The Conversation Has Started On Closing New York State’s $3 Billion Budget Deficit
A few weeks ago, I wrote in this column about the challenges posed by New York’s steadily worsening fiscal picture, as a significant drop-off in state revenues resulted in a mid-year budget deficit that had grown beyond initial expectations and is now projected at $3 billion. State Comptroller Tom DiNapoli even went so far as to recently warn that New York’s budget deficit could grow to as much as $4.1 billion if current trends continue and no action is taken.
The dramatic growth in the deficit is exactly what I warned would happen if the 2009-10 State Budget – which was built on overly optimistic assumptions and fueled by a reckless increase in government spending – was enacted. This, coupled with the fact that it imposed $8.2 billion in taxes and fees, is why our entire Conference voted against the spending plan. Unfortunately, this bad budget was signed into law and now taxpayers are once again being asked to clean up a huge mess left in the wake of Albany’s fiscal irresponsibility.
Upon the conclusion of our last public, five-way Legislative Leaders’ meeting, Governor David Paterson asked for the Legislature’s ideas on closing the state’s financial gap. On Tuesday, I instructed my legislative staff to provide the Governor and his staff with some “conversation starters” for how we could address the budget deficit and get New York back on track. Here are some of the conversation starters I provided to get the ball rolling and begin the discussion on how we can tackle New York’s multi-billion dollar budget shortfall:
- Enact an across-the-board reduction in mid-year State Operating Funds – estimated savings of $2.5 billion;
- Streamline the state bureaucracy by consolidating certain administrative agencies that have overlapping functions – estimated savings of $241 million;
- Remove a state mandate from local governments so they can decide which optional Medicaid services to provide – estimated savings of $1 billion;
- Reduce Non-Personal Services across all state agencies (this includes things like travel and office supplies) – estimated savings of $500 million;
- Reduce Personal Services across all state agencies, focusing on appointed – not civil service – administrative positions – estimated savings of $175 million;
- Eliminate Legislative Earmarks – estimated savings of $100 million; and
- Eliminate funding for state government to buy up more private land – estimated savings of $30 million.
Once fully implemented, all of the conversation starters I offered would achieve over $3 billion in state budgetary savings, effectively closing New York’s mid-year budget deficit. They would do so by reducing the size and cost of state government before focusing on crucial public priorities.
GOVERNOR PATERSON WEIGHS IN
On Thursday, Governor Paterson and Lieutenant Governor Richard Ravitch held a presentation at the State Capitol to outline the administration’s proposals for addressing the budget deficit. The Governor said he would not look to any new taxes to close the gap and I commend him for that. Our Conference and I have been saying all along that any new taxes are “conversation enders” and should be off the table. New York families and businesses already pay some of the highest taxes in our nation – increasing this crushing burden would only make our bad economy worse.
The Governor presented a two-year, $5 billion deficit reduction plan for eliminating the State's current-year budget gap that included, among other things, a reduction in school aid and funding for nursing homes. I believe that any further funding decreases in the areas of education and health care should only be considered as a very last resort. Deep, dramatic cuts in both of these priorities would likely do more long-term harm than good. Instead, we should focus first on cutting the expense and burden of state government itself by looking to some of the conversation starters I had suggested two days prior.
JOIN THE CONVERSATION
Now that the conversation has started, all New Yorkers need to be part of this important dialog. What are your suggestions for closing the state’s multi-billion dollar budget deficit? Which areas would you look at to reduce the cost of state government? E-mail your ideas to me at firstname.lastname@example.org and I will print some of the most creative and cost-effective ideas in a future legislative column regarding this subject.
As always, constituents wishing to discuss this topic, or any other state-related matter, should contact my district office at (315) 781-2030, or e-mail me at email@example.com.