Who’s the Target?

February 7, 2012

Robert Megna, director of the NYS Division of the Budget, issued a statement today (Feb. 7, 2012) which says in its totality:

“We can no longer abide by the Albany status quo that allows for out of control spending and contracting that wastes taxpayer dollars. To avoid cuts in services, local aid or tax increases, the Executive Budget directs State agencies to be more efficient and focuses resources on their core programs and services. The flexibility language will allow for a range of operational measures and will improve functions such as procurement, real estate, and information technology.”

My question is who is this directed at? Doesn’t he already have the authority to require agencies to follow existing laws and procedures to accomplish exactly what he’s asking for? What changes does he expect to occur as a result of people reading this statement? Given where we are in the current budget year, is he talking about preparing for the 2012-2013 budget year that begins October 1 or about making changes to the budget currently under review?

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The State of New York in January 2012 according to Cuomo II

January 5, 2012

Because it’s only January, Andrew Cuomo could enjoy, while writing his State of the State message, the luxury of ignoring the fact that it’s an election year. As we move closer to November, however, the ambitious agenda he proposed in yesterday’s State of the State will begin to come up against political realities. The major political issue facing the Legislature is redistricting, the outcome of which will determine whether the Republican Party retains its majority in the State Senate. If the Senate Republicans feel their toehold on political relevance is threatened, their willingness to go along with the governor’s program will diminish; yet who can blame the Democrats for wanting to draw district lines that would give them control over both Legislative bodies?

For the most part the Republicans should be happy with the Governor’s agenda. He says he will balance the budget without increasing taxes or imposing new fees; he wants to reduce the state’s pension obligations by creating a Tier 6 for future state employees; he wants to do something about the unfunded mandates that are crushing localities; he wants to put money into the state’s transportation infrastructure, which is particularly important to the business community; and he wants to make New York more competitive to boost job growth.

In fact, Cuomo may have more trouble with the Assembly than the Senate over such questions as imposing teacher evaluations on public schools, amending the Constitution to allow casino gambling and Tier 6. Knowing that his agenda is to the Assembly’s right, he threw the Assembly several bones in his State of the State, including foreclosure relief, protection for renters and doubling the goal of state contracts awarded to women and minority contractors.

Some commentators see Cuomo positioning himself for a future bid for the Presidency. He certainly infused his speech with campaign-style rhetoric, claiming he and the Legislature restored New York’s reputation as “the progressive capital of the nation.” 2011 did represent a change in direction for New York, but it was one that was forced on the state, not one the Legislature in particular wanted to embrace.

As the nation’s economy continues to teeter on the edge of another recession, depending in large part on what happens in Europe, New York again has little choice in continuing on the path of reducing the cost of government without undercutting essential governmental programs or raising taxes. To that end the governor is placing a huge bet on the idea of public-private partnerships–the idea that public investment can leverage private capital. The billion dollar leveraging projects he announced Wednesday include building the country’s largest convention center on the site of the Aqueduct Race Track, the rehabilitation of the Javits Center into a Battery-Park style complex, transportation infrastructure upgrades, an energy highway and $1 billion to help Buffalo reduce its 28% poverty rate.

Whether these public-private partnerships succeed in leveraging the kind of private investment Cuomo envisions only time will tell, but the concept is worth trying. It’s certainly an approach that makes much more sense than the Obama administration’s approach to economic development of investing public funds in companies (like Solyndra) that it wants to succeed in the market place.


Vote to keep CoBIS going or to shell it

December 14, 2011

NYS has spent more than $40 million according to the New York State Rifle & Pistol Association to collect identifying data from the shell casings of all new handguns sold in the state. The rationale for CoBIS (Combined Ballistic Identification System) was that by tracking shell markings police agencies would be able to solve more crimes and put more bad guys and gals behind bars. The folks at NYSRPA claim the expenditure has not resulted in a single arrest, much less a conviction for a crime. If this is not true, I hope some responsible person will contact us. NYSRPA argues in tough fiscal times NYS cannot afford to continue the program. Should the program be kept going or should we shell (I mean shelf) it? Vote now on the Empire Page’s poll question of the week.


Governor’s Op-Ed on the Empire Page

December 5, 2011

Read NYS Gov. Andrew Cuomo’s op ed on tax reform in the guest editorial section of the Empire Page.


Andrew Cuomo and Hugh Carey: Lessons from the Past

November 8, 2010

In the midst of his successful campaign for governor, Andrew Cuomo reportedly sent public employee union leaders around the state copies of Seymour Lachman and Robert Polner’s The Man Who Saved New York; Hugh Carey and the Great Fiscal Crisis of 1975 (State University of New York Press, 2010). Several responded publicly by arguing that the crisis of 1975 was not the same as what we’re facing today. No, today’s situation is potentially much more serious because we’re not just talking about one city, but the entire state and a huge percent of its municipalities.

In 1975, other municipalities, including the city of Yonkers, were on the verge of defaulting on their debt. But none were in as bad a shape as New York City. The city had resorted to short term borrowing in order to meet operating expenses, but even that stopped working. They had come to the end of the road – being unable to meet both short-term and long-term obligations. The state had to step in to avoid being pulled down in the undertow and as a result, NYS taxpayers had to cough up millions to service the city’s debts and those of the Urban Development Corp., the State Dormitory Authority and other authorities.

Today’s crisis has not reached the stage that Hugh Carey faced on his first day in office in January 1975. That’s one major advantage that Andrew Cuomo will have on January 1, 2011. However, while the cost of preventing the city’s bankruptcy was felt by the thousands who lost jobs and services, the state and federal governments pitched in and helped avoid a bigger crisis, due in large part to Carey’s indomitable will and political astuteness. However reluctant he was to face facts, Carey benefited from having hired people of character and talent. They helped him see the danger, at which point he piloted the ship of state to safe harbor, although not without nearly crashing into several large political icebergs.

One key for Andrew Cuomo then is what kind of people will he bring to Albany? Will he follow Hugh Carey’s example and hire people who will not be afraid to talk truth to power, or will they be people who are cowered by Cuomo into painting the world as he’d like it to be?

Another key will be whether he understands the problem is not just solving next year’s budget crisis, but seeing what New York State will be facing in 2015 and 2020. I’m not saying finding $8 billion without raising taxes to balance next year’s budget will be easy, but will the budget be balanced with the long term in mind or will Cuomo follow the pattern of his predecessors – not worrying about future until it arrives?

In 1975, Hugh Carey’s biggest obstacle was getting the federal government to participate after the city and state had both sacrificed and made major changes in budgetary practices. That took a tremendous effort on Carey’s part and required incredible political savvy. Even if Cuomo matches Carey in those qualities, the likelihood of the federal government’s playing an equivalent role in the coming years is slim to none. The simple reason is that New York would be joining a long line of states with their hands out.

Start with California whose debt is already being subsidized by the federal government (see “State Bailouts? They’ve Already Begun” by Meredith Whitney, Wall Street Journal, 11/3/2010, A27). If New York wants Washington to bail it out, it would hardly be at the front of the line and would have a tough sell to a Congress that will be extremely resistant to increasing federal spending, given Republican control of the House and the number of Democratic Senate seats up in 2012.

Let’s hope Andrew learns from Hugh Carey in another respect. Hugh Carey didn’t spend any time blaming his predecessors – Nelson Rockefeller and Malcolm Wilson – when he arrived in Albany. That’s a lesson that Barack Obama should have taken to heart. Blaming Bush may have worked for a short time, but he played that card past when it had lost any political value. There would be nothing to be gained were Cuomo to blame past governors or Legislatures for the problems we’re facing. Given that Cuomo asked to be put in a position to solve the state’s problems, the best strategy is to skip the blame game.

Union leaders should read this book. Lachman and Polner point out how men like Albert Shanker and especially Victor Gotbaum put aside self-interest and joined Carey in achieving a major victory on behalf of the entire population of New York City and the state. Everyone needs to understand that the practice of the state’s spending better than 250 percent of its tax receipts over the past decade (see Whitney) needs to be put in reverse.

Thirty-five years ago New York City’s leaders waited much too long to admit their fiscal practices were unsustainable. It appears that Sheldon Silver recognizes New York State is heading in that direction. Would that the state’s union leaders accept that reality and help avert the kind of crisis that the city faced. If not, there’s no guarantee the outcome will be as successful as the one Hugh Carey achieved in ’75.


Sunday Wrap & Poll Question for the Week of August 22

August 22, 2010

David Paterson is getting the best marks of his term in office since the honeymoon ended in the summer of 2008 for the role he played during the budget crisis (B+ in my book) and now for trying to resolve the NYC cultural center/mosque brouhaha. Even when he does good, however, he manages to look like he’s bumbling, which probably comes from a tendency to talk first and think second.

This weekend’s big story:

Rick Karlin of The Times Union picked up on two press releases issued late last week with bad news for New York’s citizenry. In the first the Division of the Budget reported on Friday that the projected budget gaps for 2011-12 and 2012-2013 have increased. On top of that the State Comptroller Tom DiNapoli announced he may reduce the projected rate of return of the state’s pension fund, meaning that localities will be hit with a bigger bill next year for their pension contributions.

Joe Spector of Gannett covered the same news.

Both writers point out the conflicting views offered by the governor’s office, which emphasizes his accomplishment in bringing home a “balanced” budget, and those of critiques such as the Empire Center’s E.J. McMahon who keeps reiterating the points he made earlier in the month that things are actually getting worse.

Poll Question of the Week

Last week we wondered how our readers read the impact of the debate over building a Moslem cultural center/mosque within 500 feet of ground zero. 50 percent feel it will help those pols who oppose the center; 30 percent see no impact; only 17 percent think their opposition will hurt those candidates.

This week we’d like to know how closely you’re following the race to decide who will replace Andrew Cuomo as the Sheriff of Wall Street, State Street and Main Street? Vote today at www.empirepage.com.


Who Can Bear Up to July Highs?

July 11, 2010

The weather has been sweltering on the East Coast and that hasn’t made it any easier for the state’s politicians to concentrate on the job at hand — passing a balanced budget. They had better start paying attention soon because November’s cold winds may sweep incumbents out of both Albany and Washington.

The hint of redistricting is in the air. Check out two pieces this weekend in the Washington Post: on Saturday the column — “Opening the curtain on redistricting” — by Michael McDonald, a senior fellow at the Brookings Institution and Micah Altman, a senior research scientist at Harvard, and on Sunday, the analysis piece by Dan Balz — “Long-term structural changes start at state level.” As I’ve stated all year, the battle for the NYS Senate is the most important electoral contest going on in NYS because whomever ends up in control will determine the district lines for Congressional and Legislative seats through 2020!

Poll Questions: Budgets and Taxes

We asked you whose budget plan you liked the best — the Governor’s or the Legislature’s and you said neither. More than 50 percent of those who voted rejected both plans while the Legislature’s budget proposal garnered just 14 percent of the vote to 31 percent who like Gov. Paterson’s budget.

This week we’re asking you about the Sugar Tax: the 18% tax on soda and other sugary drinks containing less than 70% fruit juice proposed by Governor Paterson and supported by Mayor Bloomberg. Alan Chartock likes it. Do you? Vote today on the home page.