Taxpayers Will Be Stuck With Cleanup Costs for Cuomo's Budget

When running for governor in 2010, Andrew Cuomo conceded that "New Yorkers already bear a heavy tax burden because of government over-spending."

He argued that taxes were too high and that government "refused to say 'no' to any powerful special interest group and used financial gimmicks to hide problems or kick them down the road."

Well, nine years later, Cuomo presides over a state that still has the highest combined state and local tax burden in the nation; still refuses to say no to "powerful special interest groups," and still kicks fiscal problems down the road.

As a result, Cuomo’s proposed budget for fiscal year 2020-2021 projects a deficit of $6 billion.

While the state budget projects operating funds spending to increase by only 1.9 percent to $105.8 billion, and total spending to be $178 billion, up 1.2 percent, the devil, as always, is in the details.

And those details are analyzed in a report State Comptroller Thomas P. DiNapoli released earlier this month.

Thanks to giveaways to the powerful healthcare unions, the most significant budgetary problem is soaring Medicaid spending. Deferring for another fiscal year $1.7 billion in Medicaid costs, this gimmick, the Comptroller’s report points out, is a troubling reminder “of certain historical practices that resulted in large accumulated deficits and, ultimately, the borrowing of billions of dollars to pay these down.”

The budget also "relies on unspecified actions to generate $2.5 billion in Medicaid savings during SFY 2020-21 . . . "

Don’t be surprised if the governor’s new Medicaid Redesign Team come up with cost containment solutions that include sticking local county governments with a greater share of Medicaid costs. If this comes to pass, expect homeowners to pay for it — via higher property taxes.

Another budgeting gimmick the governor utilized — one shot revenues.

It is projected that there will be $4.4 billion in "Non-Recurring and Temporary Resources." Some examples: The Mortgage Insurance Fund will be raided to the tune of $82 million and the sale of CUNY assets are projected to bring in $60 million.

But, the big number, $2.5 billion, will come from another extension of the temporary millionaires tax. This is the tax candidate Cuomo in June 2010 said he was opposed to extending because it hurts the State’s economic competitiveness. Here’s Cuomo’s exact words: "I was against it at the time, and I still am. It’s a new tax. It was supposed to sunset. If it doesn’t sunset, it’s a tax."

However, to get by, Cuomo could care less that the extension of the millionaires tax is driving out many of the top 1 percent — who pay approximately 40 percent of the state’s income tax—to low tax states like Florida, and that overtime this phenomena will wreck the state’s tax base.

Then there is the issue of accountability.

The Comptroller’s report notes "certain elements of the budget fall short with respect to high standards of transparency, accountability and oversight. Several of these would undermine the State’s basic responsibility to ensure that its budgets and financial reporting provide accountability and promote an accurate understanding of how public resources are generated and spent."

One beaut in the budget is the proposal to amend the state finance law to require the Office of State Comptroller to bless Cuomo’s fiscal gimmicks. If this comes to pass, the comptroller’s report concluded it would "cloud the picture of true spending growth" and would "result in significant expenditures beyond the amounts referenced in the appropriations by the Legislature."

And as the governor cries the fiscal blues, he proposes an additional $826 million in school aid for a total of $25.5 billion. And the budget calls for $3 billion for the MTA capital program—"although funding sources are not identified."

Cuomo also wants to issue more long-term bonded debt. His budget would authorize various public authorities to issue $10.3 billion in state-supported debt. Outstanding state-supported and state-funded debt is now projected to hit an incredible $72.2 billion in 2020.

Alarming deficits, higher taxes and fees, fiscal gimmicks, more debt — all during an economic boom.

One can only imagine how bad it will get when the next recession hits the Empire State.

But one thing is certain, when the economic downturn does arrive, taxpayers will get stuck with the tab to clean up Cuomo’s mess.

George J. Marlin, a former executive director of the Port Authority of New York and New Jersey, is the author of "The American Catholic Voter: Two Hundred Years of Political Impact," and "Christian Persecutions in the Middle East: A 21st Century Tragedy." He is chairman of Aid to the Church in Need-USA. Mr. Marlin also writes for TheCatholicThing.org and the Long Island Business News. To read more George J. Marlin — Click Here Now.