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5:55 pm
Thu January 24, 2013

Cuomo's No Drama Budget May Still Cause Some Theatrics

Governor Cuomo is trying to have a no- drama budget this year, with a low key presentation and a fiscally austere spending plan, with no major cuts or new taxes. But, growing opposition from the teachers’ union and local governments may yet result in some sparks flying before the deal is settled in late March.

Cuomo, presiding over the third year of a weak economic recovery, proposed a relatively austere budget that includes small increases for schools and some potential financial breaks for local governments. He closes a $1.3 billion dollar gap without raising any major taxes, and he does not propose any lay offs of workers, gaining savings through a hiring freeze and attrition.

The governor says he expects the state budget process, known for its legendary fights and delays, to be more orderly this year.

“It is not supposed to be traumatic,” Cuomo said during his budget presentation. “If the government is working, and the government is working well, the budget is supposed to be simple”.

Cuomo is not even getting the criticism governors usually receive from watchdog groups.  The Citizen’s Budget Commission’s Betsy Lynam says Cuomo engaged in some “creative financing”, to fund some new programs in year where revenues are meager.

Cuomo would take money from some off budget state authorities, the New York Power Authority and an energy authority, to finance a $1 billion dollar Green Bank to spur clean energy development. He’s use funds from a housing authority to build affordable housing. He also proposes taking millions from a state insurance fund account for workers compensation, saying the money won’t be needed for that purpose any longer  because he plans to reform the entire workers comp system.

In the past, similar actions have been labeled “raids” and “one shot revenue raisers” by groups like Citizens Budget Commission. But Lynam says there’s a difference in Cuomo’s method.  She says this governor has earmarked the funds for a specific purpose, not just to close a gap in  the general fund budget.

“He’s not taking the money and closing budget gaps, he’s kind of repurposing and retooling the programs that already exist in these very mission specific authorities already,” Lynam said.

Lynam says over all the budget has few gimmicks or one shots, and includes spending limits, like pre agreed upon caps on increases to education and health care. She says that squelches the big battleground fights over funding that were a major part of budget negotiations in the past.

“He has changed the dialogue and the way that people think about how to construct a budget,” she said.

But some opposition to Cuomo’s spending plan is brewing. The teachers union, New York State United Teachers says they like initiatives toward full day pre kindergarten and extending the school day and school year. But they say the 4% increase in school aid still can’t make up for the fiscal damage caused by the Great Recession, and falls billions of dollars short of a 2006 court order that found the state unconstitutionally underfunded schools. Billy Easton is with the Alliance for Quality Education, which works closely with the teachers’ union. He says schools have had to cut thousands of teachers and hundreds of programs in recent years.  

“Our schools are suffering, our schools are in crisis,” Easton said. “The state education commissioner has said our schools face educational insolvency, meaning they may not even be able to provide the basics that students need to graduate.”

The State School Boards Association’s Tim Kremer says while schools are “grateful” for a $900 million dollar increase in school aid in lean economic times. But he agrees that the funding levels are below what schools really need to operate.  

“The funding formula as it exists today does not accurately reflect the conditions of (some of) our school districts,” Kremer said.

Kremer says a new option to average pension payments over a period of several years might be attractive to schools drowning in pension costs right now.  And he says school boards like some of the easing of rules for special education.

But he says in the long term, schools need far more relief from state funded mandates in collective bargaining with unions and health care costs.

Local government leaders are also becoming increasingly restless. Syracuse Mayor Stephanie Miner , who is also co-chair of the State Democratic Party has spoken out against the governor’s budget to the Syracuse Post Standard and the New York Times, saying the pension payment plan smoother just kicks the can down the road, and that the governor needs to give  struggling cities more relief.  

Mayors from all across the state will testify at a legislative budget hearing midmorning on Monday , where there’s likely to be more drama over the budget than the governor had planned.

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