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1. As used in this section, (a) 'state agency' shall mean any state department, board, bureau, division, commission, committee, public authority, public benefit corporation, council, office, or other governmental entity performing a governmental or proprietary function for the state; and (b) 'dishonored check' shall mean a check, draft or like instrument drawn on a bank, depository or financial institution as full or partial payment for an unpaid balance on an account, or for other extensions of credit or payments of money, which is not paid or is dishonored or is returned by such institution due to insufficient funds or other cause not attributable to the state of New York. 2. Any individual, business or other entity, which is not a state agency, municipal corporation or district corporation, which makes payment to a state agency by a check which is dishonored shall be liable to such state agency for a returned check charge. The state director of the budget shall: (i) promulgate such guidelines as the director deems necessary to carry out the provisions of this section and (ii) establish a reasonable monetary amount of the returned check charge which

et shall: (i) promulgate such guidelines as the director deems necessary to carry out the provisions of this section and (ii) establish a reasonable monetary amount of the returned check charge which shall not exceed the amount set forth in section 5-328 of the general obligations law. 3. Any returned check charges assessed pursuant to this section shall be paid upon notice and demand and shall be treated and collected in the same manner as the original debt upon which the dishonored check was received and shall be collected by a state agency when such agency deems collection to be administratively practical and cost-effective. 4. The provisions of this section shall not supersede any provision of law or regulation or contract which provides a remedy for the remittance of a dishonored check to the state of New York. 5. All contracts entered into or any regulation promulgated on or after the effective date of this section which waives the imposition of returned check charges or imposes returned check charges in a manner inconsistent with this section must be approved by the state division of the budget.