Gov. Andrew M. Cuomo and legislative leaders have finalized a $143-billion state budget that cuts taxes for most New Yorkers, raises them on the wealthy and closes a $1.9-billion shortfall, all while keeping spending growth below 2 percent.
As with most budgets, there's good and bad in the package -- and plenty of give and take among the governor and the Democrats and Republicans in the State Legislature. If the vote goes according to plan, it'll be the third-consecutive state budget delivered on time, and the first time that has happened since 1984.
While that's important as New York tries to shed its image as a highly dysfunctional tax-and-spend state, it's now a functional tax-and-spend state, although perhaps just a little less so for some groups.
There's money for infrastructure, business and economic development. There's $150 million more funding for the regional economic development councils, one of the governor's key efforts to use strategic spending to push local economies to be innovative and competitive. Local governments can look toward some mandate relief. Despite a huge pushback, the governor's "smoothing option," aimed at spreading out exploding pension costs, survived the negotiations.
There's $438 million, a $75-million increase, for badly needed repairs to local roads, highways and bridges, as well as $1 billion more for education, which includes rewards for districts that extend the school day, establish proficiency exams for teachers and reward those who excel in front of the classroom. And a very important fix was made to ensure teacher evaluation plans don't expire after one year as aid will be tied to districts adopting them.
Roughly 98 percent of New Yorkers will see their tax payments fall by 2 percent, while more than 1 million families with children, earning between $40,000 and $300,000, will receive a $350 check -- or a credit, depending on how its plays out -- starting in 2014. That's money that will be spent right away and boost the economy, although sending a check in the mail during an election year is blatant pandering. Those earning more than $1 million a year will continue to pay taxes at a higher rate because an income surcharge due to expire in 2014 has been extended another three years. The $600 million raised by the millionaires' tax will be split between business tax breaks and the rebate.
There are $181 million in credits for businesses that hire teenagers and returning military veterans, and while social engineering doesn't belong in the tax code, these two groups deserve the special treatment.
Democrats managed to negotiate an increase to the minimum wage to $9 an hour, but Republicans spread it out over three years. There is also a phasing out of a utility tax, a modest but welcome break from fees tacked on to electric, water and heating bills. Cuomo wanted it extended for five years, but in the horse-trading, Republicans managed to get it phased out in three.
Nonprofit organizations caring for the disabled will see about half of their $120 million in cuts restored. While some additional dollars might be found elsewhere, it was a crude way to force some needed reforms. The decriminalization of small amounts of marijuana in New York City, the criminalization of "bath salts" and synthetic pot, and other social issues were rightly left for another day.
Lawmakers expect to vote on the bills this weekend: Kumbaya, just in time for spring holidays.