LI, NY may see federal cuts, but how much?

WASHINGTON -- Under the debt-limit deal signed into law Tuesday, the first wave of federal spending cuts will hit New York State and Long Island governments in just two months, policy analysts said.

New York could see trims, if not deep slices, in federal grants for many programs -- such as heating assistance, environmental cleanup and homeland security -- according to early indications from House GOP spending bills for the 2012 fiscal year that begins Oct. 1.

And New York's seniors might begin to notice differences in Medicare and Social Security, possibly next year or in the future, if President Barack Obama and lawmakers' talk of the need for "structural changes" to those programs leading up to the debt deal are an indication.

But Congress has not determined the actual size and specifics of the federal spending cuts headed for New York and Long Island, analysts and lawmakers said Tuesday.

So for now, state and local officials, and advocates for federally funded programs, can only guess, worry and wait.

"We don't know for sure because we don't know where Congress will choose to cut," said Nicholas Johnson of the nonpartisan Center on Budget and Policy Priorities.

The deal approved Tuesday averted a U.S. default by raising the debt ceiling $2.4 trillion while creating a framework to force Congress to reduce the federal deficit over the next decade by at least $2.1 trillion.

The deal has two steps: $1 trillion in national spending cuts over the decade between 2012 and 2021, and another $1.4 trillion in cuts or revenue increases identified by a special 12-member congressional panel.

Congress is supposed to make its first cuts in annual spending under the deal for the year that starts on Oct. 1.

But no one knows whether the House GOP and Senate Democratic majorities will be able to agree on a spending bill in time, a delay that could lead to a stopgap spending measure like the one now in effect for this year.

New York State already projects an 8.4 percent drop next year in federal grants, to $39.7 billion, reflecting the end of the stimulus spending.

Meanwhile, the special congressional committee is expected to focus on changing Medicare and Social Security.

"The good news for us is that there is no immediate impact on Medicare and Medicaid," said Ken Raske, president of the Greater New York Hospital Association.

Yet, he said he worries not only about changes the committee might propose, but also about the automatic 2 percent cut to Medicare if it deadlocks and makes no recommendation.