A State of ‘No Money’

New York’s uncertain, $177 billion budget

Drafted as unemployment and COVID-19 cases soared and businesses from Manhattan to Main Street shuttered, New York’s $177 billion fiscal 2020-21 budget reflects the times.

While it authorizes — on paper, anyway — spending of $105.8 billion during the fiscal year that began April 1, it also foresees limiting the initial outlay to $95.8 billion unless sudden infusions of cash appear. It likewise anticipates a reduction of at least $10 billion in tax revenue.

The budget, which is $1.5 billion higher than 2019-20, provides $27.9 billion in school aid, up slightly (0.3 percent) from last year. It pushes ahead on tax cuts for the middle class but also allows state budget officials to make further spending reductions across the board if economic conditions warrant it.

“The state has no money. How do you do a budget when you can’t really forecast revenues?” Gov. Andrew Cuomo remarked on April 3, several hours after the budget’s 3:30 a.m. approval by the state Legislature. (On April 24, Cuomo said state revenues are estimated to drop by $13.3 billion, or 14 percent, from what was projected in his executive budget. In addition, he said, revenues are estimated to decline by $61 billion over the financial plan period of fiscal years 2021 to 2024.)

Jonathan Jacobson, a Democrat whose Assembly district includes Beacon, made a similar point on Wednesday (April 22) in a phone interview. “It was a very hard budget,” he said. “The state is broke.”

As in the past, the budget mixes financial matters with policy.

Although Democrats hold the governorship and majorities in both legislative chambers, they still fought over specifics. For example, legislators rejected a Cuomo proposal to change the School Tax Relief (STAR) school property tax break so that homeowners who earn $200,000 to $250,000 annually would receive a check in the mail rather than a speedier automatic exemption or deduction.

“Families and senior citizens in our state who rely on this program deserve stability,” said Sandy Galef, another Democrat, who represents Philipstown in the Assembly. “Avoiding program changes every year is key.”

The governor had other conflicts with legislators. As of April 15, he had vetoed 53 budget items, “eliminating pages of unnecessary language,” as he put it, by removing appropriations deemed either “unconstitutional,” identical to other allocations, or dubious for whatever reason.

Both Highlands Assembly members lauded provisions in the budget on health care, the environment and education. “There were a lot of good things,” so many that “I’ve got too many to tell you,” Jacobson said.

State Sen. Sue Serino, a Republican whose district includes the Highlands, voted against the budget, saying in a statement that it was “shrouded in such secrecy” it demanded opposition.

“While I have always been opposed to the practice of including policy proposals in the state budget, to include partisan policy during this trying time is particularly egregious,” she said, citing provisions on elections and various other subjects. “The budget should have focused solely on running essential services and providing critical relief to those in need.”

Among the issues addressed:

Worker sick leave: Businesses with four or fewer employees must guarantee five days of job-protected, unpaid sick leave to employees each year. Those with five to 99 employees must provide at least five days of paid sick leave; businesses with 100 or more employees must provide seven paid days.

E-cigarettes and vaping: The sale or distribution of most flavored electronic cigarettes and vaping products is banned unless approved by the Food and Drug Administration. In addition, tobacco products, including e-cigarettes, cannot be sold in pharmacies or near schools.

Prescription drugs: Along with capping insulin co-payments at $100 per month for diabetics, the budget created a plan to reduce other prescription costs and established a commission to explore purchasing drugs from Canada.

Gun license restriction: Anyone convicted of a serious offense in another state cannot obtain a gun license if the offense is also illegal in New York.

Guns and domestic abuse: Law enforcement officers may remove guns from the scene of a domestic-violence incident. The new law also allows weapons to be seized from abusers immediately upon their convictions.

Hate-crime terrorism: A newly created crime, “a domestic act of terrorism motivated by hate,” has penalties of up to life in prison without parole.

$3 billion bond: The Restore Mother Nature Bond will fund projects to reduce flood risk, invest in resilient construction, restore freshwater and tidal wetlands, preserve open space, conserve forest areas and decrease pollution from agricultural and stormwater runoff.

Polystyrene ban: As of Jan. 1, 2022, the state will forbid the distribution of single-use food containers made of expanded polystyrene (often dubbed Styrofoam) and ban the sale of polystyrene packing peanuts.

Green economy: The budget created a green-jobs tax credit of up to 7.5 percent of the wages for each job created.

Recounts and campaigns: Manual recounts are required in all statewide elections in which the margin of victory is 0.2 percent or less.

Middle-class tax cuts: In 2020, the third year of a tax-trimming effort, income tax rates will fall to 6.09 percent for taxpayers in the $43,000 to $161,550 income bracket, and to 6.41 percent in the $161,550 to $323,200 bracket.

Infrastructure: The budget includes $2.6 billion for investments in upstate roads and bridges.


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One thought on “A State of ‘No Money’

  1. As a retiree living in Beacon, I think this is a critical time for lawmakers to shape decisions. It is unconscionable that the recently completed state budget makes cuts in education and health care, and further cuts must be prevented.

    Such cuts hit working people with the lowest incomes — many of whom are on the front line of the coronavirus crisis — the hardest. The right way to fill budget gaps is to make the wealthy pay a bigger share of the burden imposed by the crisis. I expect Assembly Member Jonathan Jacobson and Sen. Sue Serino to act in this sense during the legislative decisions that will have to be made.

    Crises require ongoing, democratic, effective and rapid decision-making. Other states, such as Pennsylvania, have shown the way. New communication technologies make remote hearings, meetings and voting possible and our elected representatives should use them. Elections are only a few months away and we will watch carefully to see who steps up to their responsibilities.