New York state budget

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New York is struggling with a structural deficit of $44 billion over the next five years according to the New York Division of the Budget (DOB) in releasing its mid-year financial plan update October 30, 2009, an increase of $6 billion from the most recent projections in July. New York's mid-year report is released in October because its fiscal year runs from April 1 to March 30. Gov. David A. Paterson proposes a Deficit Reduction Plan incorporating a proposal to cap state spending increases at the rate of inflation.^[1]

The most recent figures from the New York Division of the Budget show FY 2010 has a $3.2 billion deficit and FY 2011 will have a $7 to$8 billion shortfall.^[2] The governor has estimated a $9 billion shortfall.^[3] Gov. Paterson advocates quick action from the New York State Legislature at a special session starting Nov. 10 on his proposed two-year, $5 billion Deficit Reduction Plan (DRP), which purports to close the current-year gap and cut the combined projected $10 billion deficit in half. DOB revisions from the July 2009 estimate of $2.1 billion deficit for the current fiscal year to $3.2 billion is mostly due to declining income tax collections and $106 million increase for projected spending. In total, year to date income tax collections for FY 2010 are $4.4 billion less, 22% than FY 2009. The "surcharge on high-income individuals" passed during the regular legislative session to help bridge New York's original $1.7 billion budget gap^[4] has not produced the anticipated $4 billion, instead 10% less at $3.6 billion.^[5]

[edit] Budget Background

The initial phases in creating the state budget begin long before the fiscal year to which it applies. Every summer, the Division of the Budget (DOB) sends a call letter to state agencies that sets out the Governor’s priorities for the year, anticipated fiscal constraints and a schedule for submitting budget requests.^[6] The DOB is responsible for analyzing agencies' requests and aiding the Governor in creating the final state budget. ^[6]

Agencies usually submit their budget requests to the DOB by early fall.^[6] The DOB and State Comptroller must release a detailed estimate of anticipated income and expenses by November 5.^[6] The DOB evaluates the budget requests in light of trends in income and spending, assesses the state’s economic situation and presents their recommendations to the Governor.^[6]

By mid-January (or February 1st following a gubernatorial election year), the Governor must submit his budget plan to the legislature along with related appropriation, revenue and budget bills. ^[7] Along with the Executive Budget, the Governor must submit the State’s Five-Year Financial Plan, Five-Year Capital Program and Financing Plan, and any financial information supporting the Executive Budget. ^[7] The legislature then analyzes the Governor’s proposals, holds public hearings and works with the DOB in evaluating the proposed budget measures. ^[7] Both houses of the legislature must agree on the income and spending appropriations in the budget bill and submit the amended budget to the Governor for his approval. ^[7] The budget is then sent to the Governor for approval, and a final state budget is created for the upcoming fiscal year.^[7]

In approving the final state budget, the Governor may use a line-item veto to cancel out specific provisions without having to veto the bill in its entirety. ^[7] The state legislature can override the Governor's veto only by a 2/3 vote by the members of each house.

See New York state budget (2008-2009) for more information.

[edit] Accounting Principles

The Office of the State Comptroller audits state agencies, public authorities, and all local governments in New York State, including New York City. The Comptroller's audit reports are published online. Thomas P. DiNapoli has been New York State Comptroller since February 2007. The State Comptroller is New York State's chief fiscal officer. The breadth and scope of its responsibilities are unique among the states including:^[8]

• Managing the State's assets and issuing General Obligation debt;
• Conducting management and financial audits of State agencies and public benefit corporations;
• Issuing reports on State finances;
• Overseeing the fiscal affairs of local governments, including New York City;
• Reviewing State contracts, payrolls and payments before they are issued;
• Maintaining the State's accounting system and issuing monthly cash financial statements;
• Overseeing the Justice Court and Abandoned Property Programs; and
• Operating the retirement systems for State and local retirees, valued at $140.5 billion as of March 2006.
• To ensure independence, the Comptroller Office's leadership has been placed under a Statewide-elected Comptroller, selected separately from the Governor.

The Institute for Truth in Accounting (IFTA) rates New York “Tardy” in filing the state’s Comprehensive Annual Financial Report (CAFR) – The annual report of state and local governmental entities. IFTA rated 22 states timely, 22 states tardy, and 6 states as worst. IFTA does not consider New York's CAFRs, and those of the other states, to be accurate representations of the state’s financial condition because the Generally Accepted Accounting Principles (GAAP) basis does not include significant liabilities for the pension plans and for other post employment benefits, such as health care.^[9] New York's CAFRs are prepared and published online by the New York Office of the State Comptroller FY 2009's CAFR has been completed and publicly posted timely.^[10]

New York government spending is partially transparent and currently has several transparency resources as listed below. The first two are government sponsored, while the third is sponsored by the Empire Center.

• www.openbooknewyork.com was created by State Comptroller Thomas DiNapoli
• Project Sunlight was created by State Attorney General Andrew Cuomo
• www.seethroughny.net was created by the Empire Center for New York State Policy

[edit] Accounting transparency checklist

Comprehensive Balanced budget Timeliness Usability

[edit] The good

• The website has Comprehensive Annual Financial Reports (CAFR) dating back to 2003.^[12]
• An independent auditor’s report is published on page 16 of the document.^[13]
• It provides supplements to the budget workup, starting on page 96.
• The budget is posted using organized and consistent methods of financial reporting.
• New York law requires a balanced budget, but a deficit is permitted.^[14]
• It includes all costs incurred by the government, including long-term liabilities, starting on page 31 of the document.^[13]
• The CAFR compares estimated and actual budgetary numbers, such as on page 96 of the document.^[13]

[edit] The bad

• The New York office was somewhat tardy in submitting the budget.
• The CAFR is posted in a PDF format, so it’s not searchable online.

[edit] Spending transparency

[edit] Website evaluation

Budget Usability Elected Officials Administrative Officials Ethics Audits Contracts Lobbying Public records Taxes

NY.gov is the website for the state of New York.

• Main article: Evaluation of state websites

[edit] The good

• Site has a search function and is fairly easy to navigate.
• State tax information is provided.^[15]
• Administrative officials are listed with contact information in a searchable database.^[16]
• Budget is published.^[17]
• State ethics information is available.^[18]
• Audit reports are published.^[19]
• Current state contracts are available.^[20]
• Elected officials are listed with contact information under respective office.^[21]
• Includes lobbying data/reports, provides list of all registered lobbyists.^[22]

[edit] The bad

• Some information on requesting public records under the New York Freedom of Information Law is provided, but is not comprehensive and does not include all departments.^[23]
• Does not provide information on agency lobbying contracts.

New York government spending is partially transparent and currently has several transparency resources as listed below. The first two are government sponsored, while the third is sponsored by the Empire Center.

• www.openbooknewyork.com was created by State Comptroller Thomas DiNapoli
• Project Sunlight was created by State Attorney General Andrew Cuomo
• www.seethroughny.net was created by the Empire Center for New York State Policy

[edit] Government tools

The following table is helpful in evaluating the level of transparency provided by a state spending and transparency database:

Criteria for evaluating spending databases

State Database	Searchability	Grants	Contracts	Line Item Expenditures	Dept/Agency Budgets	Public Employee Salary
Open Book New York
Project Sunlight

[edit] Limitations and Suggestions for Improvements

Public employee salaries should be placed online, as should specific spending details and line-item expenditures.

[edit] Support for creation of the database

The National Taxpayers Union praised the creation of the Attorney General's Project Sunlight transparency website.^[24]

[edit] Independent transparency sites

The Empire Center for New York State Policy has created an independent transparency website, www.seethroughny.net.

[edit] Public employee salary information

The Journal News' LoHud.com offers this database of public employee salaries in Yonkers. For the article introducing the project, click here.

The Times Herald-Record offers this analysis of public salaries in the Hudson Valley with a searchable database of payroll records.

A great resource is See Through NY, a new website offering "New Yorkers a clearer view of how their state and local tax dollars are spent."

[edit] Economic Stimulus Transparency

• The American Recovery and Reinvestment Plan of 2009 designated $787 billion to be spent throughout the U.S. Of that $787 billion stimulus package, it is estimated that 69%, or over $541 billion, will be administered by state governments.^[25]

• New York will receive an estimated $11,798,038,219 ^[26]

• The economic recovery website to show how legislators and government officials in New York are spending Federal funds is available here.

[edit] Error in ARRP

On November 16 and 17, 2009, many errors were found in the $747 billion plan that showed the plan set aside money for districts that do not exist. According to Recovery.gov, the plan shows its funds will go to 884 Congressional Districts, though there are only 435.^[27][28]

New York has 29 Congressional Districts, but it's 00 District produced 31 jobs after taking home $3.8 million in stimulus funds. District 00 typically stands for the population of a whole state when the state has only enough population to have an at-large representative. In total, the ARRP website attributed 11 extra, non-existent Districts to New York and gave them a total of $12,025,926 to "create/save" 128.2 jobs.^[29]

[edit] See Also

New York taxpayer-funded lobbying

[edit] External links

• Model transparency legislation from the American Legislative Exchange Council is available at this link.
• Empire Center for New York State Policy
• Manhattan Institute for Policy Research
• Indiana Policy Review Foundation
• Indiana State Budget Agency
• Indiana Government spending

[edit] References

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