Comptroller sounds alarm about NY finances
ALBANY, N.Y. » In New York state government news, Comptroller Thomas DiNapoli is sounding an alarm about state finances.
DiNapoli, a Democrat, released a report last week on the state’s financial plan that showed state spending is on track to outpace revenues. He warned that could put the state in financial peril if the economy turns or if the federal government cuts funding.
Meanwhile, lawmakers are planning a hearing on state efforts to boost minorityand women-owned businesses.
Here’s a look at stories making news:
FINANCIAL CLOUDS LOOM: The comptroller’s report looked at the current state budget approved by lawmakers this year as well as financial plans for the next few budget cycles. He determined that if current spending levels continue, the state’s expenditures will outpace revenues within three years, creating a cumulative deficit of nearly $18 billion.
Lawmakers could avoid the deficit by cutting spending or raising revenue — but DiNapoli warned that it could put the state in a tough position if the economy worsens or if the federal government cuts funding. Increasing debt is another factor, he noted, as is the decision by lawmakers and Democratic Gov. Andrew Cuomo not to shift significant funds to the state’s budget reserves.
“The state ended the last year with the largest general fund balance in recent years, but continues to face real fiscal challenges,” DiNapoli said. “New York’s growing out-year gaps, shrinking debt capacity and the lingering threat of federal funding cuts cloud the horizon. Yet, there are no plans to add to our reserves, leaving the state with little cushion in the event of an economic downturn.”
Lawmakers passed a nearly $170 billion state budget in March. DiNapoli’s analysis shows that budget represents $6.5 billion in new spending, while revenue is projected to increase only $541 million.
Nearly $7 billion in expenditures will use onetime funding sources — such as legal settlements or one-time grants or payments — which could cause further headaches for lawmakers when the money runs out.
The report estimates that total tax receipts this year will hit nearly $78 billion, down 1.7 percent from the previous year.
BUSINESS DIVERSITY: The state has a number of programs intended to encourage women and minorities to start and operate businesses, and now Republican members of the state Senate want to know if they’re working.
The Senate’s committees on labor and economic development have scheduled a July 17 hearing in Watertown to examine the state’s Minority and WomenOwned Business Enterprises program. Lawmakers say they’ll consider changes to make the program more efficient while also enhancing the state’s overall business climate.