Rapid Reaction to Governor Hochul’s $227B FY 2024 Budget
Thumbs Up: increased state funding to keep MTA “solvent”
No Way: billions of new spending to resurrect Start-Up NY and boost Film/TV Subsidies
Reinvent Albany advocates for open and accountable NYS government. Broadly, we appreciate Governor Hochul releasing budget bills with her budget book – this increases transparency. Unfortunately, the Governor does not clearly show the public the high future cost of her proposals like increasing the Film/TV subsidy to $700m a year, nor answer big questions like how the State is paying back the $9B federal Unemployment Insurance loan.
Overall Story (Note: inflation was 6.5% in 2022)
The Governor proposes Fiscal Year 2024 spending of $227B from all sources, an increase of $5.4B or 2.4% — less than inflation. However, by far the largest two areas of state spending will increase sharply: K-12 schools plus 10%, Medicaid plus 7.7%. Executive agencies increase 2.4% while other state programs shrink -5.4% (-$2.9B). The Governor’s narrative is that state tax revenue has been much higher than projected yielding a budget surplus, but tax revenue will plunge creating a $22B deficit in the three years after this budget, FY 2025/26/27. Thus, the Governor proposes creating a large rainy day fund while vastly expanding discredited business subsidies.
Governor’s Budget and Our Priorities
Building a Strong Democracy
Bad: $25m of $100m in matching funds requested by the Public Campaign Finance Board
Thumbs up: $14m/$14m for administration requested by Public Campaign Finance Board
Increasing Government Accountability
Thumbs up: Comptroller budget – $558 million, an increase of $39 million (+7.5%) Bad: Below inflation Attorney General budget – $345 million, an increase of $18 million (+5.5%)
Bad: Below inflation Legislature budget – $274 million, an increase of $9.8 million (+3.7%)
Bad: Freeze for Authorities Budget Office at level far below what was called for by authorizing legislation.
Ethics
OK: $7.8m for the new Commission on Ethics and Lobbying in Government.
Thumbs up/Assessing Specific: Stagger terms of ethics commissioners (Part Z, PPGG Article VII).
Public Authorities
Thumbs up: more MTA operating aid broadly, still assessing the specific funding sources below proposed by the Governor. The state budget includes funding to fill the MTA’s budget gaps ($600 million in 2023, and $1.2 billion in the out years) through:
- $800 million/year from increases to the Payroll Mobility Tax (PMT), which is dedicated and remitted directly to the MTA
- $300 million in one-time state funding as the new tax revenues ramp up
- $500 in mandated NYC contributions through student metrocard and paratransit payments, and “make whole” payments for PMT exemptions
- Future casino revenues, both through licenses and gaming taxes (no amounts provided)
Reinvent Albany had proposed increasing the state’s 18-b and PMT “make whole” payments, which would increase state support by $375 million/year.
Article VII MTA and Transportation Policy Proposals
Assessing: Article VII changes related to the MTA – bus camera enforcement, and extension of tax increment financing for MTA projects, and authorizing speed cameras for MTA bridges and tunnels.
Thumbs up: “Sammy’s Law” allows NYC to lower speed limits to 20 mph
Assessing: Proposal on NYC parking reform.
Open Government
Bad: No suggested policy improvements or funding increases to fix the increasingly broken Freedom of Information Law process.
Interesting: budget book highlights some “strategic initiatives” involving procurement systems and data management (page 134).
Assessing: Amend Open Meetings Law so public entities who serve people with disabilities can meet fully remotely. (Part X, Article VII TED)
Business Subsidies
We are dismayed that the Governor is doubling down on billions in totally discredited business subsidies while cutting and freezing other state agencies and programs. Either her advisors are badly misinformed or her administration is totally cynical and swimming in pay to play.
Parade of Horribles — More to Come
No way: 55% Increase in Film/TV Tax Credits to $700m/Year. (+250m/year) (Part D, Article VII Rev)
No way: $455m for Belmont Race Track (Part X, Article VII Rev)
No way: Extension of 421-a NYC property tax abatement (Part R, Article VII ELFA)
No way: Resurrecting dead Start-Up NY as EPIC (Part CCC, TED Article VII)