screen-shot-2018-05-11-at-9-21-47-pm-150x150-3375825New York’s newly enacted state budget is balanced with higher-than-anticipated tax receipts, but out-year projected budget gaps have grown significantly larger, according to a quarterly financial plan update issued late Friday afternoon by Governor Cuomo’s Division of the Budget (DOB).

The FY 2019 Enacted Budget Financial Plan report projects a general fund budget gap of $4 billion in fiscal 2020, growing to nearly $7 billion in each of the following two years. The previous financial plan had projected those gaps at $3.5 billion, $5.2 billion and $5.1 billion, respectively.

The baseline gap estimates assume current-law spending growth of 5 percent in fiscal 2020, 4 percent in 2021, and nearly 3 percent in 2022. If spending growth is held to 2 percent throughout the four-year period, the enacted plan indicates the state will still face budget gaps of $780 million in fiscal 2020, $1.4 billion in 2021, and $487 million in 2022. Estimated on the same basis, the February financial plan had projected budget gaps of $812 million in 2020 and $429 million in 2021, followed by a 2022 surplus of $528 million. So, in effect, the fiscal outlook for 2021 and 2022 has deteriorated by $1 billion a year.

The budget enacted by the Legislature for FY 2019, which began April 1, will boost the local assistance spending increase by an additional $500 million over the amounts projected in February, but the state operating funds spending total of slightly more than $100 billion only represents a net $133 million increase over the final total for 2018, thanks to changes in the timing of 2018 and 2019 debt service payments, and apparent re-estimates of other fiscal 2018 disbursements.  This enables Cuomo to assert, for a sixth consecutive year, that he has held spending growth 2 percent—although the true figure is closer to 4 percent, counting the off-budget shift of a dedicated downstate mass transit tax and other timing items, as the state comptroller has noted.

Tax receipts in fiscal 2018 came in $334 million higher than the February estimate, and the projection for tax receipts in fiscal 2019 has been increased a net $500 million over the prior amount. The personal income tax is still coming in well above prior projections, but other tax categories are projected to be weaker than previously projected.

Tags:

You may also like

How Washington’s Budget Bill Will Affect Health Care in New York

UPDATE: The final version of the federal budget bill omitted a handful of provisions that had been included in earlier drafts. One would have penalized states that use their own money to provide coverage for undocumente Read More

Two Dozen School Districts Are Returning to the Polls for Budget Revotes

Voters in 24 New York school districts return to the polls on Tuesday for school budget revotes. Last month, voters in 96 percent of school districts outside New York City conducting votes approved their school budgets for the upcoming year. The 683 sc Read More

New York’s Proposed ‘MCO Tax’ Would Generate a Fraction of What Lawmakers Expected

The Hochul administration's proposed "MCO tax" would generate far less than the $4 billion in extra federal aid anticipated by state lawmakers when they approved the concept this spring, according to documents obtained by t Read More

How 1199 Earns its Reputation as Albany’s No. 1 Labor Power Broker

For the fourth time in six years, the president of New York's largest health-care union, George Gresham of 1199SEIU, has won the top spot on the "Labor Power 100" list from City &am Read More

New York Runs Away from the Pack on Medicaid Spending

New York's per capita Medicaid spending jumped 14 percent in 2023, moving it further ahead of the rest of the country, recently released nationwide data show. In the federal fiscal year that ended last September, New York spent $94.6 billion Read More

Hochul’s ‘Straight Talk’ on Medicaid Isn’t Straight Enough

Arguably the biggest Medicaid news in Governor Hochul's budget presentation was about the current fiscal year, not the next one: The state-run health plan is running substantially over budget. Read More

New York’s Medicaid Spending Is Running Billions Over Budget

New York's Medicaid program ran billions of dollars over budget during the first half of the fiscal year, adding to signs of a brewing fiscal crisis in Albany. According to the fro Read More

Hospital Lobby’s TV Campaign Spreads Misinformation About Medicaid

As New York's health-care industry agitates for more money from the state budget, two of its most influential lobbying groups are airing TV ads that make alarmist and inaccurate claims about Medicaid. Read More