[NYAPRS Enews] Albany Reports Suggest Local Cuts May Not Have Support

[Harvey Rosenthal]

NYAPRS Note: According to press accounts, discussions on tomorrow's
planned budget cutting session may be ruling out more local cuts (NYAPRS
members' chief objective) and focusing instead on other areas, possibly
including cutting new initiatives and items. In any case, NYAPRS is
'zapping' every state legislator today with information on the impact of
the 2% recent cuts and urging no further erosion in local safety net
services. 

 

Paterson, Legislative Chiefs Seek Deal On Budget Cuts

BY JAMES T. MADORE   Newsday  August 18, 2008

 

 ALBANY - Talks continued yesterday between Gov. David A. Paterson and
legislative leaders over $600 million in cuts to this year's budget,
with aides optimistic that a deal will be ready for lawmakers to
consider at tomorrow's special session.

 

While no agreement had been reached as of last night, sources close to
the negotiations said the sides were committed to addressing next year's
budget deficit of $6.4 billion by reducing this year's spending.
Paterson ordered the legislature to reconvene and has suggested $1
billion in cuts.

 

Paterson's plan was criticized by hospitals, nursing homes, local
governments and social service agencies, all of which would feel the
most pain. However, the sources said the legislative majority
conferences had ruled out such reductions, instead focusing on the
governor's spending limits to new programs and legislative grants, among
others.

 

"The governor appreciates the leaders' interest in finding a way to cut
expenses and face the crisis," Paterson aide Risa Heller said yesterday.
"It would be inappropriate to discuss specifics in the midst of
negotiations ... [but] the conversations have been productive."

 

Dan Weiller, a spokesman for Assembly Speaker Sheldon Silver
(D-Manhattan), added, "Real progress has been made."

 

The budget totals $122 billion but revenue has dropped because of the
state recession. While the Assembly Democratic majority is pushing to
hike income tax for millionaires, which the Senate Republican majority
and Paterson have rejected. 

 

Lawmakers, facing re-election in the fall, want to tackle the budget
deficit but not offend unions and other special interests that are
campaign contributors. So, the cuts approved tomorrow are likely to
approach $600 million, not the $1 billion floated by Paterson, the
sources said...

.....................

 

No, No, No, And No...But Maybe (Updated)
<http://blogs.timesunion.com/capitol/archives/8356> 

by Irene Jay Liu  Albany Times Union Blog   August 15, 2008

 

No to education cuts.

No to state workforce layoffs.

No to cuts to local government aid.

No to healthcare cuts.

 

That's the message from Senate Majority Leader Dean G. Skelos in a
statement released in anticipation of the August 19 (Tuesday) special
session.

 

What would he be supportive of?  Rooting out more waste from the
Medicaid system and a spending cap, a suggestion that received a
discouraging reaction from Health Commissioner Richard Daines.

 

Update: Despite the seemingly resolute tone of this statement, if you
read between the lines, there may be areas where there could be
compromise to get to the $600 million. Spokesmen for both Paterson and
Skelos have reiterated, after this release came out, their optimism and
willingness to come to an agreement. Of course, this is only the
beginning of the negotiation.

 

Areas of potential compromise? It seems pretty clear that education,
local aid, and state workforce layoffs are off the table. But cuts
through improving efficiencies within the Medicaid program that don't
affect direct payouts for services and service providers, could be a
possibility. Or across-the-board cuts in certain areas of the budget,
such as new programs that were included in this year's budget but
haven't been implemented yet (Paterson's proposal estimated a savings of
$132 million), cuts to CUNY ($51 million), or even possible member
items, though the last might be a bit of a long-shot in an election
year.

 

In terms of next steps - the leaders will continue to talk through the
weekend. And if an agreement is reached, the compromise would take form
in an Article 7 program bill from the Paterson to the Legislature. But
it is still a long way to Tuesday.

 

Skelos is already taking heat from the teachers' union, NYSUT, over
passing a property tax cap, and Paterson himself did not recommend
mid-year cuts to education. The employee unions went ballistic over the
possibility of state workforce layoffs if the Legislature cannot cut
$600 million from this year's budget. All legislators don't want to see
cuts to their communities in an election year. The Senate Republicans'
longtime ally and political backer, powerful health care union
1199/SEIU, doesn't want Medicaid cuts.

 

But despite knocking all of Paterson's suggestions, Skelos "commended
him for his leadership in focusing the Legislature and others on this
important issue.  He is right to call for spending reductions that allow
us to begin our work on next year's Budget."

 

Next week is going to be fun.

 

STATEMENT BY SENATE MAJORITY LEADER DEAN G. SKELOS

 

....The Senate Majority has been clear from the outset that this Budget
will not be balanced through mid-year education cuts, State workforce

layoffs or cuts that would force local governments to raise their taxes
to make up for a shortfall from Albany.  Cuts of this nature, midway
through

the current fiscal year, would be counterproductive and would
unnecessarily create hardship.

 

The Senate Majority is also opposed to any cuts that deprive New Yorkers
of vital health services and quality health care.  I believe we can

identify savings that will not impact our hospitals and other health
care providers, as well as other spending reductions within a $121
billion State

Budget, that if distributed fairly and equitably, would allow the
Governor to achieve the spending reductions he has proposed.

 

In the meantime, we must redouble our efforts to root out the waste,
fraud and abuse that exist in the Medicaid system so Albany is more

accountable to taxpayers....

 

------------------------------

Leaders Fear Hike In Property Taxes
Paterson's Plan To Cut Local Aid Cited As Concern
By Jenny Lee  Poughkeepsie Journal   August 17, 2008

As state legislators prepare to return to the Capitol Tuesday, Dutchess,
Ulster and state officials said they're worried Gov. David Paterson's
suggested cuts for local government assistance could lead to property
tax increases.

"New York state needs to cut its own operating costs, not shift costs to
county taxpayers, to close the state budget gap," Dutchess County Budget
Director Valerie Sommerville said.

Ulster County Administrator Michael Hein echoed that sentiment. "Simply
shifting burden from mandated programs to local governments is not tax
relief," he said.

Paterson proposed $1 billion in cuts, including slashing $506 million
from the Medicaid program, $250 million from aid to local governments
and nonprofits, $232 million from lawmakers' and the governor's pet
projects and $50 million from the City University of New York. Paterson
wants legislators to choose $600 million in cuts from his list.

The governor hopes to close a budget shortfall this year and next year.

Budget cuts could affect aid to cities, towns, villages and counties and
affect transportation, mental health and housing.

"It's clear Dutchess County, along with other counties across the state,
would see a significant negative impact in numerous service areas from
the additional six percent across-the-board reduction in state aid -
this is yet another example of a long line of cost shifts by Albany onto
local property taxpayers," Sommerville said.

If legislators reduce $250 million in aid to local governments, Ulster
could get less money for mandated programs such as early intervention,
certain public health programs, foster care and probation, Hein said.

"The 250 million-dollar proposed reduction does not include a cut in
services, only a reduction in the state's contribution," he said.

Ulster officials made a conservative sales tax revenue estimate of $83.4
million for this year, which is about $3 million lower than the 2007
estimate, Hein said.

Dutchess projected it would receive $126.3 million in sales tax revenue
this year. But sales tax receipts show a decline, and the county could
face a $3 million to $4 million shortfall this year as well as the same
shortfall next year, according to Sommerville and Finance Commissioner
Pamela Barrack.

Unlike Ulster, Dutchess has a mortgage tax. The 2008 adopted budget
projected about $6.9 million in mortgage tax revenue, but declining
trends in tax receipts indicate the county could get $2 million less.

Sommerville said the actual impact of the state budget deficit will not
be known until months from now, making it extremely difficult to develop
a county budget.

Ulster officials want to work collaboratively with towns to find
innovative ways to deliver services efficiently and save everyone more
money, Hein said.

Local support lacking

Most state legislators in the area would not support cuts to local aid.

"Our municipalities have already put their budgets in place and are
reliant on that aid passed in the (state) budget," Assemblyman Kevin
Cahill, D-Kingston, said.

By cutting local aid, Cahill said, "It's a backdoor way of raising local
taxes."

In Beacon, city leaders have said they are in a good position to handle
a potential $100,000 reduction in state aid.

Mayor Steve Gold last week said the city instituted a number of
cost-cutting measures prior to learning about the expected reduction in
state funding.

The measures include a policy calling for no idling of municipal
vehicles, an effort to reduce fuel costs. The number of trips in
municipal vehicles is also being scrutinized more closely.

Officials said the city could also tap into its approximately $5 million
fund balance if necessary. Fund balances reflect the amount of unspent
money a municipality has in reserve. The money is often used to provide
tax relief to residents or to pay for unforeseen emergencies.

"We've asked our department heads to submit any cost-cutting measures
they can for 2008 to try to reduce the operating budget for this year,"
Gold said, adding officials are analyzing the measures now.

Dealing with shortfall

In the City of Poughkeepsie, leaders are already grappling with a
projected $1.85 million budget shortfall.

To close the gap, officials have implemented a hiring freeze and asked
each department head to cut their 2008 budgets by 10 percent, only two
fiscal reactions to the expected shortfall.

Mayor John Tkazyik said the city could face a reduction of $219,000 in
state funding.

He said officials will take that potential decrease into account as they
work to close the projected budget gap and get the city back on firmer
financial ground.

"I'm sure there is going to be a ripple effect," Tkazyik said of
potential state aid decreases. "We're going to be conservative as we
move forward in planning the budget."

State Sen. John Bonacic, R-Mount Hope, said in a release he adamantly
opposes reductions in local aid.

Assemblyman Marc Molinaro, R-Tivoli, said he worries about shifting
costs onto municipalities if that results in property tax increases.

However, Molinaro said, "In my opinion, everything ought to be on the
table and we should have a serious dialogue on how to save the state
from this fiscal crisis."

Impact on health sector

Some legislators, such as state Sen. Steve Saland, R-Poughkeepsie, are
apprehensive about the impact on hospitals.

"We will seek to find means to take dollars out of the Medicaid system,"
Saland said. "We will look at some of the areas the governor has not
focused on. At this moment, it's still a work in progress."

Assemblyman Joel Miller, R-Poughkeepsie, said the solution is to look
for programs in the state that are not working. He said he would much
rather eliminate fraud in Medicaid programs than cut money.

Assemblyman Thomas Kirwan, R-Newburgh, supports the governor's suggested
cuts.

"We're just going to have to rethink what we offered to spend in
Medicaid," Kirwan said. "Nobody wants anybody to go without medical
care."

Other legislators were a little more cautious.

Sen. Vincent Leibell, R-Patterson, said he wants to get an idea of where
the revenues are. Then the next step would be how legislators can figure
out the correct numbers to fix the budget, he said.

http://www.poughkeepsiejournal.com/apps/pbcs.dll/article?AID=/20080817/N
EWS01/808170347/1001/NEWS 

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