On Tuesday afternoon, Gov. Andrew Cuomo unveiled his much anticipated 2011-12 executive budget to all New Yorkers. The presentation of the governor's spending plan to the state Legislature marks the formal kick-off to this year's budget cycle - a cycle expected to be one of the toughest in recent memory because of a steady decline in state revenues, a multi-billion dollar budget deficit needing closure, and countless special interests that remain wedded to Albany's broken status quo.
I attended the governor's presentation in Albany and am reporting back to you regarding some of its specific highlights. New York State Lieutenant Governor, and former Rochester mayor, Robert Duffy opened the presentation by outlining the severity - and enormity - of the financial challenges facing state government. State Budget Director Robert Megna did likewise, as both spoke to the weeks and months of hard work that went into constructing the governor's spending plan and a recognition that Albany's broken status quo would likely oppose many of the spending plan's proposed reforms.
Gov. Cuomo took stage and outlined his budget, building on the theme articulated in his State of the State Address message that New York finds itself at a "crossroads" and must get back on the "road to recovery." The governor said the presentation was not just about the budget or mere numbers, but the "management" of state government, as well as "values" and "choices."
The presentation certainly did not mince words or pull any punches - it spoke directly to the severe fiscal crisis confronting state government, a crisis caused by years of bad choices and certain politicians in Albany continuing to spend like there was no tomorrow.
The governor's statement that the state was "functionally bankrupt" - and just like any bankrupt entity needed fundamental restructuring - was a sobering call for restoring fiscal sanity to Albany. Having attended executive budget presentations by Governors Pataki, Spitzer and Paterson, I cannot remember such stark language ever having been used.
Nevertheless, it was a painful truth that New Yorkers needed to hear about the state's new economic reality.
Several of the financial challenges outlined by the governor - challenges that I have been sounding the alarm on for the past several years - which his budget intends to address, include:
a. State government spends too much: From 1999 to 2010, state operating funds increased by 74 percent - has your personal income increased by this amount? Probably not;
b. Rates of government spending are unsustainable: New York's 10-year average in spending growth was 5.7 percent - more than double the rate of inflation. Worse yet, much of the increased spending is dictated by state law.
Albany, we have a problem!;
c. New Yorkers get a poor return on all that spending: New York is number one in education spending, yet 34th in results; number one in Medicaid spending, yet 21st in results; and, despite spending $1.6 billion annually on an alphabet soup of economic development programs, New York ranks dead last in economic competitiveness; and
d. The high cost of New York's government means higher taxes: Our per capita state and local tax burden is $4,845 - 66 percent above the national average and the worst among all 50 states. High taxes kill jobs, plain and simple.
After framing the problems, the governor discussed how his executive budget could help redesign government, recalibrate spending and rebuild the economy, highlights included:
a. Reduce Costs: Impose fiscal discipline on state agencies through a 10 percent reduction in general fund operational costs and consolidate entities with overlapping functions, redesign New York's Medicaid program, reduce the rate of growth in government to eliminate the nearly $10 billion deficit by cutting spending by $3.7 billion, or 2.7 percent on an All Funds basis;
b. Reward Performance: Establish 10 Regional Economic Development Councils, chaired by Lt. Gov. Duffy, to create a more regionally-based approach to providing economic development funding and end the one-size-fits-all, cookie-cutter approach to economic development that Albany has employed for decades; and
c. Put People First: Focus on the actual needs of New Yorkers and end a "sham" budgeting process that has built-in automatic - not to mention unrealistic and unsustainable - increases in government spending. Examine every government program, every policy, to determine if it is actually working for patients, students and taxpayers.
The governor's budget begins a long overdue, and at times painful, process of restructuring, redesigning and reforming state government by reducing its cost and size. Tuesday's presentation marked the beginning, not the end, of this year's budget process - now the hard work starts.
I am carefully reviewing the governor's plan and focusing on providing local governments, school districts and taxpayers real relief from Albany mandates and other hidden cost drivers that lead to higher property taxes. I will not accept Albany attempting to balance the books by passing its buck - and costs - onto the backs of our local communities.
We have been there, done that and it has not worked! It is time for an end to Albany's business as usual.