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Long IslandPolitics

Gov. Andrew Cuomo proposes $137B budget

Gov. Andrew M. Cuomo's state budget plan, announced Tuesday, would cut taxes, increase spending on Medicaid and on schools by about 4 percent, but decrease spending at state universities and community colleges. Courtesy: New York State (Jan. 21, 2014)

ALBANY - -- Gov. Andrew M. Cuomo proposed a state budget Tuesday that would cut $261 million in business taxes, increase spending on Medicaid and on schools by about 4 percent, but decrease spending at state universities and community colleges.

Cuomo, a Democrat, proposed an overall budget of $137.2 billion, an increase of 1.3 percent over last year. That number expands to $142.1 billion if federal aid for superstorm Sandy and the federal health care act is included. The spending plan backloaded most of the tax cuts and high-profile spending initiatives -- meaning they won't take effect this year.

Something for everyone

But it does offer a something-for-everyone approach, leaving lawmakers room to compromise in a year when Cuomo and all 213 legislative seats are up re-election.

Cuomo proposed a greatly expanded prekindergarten program, though without a dedicated tax to support it. He also called for a review of the controversial Common Core academic standards, something many rank-and-file legislators have demanded, and $15 million toward a new "College of Emergency Preparedness, Homeland Security and Cybersecurity."

Cuomo's plan estimates the state will get $200 million for four upstate casino licenses, but is not banking on receiving the money until next year. Officials project casinos could break ground 12 months from now.

The governor proposed a 3.8 percent increase in school aid (including building aid), to $21.9 billion, a $2 billion bond act to bring broadband and new computers to classrooms, a tax credit for New York City renters and a potential tax credit for homeowners.

Cuomo sought to make the case that his tenure has turned the state's fortunes around and that legislators should follow his lead during his fourth year in office. "It's all coming together now," he told legislators at the Empire State Plaza, adjacent to the State Capitol. "We are swinging for the fences in the fourth year."

The governor proposed using taxpayers' money to fund political campaigns as a way to curb the influence of money in politics. But he didn't detail how much it would cost or how to pay for it. He did recommend boosting spending at the state Board of Elections and hiring 11 more staff members to monitor campaign finance and other laws. But, dusting off an idea that helped quash his ethics package last year, he proposed that the governor be given authority to appoint a special elections-law counsel to investigate violations.

Cuomo has rolled out most of these initiatives during the past few months, including his tax cut proposal, which counts on the state achieving budget surpluses in future years. He has said he wants to cut taxes by $2 billion. Less than 25 percent of those savings would occur this fiscal year.

Cuomo proposed an income-tax credit as a way to offset property-tax increases; he calls it a property-tax freeze. Eligible homeowners would have to be in municipalities that agree to keep spending hikes below New York's 2 percent property tax cap and take steps to consolidate services. The governor budgeted $400 million for homeowner savings this year and $976 million next year.

The governor would slightly cut the operating budgets of the State University of New York, the City University of New York and community colleges, all by 0.3 percent or less.

The administration forecast the state will have about a $500 million surplus this year. Cuomo has said the surplus could be $2 billion in 2017 if spending levels are kept in check.

Just an illusion?

One fiscal watchdog called that surplus an illusion.

"It's purely aspirational," said E.J. McMahon of the Empire Center, a conservative think tank. He said a more realistic projection shows New York with a $2 billion deficit in two years rather than a $2 billion surplus.

Senate co-leader Dean Skelos (R-Rockville Centre) opposed the idea of a tax hike to support prekindergarten and the notion of using tax dollars to fund campaigns and questioned whether tax cuts come fast enough under Cuomo's proposal.

"That's what we're going to look at and it's a really good question," Skelos said. "I think really to stimulate this economy and move it in the right direction, if there are ways we can accelerate things, I think it's what we should do."

In contrast to business tax cuts, his political partner said tax cuts should be focused on moderate-income families.

"There was too much emphasis on business tax cuts," Senate co-leader Jeff Klein (D-Bronx) said after Cuomo's address.

With Michael Gormley

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