nthis subdivision, such an appropriation shall be made only upon the\nrecommendation of the chief executive officer and the adoption of a\nresolution appropriating the recommended amount by at least two-thirds\nof the voting strength of the governing board.\n b. The moneys in a contingency and tax stabilization reserve fund may\nbe used to finance an unanticipated revenue loss chargeable to the\neligible portion of the annual budget, subject to the following\nlimitations:\n (1) the maximum amount of moneys in the fund that may be used to\nfinance an unanticipated revenue loss shall equal either the amount of\nthe revenue actually received for the base year or the amount of the\nestimated revenue for the current fiscal year, whichever is less, minus\nthe amount of the revenue actually received for the current fiscal year;\nand\n (2) the moneys in the fund may be used only to finance that portion of\nthe unanticipated revenue loss which, as a matter of law, cannot be\nfinanced with amounts available in any other account or fund.\n c. The moneys in a contingency and tax stabilization reserve fund may\nbe used to finance an unanticipated expenditure chargeable to the\neligible portion of the annual budget, subject to the following\nlimitations:\n (1) the maximum amount of moneys in the fund that may be used to\nfinance an unanticipated expenditure shall equal the sum of the amount\nof the unanticipated expenditure and the amount appropriated for that\npurpose for the current fiscal year minus either the amount appropriated\nfor that purpose for the current fiscal year or the actual expenditure\nfor the same purpose in the base year, whichever is greater; and\n (2) the moneys in the fund may be used only to finance that portion of\nan unanticipated expenditure which, as a matter of law, cannot be\nfinanced with amounts available in any other account or fund.\n d. The moneys in the contingency and tax stabilization reserve fund\nmay be used to lessen or prevent any projected increase in excess of two\nand one-half percent in the amount of the real property tax levy needed\nto finance the eligible portion of the annual budget for the next\nsucceeding fiscal year. The maximum amount of moneys in the fund that\nmay be used for this purpose shall equal the difference between the\nprojected amount of such real property tax levy and one hundred two and\none-half percent of the amount of the real property tax levy needed to\nfinance the eligible portion of the annual budget for the current fiscal\nyear.\n e. When preparing the tentative budget of a municipal corporation, if\nthe current balance of a contingency and tax stabilization reserve fund,\nas shown by the statement of the chief fiscal officer required by\nsubdivision six of this section, exceeds ten percent of the eligible\nportion of the annual budget for the current fiscal year, such excess\nshall be used to reduce the amount of real property taxes needed to\nfinance the eligible portion of the annual budget for the next\nsucceeding fiscal year.\n 5. The moneys in the contingency and tax stabilization reserve fund\nshall be deposited in one or more of the banks or trust companies\ndesignated, in the manner provided by law, as depositories of the funds\nof such municipal corporation. The governing board, or the chief fiscal\nofficer having custody of such money of such municipal corporation, if\nthe governing board shall delegate such duty to him, may invest the\nmoneys in such fund in obligations specified in section eleven of this\narticle. Any interest earned or capital gain realized on the money so\ndeposited or invested shall accrue to and become part of such fund.\n 6. The chief fiscal officer shall account for the contingency and tax\nstabilization reserve fund separate and apart from all other funds of\nthe municipal corporation. Such accounting shall show: the source, date\nand amount of each sum paid into the fund; the interest earned by such\nfund; capital gains or losses resulting from the sale of investments of\nthe fund; the order, source thereof, date and amount of each\nappropriation from this fund; the assets of the fund, indicating cash\nbalance and a schedule of investments. Not later than sixty days after\nthe start of each fiscal year and at such times as may be required by\nthe governing board, the chief fiscal officer shall furnish to the\ngoverning board a detailed report of the operation and condition of the\nfund during the preceding fiscal year which shall include a statement of\nreceipts and disbursements, and a statement of the balance of the fund\nas of the last day of such preceding fiscal year and such other dates as\nmay be specified by the governing board. Not later than thirty days\nprior to the last date provided by law for the filing of the tentative\nbudget, the chief fiscal officer shall furnish to the officer or body\nresponsible for preparing the tentative budget a statement of the\ncurrent balance of the fund.\n 7. The members of the governing board are hereby declared trustees of\nthe moneys in the contingency and tax stabilization reserve fund and\nshall be subject to all duties and responsibilities imposed by law on\ntrustees, and such duties and responsibilities may be enforced by the\nmunicipal corporation or by any board, commission, agency, officer or\ntaxpayer thereof.\n 8. Any officer of a municipal corporation shall be guilty of a\nmisdemeanor if he or she willfully and knowingly causes the municipal\ncorporation to:\n a. Appropriate moneys from the contingency and tax stabilization\nreserve fund for any purpose not authorized by this section.\n b. Expend any money from the contingency and tax stabilization reserve\nfund for a purpose other than that for which it was appropriated.\nThe provisions of this subdivision shall be considered to be in addition\nto any other penalties provided by law.\n * 4. Moneys in such fund shall be deposited and secured in the manner\nprovided by section ten of this article. The moneys in such fund so\ndeposited shall be kept in a separate bank account. The governing board\nor the chief fiscal officer of such municipality, if the governing board\nshall delegate such duty to him, may invest the moneys in such fund in\nthe manner provided in section eleven of this article. Any interest\nearned or capital gains realized on the moneys so deposited or invested\nshall accrue to and become part of such fund. Such board or officer\nshall incur no personal liability on account of any investment made\npursuant to the provisions of this section.\n * NB sb. 4 amended by Ch. 708/92, § 3 is to former section 6-E -\nrepealed Ch. 655/92\n