The New York State Senate and Assembly presented their one-house budget proposals last week, and both have sent representatives to committee to negotiate with Gov. Andrew Cuomo in hopes of passing a satisfactory state financial plan by April 1.
Already, lawmakers in Albany have approved key aspects of the reform plan Cuomo presented on Jan. 17, including a new Tier VI pension plan, new teacher evaluations and expanded gaming and casinos.
Now that both houses have passed their proposals, each has sent representatives to the budget committee to sit down and hammer out a final budget.
“They’re broken into committees and we try to reconcile the two budget proposals,” said Sen. John DeFrancisco (R-Syracuse), who chairs the Senate Finance Committee. “At the same time, we’re negotiating with the governor and trying to see what he can agree to.”
The governor’s spending plan amounted to $132.5 billion for the fiscal year that begins April 1, 2012. Meanwhile, the Senate’s proposal is just under $132.5 billion, and the Assembly’s is $132.7 billion.
While there are numerous differences between the one-house proposals themselves and between the proposals and the executive budget presented in January, the most noteworthy deal with school aid and Medicaid, along with a couple of other projects.
School aid
In a highly controversial move, Cuomo added $200 million to a fund for competitive grants he created last year. Superintendents across the state have criticized the governor and asked that he return that money to the general school aid fund so that it can be divided between the state’s school districts. Both one-house budgets have heeded that call.
“Most districts have been hit so hard the last couple of years,” DeFrancisco said. “We want to redirect that $200 million into the school aid formula. We never spent the $50 million [that was set aside last year]. In the Senate’s proposal, we’re setting aside that $50 million and leaving it where it is. That’s a good idea, and we want to reward districts that are doing creative things. We’re trying to direct it toward low-wealth, high-needs districts.”
DeFrancisco noted that determining the best destination for those funds won’t be easy.
“Of course, ‘high-needs’ is in the eye of the beholder,” he said. “Everybody’s trying to protect their own districts. I suspect we’ll be working a lot on that between now and the final budget proposal. The governor is willing to consider it. It just comes down to how the language will be written.”
The assembly’s budget also redirected the money Cuomo had set aside. It takes that $200 million and directs $178 million to the school aid formula, $10.2 million for Teacher Centers, $1 million for Adult Literacy programs and $1 million in additional support for the Comprehensive Attendance Program for non-public schools.
Medicaid relief
In general, all three proposals agree on Cuomo’s proposal to cap spending growth on Medicaid for counties; it’s the timing and specific details that have yet to be worked out.
The state enacted a phased-in 3 percent cap in 2005 that went into effect in 2008; however, many counties complained that, since the tax cap is 2 percent, Medicaid still put a huge burden on their budgets. Under Cuomo’s proposal, starting with this budget, the state will phase in a program over the next three years to hold the counties harmless from any Medicaid increases. This year, the counties will still abide by the 3 percent cap, but by 2015-16, they will pay 0 percent, and the state will be responsible for that amount. Cuomo’s proposal also calls for a state takeover of the administration of Medicaid programs from the counties.
Both the Senate and the Assembly are on board with the basic idea of the state taking over Medicaid growth from the counties. The Assembly, however, has concerns about the administrative takeover.
“All the Assembly version does is asks that we work with each county to work out how the process takes place — what employees get hired, etc,” said Will Barclay (R-Pulaski). Barclay serves on the Assembly’s Ways and Means Committee. “We want a partnership with the counties.”
The Senate’s proposal, meanwhile, calls for the growth takeover to happen within one year instead of three. But DeFrancisco pointed out that the money was still coming out of taxpayers’ pockets.
“The real problem isn’t what pocket it comes out of to pay it. The real relief isn’t going to come from capping it,” he said. “It comes from cutting back on the optional services the federal government doesn’t require us to provide. New York state provides a lot more under Medicaid than other states do, and it’s costing us. We’re going to get caught up in it sooner or later… The state continues to pay these exponential growth costs, and that means less money for education and other programs. There’s more money locally, which provides nice temporary relief, but it won’t last. We’ve got to cut back on these optional services so our costs altogether go down.”
Other major differences
The Senate’s budget also contained additional funding for the EPIC program, which provides low-cost prescriptions for seniors.
“In last year’s budget, it took some substantial cuts,” DeFrancisco said. “Both the Senate and the Assembly restored part of those cuts. This year, the governor kept the program at last year’s levels, so our budget restored more dollars for the EPIC program. That’s one of the things I’ve heard about most from people. We’re working hard to make that a reality.”
The Assembly’s proposal, meanwhile, calls for numerous tax cuts for middle-class families, as well as a Youth Jobs program that includes job training and tax credits to businesses that hire disadvantaged youth.
Despite the differences in the budgets, lawmakers believe they can put out a budget on time.
“I’m confident we can put something together by March 31,” DeFrancisco said.
