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Senate Finance Majority Staff Analysis of the 2010-11 Executive Budget

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Senate Finance Majority Staff Analysis of the 2010-11 Executive Budget Senate Finance Majority Staff Analysis of the 2010-11 Executive Budget Senator Carl Kruger Senator John L. Sampson Chair, Senate Finance Committee Conference Leader Senator Liz Krueger Senator Malcolm M. Smith Vice-Chair, Senate Finance President Pro Tem Committee Senator Pedro Espada, Jr. Joseph F. Pennisi Majority Leader Secretary, Senate Finance Committee SENATE FINANCE COMMITTEE Senator Carl Kruger – Chairperson Senator Liz Krueger – Vice-Chairperson Majority Members Senator William Stachowski Senator Suzi Oppenheimer Senator Velmanette Montgomery Senator Thomas Duane Senator Kevin Parker Senator Toby Stavisky Senator Martin Dilan Senator John Sampson Senator Andrea Stewart-Cousins Senator Antoine Thompson Senator Eric Adams Senator Neil Breslin Senator Ruben Diaz, Sr. Senator Pedro Espada, Jr. Senator Jeffrey Klein Senator Bill Perkins Senator David Valesky January 2010 Dear Colleagues; On Tuesday, January 19th, Governor Paterson proposed his Executive Budget. As a conference, our priorities for the budget are clear: it must create jobs, control spending, and protect already overburdened taxpayers. While everyone is in agreement regarding the seriousness and scope of this economic crisis, it’s also clear that in order to meet our objectives, the Executive Budget will need significant modification to meet the standard of fiscal prudence. Changing Course In less than 20 years, the State Budget grew nearly 100-percent—an unsustainable pattern that well outpaced the race of inflation. Instead of capitalizing on the economic largesse of the 1990’s and early 2000’s, prior leadership employed a borrow-and-spend tradition. Poor fiscal choices then are hurting us now. For instance, New York’s debt service load will increase by 17% this year, a clear indicator of the lack of fiscal stewardship of the past. Structural reforms to the budget are more than a step in the right direction, they are the only path to long-term fiscal health. It is disappointing that the Executive Budget just barely explores structural changes to state and budgetary operations. We must be thinking creatively; it is time for innovative budget reforms. Modifications are Necessary Nowhere in the Governor’s plan is there a short- or long-term guarantee to provide property tax relief. The Senate Majority is committed to developing a long-term plan for homeowners, and one of the many ways we can free up funds for such a plan is through reducing the scope of government. The Governor’s across-the-board cuts for government are typical – and not nearly enough. The Legislature has an obligation to the public to enact a budget that creates jobs, controls spending, and provides relief. The data prepared by Finance Committee staff will provide greater insight into specific programmatic proposals within the Governor’s budget which must be discussed in depth, opposed when necessary, and made stronger when appropriate to maintain New York’s status as the Empire State. Sincerely, Senator Carl Kruger Chair, Senate Finance Committee STAFF ANALYSIS OF THE SFY 2010-11 EXECUTIVE BUDGET As prepared by the Senate Finance Committee Staff Joseph F. Pennisi Secretary to the Senate Finance Committee Felix O. Muñiz Michael J. Laccetti Director of Budget Studies Director of Fiscal Studies Mary C. Arzoumanian Jacqueline Y. Donaldson Janet G. Ho Maria A. LoGiudice Paul Alexander Lillian Kelly Megan Baldwin David King Gopa Barua Lei Liao Rosa Maria Castillo Kesper Matthew Peter Kathleen Childs Carrie Schneider Gideon Grande Ade Somide Tracy Hennige Marcie Sorrentino James Hugger Angela Stempky Schedule Of Joint Legislative Public Hearings On 2010-2011 Executive Budget Proposal Date Location Time Topic January 25 Hearing Room B 10:00 AM Local Government January 26 Hearing Room B 9:30 AM Environmental Conservation January 27 Hearing Room B 9:30 AM Higher Education February 1 Hearing Room B 9:30 AM Economic Development February 1 Hearing Room B 1:00 PM Taxes February 2 Hearing Room B 10:00 AM Education February 3 Hearing Room B 9:30 AM Mental Health February 3 Hearing Room B 1:00 PM Housing February 8 Hearing Room B 9:30 AM Public Protection February 8 Hearing Room B 1:00 PM Transportation February 9 Hearing Room B 10:00 AM Health/Medicaid February 10 Hearing Room B 9:30 AM Workforce February 10 Hearing Room B 12:00 PM Human Services Table of Contents HIGHLIGHTS OF SFY 2010-11 EXECUTIVE BUDGET ........................................... 1 FINANCIAL PLAN OVERVIEW ........................................................................................ 1 EDUCATION ........................................................................................................................ 6 HIGHER EDUCATION ..................................................................................................... 10 HEALTH AND MEDICAID .............................................................................................. 18 MEDICAID COST CONTAINMENT ............................................................................... 20 HUMAN SERVICES .......................................................................................................... 53 AGENCY CONSOLIDATIONS AND MERGERS ........................................................... 55 PRISON CLOSURES ......................................................................................................... 58 ECONOMIC DEVELOPMENT ......................................................................................... 60 CRIMINAL JUSTICE MERGERS .................................................................................... 62 LABOR ............................................................................................................................... 64 AMERICAN RECOVERY AND REINVESTMENT ACT OF 2009 ................................ 68 LOCAL GOVERNMENT ASSISTANCE ......................................................................... 70 MANDATE REFORM ....................................................................................................... 79 PROPERTY TAX RELIEF ................................................................................................. 86 TRANSPORTATION ......................................................................................................... 89 ENVIRONMENT ................................................................................................................ 92 ECONOMICS, REVENUE AND CAPITAL ................................................................ 94 ECONOMIC OUTLOOK ................................................................................................... 94 GENERAL FUND RECEIPTS ........................................................................................... 98 ALL FUNDS RECEIPTS .................................................................................................... 99 PERSONAL INCOME TAX ............................................................................................ 100 ALCOHOLIC BEVERAGE CONTROL LICENSE FEES .............................................. 103 ALCOHOLIC BEVERAGE TAXES ................................................................................ 105 AUTO RENTAL TAX ...................................................................................................... 106 CIGARETTE AND TOBACCO TAXES ......................................................................... 107 HIGHWAY USE TAX ...................................................................................................... 109 MOTOR FUEL TAX ........................................................................................................ 110 MOTOR VEHICLE FEES ................................................................................................ 111 SALES AND USE TAX ................................................................................................... 112 BEVERAGE AND SYRUPS TAX ................................................................................... 114 BANK TAX ...................................................................................................................... 115 CORPORATION FRANCHISE TAX .............................................................................. 117 CORPORATION AND UTILITIES TAXES ................................................................... 119 INSURANCE TAXES ...................................................................................................... 121 PETROLEUM BUSINESS TAXES ................................................................................. 123 SEVERANCE TAX .......................................................................................................... 125 ESTATE TAX ................................................................................................................... 126 REAL ESTATE TRANSFER TAX .................................................................................. 128 PARI-MUTUEL TAX ....................................................................................................... 129 RACING ADMISSION/BOXING AND WRESTLING EXHIBITIONS TAX .............. 130 METROPOLITAN TRANSPORTATION AUTHORITY RECEIPTS ........................... 131 MISCELLANEOUS RECEIPTS ...................................................................................... 133 REVENUE ACTIONS ...................................................................................................... 138 ARTICLE VII REVENUE BILL .....................................................................................
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