Wed January 22, 2014
Cuomo's budget phases in pre-K, tax cuts
Governor Andrew Cuomo released his 2014-2015 state budget Tuesday. The $137.2 billion spending plan includes more money for schools, including a phase-in of funding for universal pre-kindergarten programs. It would also freeze property taxes for two years, if local governments cooperate.
The governor’s budget, which includes a 3.1% increase in school aid, a two-year property tax freeze and phased-in business tax cuts, offers something for everyone in a year where Cuomo and all 213 members of the legislature are up for re-election.
“It’s not a package that’s been put together to provoke,” Cuomo said. “It’s a package that’s been put together to pass.”
Cuomo offered more details of a $2 billion education bond act to go before voters in November. It would, in part, pay for better Internet access and iPads. And Cuomo announced a plan for universal pre-kindergarten in New York, to be phased in over the next five years and worth $1.5 billion when it's fully funded.
"The state will pay for it and be proud to pay for it,” said Cuomo, to applause.
Cuomo’s pre-K proposal could solve a conundrum for the governor. New York City Mayor Bill deBlasio campaigned on providing universal pre-kindergarten, funded by a new tax he’s seeking on wealthy New Yorkers. Cuomo has said he does not want to raise taxes this year.
By providing a funding plan, the governor could resolve the issue. But Mayor deBlasio, speaking before the budget presentation, seemed reluctant to give up on his plan to use a dedicated tax revenue source to fund pre-K.
“I have a mandate from the people to pursue this plan,” said deBlasio. “Of course we’ll be respectful and communicative, but this is the plan that will work for the people of the City.”
Assembly Speaker Sheldon Silver suggests a compromise. He says perhaps pre-K could be funded in part by both sources, state funding and an additional tax on the wealthy.
“Maybe a tax would only be needed for part of what’s overall needed,” said Silver. “We’ll have to see the plan.”
The governor also detailed his tax cut plans. New Yorkers making up to a half-million dollars a year would get a credit on their income taxes if their local governments and schools hold spending to below two percent a year. They would also have to agree to consolidate services in the second year of the plan.
A cut in business taxes, including the corporate tax rate, and a lower estate tax will be phased in between now and 2017.
In fact, many of the proposals in the budget do not fully take effect for several more years. The state does not currently have enough money to pay for them all. But the governor and his budget officials believe that if they continue to hold spending to 2% a year or lower, the state will have an over $2 billion surplus in three years, enough to pay for the tax cuts, pre-kindergarten and other programs.
They say spending will only rise by 1.7% in the new budget.
The leader of the Republicans in the State Senate, Dean Skelos, says he would like to see the tax cuts happen even faster.
“If there are ways that we can accelerate things I think it is what we should do,” said Skelos, who says a speedier faster timetable would “stimulate the economy.”
The governor also called for ethics reform in his budget. He includes public campaign financing, though he did not name a dollar amount or identify a funding source. He does want $5.3 million to fund an independent enforcement unit for policing campaign violations.
Cuomo acknowledges that he’s faced resistance from the legislature to reform plans in the past, but he exhorted lawmakers to change their minds. He says the string of indictments, arrests and investigations of legislators is tarnishing everyone.
“It’s a drip, drip, drip of these negative, one-off stories,” Cuomo said. “And it has to be addressed”.
And even though it’s not exactly a spending item, the Governor called for legislation to fix the troubled implementation of the new Common Core standards in schools, saying the rollout by the State Board of Regents is “flawed.” Cuomo also called for a ban on standardized testing of school children in kindergarten through the second grade.
The fiscal year ends March 31, and Cuomo and the legislative leaders all say they plan to pull off another on time budget.
Here are other highlights of the governor's budget for 2014-15 as outlined by the Associated Press:
- Total proposal: $137.2 billion.
- Total growth: 1.7 percent.
- A projected surplus of more than $300 million in the current year, growing to $2.7 billion by 2018.
- A 3.8 percent increase in aid for schools, to $21.9 billion.
- A $2 billion bond act that would bring broadband and computers to classrooms if approved by voters.
- An increases of 4.6 percent for federally and state funded Medicaid, to $58.2 billion.
- Tax and assessment reductions that will provide property, business, and estate tax relief.
- A public campaign financing system based on New York City's model with contributions of up to $175 would be matched $6 to $1.
- A total of $2.2 billion in spending over five years to fund both the after-school program and universal pre-kindergarten statewide.
- An end to standardized testing for students in kindergarten through 2nd grade.
- Establishing a panel to review the implementation of the statewide Common Core standards.
- Spending $15 million to plan for a new College of Emergency Preparedness, Homeland Security and Cybersecurity.
- Scholarships totaling $8 million at public colleges for the top 10 percent of high school graduates who pursue careers in science, technology, engineering or math and agree to work in New York for five years.
- Reforming and extending for 10 years the Brownfield Cleanup Program.
- Adding $4 million would be added to the state's Environmental Protection Fund
- Seeking an additional $486 million in federal funds to replace and repair about 100 flood-prone bridges.
- Seeking $1.4 billion from the federal government to harden the state's power grid against extreme weather.
- Projects totaling $147 million along coastlines and waterways to provide flood control and critical infrastructure.
- Start a multibillion dollar overhaul of New York's mass transportation systems and New York City's airports, including protecting them against severe weather.
- Include $39 million for grants to encourage municipal consolidations and regional services and tax credits for residents of local governments that fully dissolve or consolidate.
- Hold public safety agency spending steady at $4.7 billion.
- Invest $10 million in technology for state and local law enforcement agencies to share information.