Cuomo tackles budget woes in State of the State

Gov. Andrew Cuomo delivers his first State of the State address in Albany, where he promised to revamp the state's Medicaid and education systems. Photo courtesy governor's office
By Howard Koplowitz

Gov. Andrew Cuomo pledged to cut the state’s $10 billion deficit without borrowing and to dissolve thousands of commissions and other bodies during his State of the State address last week.

“What is the state of the state? This is a time of crisis for our state and to seize the moment of opportunity that is before us,” Cuomo said during his speech at the Empire State Plaza Convention Center in Albany — the first time the address has been delivered outside the Capitol building since 1927.

Cuomo said the site of the address as well as his giving legislative leaders the opportunity to speak at the event and allowing 2,200 members of the public to attend was a “metaphor for change.”

“For New York, it is time to change, my friends,” he said.

Cuomo said the state can pull out of its economic slump, noting that there are 100,000 unemployed workers in the state.

“The economic recession has taken an especially hard hit on the state of New York,” he said.

The new governor also said property tax and spending caps were on his agenda, pointing out that taxes in New York are 66 percent higher than the national average and pension costs are expected to skyrocket by 476 percent in 2013 over 1998-99 levels.

“The proof is in the pudding and New Yorkers are voting with their feet,” Cuomo said, referring to the 2 million state residents who left New York this year. “We must use this moment to transform our government, This is a fundamental realignment for this state.”

Cuomo said there was also an abundance of executive branch agencies and more than 10,500 special and local districts that can be cut to save the state money.

For instance, Cuomo said 87 other organizations, including 46 councils, have been added to the state Department of Health since the 1920s.

“It’s time to organize the government, make it professional, make it efficient, make it effective,” he said.

Cuomo said he would set up a commission that would be responsible for making a reorganization report to the Legislature, which would have 30 days to reject the plan or else it passes.

The governor also said the budget process needs reforming “from partisan political theater to debate and compromising.”

“I suggest maybe we try it different this year,” he said.

On Medicaid, Cuomo said the program needs to be shaken up and commissioned a Medicaid redesign team to find alternative ways to cut that portion of the budget.

Turning to education, Cuomo said the current structure offers no performance incentives and he promised to create a $250 million school performance fund, where money is doled out based on a school district’s improvement.

Cuomo also spoke of the need to reform the culture of corruption in Albany.

“We have to transform the ethical environment and we need to clean up Albany,” he said. “The people of this state have lost trust in state government. It is time to pass ethics reform and it’s time to pass ethics reform now.”

Under his so-called Clean Up Albany Plan, Cuomo said the state needs to end pay-to-play politics, require legislators to provide a full disclosure of their outside income and have campaigns publicly financed.

Cuomo said the state’s priciest program, Medicaid, cost 5 percent more than the rate of inflation from 1994 to 2009 and education spending rose 6 percent during that time.

“We just can’t afford those rates of increase,” he said.

The governor said the state’s expenses far exceed its revenue and that a $10 billion deficit this year is expected to be followed by a $14 billion hole in 2011 and $17 billion in 2012.

“This is not a one-year problem,” he said. “This is an unsustainable rate of growth and it has been for a long time.”

Cuomo said that not only is the state spending too much, but it is not getting a proportional bang for its buck, noting New York’s education spending was the most expensive in the nation but was 34th in results.

Medicaid spending was also the highest in the country, but the state was 21st in results, Cuomo said.

In an effort to boost the economy, Cuomo promised to create 10 economic regional councils across the state, which would be composed of public/private partnerships dedicated to creating jobs.

“We need to put up a sign that New York is open for business,” he said.

Cuomo said the councils would be responsible for coming up with job development plans and compete with each other for up to $2 million in funding.

“New York has no future as the tax capital of the nation,” he said. “This has to change.”

Cuomo struck an optimistic tone, saying the state’s legacy is leading the nation and that it could come back stronger from the economic recession and corruption that has recently defined the state.

“This has been an aberration, this recent past,” he said.

Reach reporter Howard Koplowitz by e-mail at hkoplowitz@cnglocal.com or by phone at 718-260-4573.

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