CHAPTER 579

FORMERLY SENATE BILL NO. 664

AS AMENDED BY HOUSE

AMENDMENT NO. 3

AN ACT TO AMEND TITLE 29, DELAWARE CODE, CHAPTERS 63 AND 65 TO REQUIRE ALL STATE DEPARTMENTS AND STATE AGENCIES AND DIVISIONS THEREOF, THE BUDGET DIRECTOR, THE GOVERNOR AND THE GENERAL ASSEMBLY TO INCLUDE AND REPORT IN ANY AND ALL BUDGETARY OR APPROPRIATION REQUESTS OR BILLS AN APPROPRIATE AMOUNT TO COVER OTHER EMPLOYMENT COSTS ("FRINGE BENEFITS") AND TO REQUIRE STATE DEPARTMENTS AND AGENCIES TO RECEIVE REIMBURSEMENT FOR THE FULL COSTS OF GOODS AND SERVICES PROVIDED TO OTHERS.

WHEREAS, the cost of labor is no longer confined to mere salaries or wages, but includes an ever increasing percentage of mandatory other employment costs, commonly referred to as "fringe benefits"; and

WHEREAS, it is incumbent upon all branches of government to budget and provide appropriations currently for such mandated other employment costs; and

WHEREAS, neglect to provide currently at the onset for such other mandated employment costs causes future embarrassment and difficulty in funding thereof; and

WHEREAS, it is impossible to determine the true total cost of any State activity or operation when the factor of "other employment costs" is not taken into account, but assumed to be forthcoming from an illusory but undefined source;

NOW, THEREFORE,

Be it enacted by the General Assembly of the State of Delaware:

Section 1. Amend Title 29, Chapter 63, Delaware Code, by adding a Section 6340 to read as follows:

§ 6340. Other employment costs (fringe benefits)

(a) There shall be included, immediately following the lines for items which provide for salaries or wages of State Employees in any Department, Division or Agency budget, appropriation or supplementary appropriation request or Bill, a separate line or item covering other employment costs (fringe benefits) related to such salaries or wages. No appropriation for such other employment costs shall be used or transferred to or for any other purpose.

(b) Other Employment Costs shall include such costs to the State as Federal Insurance Contributions (Social Security), State Retirement Plans (Employees' Pensions), Health Care Insurance (Blue Cross and Blue Shield), and such other fringe benefit plans as may hereinafter be enacted.

() Each year on or before August 1, the Secretary of Finance shall determine an appropriate rate factor on an average or actual basis, for each of the State fringe benefit plans, in order that the Budget Director may advise each State Agency how it shall provide for such other employment costs in their respective budget requests for the ensuing fiscal year.

(a) Any department or agency employing personnel who are paid from Federal funds or from Capital Improvement Debt appropriations shall pay to the Treasurer of the State of Delaware from such funds an amount based upon the rate factor for each of the State fringe benefit plans established under subsection (c) hereof applicable to salaries and wages paid to employees from such Special Funds.

Section 2. Amend Title 29, Delaware Code, Chapter 65, by adding Sections 6530 and 6531 to read as follows:

§ 6530. Other employment costs (fringe benefits)

The Secretary of Finance and the Budget Director shall promulgate such budgetary, according, funding and reporting rules and regulations as shall be necessary to implement the provisions of Title 29, Chapter 63, § 6340.

§ 6531. Reimbursement for cost of goods and services provided

(a) Reimbursement. All State agencies and departments which provide goods and/or services to any other State agency, State department, or to any other governmental agency, person, corporation, partnership or business organization excepting all incorporated municipalities of this State, on a reimbursement basis, shall be reimbursed in amounts which shall not be less than the full cost of such goods and services; provided, however, if the Governor shall indicate to the said agency or department that such reimbursement for the full cost of goods and/or services provided is not in the best interest of the State of Delaware, then reimbursement for the full cost of any goods and/or services provided shall not be required.

(b) Full cost is defined as purchase of 'out-of-pocket' costs including other employment costs, plus overhead costs, computed in accordance with accepted governmental accounting principles, as prescribed by the Secretary of Finance.

Approved July 24, 1972.