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art.013/3/013/2/013/1

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     ARTICLE 13 AS AMENDED

RELATING TO BUDGET ACCOUNTS

     SECTION 1. Section 35-4-27 of the General Laws in Chapter 35-4 entitled “State Funds”

is hereby amended to read as follows:

     35-4-27. Indirect cost recoveries on restricted receipt accounts. – Indirect cost

recoveries of ten percent (10%) of cash receipts shall be transferred from all restricted receipt

accounts, to be recorded as general revenues in the general fund. However, there shall be no

transfer from cash receipts with restrictions received exclusively: (1) from contributions from

non-profit charitable organizations; (2) from the assessment of indirect cost recovery rates on

federal grant funds; or (3) through transfers from state agencies to the department of

administration for the payment of debt service. These indirect cost recoveries shall be applied to

all accounts, unless prohibited by federal law or regulation, court order, or court settlement. The

following restricted receipt accounts shall not be subject to the provisions of this section:

     Executive Office of Health and Human Services

     Organ Transplant Fund

     HIV Care Grant Drug Rebates

     Department of Human Services

     Veterans' home – Restricted account

     Veterans' home – Resident benefits

     Pharmaceutical Rebates Account

     Demand Side Management Grants

     Veteran's Cemetery Memorial Fund

     Donations- New Veterans' Home Construction

     Department of Health

     Providence Water Lead Grant

     Pandemic medications and equipment account

     Miscellaneous Donations/Grants from Non-Profits

     State Loan Repayment Match

     Department of Behavioral Healthcare, Developmental Disabilities and Hospitals

     Eleanor Slater non-Medicaid third-party payor account

     Hospital Medicare Part D Receipts

     RICLAS Group Home Operations

     Commission on the Deaf and Hard of Hearing

     Emergency and public communication access account

     Department of Environmental Management

     National heritage revolving fund

     Environmental response fund II

     Underground storage tanks registration fees

     Rhode Island Historical Preservation and Heritage Commission

     Historic preservation revolving loan fund

     Historic Preservation loan fund – Interest revenue

     Department of Public Safety

     Forfeited property – Retained

     Forfeitures – Federal

     Forfeited property – Gambling

     Donation – Polygraph and Law Enforcement Training

     Rhode Island State Firefighter's League Training Account

     Fire Academy Training Fees Account

     Attorney General

     Forfeiture of property

     Federal forfeitures

     Attorney General multi-state account

     Forfeited property – Gambling

     Department of Administration

     RI Health Benefits Exchange

     Office of Management and Budget

     Information Technology Investment Fund

     Restore and replacement – Insurance coverage

     Convention Center Authority rental payments

     Investment Receipts – TANS

     Car Rental Tax/Surcharge-Warwick Share

     Housing Resources Commission Restricted Account

     Department of Revenue

     Jobs Tax Credit Redemption Fund

     Legislature

     Audit of federal assisted programs

     Department of Children, Youth and Families

     Children's Trust Accounts – SSI

     Military Staff

     RI Military Family Relief Fund

     RI National Guard Counterdrug Program

     Treasury

     Admin. Expenses – State Retirement System

     Retirement – Treasury Investment Options

     Defined Contribution – Administration - RR

     Violent Crimes Compensation – Refunds

     Treasury Research Fellowship

     Business Regulation

     Banking Division Reimbursement Account

     Office of the Health Insurance Commissioner Reimbursement Account

     Securities Division Reimbursement Account

     Commercial Licensing and Racing and Athletics Division Reimbursement Account

     Insurance Division Reimbursement Account

     Historic Preservation Tax Credit Account.

     Judiciary

     Arbitration Fund Restricted Receipt Account

     Third Party Grants

     RI Judiciary Technology Surcharge Account

     Department of Elementary and Secondary Education

     Statewide Student Transportation Services Account

     School for the Deaf Fee for Service Account

     Davies Career and Technical School Local Education Aid Account

     Davies – National School Breakfast & Lunch Program

     Department of Labor and Training

     Job Development Fund

     Department of Transportation

     Rhode Island Highway Maintenance Account

     SECTION 2. Section 35-6-1 of the General Laws in Chapter 35-6 entitled “Accounts and

Control” is hereby amended to read as follows:

     35-6-1. Controller – Duties in general. – (a) Within the department of administration

there shall be a controller who shall be appointed by the director of administration pursuant to

chapter 4 of title 36. The controller shall be responsible for accounting and expenditure control

and shall be required to:

     (1) Administer a comprehensive accounting and recording system which will classify the

transactions of the state departments and agencies in accordance with the budget plan;

     (2) Maintain control accounts for all supplies, materials, and equipment for all

departments and agencies except as otherwise provided by law;

     (3) Prescribe a financial, accounting, and cost accounting system for state departments

and agencies;

     (4) Preaudit all state receipts and expenditures;

     (5) Prepare financial statements required by the several departments and agencies, by the

governor, or by the general assembly;

     (6) Approve the orders drawn on the general treasurer; provided, that the preaudit of all

expenditures under authority of the legislative department and the judicial department by the state

controller shall be purely ministerial, concerned only with the legality of the expenditure and

availability of the funds, and in no event shall the state controller interpose his or her judgment

regarding the wisdom or expediency of any item or items of expenditure;

     (7) Prepare and timely file, on behalf of the state, any and all reports required by the

United States, including, but not limited to, the internal revenue service, or required by any

department or agency of the state, with respect to the state payroll; and

     (8) Prepare a preliminary closing statement for each fiscal year. The controller shall

forward the statement to the chairpersons of the house finance committee and the senate finance

committee, with copies to the house fiscal advisor and the senate fiscal and policy advisor, by

September 1 following the fiscal year ending the prior June 30 or thirty (30) days after enactment

of the appropriations act, whichever is later. The report shall include but is not limited to:

     (i) A report of all revenues received by the state in the completed fiscal year, together

with the estimates adopted for that year as contained in the final enacted budget, and together

with all deviations between estimated revenues and actual collections. The report shall also

include cash collections and accrual adjustments;

     (ii) A comparison of actual expenditures with each of the actual appropriations, including

supplemental appropriations and other adjustments provided for in the Rhode Island General

Laws;

     (iii) A statement of the opening and closing surplus in the general revenue account; and

     (iv) A statement of the opening surplus, activity, and closing surplus in the state budget

reserve and cash stabilization account and the state bond capital fund.

     (b) The controller shall provide supporting information on revenues, expenditures, capital

projects, and debt service upon request of the house finance committee chairperson, senate

finance committee chairperson, house fiscal advisor, or senate fiscal and policy advisor.

     (c) Upon issuance of the audited annual financial statement, the controller shall provide a

report of the differences between the preliminary financial report and the final report as contained

in the audited annual financial statement.

     (d) Upon issuance of the audited financial statement, the controller shall transfer all

general revenues received in the completed fiscal year, net of transfer to the state budget reserve

and cash stabilization account as required by § 35-3-20, in excess of those estimates adopted for

that year as contained in the final enacted budget to the employees' retirement system of the state

of Rhode Island as defined in § 36-8-2.

     (e)(d) The controller shall create a special fund not part of the general fund and shall

deposit amounts equivalent to all deferred contributions under this act into that fund. Any

amounts remaining in the fund on June 15, 2010, shall be transferred to the general treasurer who

shall transfer such amounts into the retirement system as appropriate.

     (f)(e) The controller shall implement a direct deposit payroll system for state employees.

     (i) There shall be no service charge of any type paid by the state employee at any time

which shall decrease the net amount of the employee's salary deposited to the financial institution

of the personal choice of the employee as a result of the use of direct deposit.

     (ii) Employees hired after September 30, 2014, shall participate in the direct deposit

system. At the time the employee is hired, the employee shall identify a financial institution that

will serve as a personal depository agent for the employee.

     (iii) No later than June 30, 2016, each employee hired before September 30, 2014, who is

not a participant in the direct deposit system, shall identify a financial institution that will serve as

a personal depository agent for the employee.

     (iv) The controller shall promulgate rules and regulations as necessary for

implementation and administration of the direct deposit system, which shall include limited

exceptions to required participation.

     SECTION 3. Section 1 shall take effect upon passage. Section 2 shall take effect as of

July 1, 2014.