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First Substitute H.B. 109

Representative Kory M. Holdaway proposes the following substitute bill:





Sponsor: Kory M. Holdaway

             6      This act modifies the Budgetary Procedures Act by clarifying the governor's powers to
             7      reduce budgetary allotments, fund transfers, and work programs when estimated total
             8      revenues are less than total appropriations. This act prohibits the governor from making
             9      any reductions in budgetary allotments and fund transfers when the deficiency is h [ $25 ] $50 h
             9a      million
             10      or more. This act prohibits the governor from interfering with established legislative
             11      priorities when reducing budgetary allotments and fund transfers. This act prohibits the
             12      governor from using his power to modify work programs to avoid the requirements of this
             13      act.
             14      This act affects sections of Utah Code Annotated 1953 as follows:
             15      AMENDS:
             16          63-38-10, as last amended by Chapter 61, Laws of Utah 1987
             17          63-38-11, as last amended by Chapter 216, Laws of Utah 1994
             18      Be it enacted by the Legislature of the state of Utah:
             19          Section 1. Section 63-38-10 is amended to read:
             20           63-38-10. Overexpenditure of budget by agency -- Prorating budget income shortfall.
             21          (1) In providing for appropriations, the Legislature intends that expenditures of
             22      departments, agencies, and institutions of state government be kept within revenues available for
             23      such expenditures.
             24          (2) (a) The Legislature also intends that line items of appropriation not be overexpended.
             25          (b) If an agency's line item is overexpended at the close of a fiscal year:

             26          (i) the director of the Division of Finance may make payments from the line item to
             27      vendors for goods or services that were received on or before June 30; and
             28          (ii) the director of the Division of Finance shall immediately reduce the agency's line item
             29      budget in the current year by the amount of the overexpenditure.
             30          (c) Each agency with an overexpended line item shall produce a written report explaining
             31      the reasons for the overexpenditure and shall present the report to the Board of Examiners as
             32      required by Section 63-6-10 .
             33          (3) [If] (a) As used in this Subsection (3):
             34          (i) "Estimated total revenues" means the estimated total of all revenues accruing in any
             35      given fiscal year to the General Fund, or any other major fund type, collections, [or] and dedicated
             36      credits, from which appropriations are made[, are not sufficient to cover the appropriations made
             37      for that period, the governor shall reduce the budgetary allotments and transfer of funds by the
             38      amount of the deficiency] that are adopted by the Legislature's Executive Appropriations
             39      Committee.
             40          (ii) "Total appropriations" means the total of all appropriations made for a particular fiscal
             41      year.
             42          (b) (i) If the total appropriations exceed the estimated total revenues by less than h[ $25 ] $50 h
             43      million, the governor may reduce budgetary allotments and transfers of funds by the amount of the
             44      deficiency.
             45          (ii) Whenever the Legislature has, in an appropriation act or statute, listed or funded
             46      projects or programs in a priority order, the governor shall ensure that the projects are fully funded
             47      in the order established by the Legislature and may not reduce the appropriation or budgetary
             48      allotment for a project with a higher priority while maintaining the entire appropriation or
             49      allotment for a project with a lower priority.
             50          (c) If the total appropriations exceed the estimated total revenues by h [ $25 ] $50 h million or
             50a      more,
             51      the governor may not reduce budgetary allotments or transfers of funds, but shall allow the
             52      Legislature to resolve the deficiency h AS SOON AS POSSIBLE h .
             53          (4) (a) No department may receive any advance allotment, or allotments in excess of
             54      regular monthly allotments, that cannot be covered by anticipated revenue within the work
             55      program of the fiscal year, unless the governor allocates moneys from his emergency
             56      appropriations.

             57          (b) All allocations made from the governor's emergency appropriations shall be reported
             58      to the budget subcommittee of the Legislative Management Committee by notifying the Office of
             59      the Legislative Fiscal Analyst at least 15 days before the effective date of the allocation.
             60          (c) Emergency appropriations shall be allocated only to support activities having existing
             61      legislative approval and appropriation, and may not be allocated to any activity or function rejected
             62      directly or indirectly by the Legislature.
             63          Section 2. Section 63-38-11 is amended to read:
             64           63-38-11. Director of finance to exercise accounting control -- Work programs --
             65      Allotments and expenditures.
             66          (1) The director of finance shall exercise accounting control over all state departments,
             67      institutions, and agencies other than the Legislature and legislative committees.
             68          (2) (a) The director shall require the head of each department to submit, by May 15 of each
             69      year, a work program for the next fiscal year.
             70          (b) The director may require any department to submit a work program for any other
             71      period.
             72          (3) The work program shall include appropriations and all other funds from any source
             73      made available to the department for its operation and maintenance for the period and program
             74      authorized by the appropriation act.
             75          (4) (a) The director of finance shall, upon request from the governor, revise, alter,
             76      decrease, or change work programs.
             77          (b) The governor may not request revisions, alterations, decreases, or changes in work
             78      programs to avoid the requirements of Subsection 63-38-10 (3).
             79          (5) Notwithstanding the requirements of Title 63, Chapter 38a, Revenue Procedures and
             80      Control Act, the aggregate of the work program changes may not exceed the total appropriations
             81      or other funds from any source that are available to the department line item for the fiscal year in
             82      question.
             83          (6) The director of finance shall transmit a copy of the changes when approved by the
             84      governor to the head of the department concerned and also a copy to the legislative analyst.
             85          (7) Upon request, review, and approval by the governor, the director of finance shall
             86      permit all expenditures to be made from the appropriations or other funds from any source on the
             87      basis of those work programs.

             88          (8) (a) Except as provided by Subsection (8)(c), the director shall, through statistical
             89      sampling methods or other means, examine and approve or disapprove all requisitions and requests
             90      for proposed expenditures of the departments.
             91          (b) No requisitions of any of the departments shall be allowed nor shall any obligation be
             92      created without the approval and the certification of the director.
             93          (c) Notwithstanding the requirements of Subsection (8)(a), the director need only certify
             94      the availability of funds when the requisitions or proposed expenditures are for the judicial branch
             95      or to pay the salaries or compensation of officers fixed by law.

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