Even if New York averts government shutdown, its budget woes escalate
New York State lawmakers are likely to approve another short-term fix to prevent a threatened government shutdown. Delay in closing an $8.5 billion budget gap is only making things worse, some analysts say.
In the absence of an actual budget, the New York legislature since April 1 has been passing weekly emergency spending bills to pay the salaries of state troopers, park employees, and drug addiction counselors, among others.Skip to next paragraph
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On Monday, Albany legislators are expected to pass yet another short-term fix that will keep the state running for another week. Without it, Gov. David Paterson had said he would shut down many state activities.
Within the weekly spending measures, however, are glimpses of what the Empire State may look like if state officials ever do bridge a $8.5 billion spending gap, second only to California for the highest in the nation. The snapshot is of a state that will be spending less money on hospitals, education, and the environment. Commuters may end up either paying higher fares to ride the rails or waiting longer for mass transit rides. And some of those local Little Leagues that used to get checks from their local legislators may have to pass the hat to fund ballfield renovations.
“It most likely means a lower quality of life for New Yorkers," says Frank Mauro, executive director of the Fiscal Policy Institute in Albany, N.Y. “The way they are balancing the budget now is similar to the 1990s, when there were deep service cuts.”
Other states are also expected to face red ink when their budgets are due on July 1. Total budget shortfalls for the states will amount to $140 billion, estimates The Center on Budget and Policy Priorities (CBPP). Some of that will be ameliorated if Congress approves $23 billion in additional funding for Medicaid programs and perhaps another $25 billion for education.
New York State, however, is unique in that its fiscal year began April 1. By not passing a budget for the first three months of its fiscal year, the state is digging itself into a deeper hole, says Nicholas Johnson, fiscal director of the CBPP. “The longer you wait, the harder it is to find the money,” he says, noting that the state may lose potential revenue from any new taxes for at least 25 percent of its fiscal year.
Democrats control the state Assembly and have a tenuous majority in the Senate. This being an election year, some Democrats have said during negotiations with Governor Paterson (a fellow Democrat) that they can no longer vote to cut the budget. Republican lawmakers don’t want to pass tax increases. Lawmakers from both sides want some form of property-tax relief.