§ 201-a. Flexible benefits program for certain state officers and employees. 1. This section shall be applicable to employees as defined in subdivision one of section eleven of chapter four hundred sixty of the laws of nineteen hundred eighty-two, as amended and employees and officers of public authorities and public benefit corporations, annual employees of the legislative branch, and judges and justices of the unified court system and non-judicial employees of the unified court system whose positions are not in collective negotiating units under article fourteen of the civil service law who elect to participate in the benefits of the employee benefit program provided by paragraph (a) of subdivision two of section eleven of chapter four hundred sixty of the laws of nineteen hundred eighty-two, as amended.

2. The director of employee relations, in consultation with the director of the budget and the president of the civil service commission, is authorized to establish a flexible benefits program consistent with sections seventy-nine, one hundred five, one hundred six, one hundred twenty-five and one hundred twenty-nine of the internal revenue code and regulations adopted pursuant thereto, and implement such program subject to the approval of the director of the budget.

3. At the request of an employee as defined in subdivision one of this section, the comptroller shall, by payroll deduction, defer the payment of part of the compensation of such employee as provided in a written statement by the employee for the purpose of establishing and maintaining a flexible spending account as authorized in subdivision two of this section, and shall transfer the amount so deferred to the authorized program administrator.

4. The term "program administrator" shall mean that agent, as determined by the director of employee relations, responsible for the maintenance and management of flexible spending accounts as authorized in subdivision two of this section.

5. Moneys held in such accounts for the employees of each such participating employer shall be held by the program administrator as agent for the participating employee and shall be accounted for separately and shall remain the property of such participating employer. Notwithstanding any law to the contrary, moneys may be paid out of such accounts without any appropriation by law. All payments of moneys from such accounts shall be made only in accordance with the flexible benefits program audit of the state comptroller. Any unexpended balances in such accounts at the end of a plan year as that term is so defined by the internal revenue service shall be returned to the control of the participating employer and, in the case of the state, to the general fund.

6. To the extent permitted by section one hundred twenty-five of the internal revenue code and regulations adopted pursuant thereto, any salary deferred by an employee as defined in subdivision one of this section under a flexible benefits program established pursuant to this section shall be considered part of annual compensation for the purpose of computing retirement benefits.

7. Notwithstanding any other law, rule, or regulation to the contrary, where, and to the extent that, an agreement between the state and an employee organization entered into pursuant to article fourteen of the civil service law on behalf of employees in a collective negotiating unit established pursuant to article fourteen of the civil service law provides for flexible benefits provided by this section, such flexible benefit program shall be established in accordance with such agreement.