New York state budget (2010-2011)
Contents |
The state budgets on an annual cycle.[1] The state's fiscal year runs from April 1 to March 30.[2]
As of July 2010 New York had a total state debt of $122,527,873,429 when calculated by adding the total of outstanding debt, pension and OPEB UAAL’s, unemployment trust funds and the 2010 budget gap as of July 2010.[3]
| Total spending | Pension | Health care | Education | Welfare | Protection | Transport | Debt | Budget gap |
|---|---|---|---|---|---|---|---|---|
| $117 | $11 | $45.4 | $15.2 | $10.2 | $8.1 | $12.5 | $138.2 | $5.4 |
| Total spending | Pension | Health care | Education | Welfare | Protection | Transport | Debt |
|---|---|---|---|---|---|---|---|
| $181 | $8.9 | $16.8 | $56.1 | $17.2 | $15.9 | $20.4 | $181 |
Fiscal Year 2011 State Budget
- See past state budgets
Find the state’s FY2011 Comprehensive Annual Financial Report (CAFR) compiled by the state government here.
Comptroller DiNapoli said state tax collections for FY2011 were $926 million below the original projections in the state budget. For the fiscal year, New York collected $133.3 billion dollar, 5% more than FY2010. Spending, however, rose to $134.8 billion, an increase of 6.3%.[5]
New York had the highest debt per capita for general obligation borrowing at $3,135 per person.[6] The FY2011 budget as it was passed increased spending by 2.4% over the previous budget.[7]
In Dec. 2010, the National Conference of State Legislatures said that the state faced a shortfall of $315 million, which represented 0.6% of the FY2011 state budget.[8] On Dec. 31, 2010, 900 state employees were laid off.[9] The State Senate Democrats exceeded their $29 million legislative budget by at least $7 million, which was expected to result in the layoffs of 200 Senate staffers in mid-Jan. 2011.[10]
Gov. Paterson called special legislative session that began on November 29, 2010 to address a $315 million budget deficit,[11] but legislators declined to do so.[12] The governor's bill was delivered to the Legislature two hours after the special session was to begin, leading Senate Democrats to say that they had insufficient time to consider it. When the Senate decided to pass, there was no need for the Assembly to act on the bill.[12] The governor said he would not call another special session unless legislative leaders decided they wanted to address the deficit.[12] Special sessions are estimated to cost more than $50,000 a day in per diem expense checks of about $170 for lawmakers and the price of travel, staff lodging, meals, etc.[12]
The same week that the governor called the special session, he awarded $16.7 million in grants, including funding for a youth chess program and to promote a New Jersey-New York Super Bowl.[13]
Comptroller Thomas DiNapoli placed the state deficit at $1 billion on November 15, 2010.[14] The budget hole was the result of several factors, including a decrease in taxes paid to the state, higher Medicaid costs, and the inability to collect $150 million in projected revenue from the sale of cigarettes to non-Indians on reservations.[11] Republicans opposed closing the deficit with new taxes or fees and the governor had not released a proposal prior to the start of the special session.[11] Some legislators said they thought it was more appropriate to wait to cut any spending to address the deficit until January, when the governor-elect and new lawmakers took office.[15]
On Nov. 1, 2010, the Division of Budget reported that tax revenue failed to increase as much as projected in August when lawmakers passed the state's spending plan and, as a result, the state faced a $315 million budget.[16][17] In Oct. 2010, the governor announced that he planned to save $250 million in the FY2011 budget by firing 898 state workers by the Dec. 31, 2010.[16]
On August 3, 2010, the State Senate finalized the $135.5 billion budget by passing a revenue bill along party lines that completed the state budget and was expected to generate an additional $1 billion through a mix of tax hikes and other measures.[7][18] The wrong bill, however, was sent to and signed by the governor who signed a proper version of the budget bill on Aug. 11, 2010 after the mistake was discovered.[19]
The budget raised taxes on the sale of clothing, eliminating a sales tax exemption on clothing and footwear purchases of less than $110 starting on Oct. 1. The increase was expected to generate about $330 million in revenue. It also increased taxes on a variety of businesses.[7]
The budget also increased the state's share of revenue from video gambling machines and permits casinos to stay open later and reduced charitable deductions for those who made $10 million or more.[7] The FY2011 budget includes a 5 percent cut -- about $1.4 billion -- in school aid.[2]
The budget required the booking industry, including Expedia, Orbitz and travel agencies, to collect sales tax on lodging, a move that was expected to bring in $10 million in FY2011.[20]
As hedge funds were being wooed to move out of the state, legislators rejected a plan to make earnings by hedge fund managers “ordinary” income, subject to New York State taxes.[7]
Governor David Paterson said, “It was a meaningful budget in that in spite of all the discussion earlier in the year, there was no borrowing. We didn't borrow a dime.” The governor said he accepted the sales tax but was not happy about it, and also said he was not behind the property tax relief that the Assembly wanted. The governor planned to have the Assembly vote in October on the tax cap.[21]
The budget did not include the sugary drink tax the governor pushed for, nor a plan to sell wine in grocery stores or a plan to let SUNY and CUNY schools set their own tuition rates.[21]
The $134 billion state budget relied on sources of revenue that critics called risky because they could fall short of predictions. Some of those sources included:[22]:
$45 million from expanding video lottery gaming.
$221 million from additional tax audit recoveries.
$300 million from Medicaid fraud recoveries.
$330 million from a temporary 4 percent sales tax on clothing that was previously exempted.
$440 million in new cigarette taxes, including collecting taxes from tobacco sold on Indian land.
$250 million in workforce reductions, which would require cooperation from public employee unions, which the state has not yet received, and the budget director said this estimate was likely high.
5.6% of the budget went to transportation.[23]
Revenues
The state collected $529 million less in taxes during the first six months of FY2011 than the state budget office projected in August 2010.[24]
Federal Funds
The state received approximately $2 billion from the federal government under :: H.R. 1586, a $26 billion plan to give states money for Medicaid and education that the President signed into law on August 10, 2010. U.S. Sen. Charles Schumer said New York is to get $2 billion in Medicaid funding from Washington that was feared lost and over $600 million in new education aid to avoid teacher layoffs.[25] State budget director Robert Megna said that the federal funds may not alleviate the need for layoffs.[26]
Education
The state received $608 million to restore teaching positions as part of the stimulus plan approved in Aug. 2010.[27] Then the state was to get $700 million over four years as part of the U.S. Department of Education's Race to the Top.[27] Some budget experts warned that school districts and state governments could be further strained because of the infusion of essentially one-shot revenue amid the state's ongoing fiscal problems.[27]
Negotiations and Emergency measures
The state legislature passed the $135.5 billion state budget for FY2011 on August 3, 2010, 125 days late.[7] The state's fiscal year runs from April 1 to March 30, but the New York State Legislature failed to pass a budget for FY2011 prior to the end of FY2010.[28] At the time the state had met its budget deadline only six times since 1975.[29] The FY2011 budget increased spending by 2.4% over the previous budget.[7]
Prior to the 4th of July holiday and recess, the Assembly approved a $136 billion spending plan, but the Senate left Albany for the recess without voting on revenue legislation needed to pay for the budget and did so in early August.[30]
On July 15, 2010, state comptroller Thomas DiNapoli released a report finding that spending to fund state government had increased 7.6% in 2010, and, even when adjusted for payments that were delayed from FY2010, the rate of state spending was more than twice the inflation rate, up 4.2%.[18] The report also stated that "optimistic budgetary assumptions" could have left the state up to $4.8 billion in the hole for the year — more than half of the $9.2 billion budget gap that lawmakers were trying to eliminate.[18]
For the 125 days the state did not have a budget, it operated on more than a dozen emergency legislation signed by Gov. David A. Paterson.[31] As of June 2010, the governor had signed 11 emergency spending measures to keep the government operational.[31][32][33] The measures delayed a 4 percent pay increase due April 1 for 130,000 state workers.[33] The emergency spending measure passed on June 14, 2010, included about $326 million in cuts to programs for the mentally disabled and social services.[31]
Some of the bills included long-term budget cuts, including cuts to Medicaid, so the budget was partially cobbled together through the emergency bills.[31] One of those long term provisions included increased the state cigarette tax by $1.60 per pack as of July 1, 2010.[34] The measure also more than doubles the tax on smokeless tobacco to $2 an ounce from 96 cents an ounce, starting on Aug. 1, 2010, and the wholesale tax on cigars, dips and other kinds of tobacco will rise to 75 percent from 46 percent. The state planned to collect taxes on cigarettes sold on Native American reservations to off-reservation visitors, an issue that led to violent protests during the early 1990s. One chief has said that trying to collect taxes would be considered an act of war.[34] The tobacco taxes were expected to provide $440 million in revenue which will go toward health care programs.[34] The day before collection of the tax was to begin, Judge Samuel Green issued a temporary restraining order preventing the state from collecting the taxes.[35]
Size of the State Work Force The New York Times reported that the state had two separate public payrolls, one controlled by the governor, with approximately 131,000 employees, and another encompassing approximately 163,000 more workers that was not under control of the governor and consisted of independent public authorities and agencies. The independent public authorities received their revenue from the dedicated sources they are created to oversee and not directly on taxpayer dollars, but their employees did collect state benefits like public pensions. While the payroll under the governor's control declined 25% over the previous 20 years, the independent agency payroll grew.[36]"Albany’s Two Payrolls: One Is Anybody’s Guess" July 27, 2010</ref>
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.[37] The DOB is responsible for analyzing agencies' requests and aiding the Governor in creating the final state budget. [37]
Agencies usually submit their budget requests to the DOB by early fall.[37] The DOB and State Comptroller must release a detailed estimate of anticipated income and expenses by November 5.[37] 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.[37]
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. [38] 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. [38] The legislature then analyzes the Governor’s proposals, holds public hearings and works with the DOB in evaluating the proposed budget measures. [38] 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. [38] The budget is then sent to the Governor for approval, and a final state budget is created for the upcoming fiscal year.[38]
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. [38] The state legislature can override the Governor's veto only by a 2/3 vote by the members of each house.
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:[39]
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.[40] 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.[41]
| Credit Rating | Fitch | Moody's | S&P |
| New York[42] | AA- | Aa3 | AA |
Budget transparency
- See sample transparency legislation at the Sunshine Standard
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
- See also: Evaluation of New York state website
Government tools
The following table is helpful in evaluating the level of transparency provided by a state spending and transparency database:
| State Database | Searchability | Grants | Contracts | Line Item Expenditures | Dept/Agency Budgets | Public Employee Salary |
|---|---|---|---|---|---|---|
| Open Book New York |  |
 |
|
|
|
|
| Project Sunlight | |
|
|
|
|
|
Limitations and Suggestions for Improvements
Public employee salaries should be placed online, as should specific spending details and line-item expenditures.
Independent transparency sites
The Empire Center for New York State Policy has created an independent transparency website, www.seethroughny.net.
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."
Economic Stimulus Transparency
- The state will approximately $2 billion from the federal government under :: H.R. 1586, a $26 billion plan to give states money for Medicaid and education that the President signed into law on August 10, 2010. U.S. Sen. Charles Schumer said New York is to get $2 billion in Medicaid funding from Washington that was feared lost and over $600 million in new education aid to avoid teacher layoffs.[43]
- New York received an estimated $11,798,038,219 from the American Recovery and Reinvestment Plan of 2009 [44]
- The economic recovery website to show how legislators and government officials in New York are spending Federal funds is available here.
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.[45][46]
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.[47]
Budget Figures
General Fund 2009-10[48]
| Category | FY2009 Amount in millions Actual | FY 2010 Amount in millions Estimated |
|---|---|---|
| Beginning Balance | 1,304 | 614 |
| Revenues | 29,060 | 27,338 |
| Adjustments | 562 | 0 |
| Total Resources | 30,926 | 27,952 |
| Expenditures | 30,312 | 27,442 |
| Adjustments | 0 | 10 |
| Ending Balance | 614 | 500 |
| Budget Stabilization Fund | 0 | 0 |
Fiscal 2010 Tax Collections Compared With Projections Used in Adopting Fiscal 2010 Budgets (Millions)[48]
| Category | Amount |
|---|---|
| Sales Tax Original Estimate | 10,390 |
| Sales Tax Current Estimate | 10,005 |
| Personal Income Tax Original Estimate | 37,239 |
| Personal Income Tax Current Estimate | 34,380 |
| Corporate Income Tax Estimate | 5,495 |
| Corporate Income Tax Estimate | 5,688 |
Cuts made to FY2010 budget after passage (in millions)[48]
| Category | Amount |
|---|---|
| K-12 Education | 40.0 |
| Higher Education | 160.0 |
| Public Assistance | 23.0 |
| Medicaid | 140.0 |
| Corrections | 70.0 |
| Transportation | 186.0 |
| Other | 464.0 |
| Total | 1,083.0 |
Changes Over 20 Years
In 20 years, the state budget has grown from to $48.9 billion to a projected $136.5 billion.
The State University of New York has grown by 14 percent over the last two decades, and the workforce of the state judiciary has increased by 31.6 over that period.[36]
See Also
New York government sector lobbying
New York state budget (2008-2009)
External links
- State Budget Solutions, New York
- 2010-11 Executive Budget
- 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
References
- ↑ National Conference of State Legislatures "State Experiences with Annual and Biennial Budgeting" April 2011
- ↑ 2.0 2.1 The Wall Street Journal "New York State Passes Budget" March 31, 2011
- ↑ State Budget Solutions “States Hide Trillions in Debt” July 22, 2010
- ↑ 4.0 4.1 USA Spending, State Guesstimated* Government Spending
- ↑ WBNG.com "New York State Tax Collections Below Projections" April 18, 2011
- ↑ The San Francisco Chronicle "How much does California owe?" Jan. 19, 2011
- ↑ 7.0 7.1 7.2 7.3 7.4 7.5 7.6 The New York Times "125 Days Late, a State Budget With New Taxes" August 3, 2010
- ↑ The Wall Street Journal “States Face Budget Shortfalls of $26.7 Billion“ Dec. 8, 2010
- ↑ Cite error: Invalid
<ref>tag; no text was provided for refs namedmess - ↑ New York Daily News "Albany pols - $7M over budget - will be forced to fire 200 workers next month" Dec. 29, 2010
- ↑ 11.0 11.1 11.2 The Rochester Democrat and Chronicle "Budget fix focus of today's special session" Nov. 29, 2010
- ↑ 12.0 12.1 12.2 12.3 The Wall Street Journal "NY Legislature rejects addressing $315 deficit" Nov. 29, 2010
- ↑ [The Wall Street Journal "Report: NY's Paterson doled $16.7M in state grants " Dec 6, 2010]
- ↑ Cite error: Invalid
<ref>tag; no text was provided for refs namedbillion - ↑ [The Wall Street Journal "NY Legislature heads into special session" Nov. 29, 2010]
- ↑ Cite error: Invalid
<ref>tag; no text was provided for refs namedbloomberg - ↑ Cite error: Invalid
<ref>tag; no text was provided for refs namedmidyear - ↑ 18.0 18.1 18.2 The Albany Times Union "State fiscal woes grow" Aug. 22, 2010
- ↑ [The Buffalo News "Paterson signed the wrong budget bill" Aug. 12, 2010 ]
- ↑ The New York Times "Hotel Room Resellers Must Now Pay Room Tax" Aug. 4, 2010
- ↑ 21.0 21.1 Fox 23 News "Impact of the finally passed New York State budget" August 4, 2010
- ↑ [The Syracuse Post-Standard "NY state budget built on risky assumptions about payroll cuts, cigarette taxes" Aug. 16, 2010]
- ↑ The Wall Street Journal "New Yorkers Dazed and Confused by State Budget" Oct. 6, 2010
- ↑ Bloomberg "New York State Tax Collections $529 Million Less Than Foreseen in August" Oct. 19, 2010
- ↑ Businessweek "Cash-strapped NY, public schools may get windfalls" Aug. 11, 2010
- ↑ The New York Daily News "State Budget Director Bob Megna: Medicaid Money Won't Affect Layoff Plans" Aug. 2010
- ↑ 27.0 27.1 27.2 [The Poughkeepsie Journal "Advocates hail federal school aid, but what happens when the money runs out?" Aug. 31, 2010 ]
- ↑ New York Times "Albany Misses Its Deadline on Budget" April 1, 2010
- ↑ My Fox NY "No State Budget. Now What?" March 30, 2010
- ↑ Cite error: Invalid
<ref>tag; no text was provided for refs namedadjourns - ↑ 31.0 31.1 31.2 31.3 "Another Emergency Bill Averts Albany Shutdown" June 14, 2010
- ↑ Business Week "New York State's Paterson Pushes for Action on Past-Due Budget" May 3, 2010
- ↑ 33.0 33.1 Business Week "New York State Legislature Approves Emergency Spending Bills" April 19, 2010
- ↑ 34.0 34.1 34.2 New York Times "Cigarette Tax Increased to Keep State Running" June 21, 2010
- ↑ Bloomberg "New York Is Blocked From Collecting Taxes on Indian Reservation Cigarettes" Sept. 2, 2010
- ↑ Cite error: Invalid
<ref>tag; no text was provided for refs namedguess - ↑ 37.0 37.1 37.2 37.3 37.4 Division of the Budget, Division of the Budget Review
- ↑ 38.0 38.1 38.2 38.3 38.4 38.5 Division of the Budget, Legislative Action
- ↑ The New York Office of the State Comptroller Web site, retrieved November 2, 2009
- ↑ Institute for Truth in Accounting, “The Truth About Balanced Budgets—A Fifty State Study,” Page 35
- ↑ New York Office of the State Comptroller Web site, retrieved November 2, 2009
- ↑ State of Indiana, “State Credit Ratings-as of June 24, 2009"
- ↑ Businessweek "Cash-strapped NY, public schools may get windfalls" Aug. 11, 2010
- ↑ [1]
- ↑ $6.4 Billion Stimulus goes to Phantom Districts, Watchdog.org, November 17, 2009
- ↑ Stimulus Creates Jobs in Non-Existent Congressional Districts, Watchdog.org, November 16, 2009
- ↑ New York, Watchdog.org, November 17, 2009
- ↑ 48.0 48.1 48.2 National Governors Association and National Association of State Budget Officers Fiscal Survey of States June 2010
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