ALBANY - The state Legislature passed a $121.7 billion budget Wednesday that will include $1.5 billion in new taxes, $205 million in new fees and $200 million in member items - or pork barrel spending - that politicians can direct back to their own districts.
Legislators expect the state to raise $66.4 million for an optional new driver's license or ID card that would add $30 to the current $50 license fee and give the user the ability to cross some borders, including Canada's.
Another $28 million is expected to come in from a new surcharge on traffic tickets and another $70 million will come from a new assessment on health insurers.
For New Yorkers, this means they'll have to spend more on identification if they want to go to bordering countries, and if they drive too fast along the way it could cost them $20 more for a ticket and $170 more if they drive under the influence.
State officials don't think the extra fee they've applied to insurance companies will be passed on to customers, but it remains a possibility.
The budget doesn't include new personal income taxes and it cuts local assistance programs - except for school aid and most entitlement programs - by 2 percent to save $270 million.
“In the economy, we're in the worst of times,” Gov. David Paterson said Wednesday of the difficulty in getting out the budget - which was nine days past the state's constitutional deadline. He described the economy and the unique circumstances that made him governor less than a month ago as “twin storms” complicating the budget.
Paterson took over March 17 because former Gov. Eliot Spitzer resigned after being linked to a prostitution ring.
New York state Comptroller Thomas DiNapoli questioned Wednesday if the revenues lawmakers are counting on to cover the state budget will turn up.
“Albany should keep an eraser handy,” DiNapoli said of the 2008-09 budget proposal. Budget planners come up with a spending plan in part by anticipating revenue from the previous year, and 2007-08 was “a volatile year,” he said.
“Spending and revenue projections were a moving target all year and significantly deviated from what was estimated,” DiNapoli said. “The economy is in rough shape and the worst may still be around the corner.”
DiNapoli's preliminary revenue and spending results for the last fiscal year pointed to lower than expected business taxes, and general fund tax receipts $120 million below estimates.
With that trend, the Legislature may have to reevaluate their spending plans throughout the year. In past years when revenues plummeted, the Legislature had to return to Albany to cut the budget, including school district funds.
“It's a concern of mine, like it is of everybody in New York state,” Senate Majority Leader Joseph Bruno said Wednesday. “I don't think it will happen. I'd rather be optimistic and expect that pretty much the worst of what we have to do budget-wise and the challenges that we've overcome here in getting the budget done are behind us. What the future brings, no one can tell.”
The budget, which was due April 1, increased spending 4.9 percent and included $1.6 billion in capital projects statewide. An upstate revitalization initiative will pump $700 million into the struggling region.
Education advocates said kids are the real winners in the budget and that the historic $1.75 billion increase in aid will help more students perform better in the neediest schools.
“We were able to keep a promise to the children of our state,” Assembly Speaker Sheldon Silver said.
But the bloated budget and reliance on questionable revenue sources at a time when the economy is on a downturn could mean higher taxes and even bigger budget gaps in the future.
Elizabeth Lynam, deputy research director for the Citizen's Budget Commission, said the spending in Albany is out of control, and in the long run New Yorkers will be paying for it.
“Eight months from now they're going to be wrestling with a $5 billion-plus budget gap, in a situation where it's likely to be worse because the revenues won't be there,” she said. “The tax burden New Yorkers face is already the second highest in the country, and unless their elected officials take stock of the situation and get the pocketbook under control, the taxes will be even higher.”
The state will get additional revenue through a number of new business taxes, including $429 million from closing what lawmakers called tax “loopholes.” Lawmakers expect to raise $250 million in taxes to put video slot machines into the Aqueduct Racetrack and other developments that could include hotels. Another $268 million will come in from increases in taxes on cigarettes and small cigars, both of which are going up $1.25.
State officials couldn't provide the exact budget deficit they had to fill for fiscal year 2008-2009, but it's projected at $4.6 billion.
Highlights of the 2008-09 budget
There is a lot in the $121.7 billion state budget for the 2008-09 fiscal year that will pinch New Yorkers' wallets, help their communities, and likely puzzle a few taxpayers as the state heads toward recession. The budget is also notable for what was left out.
SPENDING HIGHLIGHTS:
• “Enhanced driver's licenses” to help New Yorkers comply with the Western Hemisphere Travel Initiative. The new, optional driver's licenses will allow New Yorkers to travel outside the country without needing a passport or birth certificate. The new, 8-year licenses will add $30 to the $50 cost of reissuing a license with part of the $66 million in revenue going to the state's general fund and to counties.
• An additional $20 surcharge on most motor vehicle offenses and a $170 surcharge in sentencing for driving while intoxicated.
• A record $1.75 billion increase in school aid, to about $20 billion. That includes extra funding sought for New York City and suburban Long Island school districts, and a guarantee that no district will receive less than a 3 percent increase. State legislators say that should be enough to ease increases in local school taxes.
• A restoration of $273 million in measures sought by Gov. David Paterson to reduce the growth in spending in health care, mostly for hospitals and nursing homes that lobbied hard for the funding.
• A weakening or at least a delay of the long-range plan by former Gov. Eliot Spitzer and Paterson to cut health care spending that has forced state spending increases of two or three times the inflation rate in recent years. For example, for the five fiscal years ending in 2006-07 before the effort, Medicaid spending grew an average of 8.3 percent. In 2006-07, in the first year of the effort pushed by Spitzer, spending decreased 1.9 percent. Under the current budget, spending will increase 1.1 percent. In addition, further cuts will now require input from the hospitals and health care industry that would lose funding.
• Creation of a discount prescription card for income-eligible New Yorkers. The cards will provide discounts on average of 30 percent off brand-name drugs and 60 percent off generic drugs for about 400,000 New Yorkers 50 to 64 years old and the disabled.
• State lawmakers will keep almost 100 troopers in schools, instead of putting them along the border, but redeploy more than 100 troopers now covering video slot machine centers authorized by the state Lottery Division. The redeployed troopers will go to cities with rising crime rates, many of which are upstate.
• $25 million to provide health coverage for about 400,000 uninsured children from low and moderate income families.
• $15.6 million to provide loan repayments, grants and other incentives to place more physicians in rural and urban areas without enough medical providers.
• A $1.25-per-pack increase in the cigarette and small cigar tax to raise $268 million, mostly for health care programs.
• $95 million to improve state parks.
• Cuts 9 percent, or $12 million, from the state Lottery, but authorizes allowing investors to pay for the right to operate the lottery in exchange for a trust fund worth billions of dollars.
SPENDING REJECTED BY THE LEGISLATURE:
• Paterson's plan to cut 2 percent in the growth in aid to municipalities, leaving many with about an 8 percent increase in aid over the previous fiscal year. But the cut in state aid could contribute to higher local property taxes for those cities. Paterson had sought 2 percent cuts in state agencies, too, to combat a deficit estimated at nearly $5 billion.
• A proposal to increase the income tax on New Yorkers making over $1 million a year.
• A proposal to increase the $291 basic monthly welfare grant for a family of three by $29.
• A “car tax” proposed in the executive budget that would have permanently raised the motor vehicle law enforcement fee from $5 to $20. Instead, they're proposing extending the current fee of $5 for one year only.
• A nearly $5 million plan to expand broadband Internet access in New York. Senate Republicans say they support making broadband available to more people, but the additional money isn't urgently needed because $5 million that previously had been allotted for that purpose was just released last month.
• Spitzer's cost-saving plan to close four of New York's 69 prisons, where the inmate population has dropped by 9,000 in a decade to about 62,000 with a staff of 31,000. That keeps open Camp Pharsalia in Chenango County, Camp McGregor in Saratoga County, Camp Gabriels in Franklin County and Hudson Correctional Facility in Columbia County.
--A raise for the 1,250 state-level judges, sought after 10 years of falling behind counterparts nationwide. Despite widespread support for the idea, the chances of the bill passing dimmed when public pressure forced judges' raises to be uncoupled from legislators' pay raises. That's how senators and Assembly members have gotten past raises.
- The Associated Press
Another $28 million is expected to come in from a new surcharge on traffic tickets and another $70 million will come from a new assessment on health insurers.
For New Yorkers, this means they'll have to spend more on identification if they want to go to bordering countries, and if they drive too fast along the way it could cost them $20 more for a ticket and $170 more if they drive under the influence.
State officials don't think the extra fee they've applied to insurance companies will be passed on to customers, but it remains a possibility.
The budget doesn't include new personal income taxes and it cuts local assistance programs - except for school aid and most entitlement programs - by 2 percent to save $270 million.
“In the economy, we're in the worst of times,” Gov. David Paterson said Wednesday of the difficulty in getting out the budget - which was nine days past the state's constitutional deadline. He described the economy and the unique circumstances that made him governor less than a month ago as “twin storms” complicating the budget.
Paterson took over March 17 because former Gov. Eliot Spitzer resigned after being linked to a prostitution ring.
New York state Comptroller Thomas DiNapoli questioned Wednesday if the revenues lawmakers are counting on to cover the state budget will turn up.
“Albany should keep an eraser handy,” DiNapoli said of the 2008-09 budget proposal. Budget planners come up with a spending plan in part by anticipating revenue from the previous year, and 2007-08 was “a volatile year,” he said.
“Spending and revenue projections were a moving target all year and significantly deviated from what was estimated,” DiNapoli said. “The economy is in rough shape and the worst may still be around the corner.”
DiNapoli's preliminary revenue and spending results for the last fiscal year pointed to lower than expected business taxes, and general fund tax receipts $120 million below estimates.
With that trend, the Legislature may have to reevaluate their spending plans throughout the year. In past years when revenues plummeted, the Legislature had to return to Albany to cut the budget, including school district funds.
“It's a concern of mine, like it is of everybody in New York state,” Senate Majority Leader Joseph Bruno said Wednesday. “I don't think it will happen. I'd rather be optimistic and expect that pretty much the worst of what we have to do budget-wise and the challenges that we've overcome here in getting the budget done are behind us. What the future brings, no one can tell.”
The budget, which was due April 1, increased spending 4.9 percent and included $1.6 billion in capital projects statewide. An upstate revitalization initiative will pump $700 million into the struggling region.
Education advocates said kids are the real winners in the budget and that the historic $1.75 billion increase in aid will help more students perform better in the neediest schools.
“We were able to keep a promise to the children of our state,” Assembly Speaker Sheldon Silver said.
But the bloated budget and reliance on questionable revenue sources at a time when the economy is on a downturn could mean higher taxes and even bigger budget gaps in the future.
Elizabeth Lynam, deputy research director for the Citizen's Budget Commission, said the spending in Albany is out of control, and in the long run New Yorkers will be paying for it.
“Eight months from now they're going to be wrestling with a $5 billion-plus budget gap, in a situation where it's likely to be worse because the revenues won't be there,” she said. “The tax burden New Yorkers face is already the second highest in the country, and unless their elected officials take stock of the situation and get the pocketbook under control, the taxes will be even higher.”
The state will get additional revenue through a number of new business taxes, including $429 million from closing what lawmakers called tax “loopholes.” Lawmakers expect to raise $250 million in taxes to put video slot machines into the Aqueduct Racetrack and other developments that could include hotels. Another $268 million will come in from increases in taxes on cigarettes and small cigars, both of which are going up $1.25.
State officials couldn't provide the exact budget deficit they had to fill for fiscal year 2008-2009, but it's projected at $4.6 billion.
Highlights of the 2008-09 budget
There is a lot in the $121.7 billion state budget for the 2008-09 fiscal year that will pinch New Yorkers' wallets, help their communities, and likely puzzle a few taxpayers as the state heads toward recession. The budget is also notable for what was left out.
SPENDING HIGHLIGHTS:
• “Enhanced driver's licenses” to help New Yorkers comply with the Western Hemisphere Travel Initiative. The new, optional driver's licenses will allow New Yorkers to travel outside the country without needing a passport or birth certificate. The new, 8-year licenses will add $30 to the $50 cost of reissuing a license with part of the $66 million in revenue going to the state's general fund and to counties.
• An additional $20 surcharge on most motor vehicle offenses and a $170 surcharge in sentencing for driving while intoxicated.
• A record $1.75 billion increase in school aid, to about $20 billion. That includes extra funding sought for New York City and suburban Long Island school districts, and a guarantee that no district will receive less than a 3 percent increase. State legislators say that should be enough to ease increases in local school taxes.
• A restoration of $273 million in measures sought by Gov. David Paterson to reduce the growth in spending in health care, mostly for hospitals and nursing homes that lobbied hard for the funding.
• A weakening or at least a delay of the long-range plan by former Gov. Eliot Spitzer and Paterson to cut health care spending that has forced state spending increases of two or three times the inflation rate in recent years. For example, for the five fiscal years ending in 2006-07 before the effort, Medicaid spending grew an average of 8.3 percent. In 2006-07, in the first year of the effort pushed by Spitzer, spending decreased 1.9 percent. Under the current budget, spending will increase 1.1 percent. In addition, further cuts will now require input from the hospitals and health care industry that would lose funding.
• Creation of a discount prescription card for income-eligible New Yorkers. The cards will provide discounts on average of 30 percent off brand-name drugs and 60 percent off generic drugs for about 400,000 New Yorkers 50 to 64 years old and the disabled.
• State lawmakers will keep almost 100 troopers in schools, instead of putting them along the border, but redeploy more than 100 troopers now covering video slot machine centers authorized by the state Lottery Division. The redeployed troopers will go to cities with rising crime rates, many of which are upstate.
• $25 million to provide health coverage for about 400,000 uninsured children from low and moderate income families.
• $15.6 million to provide loan repayments, grants and other incentives to place more physicians in rural and urban areas without enough medical providers.
• A $1.25-per-pack increase in the cigarette and small cigar tax to raise $268 million, mostly for health care programs.
• $95 million to improve state parks.
• Cuts 9 percent, or $12 million, from the state Lottery, but authorizes allowing investors to pay for the right to operate the lottery in exchange for a trust fund worth billions of dollars.
SPENDING REJECTED BY THE LEGISLATURE:
• Paterson's plan to cut 2 percent in the growth in aid to municipalities, leaving many with about an 8 percent increase in aid over the previous fiscal year. But the cut in state aid could contribute to higher local property taxes for those cities. Paterson had sought 2 percent cuts in state agencies, too, to combat a deficit estimated at nearly $5 billion.
• A proposal to increase the income tax on New Yorkers making over $1 million a year.
• A proposal to increase the $291 basic monthly welfare grant for a family of three by $29.
• A “car tax” proposed in the executive budget that would have permanently raised the motor vehicle law enforcement fee from $5 to $20. Instead, they're proposing extending the current fee of $5 for one year only.
• A nearly $5 million plan to expand broadband Internet access in New York. Senate Republicans say they support making broadband available to more people, but the additional money isn't urgently needed because $5 million that previously had been allotted for that purpose was just released last month.
• Spitzer's cost-saving plan to close four of New York's 69 prisons, where the inmate population has dropped by 9,000 in a decade to about 62,000 with a staff of 31,000. That keeps open Camp Pharsalia in Chenango County, Camp McGregor in Saratoga County, Camp Gabriels in Franklin County and Hudson Correctional Facility in Columbia County.
--A raise for the 1,250 state-level judges, sought after 10 years of falling behind counterparts nationwide. Despite widespread support for the idea, the chances of the bill passing dimmed when public pressure forced judges' raises to be uncoupled from legislators' pay raises. That's how senators and Assembly members have gotten past raises.
- The Associated Press
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