Cuomo warns of dire consequences if Congress does not approve relief package

Dec 10, 2020

With Congress still stalled over a new pandemic-related federal relief package, Gov. Andrew Cuomo and New York City Mayor Bill de Blasio are warning of dire consequences for the city and the state if they don’t receive funding to help plug major budget deficits.

Cuomo said several thousand state and local government workers could be laid off, including 7,000 at the Metropolitan Transportation Authority, if the federal government does not provide a bailout to help close the state’s multibillion-dollar budget deficit.

He also predicted that there will be tax increases. In a briefing with reporters, though, he did not specify what kind of taxes. Many Democrats in the state Legislature have long advocated for raising taxes on New York’s wealthiest residents.

Cuomo said he also won’t rule out borrowing money if Congress does not come through with a plan.

“If we do not get federal funding, the consequences are going to be devastating,” Cuomo said.

Cuomo was joined, in a rare show of unity, by New York City Mayor Bill de Blasio, who said the funding delay is an insult to the families of the thousands who died when New York was the epicenter of the disease in the spring.

“The state of New York has gone through hell,” de Blasio said. “You have to have support for the state government.”

The president of New York State’s AFL-CIO union, Mario Cilento, also joined the Zoom call. He said the additional federal unemployment benefits that run out Dec. 26 need to be renewed now. He said many don’t have the money to pay for food and rent or buy holiday gifts for their children.

“It kills me to think that so many New Yorkers are going to have to disappoint their children this year,” Cilento said.

Cuomo’s budget office has reduced spending to try to control the deficit, now estimated at $15 billion. They have temporarily withheld 20% of some aid payments due to local governments and school districts.

The New York State School Boards Association’s Robert Schneider said more than $300 million in payments owed to schools were held back over the summer.

“Thankfully, it’s only withheld at this point, it’s not a cut,” Schneider said. “So we hope we see that money getting distributed to school districts eventually.”

Schneider said schools also incurred additional expenses when they were closed earlier this year because of the pandemic. They used school buses to distribute food to children on free or subsidized meal programs. He said they were told recently that the state would not reimburse those costs.

“We are very frustrated with that,” Schneider said.

Cuomo said he’s withheld the 20% in aid payments because the state doesn’t have the money right now, and needs that amount from the federal government.

“If they give it to us, then we are made whole,” said Cuomo. “And they would receive the full funding.”

But Cuomo said if there’s only a partial reimbursement from the federal government, then he’ll have to take the other steps, including raising taxes.

“I believe we’re going to have to raise taxes at the end of the day, in any event,” Cuomo said. “But the question is, how much?”

The governor’s budget director, Robert Mujica, said the state has not withheld aid from schools in the fall payments, but may have to again by the close of the state’s fiscal year if no federal aid comes through. Mujica also said he’s working with the state Education Department to try to get the schools reimbursed for the additional bus trips.

Meanwhile, the pro-taxation coalition Strong Economy for All, heralded the governor’s comments that new taxes are necessary. But they urged a swifter response.

“Acceptance is only the first step,” Charles Khan, the coalition’s organizing director, said in a statement.