Transparency of State Budget “Withholdings” Needed Ahead of Governor Cuomo’s Executive Budget

Governor Cuomo’s Executive Budget will be released next week, and the details of budget “withholdings” and “advanced payments” is still needed according to a letter from twenty watchdog groups sent to the Cuomo administration in December 2020.

Reinvent Albany believes that without information about the withholdings and advanced payments, the public and Legislature do not know if reductions in state aid have been fair and sensible. The lack of detailed information keeps New Yorkers in the dark how much the Governor has withheld from local governments, state vendors and the Metropolitan Transportation Authority (MTA), which is facing its own dire fiscal crisis and a deficit of more than $8 billion.

In response to the group letter, the Division of the Budget said that a full breakdown of the withholdings and potentially permanent reductions will be made available in the Governor’s January budget proposal.

Reinvent Albany is concerned about the “blurring” of the FY 2021 and 2022 budgets and lack of transparency about what is effectively a cut or delayed payment.

We will be closely reviewing the state’s budget proposals to see if there is sufficient transparency in the Governor’s proposals to close the state’s budget gaps, as well as past state actions to withhold taxpayer dollars from state agencies, local governments, and vendors.

The full letter as sent to the State Division of the Budget on December 21, 2020 is below and here.

December 21, 2020

Robert Mujica
Director, NYS Division of the Budget

Re: Please Publish More Detailed, Monthly State Budget Withholding and Advanced Payment Information

Dear Mr. Mujica,

We write as watchdog groups and advocates for government transparency and public accountability to ask that you disseminate timely and detailed information about the State’s withholding of funds, which was authorized on an emergency basis in the Fiscal Year 2021 Adopted Budget, and the $1.5 billion in advanced payments that were announced at Governor Cuomo’s December 16 press conference.

The State is currently in the third quarter of fiscal year 2021 and has not released a plan to implement any spending reductions. Instead, payments have been withheld and little information has been publicly released. The Mid-Year Financial Plan update included a table that showed $2.4 billion in withholdings through September in ten broad categories, which are not broken down by agency or individual program. The lack of details makes it difficult to assess how State actions are impacting agencies, local entities, and nonprofits.

Furthermore, the Division of the Budget’s (DOB) legally required notification to the Legislature has only included payments that were withheld beyond a statutory payment date. This subset of withholdings totaled less than $500 million through August, the latest date of data available. These notices are currently only accessible through Freedom of Information Law requests; they are not published by DOB or the Legislature on their websites.

The lack of publicly available, detailed information also deprives New Yorkers from insight into exactly how much DOB has withheld from local governments, state vendors and the Metropolitan Transportation Authority (MTA). The MTA is the largest single component unit of New York State government, and it is struggling to survive cash shortfalls that exceed $10 billion over the next 4 years. Other stakeholders likewise should know exactly how much state funding is being withheld from programs that are important to them.

The longer that the State withholds payments, the more likely they are to become de facto cuts as recipients manage their activities without funds or certainty of receipt. For example, the lack of payment has already resulted in 3,000 layoffs of adjunct professors at the City University of New York (CUNY), and reportedly 1,800 nonprofit social service providers are at risk of closure.

Providing advanced payments to certain entities that are facing financial hardship is a welcome action that may ease the burden for some whose payments were withheld. Making the details of these payments public in a timely manner is important for accountability. Without such information on the withholdings and advanced payments the public has no basis on which to assess if these actions inappropriately disadvantage any of the affected entities.

In order to provide greater information to the public and stakeholders, we ask DOB to publish on its website timely and complete information about funds that have been withheld or advanced as part of the state budget adjustment process, ideally monthly and broken out by agency and major program.

Sincerely,

John Kaehny
Executive Director
Reinvent Albany

Andrew Rein
President
Citizens Budget Commission

Joseph G. Rappaport
Executive Director
Brooklyn Center for Independence of the Disabled (BCID)

Susan Dooha
Executive Director
Center for Independence of the Disabled, NY

Betsy Gotbaum
Executive Director
Citizens Union of the City of New York

Susan Lerner
Executive Director
Common Cause New York

Peter Iwanowicz
Executive Director
Environmental Advocates NY

Jonas J.N. Shaende, PhD
Chief Economist
Fiscal Policy Institute

Laura Ladd Bierman
Executive Director
League of Women Voters of New York State

Blair Horner
Executive Director
NYPIRG

McGregor Smyth
Executive Director
New York Lawyers for the Public Interest (NYLPI)

Meghan Parker
Director of Advocacy
New York Association on Independent Living

Lisa Daglain
Executive Director
Permanent Citizens Advisory Committee to the MTA (PCAC)

Tom Wright
President and CEO
Regional Plan Association

Betsy Plum
Executive Director
Riders Alliance

Eric McClure
Executive Director
StreetsPAC

Michael Kink
Executive Director
Strong Economy for All

David Bragdon
Executive Director
TransitCenter

Danny Harris
Executive Director
Transportation Alternatives

Nick Sifuentes
Executive Director
Tri-State Transportation Campaign

Cc.

Senate Majority Leader Andrea Stewart-Cousins
Assembly Speaker Carl Heastie
Senate Finance Chair Liz Krueger
Assembly Ways and Means Chair Helene Weinstein