9 NYCRR 166-5.5

Except if a covered provider has obtained a waiver pursuant to section 166-5.6 of this Subpart, a covered provider as defined in this Subpart shall not use State funds or State-authorized payments for executive compensation given directly or indirectly to a covered executive in an amount greater than $199,000 per annum, provided, however, that the office shall review this figure annually to determine whether adjustment is necessary based on appropriate factors and subject to the approval of the Director of the Division of the Budget. Commencing on July 1, 2013, the limits on executive compensation pursuant to this Subpart shall be effective and applicable to each covered provider on the first day of each covered provider’s respective covered reporting period. Violation of this subdivision shall subject the covered provider to the penalties set forth in section 166-5.8 of this Subpart. To determine whether a covered provider may be subject to penalties, such provider shall provide, upon request by the office or its designee, contemporaneous documentation in a form and level of detail sufficient to allow such determination to be made.

The limit on executive compensation pursuant to this section shall not be applied to limit reimbursement with State funds or State-authorized payments for reasonable compensation paid to a covered executive for program services, including but not limited to supervisory services performed to facilitate the covered provider’s program services, rendered by the executive outside of his or her managerial or policy-making duties. Documentation of such program services rendered shall be used by the covered provider to determine that percentage, if any, of the covered executive’s compensation that is attributable to program services and that compensation shall not be considered in the calculation of his or her executive compensation. Such documentation shall be maintained and provided to the office or its designee upon request. Clinical and program personnel in a hospital or other entity providing program services, including chairs of departments, heads of service, chief medical officers, directors of nursing, or similar types of personnel fulfilling administrative functions that are nevertheless directly attributable to and comprise program services shall not be considered covered executives for purposes of limiting the use of State funds or State-authorized payments to compensate them.

If a covered provider receives State funds or State-authorized payments from multiple sources, the provider’s compliance with the limit on executive compensation in subdivision (a) of this section shall be determined based upon the total amount of such funding received and the reimbursements received from all sources of State funds or State-authorized payments. As set forth in section 166-5.8 of this Subpart, the covered provider shall report all of such State funds and State-authorized payments in the form specified by the office or its designee.

The limit on executive compensation in subdivision (a) of this section and the reporting requirements in section 166-5.7 of this Subpart shall apply to subcontractors and agents of covered providers if and to the extent that such a subcontractor or agent has received State funds or State-authorized payments from the covered provider to provide program or administrative services during the reporting period and would otherwise meet the definition of a covered provider but for the fact that it has received State funds or State-authorized payments from the covered provider rather than directly from a governmental agency. A covered provider shall incorporate into its agreement with such a subcontractor or agent the terms of these regulations by reference to require and facilitate compliance. Upon request, covered providers shall promptly report to the funding or authorizing agency the identity of such subcontractors and agents, along with any other information requested by that agency or by the office or its designee. A covered provider shall not be held responsible for a subcontractor’s or agent’s failure to comply with these regulations.

The office or its designee, rather than the county or local unit of government or an entity contracting on behalf of such government, shall be responsible for obtaining the necessary reporting from and compliance by such covered providers, and shall issue guidance to affected county and local governments to set forth the procedures by which the office or its designee shall do so.

If the contract, grant, or other agreement is subject to more stringent limits on executive compensation, whether through law or contract, such limits shall control and shall not be affected by the less stringent limits imposed by these regulations. However, the definition and interpretation of terms in this Subpart shall not be affected or limited by the definition or interpretation of terms in other regulations or agreements.