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A08314 Memo:

NEW YORK STATE ASSEMBLY
MEMORANDUM IN SUPPORT OF LEGISLATION
submitted in accordance with Assembly Rule III, Sec 1(f)
 
BILL NUMBER: A8314
 
SPONSOR: Giglio JM
  TITLE OF BILL: An act to amend the state finance law, in relation to increasing the amount of money that may be maintained in the tax stabilization reserve fund   PURPOSE OR GENERAL IDEA OF BILL: Increases the amount allowed by law to the tax stabilization reserve fund, or "rainy day fund," to 5% of state fiscal year disbursements. Currently. the amount allowed by law in this fund is 2% of state fiscal year disbursements.   SUMMARY OF PROVISIONS: Section 1. Subdivisions 3 and 4 of section 92 of the state finance law shall be amended. Subdivision 3 requires any cash surplus remaining in the general fund over and above the norm at the close of each fiscal year be transferred from or retained in such fund. All of such surplus moneys shall be transferred to the tax stabilization reserve fund. Any balance of such surplus moneys, thereafter retained in the general fund, shall be retained in such fund and be available for the reduction of state taxes. Subdivision 4 requires that in the event that at the close of any fiscal year the receipts derived from the taxes, fees and other sources shall fall below the norm for such fiscal year, there shall be transferred from the tax stabilization reserve fund to the general fund to the extent that there are sufficient moneys in the tax stabilization reserve fund, an amount equal to the difference between the norm and the amount of such receipts. Section 2. This act shall take effect immediately.   JUSTIFICATION: New York's debt continues to grow and residents are bearing an increas- ing tax burden. Many local governments and school districts, particular- ly upstate. are being forced to increase property taxes to pay bills and continue their operation. Additionally. New York's high cost of living and doing business has led to a decline population, particularly of those people under the age of 35. This is a common sense piece of legis- lation that is only a small step toward solving complicated issues. It will provide the State with the ability to place more money in the tax stabilization reserve fund, basically meaning a "rainy day fund" to be used for the reduction of or an offset to an increase of state taxes.   PRIOR LEGISLATIVE HISTORY: 2020: A5696 held in ways and means 2018: A4854 referred to ways and means 2018: A4854 referred to ways and means Subdivisions 3 and 4 of section 92 of the state finance law. as sepa- rately amended by chapter 405 and 957 of the laws of 1981 provide that only 2 percent of state fiscal year disbursements may be placed in the tax stabilization reserve fund.   FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS: Minimal.   EFFECTIVE DATE: This act shall take effect immediately.
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