ALBANY – Gov. Andrew Cuomo today proposed a sizeable increase in the state budget for the coming year, but said much of the increase is due to federal aid to help with Hurricane Sandy relief efforts and for implementation of a new national health insurance program.
The budget plan eliminates a budget gap of $1.35 billion, but still leaves nearly $10 billion in projected deficits in the next three years.
The governor said he would not raise taxes in his new budget. But the plan does call for a number of “revenue extenders,” like continuation of a tax on utility companies that the administration said is worth over $500 million and a $24 million tire waste fee. Other revenues will come from $7 million in various “loophole closings,” a favorite term used by governors instead of a tax increase.
The governor, in a speech this afternoon at a state theater near the Capitol, acknowledged a budget short on drama.
“It is not supposed to be traumatic. If the government is working and the government is working well, the budget is supposed to be simple," he told lawmakers.
But Cuomo’s budget does call for 1,400 state worker job cuts, flat state aid to cities, towns and villages, and a series of mostly modest economic development programs.
For Buffalo, the governor’s budget calls for a $100 million in job creation efforts, part of his previous vow of $1 billion for Western New York.
The precise plan for the spending was not immediately available this afternoon, but it includes $75 million in new capital spending and $25 million in tax breaks to lure and retain companies.
Also in the budget is the financial deal to keep the Buffalo Bills for at least the next seven years: $60 million, including $54 million in stadium renovations.
The modest economic development programs, a likely bow to the state’s deficit and the continuing sour national and state economy, include a $5 million statewide marketing effort. That is far less than what a special interest committee with ties to Cuomo spent promoting the governor’s agenda.
Another program Cuomo has touted – “innovation hot spots’’ – to link companies with universities will be funded at just $1.25 million in the beginning.
Overall, the state budget will total $142.6 billion, up sharply from last year’s budget of $133.4 million.
About $6 billion of that is labeled “extraordinary’’ federal aid, mostly in the form of Hurricane Sandy recovery efforts.
The governor, in his third budget since taking office, sought to portray a state government more settled.
“The budget process is no longer traumatic…After a period of severe instability, the state’s finances are on solid footing,’’ according to a budget briefing book released by the administration this afternoon.
The budget, though, is silent on a number of major mandate relief efforts sought by municipalities, school districts and business groups as a way to help cut expenses and lower property tax bills.
The plan does seek to allow localities to tap into long-term expected savings from a new pension tier enacted last year for new government workers. It was not immediately certain how these new savings could be “locked in’’ to prevent big spikes local governments can see in their pension contributions for employees.
The Cuomo budget proposes $434 million in state agency cuts, which would coming from job losses, agency mergers and the closing of two state prisons – in Manhattan and Dutchess County.
A $50 million venture capital program to encourage location of start-up companies will be funded mostly through the New York Power Authority and the state’s main economic development agency.
In setting up a battle with Republicans who partially control the Senate, Cuomo put his plan to raise the minimum wage – from $7.25 per hour to $8.75 – into the budget plan. New York governors, thanks to a series of court decisions and language in the state constitution, have relatively great budget powers compared to other states. Legislators cannot, for instance, change the language in legislation he proposes today, giving less incentive for Cuomo to negotiate certain provisions if lawmakers care about getting a budget done by the March 31 deadline.
The governor will also make it easier to add to the number of locations offering Quick Draw, a lottery game treatment experts call especially addictive. It comes as he also wants to add up to seven new casinos in the state.
The governor’s budget also proposes to extend the current $5 million tax credit for certain historic property rehabilitation projects. He vetoed a bill in December, which developers said would mostly benefit downtown Buffalo and other upstate communities, to increase the credit to $12 million per project.
On school funding, the governor’s plan increases overall education spending by 4.4 percent, or $889 million, to $20.8 billion. The main school funding formula will grow by 3 percent. It will also require districts to have in place another new round of teacher and principal evaluation systems by September 1 this year or they will lose any increase in state aid. That is four months earlier than districts had under the new program to strike a deal with teachers unions by last week or lose the aid increase.
Major education initiatives the governor outlined in his State of the State will also be funded at modest levels. His call for all-day pre-kindergarten, to be located in poorer districts, will be funded at $25 million. And a program to extend the school year or school day will get just $20 million in grants in a competitive program awarded to certain schools that increase learning time by at least 25 percent in a day or year.
He is also proposing $11 million to fund $15,000 annual stipends for teachers – in the beginning to target math and science teachers – who are highly qualified enough to train other teachers.
For more information from the budget announcement, check out the Politics Now blog.