N.Y. State Fin. Law § 179-H
Except in situations when federal law or the provisions of section one hundred seventy-nine-o of this article require otherwise, an interest payment required by this article shall be paid from the same appropriation as that from which the related proper invoice is paid; provided, however, (1) that the interest payment shall not reduce the amount of money that otherwise will be payable to the contractor under the terms of the relevant contract and (2) that if the obligation to make an interest payment is incurred in whole or in part because it takes the department of audit and control more than eight calendar days, excluding legal holidays, from the date it receives an approvable voucher from another state agency to process a contract payment, then the portion of the total interest payment that is attributable to delays by the department of audit and control shall be paid from funds made available to the department of audit and control. Notwithstanding any other provision of law to the contrary, if the amount of money available from any such appropriation to the state agency which received the proper invoice is insufficient to pay the interest and if for any reason it is not feasible for the director of the budget to exercise the transfer or interchange authority established by section fifty-one or ninety-three of this chapter, the director of the budget may issue a certificate or certificates transferring or interchanging within a fund such amount as is needed to pay the interest to said appropriation within such fund from the unspent balance of any appropriation that is available to the same state agency. In exercising the latter transfer or interchange authority, the director of the budget shall transfer or interchange amounts that are not needed to accomplish the purposes for which the appropriation was made, except, however, the director of the budget may, to the extent he deems it practicable, transfer or interchange amounts from appropriations that otherwise would be available for the administration and operations of the state agency which incurred the interest payment. Any such certificate or certificates issued by the director of the budget shall be sent to the state comptroller and copies shall be filed with the chairman of the senate finance committee and the chairman of the assembly ways and means committee.
N.Y. State Fin. Law § 179-H