Hawley’s Albany Update

Budget more of the same
April 11, 2007

Last week in Albany, the state Legislature passed a $121 billion budget after a series of closed-door, last minute negotiations yielded a late budget for the first time in three years. The budget is highlighted by $8 billion more spending from one year ago, insufficient tax relief, and a flawed negotiation process that lacked transparency and openness.

The spending increase, which is twice the rate of inflation, shows this government still chooses to live outside its means while it implements no measures to manage the state debt. Coupled with tax hikes and modest property tax relief, I am concerned that despite the rhetoric championing reform, we are simply seeing more of the same.

As property tax relief continues to be a priority for most residents, the Legislature was able to secure the return of STAR rebate checks for this year. The program will yield $1.3 billion in cuts for homeowners in fiscal year 2007-08. While this is a good start, it is not nearly enough for the overburdened property owners of Western New York.

Despite the program’s best intentions, the system is flawed in that last year it cost the state $1 million in postage and an additional $1.3 million in administrative costs to send the checks to you. This is a categorical waste of taxpayer money.

I am an opponent of rebate checks because I believe homeowners would see greater savings by subtracting the actual property tax savings from the gross amount and paying the difference. We could secure larger tax savings for property owners this way.

The budget also fails to deliver the property tax relief homeowners desperately need by not attacking the $4.5 billion in annual Medicaid fraud, waste and abuse. That is money that should be returned to you, yet this government continues to take a passive stance in dealing with the problem. The budget calls for only $100 million in recovery.

As Attorney General, Eliot Spitzer was relentless in attacking corporate fraud. I was optimistic that he would take the same attitude in dealing with Medicaid abusers. Unfortunately, that has yet to come to fruition and one year from now, we will still be ranked number one in the nation in money lost to Medicaid fraud.

Despite the major flaws in this budget, there was some good as we saw record levels of investment for education. It is anticipated that for the 2007-08 school year, $19.6 billion is provided in General Support for Public Schools, an increase of $1.75 billion from last year.

Furthermore, $30 million has been dedicated to the Dairy Assistance Program that will help local dairy farmers sustain their economic viability. Dairy farmers represent an important piece of our region’s framework and are essential to the state’s economic health.

Overall, though, this budget is a major disappointment on many levels. Negotiations were conducted in secret after reform measures that passed both houses of the Legislature promised a more open and transparent process in full view of the public. That clearly did not happen.

Our government’s leadership must learn to spend more responsibly, the same way you and I do. We do not buy what we cannot afford. I am hopeful that all involved will learn from this year’s failures and make the necessary adjustments next year to bring about a more efficient and effective public process.