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Budget Banter


The governor releases his budget, and everyone else releases a statement

On Tuesday, Governor David Paterson unveiled his 2010 budget proposal. The proposed budget plan eliminates the $7.4 billion budget gap projected for 2010-2011, including the $500 million deficit carried forward from 2009-10, and reduces the gap in 2011-12 by more than one-half, from $14.3 billion to $6.3 billion.

The gap-closing is accomplished through a combination of reductions to local aid, spending cuts, and $1 billion in new taxes and fees.

Those tax and fee increases include a new excise tax on syrup used in soft drinks and other beverages ($465 million), a $1 per pack increase in the cigarette tax ($218 million), as well as a plan that would permit grocery stores to pay a franchise fee for the privilege to sell wine ($92 million) and assessments on healthcare providers ($216 million).

Paterson also says he will begin the process of trying to end tax-free cigarette sales by Indian tribes. That plan might work out if Paterson also puts an excise tax on the purchase of tires used to block the Thruway by burning said tires.

Absent from this proposal are any big picture ideas on consolidating state agencies, authority reform or structural reform to the state workforce. Local political analyst and blogger Alan Bedenko says, “Paterson’s proposed budget takes a hard look at doing the same damn thing the state has been doing for the last four decades, and making the bold choice to keep doing the same damn thing.”

Two elements of the governor’s proposal stand out:

Borrowing: Plans to borrow money are on the agenda, such as $7 billion to help fund an ambitious road and bridge construction effort over the next two years.

No layoffs: The governor proposes no layoffs of state workers, but counts on another pay freeze by non-unionized workers. Unions have refused to amend their contracts to permit pay freezes or furloughs. Paterson expects the portion of the state work force that he controls—which totals about 131,000, and does not include agencies such as SUNY—will drop by about 625 positions by spring of 2011.

Seems like we could have done a little more on trimming the state payroll, eh?

Especially when we’re talking about a $1.1 billion cut in state funding to local schools. Assemblyman Sam Hoyt released a statement asking why Paterson and the Assembly and Senate refused to act on legislation that would have brought in $400 million in direct federal aid to local schools in 2010.

“In August, I wrote the governor asking him to convene a special session of the legislature to begin the discussion concerning New York’s Race to the Top application,” Hoyt said. “Five months later, with less than 24 hours before the application was due, a special session was called and as usual, nothing was accomplished.”

The Buffalo Niagara Partnership put out their predictable mixed response:

In our initial assessment of the governor’s 2010-11 budget proposal we are heartened by his attempt to control overall spending. However, given the state’s current and growing budget deficit, we’d much prefer to see the price tag for running New York State government go down.

We are, however, extremely pleased to see inclusion of the UB 20/20 (sic) reforms that are critical to the growth and economic well-being of the University at Buffalo and other SUNY and CUNY institutions.

Let me rephrase that for Mr. Rudnick: “We’re opposed to the new taxes, fees, and obscene spending. Well, except for the obscene spending that directly benefits us, we’re good with that.”

Those are just two of the dozens of statements issued by politicians and special interest groups in immediate response to Paterson’s proposal. Let the budget battle begin.

—chris smith,

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