2014 -- H 7943

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LC005184

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2014

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A N   A C T

RELATING TO TOWNS AND CITIES - BUDGET COMMISSION

     

     Introduced By: Representatives Casey, Morin, Phillips, DeSimone, and Costantino

     Date Introduced: March 13, 2014

     Referred To: House Municipal Government

     It is enacted by the General Assembly as follows:

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

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Commissions" is hereby amended to read as follows:

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

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

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whom who shall be designees of the director of revenue,; one of whom who shall be the elected

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chief executive officer of the city; and one of whom who shall be a council member of the town

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or city elected to serve on the budget commission as chosen by a majority vote of said town or

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city council the president of the city or town council. In cities or towns in which the elected chief

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executive officer for purposes of this chapter is the president of the city or town council, one

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member shall be the appointed city or town manager or town administrator (or, if none, the city or

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town chief financial officer) as the fifth (5th) member. The budget commission shall act by a

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

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implementation of appropriate measures to secure the financial stability of the city or town. The

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

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      The budget commission shall be subject to chapter 36-2 of title 36 of the general laws,

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"Access to Public Records," and chapter 36-14 of title 36 of the general laws, "Code of Ethics".

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The budget commission shall be subject to chapter 42-46 of title 42 of the general laws "Open

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Meetings" when meeting to take action on the following matters:

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      (1) Levy and assessment of taxes;

 

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      (2) Rulemaking or suspension of rules;

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      (3) Adoption of a municipal budget;

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

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bargaining agreements; and

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

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commission are insufficient to restore fiscal stability to the city or town.

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

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

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town charter.

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

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authorization, transfer, or other municipal spending authority shall take effect until approved by

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the budget commission. The budget commission shall approve all appropriations, borrowing

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authorizations, transfers, and other municipal spending authorizations, in whole or part.

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

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notwithstanding any city or town charter provision or local ordinance to the contrary, the budget

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commission shall have the power to:

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      (1) Amend, formulate, and execute the annual municipal budget and supplemental

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municipal budgets of the city or town, including the establishment, increase, or decrease of any

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appropriations and spending authority for all departments, budget commissions, committees,

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agencies, or other units of the city or town; provided, however, that notwithstanding sections

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§§16-2-9 and 16-2-18 of the general laws, this clause shall fully apply to the school department

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and all school spending purposes;

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

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departments;

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

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

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

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

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

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

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town's government;

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

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

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

 

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otherwise within the authority of the city or town;

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      (8) Appoint, remove, supervise, and control all city and town employees and have

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

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

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employment held by other employees or officers of the city or town; provided, further, that the

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budget commission shall have the authority to exercise all powers otherwise available to a

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municipality regarding contractual obligations during a fiscal emergency; provided, further, that

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no city or town employee or officer shall hire, fire, transfer, or alter the compensation or benefits

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of a city or town employee except with the written approval of the budget commission; and

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provided, further, that the budget commission may delegate or otherwise assign these powers

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with the approval of the director of revenue;

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

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town to reflect the fiscal emergency and changes in the responsibilities of the officials as

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provided by this chapter;

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

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

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

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

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45 of the general laws in employing such staff; provided, further, that the budget commission,

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with the approval of the director of revenue, shall have authority to set the compensation, terms,

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and conditions of employment of its own staff; provided, further, that the city or town shall

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

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

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

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the necessary funds from the city's or town's distribution of state aid and shall expend those funds

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directly for the benefit of the budget commission;

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

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offices, or functions of the city or town, in whole or in part, and to establish such new

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departments, commissions, authorities, boards, offices, or functions as it deems necessary, and to

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transfer the duties, powers, functions, and appropriations of one department, commission, board,

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

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

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

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predecessor;

 

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

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

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

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with the approval of the director of revenue;

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

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town with the approval of the director of revenue;

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

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

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

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or town which that permit the budget commission to effectively carry out this chapter under

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subsection §42-35-3(b) of the general laws;

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      (17) Alter or rescind any action or decision of any municipal officer, employee, board,

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authority, or commission within fourteen (14) days after receipt of notice of such action or

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decision;

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

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the city or town;

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

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

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section 5 of the Constitution of the state, R.I. Const., Art.XIII,Sec.5 a budget commission is

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authorized to issue bonds, notes, or certificates of indebtedness to fund the deficit of a city or

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town without regard to section §45-12-22.4 of the general laws, to fund cash flow, and to finance

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capital projects. Bonds, notes, or certificates of indebtedness issued under authority of this

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chapter shall be general obligation bonds backed by the full faith and credit and taxing power of

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the city or town; provided, however, that the budget commission may pledge future distributions

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

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state aid is so pledged, the budget commission shall execute, on behalf of the city or town, a trust

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

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

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

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

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

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

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Bonds, notes, or certificates of indebtedness authorized under authority of this chapter shall be

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executed on behalf of the city or town by a member of the commission and, except as provided

 

LC005184 - Page 4 of 6

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for in this chapter, may be subject to the provisions of chapter 45-12 of title 45 of the general

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laws so far as apt, or may be subject to the provisions of any special bond act enacted authorizing

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the issuance of bonds of a city or town so far as apt, provided, however that any bonds or notes

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issued for school purposes must be approved by the general assembly in order to qualify for

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school housing aid as set forth in chapter 16-7 of title 16 of the general laws; and

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

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charter provision or ordinance that any elected official of the city or town may exercise, acting

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separately or jointly; provided, however, that with respect to any such exercise of powers by the

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budget commission, the elected officials shall not rescind or take any action contrary to such

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action by the budget commission so long as the budget commission continues to exist.

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

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the state's basic education program under chapter 7 of title 16 of the Rhode Island general laws in

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

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approval of the director of the department of revenue, notwithstanding any general or public law

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

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payments to the fiscal advisors of the house and senate finance committees. The state general

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treasurer shall deduct the estimated cost to the state's general fund resulting from any advance

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payments.

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     SECTION 2. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO TOWNS AND CITIES - BUDGET COMMISSION

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     This act would provide for a member of a town or city council to be elected to serve on a

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budget commission.

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     This act would take effect upon passage.

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