2015 -- H 5200

========

LC000080

========

     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2015

____________

A N   A C T

RELATING TO TOWNS AND CITIES -- BUDGET COMMISSIONS

     

     Introduced By: Representatives Phillips, Morin, Casey, Melo, and Abney

     Date Introduced: January 21, 2015

     Referred To: House Finance

     It is enacted by the General Assembly as follows:

1

     SECTION 1. Section 45-9-6 of the General Laws in Chapter 45-9 entitled "Budget

2

Commissions" is hereby amended to read as follows:

3

     45-9-6. Composition of budget commission. -- (a) If a budget commission is established

4

under §§ 45-9-5 or 45-12-22.7, it shall consist of five (5) members: three (3) of whom shall be

5

designees of the director of revenue; one of whom shall be the elected chief executive officer of

6

the city; and one of whom shall be a council member of the town or city elected to serve on the

7

budget commission as chosen by a majority vote of said town or city council. In cities or towns in

8

which the elected chief executive officer for purposes of this chapter is the president of the city or

9

town council, one member shall be the appointed city or town manager or town administrator (or,

10

if none, the city or town chief financial officer) as the fifth member. For a fire district, it shall

11

consist of five (5) members: three (3) of the members of the budget commission shall be

12

designees of the director of revenue; one shall be the chairperson of the district's governing body;

13

and one shall be the fire chief of the district. The budget commission shall act by a majority vote

14

of all its members. The budget commission shall initiate and assure the implementation of

15

appropriate measures to secure the financial stability of the city, town, or fire district. The budget

16

commission shall continue in existence until the director of revenue abolishes it.

17

      The budget commission shall be subject to chapter 2 of title 36, "Access to Public

18

Records," and chapter 14 of title 36, "Code of Ethics". The budget commission shall be subject to

19

chapter 46 of title 42 "Open Meetings" when meeting to take action on the following matters:

 

1

      (1) Levy and assessment of taxes;

2

      (2) Rulemaking or suspension of rules;

3

      (3) Adoption of a municipal or fire district budget;

4

      (4) Approval of collective bargaining agreements and amendments to collective

5

bargaining agreements; and

6

      (5) Making a determination under § 45-9-7 that the powers of the budget commission are

7

insufficient to restore fiscal stability to the city, town, or fire district.

8

      (b) Action by the budget commission under this chapter shall constitute action by the

9

city, town, or fire district for all purposes under the general laws, under any special law, and

10

under the city, town, or fire district charter.

11

      (c) Until the budget commission ceases to exist, no appropriation, borrowing

12

authorization, transfer, or other municipal or fire district spending authority, shall take effect until

13

approved by the budget commission. The budget commission shall approve all appropriations,

14

borrowing authorizations, transfers, and other municipal or fire district spending authorizations,

15

in whole or part.

16

      (d) In addition to the authority and powers conferred elsewhere in this chapter, and

17

notwithstanding any city, town, or fire district charter provision, or local ordinance, or rule or

18

regulation to the contrary, the budget commission shall have the power to:

19

      (1) Amend, formulate, and execute the annual municipal or fire district budget and

20

supplemental municipal or fire district budgets of the city, town, or fire district, including the

21

establishment, increase, or decrease of any appropriations and spending authority for all

22

departments, budget commissions, committees, agencies or other units of the city, town, or fire

23

district; provided, however, that notwithstanding §§ 16-2-9 and 16-2-18, this clause shall fully

24

apply to the school department and all school spending purposes;

25

      (2) Implement and maintain uniform budget guidelines and procedures for all

26

departments;

27

      (3) Amend, formulate and execute capital budgets, including to amend any borrowing

28

authorization, or finance or refinance any debt in accordance with the law;

29

      (4) Amortize operational deficits in an amount as the director of revenue approves and

30

for a term not longer than five (5) years;

31

      (5) Develop and maintain a uniform system for all financial planning and operations in

32

all departments, offices, boards, commissions, committees, agencies, or other units of the city's,

33

town's, or fire district's government;

34

      (6) Review and approve or disapprove all proposed contracts for goods or services;

 

LC000080 - Page 2 of 6

1

      (7) Notwithstanding any general or special law to the contrary, establish, increase, or

2

decrease any fee, rate, or charge, for any service, license, permit, or other municipal or fire

3

district activity, otherwise within the authority of the city, town, or fire district;

4

      (8) Appoint, remove, supervise, and control all city, town, or fire district employees and

5

have control over all personnel matters other than disciplinary matters; provided, that the budget

6

commission shall hold all existing powers to hire and fire and set the terms and conditions of

7

employment held by other employees or officers of the city, town, or fire district; provided,

8

further, that the budget commission shall have the authority to exercise all powers otherwise

9

available to a municipality or fire district regarding contractual obligations during a fiscal

10

emergency; provided, further, that no city, town, or fire district employee or officer shall hire,

11

fire, transfer, or alter the compensation or benefits of a city, town, or fire district employee except

12

with the written approval of the budget commission; and provided, further, that the budget

13

commission may delegate or otherwise assign these powers with the approval of the director of

14

revenue;

15

      (9)(8) Alter or eliminate the compensation and/or benefits of elected officials of the city,

16

town, or fire district to reflect the fiscal emergency and changes in the responsibilities of the

17

officials as provided by this chapter;

18

      (10)(9) Employ, retain, and supervise such managerial, professional, and clerical staff as

19

are necessary to carry out its responsibilities; provided, however, that such employment, retention

20

and supervisory decisions are subject to the approval of the director of revenue; provided, further,

21

that the budget commission shall not be subject to chapter 2 of title 37 or chapter 55 of title 45 in

22

employing such staff; provided, further, that the budget commission, with the approval of the

23

director of revenue, shall have authority to set the compensation, terms, and conditions of

24

employment of its own staff; provided, further, that the city, town, or fire district shall annually

25

appropriate amounts sufficient for the compensation of personnel hired under this clause as

26

determined and fixed by the budget commission; provided, further, that, if the city, town, or fire

27

district fails to appropriate such amounts, the director of revenue shall direct the general treasurer

28

to deduct the necessary funds from the city's, town's, or fire district's distribution of state aid and

29

shall expend those funds directly for the benefit of the budget commission;

30

      (11)(10) Reorganize, consolidate, or abolish departments, commissions, authorities,

31

boards, offices, or functions of the city, town, or fire district, in whole or in part, and to establish

32

such new departments, commissions, authorities, boards, offices, or functions as it deems

33

necessary, and to transfer the duties, powers, functions and appropriations of one department,

34

commission, board, office, or other unit to another department, commission, authority, board, or

 

LC000080 - Page 3 of 6

1

office, and in connection therewith, remove and appoint new members for any such commission,

2

authority, board, or department which appointees shall serve the remainder of any unexpired term

3

of their predecessor;

4

      (12)(11) Appoint, in consultation with the director of revenue, persons to fill vacancies

5

on any authority, board, committee, department, or office;

6

      (13)(12) Sell, lease, or otherwise transfer, real property and other assets of the city, town,

7

or fire district with the approval of the director of revenue;

8

      (14)(13) Purchase, lease, or otherwise acquire, property or other assets on behalf of the

9

city, town, or fire district with the approval of the director of revenue;

10

      (15)(14) Enter into contracts, including, but not limited to, contracts with other

11

governmental entities, and such other governmental entities are hereby authorized to enter into

12

such contracts;

13

      (16)(15) Adopt rules and regulations governing the operation and administration of the

14

city, town, or fire district that permit the budget commission to effectively carry out this chapter

15

under § 42-35-3(b);

16

      (17)(16) Alter or rescind any action or decision of any municipal or fire district officer,

17

employee, board, authority, or commission within fourteen (14) days after receipt of notice of

18

such action or decision;

19

      (18)(17) Suspend, in consultation with the director of revenue, any rules and regulations

20

of the city, town, or fire district;

21

      (19)(18) Notwithstanding any other general law, special act, charter provision, or

22

ordinance, and in conformity with the reserved powers of the general assembly pursuant to

23

Article XIII, section 5 of the constitution of the state, a budget commission is authorized to issue

24

bonds, notes, or certificates of indebtedness to fund the deficit of a city, town, or fire district

25

without regard to § 45-12-22.4, to fund cash flow and to finance capital projects. Bonds, notes, or

26

certificates of indebtedness issued under authority of this chapter shall be general obligation

27

bonds backed by the full faith and credit and taxing power of the city, town, or fire district;

28

provided, however, that the budget commission may pledge future distributions of state aid for

29

the purpose of retiring such bonds, notes, or certificates of indebtedness. If any state aid is so

30

pledged, the budget commission shall execute on behalf of the city, town, or fire district a trust

31

agreement with a corporate trustee, which may be any bank or trust company having the powers

32

of a trust company within the state, and any state aid so pledged shall be paid by the general

33

treasurer directly to the trustee to be held in trust and applied to the payment of principal and

34

interest on such bonds, notes, or certificates of indebtedness; any earnings derived from the

 

LC000080 - Page 4 of 6

1

investment of such pledged aid shall be applied as needed to the payment of that principal and

2

interest and for trustee's fees and related expenses, with any excess to be paid to the city, town, or

3

fire district. Bonds, notes, or certificates of indebtedness authorized under authority of this

4

chapter shall be executed on behalf of the city, town, or fire district by a member of the

5

commission and, except as provided for in this chapter, may be subject to the provisions of

6

chapter 12 of title 45 so far as apt, or may be subject to the provisions of any special bond act

7

enacted authorizing the issuance of bonds of a city, town, or fire district so far as apt; provided,

8

however, that any bonds or notes issued for school purposes must be approved by the general

9

assembly in order to qualify for school housing aid as set forth in chapter 7 of title 16; and

10

      (20)(19) Exercise all powers under the general laws and this chapter, or any special act,

11

any charter provision or ordinance that any elected official of the city, town, or fire district may

12

exercise, acting separately or jointly; provided, however, that with respect to any such exercise of

13

powers by the budget commission, the elected officials shall not rescind nor take any action

14

contrary to such action by the budget commission so long as the budget commission continues to

15

exist.

16

      (21)(20) Certify to the Rhode Island department of revenue the need to advance

17

payments of the state's basic education program under chapter 7 of title 16 in the amount

18

determined by the budget commission. Said amount shall be advanced, subject to approval of the

19

director of the department of revenue, notwithstanding any general or public law to the contrary.

20

The director of the department of revenue shall provide notice of any advance payments to the

21

fiscal advisors of the house and senate finance committees. The state general treasurer shall

22

deduct the estimated cost to the state's general fund resulting from any advance payments.

23

     SECTION 2. This act shall take effect upon passage.

========

LC000080

========

 

LC000080 - Page 5 of 6

EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO TOWNS AND CITIES -- BUDGET COMMISSIONS

***

1

     This act would eliminate personnel decisions from the enumeration of the powers of

2

budget commissions.

3

     This act would take effect upon passage.

========

LC000080

========

 

LC000080 - Page 6 of 6