Study: Dire fiscal future for NY governments
ALBANY -- New York's state and local governments and their taxpayers are on an unsustainable fiscal path, despite some improvements and a public perception that the outlook is far brighter, a nonpartisan task force found in a report released yesterday.
The state continues to be plagued, as it has for decades, by "structural budget problems" and partisan politics in budgeting, the task force found. New York's long-term deficit "has been papered over with gimmicks" that continue, it stated.
"There is no assurance that the state's structural debt is sustainable," the report stated. It also warned of a "growing number of illiquid, near-insolvent cities and counties with structural budget deficits." "New York's fiscal future sits on shaky ground," the report concluded.
The State Budget Crisis Task Force was led by former Democratic Lt. Gov. Richard Ravitch, who was critical to saving New York City from bankruptcy in the 1970s. He partnered with former Federal Reserve chairman Paul Volker.
The report warns taxpayers of the continued use of one-shot fiscal gimmicks and spending that can't be supported.
It was released as Gov. Andrew M. Cuomo and his top administration held a news conference to detail their accomplishments. They included fiscal improvements they note are reflected in public opinion polls in which just over half of New Yorkers now see a rosier future.
"And you did it without raising taxes; you did it without gimmicks," said Lawrence Schwartz, Cuomo's chief of staff, at his side.
Cuomo and the legislature 12 months ago increased income taxes to raise $1.9 billion to close the latest deficit in a millionaire's tax. Cuomo and the Senate Republicans had promised since their 2010 campaigns to stop the Assembly's push for a millionaires' tax as a job killer. Cuomo and the legislature also enacted five straight years of public college tuition increases, calling it a rational tuition policy.
The task force cites several continuing one-shots threatening fiscal stability that total $4.5 billion in the current state budget. They include the temporary millionaires' tax, deferment of business tax credits and borrowing to make public pension payments.
But Cuomo sees a fiscal turnaround. "Gov. Cuomo has been successful in unraveling many of the budget gimmicks made by previous administrations," said his budget spokesman Morris Peters.