Assembly’s Budget Plan Closes $9.2 Billion Budget Deficit

Proposal puts families first by rejecting $1 billion in new taxes and fees and making $4.3 billion in spending reductions
March 25, 2010

Assemblywoman Ellen Jaffee (D-Suffern) and Assemblyman Ken Zebrowski (D-New City) announced that the Assembly passed a budget plan that puts New York on a path to fiscal recovery, and closes the deficit by making $4.3 billion in balanced cuts and other actions.

“The Assembly has put forth a bold budget that makes the necessary cuts in spending, while protecting programs that mean the most to working families,” Assemblywoman Jaffee said. “I’ve said from the beginning of this process that this year’s budget must include cuts – as painful as they may be.”

The Assembly’s proposal, in addition to $4.3 billion in cuts and $1 billion in rejected tax increases, restores $600 million to school aid, rejecting the largest school aid cut – $1.4 billion – by any governor in New York history. The burden on local taxpayers is also reduced by the restoration of SUNY and CUNY community college base aid to its prior level of $2,545 per full-time equivalent student.

“Crippling cuts to education hurt our children and increase property taxes, that's not going to happen on my watch” Assemblyman Zebrowski said. “My priorities for this budget were simple: no new taxes on middle class New Yorkers, restorations of education aid and protection of seniors and residents with developmental disabilities; this resolution goes a long way to achieving those goals.”

The Assembly’s budget proposal saves the parks and historic sites that were threatened with closure by restoring $11.25 million of the $15 million cut so our families can continue to enjoy all the healthy, low-cost outdoor activities these beautiful sites have to offer.

“Clearly, our economy has changed and state revenues are down. In this environment, we must keep pushing for responsible reductions that match spending with revenues and shrink the overall size of government,” Assemblywoman Jaffee said. “But we must also protect New York taxpayers from harsh cuts to vital programs, particularly our most vulnerable residents. While this approach impacts nearly every aspect of the state budget, we’ve crafted a plan that doesn’t leave families without the essential services they rely on.”

The Assembly’s plan restores cuts to nursing homes, hospitals and the Elderly Pharmaceutical Insurance Coverage program. It also cracks down on Medicaid fraud, capturing $300 million in increased savings, and reduces other Medicaid and health spending by an additional $700 million. The Assembly proposal reinstitutes the requirement that health insurance companies may not increase premiums on certain plans without prior approval from the Insurance Department.

Another key provision of the Assembly’s budget proposal is a shift in costs of Medicaid administration from counties to the state, saving local taxpayers over $300 million per year by improving uniformity in eligibility and service determinations, increasing efficiencies, and consolidating duplicative services and contracts.

Numerous agency consolidations will also save the state $32 million in the 2010-2011 budget.

In addition, the Assembly budget also proposes major budget reforms based on the recommendations of Lt. Gov. Richard Ravitch, including the five-year elimination of the structural deficit by moving to a GAAP balanced budget, the formation of the Review Board and the imposition of strict time periods to address unanticipated revenue shortfalls.

“A major part of this budget includes adopting measures for fiscal stability to ensure New York never finds itself in this kind of budgetary mess again,” Assemblywoman Zebrowski said.

“In these tough times we need to be careful with every fiscal choice we make. The Assembly’s budget proposal continues to close some of the largest budget gaps in state history, while ensuring families have the vital services they rely on,” Assemblywoman Jaffee said. “I urge the Senate and governor to work with the Assembly on this plan so we can quickly arrive at a final budget that puts people before politics, keeping families first.”