Comptroller: State budget gap near $1B

The state’s top fiscal officer said this year’s deficit could be as high as $1 billion – a significant increase from the $315 million Governor David Paterson’s office has been reporting.
State Comptroller Thomas DiNapoli’s office released a report on Monday, November 15 that shows difficult financial times ahead for the state in the upcoming years, but also a problem they need to address this year.
“General Fund tax collections will have to grow more than 10 percent for the rest of the year to meet year-end projections,” DiNapoli said. “Based on current trends, the General Fund deficit could approach $1 billion by the end of the fiscal year, if corrective action is not taken. It is time to take off the rose-colored glasses and face the grim economic reality. We cannot allow this year’s problems to fester. Doing so will only make these problems that much harder to deal with.”
Paterson’s administration has been saying that this year’s budget gap is closer to $315 million, and he has been reportedly mulling calling legislators back into session to close that gap. However, it is not clear whether legislators would agree to cuts before the end of session with the new state leaders in the Senate and Assembly and a new Governor taking office on January 1.
In addition to the $1 billion gap for this year, a report earlier this month out of DiNapoli’s office said that “the structural imbalance in the state budget poses broad, long-term risks.” All Funds spending is expected to reach $148.7 billion by fiscal year 2012-13, while All Funds revenues are projected to only be $133.9 billion, according to the report.
That report also noted that nearly $16.7 billion used to balance the fiscal year 2010-11 General Fund budget was either one-shot or temporary revenue, including $4.9 billion in federal stimulus funding (scheduled to end in FY 2011-12), and $7.1 billion in temporary revenue actions (ranging in duration from three to five years).
Meanwhile, Governor-elect Andrew Cuomo, who is putting in place his transition team to take over on January 1, has pledged to balance the budget by “by immediately imposing a cap on state spending and freezing salaries of state public employees as part of a one-year emergency financial plan, committing to no increase in personal or corporate income taxes or sales taxes and imposing a local property tax cap.”