(1) For the purpose of closing the state's books, and subject to the provisions of this section, the controller may, on or after May 1 of any fiscal year and before the forty-fifth day after the close thereof, upon approval of the governor, allow any department, institution, or agency of the state, including any institution of higher education, to make an expenditure in excess of the amount authorized by an item of appropriation for such fiscal year if: (a) The overexpenditure is for medicaid programs; or (a.5) The overexpenditure is by the department of health care policy and financing for the children's basic health plan established pursuant to article 8 of title 25.5, C.R.S.; except that, to the extent that the overexpenditure allowed pursuant to this paragraph (a.5) is from the general fund, the overexpenditure from the general fund shall not exceed two hundred fifty thousand dollars in any fiscal year; or (a.6) The overexpenditure is by the department of health care policy and financing for the required state contribution payment pursuant to the federal "Medicare Prescription Drug, Improvement, and Modernization Act of 2003", Pub.L. 108-173; or (a.7) The overexpenditure is by the department of health care policy and financing for the state medical assistance program, established pursuant to section 25.5-2-104; or (a.8) The overexpenditure is by the department of health care policy and financing for the state children's basic health plan, established pursuant to section 25.5-2-105; or (b) (I) The overexpenditure is by the department of human services for any purpose other than medicaid programs, but the total of all overexpenditures allowed pursuant to this subsection (1)(b) must not exceed one million dollars in any fiscal year; or (II) The overexpenditure is by the department of human services for the relative guardianship assistance program established in section 26-5-110 or the adoption assistance program created in section 26-7-103; or (c) The overexpenditure is for any purpose of a department, institution, or agency of the executive branch other than the department of human services, but the total of all overexpenditures allowed pursuant to this paragraph (c) shall not exceed three million dollars in any fiscal year; or (c.5) The overexpenditure is for the workers' compensation self-insurance program of the department of human services established pursuant to section 8-44-203, C.R.S.; or (d) The overexpenditure is for any purpose of the judicial department, but overexpenditures allowed pursuant to this paragraph (d) shall be subject to the limitation in section 24-75-110; or (e) The overexpenditure is by the department of corrections for the purchase of pharmaceuticals and the purchase of medical services from other medical facilities as part of the medical services subprogram for department institutions. The overexpenditure authorized by this paragraph (e) shall only be allowed for the 2001-02 fiscal year. (f) The overexpenditure is by the department of education for providing reimbursements to a participating school food authority for offering eligible meals without charge, pursuant to section 22-82.9-204 (1)(b); or (g) The overexpenditure is of money that originated from the coronavirus state fiscal recovery fund in excess of the amount authorized by an item of appropriation or the amount in a recipient fund or the discretionary account, as each is defined in section 24-75-226, in state fiscal year 2023-24 if the money that funded the appropriation is transferred from the recipient fund or discretionary account to the "American Rescue Plan Act of 2021" cash fund pursuant to section 24-75-226 (3.5). (1.5) For the purposes of this section, an overexpenditure includes any instance in which the total expenditures charged to a specific line item of appropriation are in excess of the total spending authority appropriated for that line item and any instance in which sufficient cash or cash-exempt reserves have not been earned to cover related expenditures and there is no statutory fund balance to cover such expenditures. (2) Overexpenditures allowed pursuant to subsection (1) of this section shall be subject to the following requirements: (a) Except as specifically provided in this section, overexpenditures shall be consistent with all statutory provisions applicable to the program, function, or purpose for which the overexpenditure is made, including the provisions of appropriation acts. (b) No overexpenditure shall be allowed in excess of the unencumbered balance of the fund from which the overexpenditure is made as of the date of the expenditure. (c) For fiscal years commencing on or after July 1, 2014, no overexpenditure is allowed under paragraph (a) or (a.5) of subsection (1) of this section for any appropriation in the annual general appropriation act to the department of health care policy and financing that is in a line item for the executive director's office or in a line item that the general assembly has labeled as ineligible for an overexpenditure under said paragraphs. (3) For any overexpenditure, whether or not allowed by the controller in accordance with subsection (1) of this section, the controller shall restrict, in an amount equal to said overexpenditure, the corresponding item or items of appropriation that are made in the general appropriation act for the fiscal year following the fiscal year for which the overexpenditure that is allowed occurs. For the purposes of determining such corresponding item or items of appropriation, the controller shall consider, in order of importance, the fund from which the overexpenditure was allowed, the department, institution, or agency that was allowed to make the overexpenditure, and the purpose for which the overexpenditure was allowed. The department, institution, or agency shall not be allowed to expend any amount restricted pursuant to this subsection (3) unless such restriction is released in accordance with subsection (4) of this section. (3.5) (a) Notwithstanding subsection (3) of this section, for an overexpenditure described in subsection (1)(g) of this section, the controller shall restrict, in an amount equal to said overexpenditure, corresponding items of appropriation made for the fiscal year following the fiscal year for which the overexpenditure occurs, as follows: (I) An appropriation from the general fund to the same department for the same purpose or, if there is no appropriation from the general fund to the same department for the same purpose, a corresponding item or items of appropriation from the general fund, as described in subsection (3) of this section; and (II) An appropriation to the same department for personal services made pursuant to section 24-75-226 (4)(a)(V), or, if there is no appropriation to the same department for personal services made pursuant to section 24-75-226 (4)(a)(V), an appropriation to the department of corrections for personal services made pursuant to section 24-75-226 (4)(a)(V). (b) (I) The department, institution, or agency shall not be allowed to expend any amount restricted pursuant to subsection (3.5)(a)(I) of this section. A department that has an appropriation restricted pursuant to subsection (3.5)(a)(II) of this section may submit a request for a supplemental appropriation for an amount equal to the amount restricted. (II) While the supplemental appropriation process is the appropriate means by which to restore funding that was restricted pursuant to this subsection (3.5), it is the intent of the general assembly that each department receive the full amount of money appropriated for a program for which an overexpenditure is made pursuant to subsection (1)(g) of this section or for an appropriation that is restricted pursuant to this subsection (3.5), though it may be necessary to adjust the source of the money that funds the appropriation. (c) On or before December 31, 2024, the state controller shall report to the joint budget committee information about each overexpenditure made pursuant to subsection (1)(g) of this section and each appropriation restricted pursuant to this subsection (3.5). (d) This subsection (3.5) is repealed, effective June 30, 2028. (4) (a) The department, institution, or agency whose appropriation is restricted may request a supplemental appropriation for the fiscal year in which the overexpenditure occurred for the amount of any overexpenditure allowed pursuant to this section. If a supplemental appropriation is enacted for the overexpenditure or some portion thereof, the restriction on the succeeding fiscal year's appropriation shall be released in the amount of the supplemental appropriation enacted. (b) If the amount of the restriction imposed pursuant to subsection (3) of this section was based on an estimate of the amount of the overexpenditure and the amount of such restriction exceeds the actual amount of the overexpenditure, the controller shall release that portion of the restricted amount that exceeds the actual amount of the overexpenditure. (5) The limitation on general fund appropriations and the requirement for a general fund reserve contained in section 24-75-201.1 shall not apply to overexpenditures from the general fund for medicaid programs allowed pursuant to subsection (1)(a) of this section to overexpenditures by the department of education allowed pursuant to subsection (1)(f) of this section, or to supplemental general fund appropriations for medicaid programs enacted pursuant to subsection (4) of this section. Overexpenditures for all other purposes allowed pursuant to subsection (1) of this section and supplemental general fund appropriations for all other purposes enacted pursuant to subsection (4) of this section shall be considered appropriations for the fiscal year in which the overexpenditure was allowed and shall accordingly be subject to the limitations and requirements of section 24-75-201.1. (6) The controller may allow overexpenditures pursuant to this section only for the fiscal years beginning on or after July 1, 1998, but prior to July 1, 2025. This section is repealed, effective September 1, 2025.
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