NY A41002

Establishes the FMAP Contingency Fund in the state treasury to address potential loss of enhanced Federal Medicaid Assistance Percentages (FMAP) funding if the federal government fails to enact an extension by September 1, 2010.

Authorizes uniform reduction of up to $1,085,000,000 in undisbursed general fund and state special revenue fund aid to localities if enhanced FMAP is not extended, with exemptions for emergency assistance, federal law requirements, debt service obligations, and binding legal obligations.

Requires the Director of the Budget to prepare and file a written allocation plan detailing the reductions with the state comptroller and legislative finance committee chairs by September 1, 2010.

Permits the contingency fund to temporarily loan cash to the general fund and requires full payment restoration to recipients if enhanced FMAP is extended at assumed levels before January 1, 2011.

If enhanced FMAP is not extended or extended in an amount less than assumed by January 1, 2011, all contingency fund monies transfer to the general fund, and the state's liability for payments is reduced by up to $1,085,000,000.