ALBANY — This week, New York lawmakers must confront completing a state budget amid fear and uncertainty far beyond the annual anxiety that surrounds the fight over billions of dollars of taxpayers’ money.
As the COVID-19 pandemic grows, Gov. Andrew M. Cuomo is warning of a revenue hit of $15 billion and “education cuts all across the state.” He’s even seeking authority to do “rolling” budget adjustments every fiscal quarter.
With votes on budget bills expected to begin Monday, schools and local governments are bracing for the worst.
Strapped counties fear they’ll be forced to pay for a greater share of Medicaid.
Lawmakers and advocates are worried the usual strong-arming machinations that are always part of the budget will be more blatant because the focus is all on the virus.
Businesses fear far-reaching “prevailing wage” and workers’ compensation conditions will be imposed, making it harder to bounce back. Criminal-justice advocates worry lawmakers will cave to Cuomo’s wishes to change a brand-new bail law.
Beyond the spending details, it’s not clear yet how the 200-plus state legislators can convene to fully vet the latest proposals while adhering to social distancing guidelines. Or even how they will cast votes.
Legislative leaders are rushing to put in place a “remote” voting process and legal structure, now that four lawmakers have tested positive for the virus. A state Senate official said the chamber intended to approve a resolution Sunday to sidestep the requirement that lawmakers actually be seated in the chamber to vote; the plan is to begin voting Monday on the least controversial of what’s expected to be about 14 budget bills.
And it is supposed to be completed by Wednesday, the first day of New York’s 2020-21 fiscal year.
A full fiscal impact of the virus won’t be known for some time. But New York lawmakers need to act because delay could make things worse, one conservative fiscal watchdog said.
“They have to make decisions now. Every moment they waste is going to make the problem worse and that is going to cost jobs in the future,” said E.J. McMahon, research director at the Empire Center, an Albany think tank. “They don’t gain anything by stalling.”
Cuomo in January proposed a $178 billion budget that sounded like standard fare in Albany.
He proposed dealing with a $6 billion deficit by shifting significant Medicaid costs to counties, slowing but not cutting education spending increases promised in previous years, trimming the state workforce, offloading some environmental spending through a bond act and legalizing and taxing marijuana.
Most importantly, his plan counted on a growing economy that would boost state revenue some $5 billion in 2020-21.
Those calculations are out the window.
“We have no state revenue to speak of. We are going to have to dramatically cut our state spending,” Cuomo said Friday. “You can’t spend what you don’t have.”
Asked if the uncertainty makes the budget process worse, the governor said the opposite, claiming there is little to debate.
“It’s easy because zero is actually an easy number,” he said.
But in reality, there are widely differing viewpoints.
McMahon and others are saying lawmakers should do the hardest thing first — cut education spending — and then look to add if the economy begins to bounce back. They also support a temporary freeze on all public-sector salaries.
It’s easier that way for schools and counties to plan rather than fear quarterly and continual reductions.
“And if we have a pleasant surprise, so be it,” McMahon said.
School spending runs about $27 billion annually — the single biggest budget item — and lawmakers previously had talked of increasing it by $1 billion.
Liberal lawmakers and advocates want a different approach: Tax the ultrarich.
They proposed raising the tax rate by at least 0.5 percentage points on anyone earning at least $5 million annually, taxing certain capital gains as income and taxing condos and apartments in New York City that function as second homes. All told, that could bring in $10 billion a year or more.
“The reality is we have a lot of rich people who are still very rich. They have not lost their jobs. They have not lost their wealth,” said Michael Kink, executive director of the progressive group Strong Economy For All Coalition.
One thing the left and right agree on: Any federal stimulus package won’t be enough to cover New York’s budget hole.
Another controversy: Cuomo wants to cut Medicaid spending and shift some to counties — though policies he approved in previous years, such as boosting wages of health care workers, contributed to the state’s deficit.
“This is cruel and inhumane, and we will not accept a budget that includes these cuts,” Sen. Zellnor Myrie (D-Brooklyn) wrote on Twitter.
Lawmakers too are girding for Cuomo’s stated preference of tucking nonemergency issues, such as adding to the list of crimes for which a judge can detain a suspect and legalizing gestational surrogacy.
“In today’s current environment, trying to rush through a policy-heavy spending plan could be catastrophic,” Assembly Minority Leader Will Barclay (R-Pulaski) said.
Exacerbating the pressure, the 150-seat Assembly and 63-seat Senate haven’t been able to hold meetings to fully vet Cuomo’s ideas and offer counterproposals, in large part because of social distancing in the wake of the coronavirus pandemic.
They convened in Albany on March 18 to approve an emergency sick leave bill, only to find out several lawmakers later tested positive for the virus.
Senate Majority Leader Andrea Stewart-Cousins (D-Yonkers) said Saturday her chamber will return to Albany on Sunday to approve a resolution to allow “remote voting” on legislation. The Senate aims to begin taking up bills Monday. Assembly leaders didn’t immediately say whether they would follow the same schedule, though the houses typically run in tandem.