(1) Beginning with the 1998-99 fiscal year, any agency may implement measures that reduce the costs of delivering the agency's services and products below the amount of the agency's appropriations for a given fiscal year. Any agency that achieves cost savings under this subsection (1) may transfer twenty percent of the amount of the cost savings from one item of appropriation made to the agency in the general appropriation act or any supplemental appropriation act to another item of appropriation made to the same agency in said act. The following limitations shall apply only to transfers made pursuant to this subsection (1):
In no case shall an agency use any of the amount transferred as a result of costsavings to add employment positions or for personal services.
All transfers made pursuant to this subsection (1) shall be between items of appropriations made for the fiscal year in which the cost savings were achieved.
Prior to expending any moneys so transferred, the agency that achieved the cost savings shall enter into a memorandum of understanding with the joint budget committee that details how the agency will spend the transferred moneys.
Any moneys transferred to an agency as the result of cost savings may be spent onlyfor reinvestment in technology or other capital projects related to the item of appropriation to which the moneys were transferred.
(1.5) Beginning with the 2004-05 fiscal year, an agency that achieves cost savings, as an alternative to the transfer authorized pursuant to subsection (1) of this section, may transfer fifty percent of the amount of the cost savings from one item of appropriation made to the agency in the general appropriation act or any supplemental appropriation act to the item for personal services in the appropriation made to the same agency for the purpose of paying performancebased awards to employees of the agency. The award shall be awarded in the fiscal year in which the cost savings are achieved and shall be made consistent with the performance review done in accordance with the merit pay system identified in section 24-50-104 (1)(c.7). Prior to the end of the state fiscal year in which a transfer is made pursuant to this subsection (1.5), an agency shall submit written notice to the joint budget committee, the office of state planning and budgeting, and the state controller of the amount of the cost savings achieved by the agency during the state fiscal year.
The general assembly may reduce an agency's appropriations for the fiscal year following the fiscal year in which the agency achieved the cost savings by the amount of such cost savings if the general assembly determines that the agency is no longer maintaining the measures the agency used to achieve the cost savings or that such cost savings is sustainable for more than one fiscal year. Except as otherwise provided in this subsection (2), the general assembly shall not use a one-time cost savings an agency achieves in a given fiscal year to justify reducing any item of appropriation or the total amount of appropriations the agency may receive in the fiscal year following the fiscal year in which the agency achieved the cost savings. However, nothing in this subsection (2) shall affect the general assembly's authority to reduce an agency's appropriations for any reason other than cost savings.
Nothing in this section shall be construed to allow an agency to avoid any power orduty required by law that otherwise applies to the agency's actions.
Source: L. 98: Entire article added, p. 1309, § 1, effective August 5. L. 2004: (1) amended and (1.5) added, p. 1239, § 1, effective August 4. L. 2012: (1.5) amended, (HB 121321), ch. 260, p. 1341, § 4, effective September 1.
Cross references: In 2012, subsection (1.5) was amended by the "Modernization of the State Personnel System Act". For the short title and the legislative declaration, see sections 1 and 2 of chapter 260, Session Laws of Colorado 2012.