Governor Paterson has described his most significant budget-cutting undertaking as painful but necessary medicine for New York’s fiscal maladies. In Albany, however, pain is relative.

For the Department of Environmental Conservation, complying with the governor meant coordinating an advertising program with another office. For the Olympic Regional Development Authority, it meant scrapping a snowboarding competition. For one tiny agency, it meant getting by without a summer intern.

During budget negotiations last spring, Mr. Paterson ordered his agency commissioners each to draw up plans for reducing their operating expenditures this fiscal year by 3.35%, as part of the administration’s so-called Program to Eliminate the Gap. The mandated belt-tightening would “send a message that we wanted to cut spending as much as we can,” the governor has said.

For the 75 agencies that had to comply with the order, the cut was not really a cut, but a slight slow-down in spending growth that provided room for the Legislature to add its own appropriations without further stretching out next year’s estimated budget gap of $5 billion.

Forced to give up a total of $400 million from their budgets, agencies have conserved cash in less than extreme ways: for example, putting a freeze on new BlackBerry purchases, relying more heavily on teleconferencing, limiting requests for outside counsel, or passing more costs down to the county level. Virtually all of the state’s more than 200,000 employees get to keep their jobs. To cut down on personnel costs, agencies are limiting new hires to “critical functions” or slightly reducing payrolls through attrition.

“This has been an exercise in painless paring,” a fiscal analyst for the Manhattan Institute, E.J. McMahon, said.

The Department of Environmental Conservation shaved away its 3.35% without laying off one of its roughly 4,100 employees. “It will not be necessary to incur any layoffs; all staff from eliminated activities will be redirected to other essential functions as attrition occurs,” its report states. The department economized, in part, by sharing the costs with another state office for an advertising contract for the Adirondack and Catskill campgrounds.

A key cost-saving measure for the Division of Lottery was the elimination of programs that “showcase the lottery’s education mission.” The lottery, which contributes more than $2 billion of gambling proceeds a year to education aid, sponsors scholarship competitions and coordinates “educator of the week” segments with local television stations. The division is also relying on lower-priced printing contracts for its instant tickets.

The Olympic Regional Development Authority, which manages and upgrades the facilities used during the 1980 Winter Olympic Games, dealt with a third of its budget cut by deciding it will no longer host the World Cup snowboard championship, one of the various competitions that take place at the Lake Placid resort site. It’s also eliminating vacant senior management positions.

The Tug Hill Commission, which oversees the protection of the sparsely populated region between Lake Ontario and the Adirondacks, must now get by without a summer intern who historically has helped run a computerized mapping system that tracks land-use patterns and property ownership.

To make the 3.35% cut, the commission also conserved money by no longer broadcasting its meetings live on the Internet.

One of the smallest agencies, the State of New York Northeastern Queens Nature and Historical Preserve Commission, which monitors land-use along shorelines in the borough, had to cough up $4,000.

“The agency is currently investigating more affordable, all-inclusive plans that combine Internet, telephone, and fax service. The agency also plans to reduce travel expenses as much as possible (the 2008-09 budget only contains $400 for travel expenses),” its plan said.

“I don’t think it will be arduous,” the chairman of the commission, Bernard Haber, said. “It’s not a major amount. We’ll be able to do it. We’ll be able to manage.”

While Mr. Paterson has said he has left the door open for further agency cuts, he’ll have to look elsewhere to close next year’s gap, which has grown to $5 billion despite an anticipated 2.7% increase in taxes, fees, and other receipts. (The increase is wiped out by a 10% hike in baseline spending.)

Increases in Medicaid spending and school aid — two areas not affected by his Program to Eliminate the Gap — account for about 70% of the budget hole for the 2009-10 fiscal year.

© 2010, New York The Sun

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The Empire Center is an independent, non-partisan, non-profit think tank located in Albany, New York. Our mission is to make New York a better place to live and work by promoting public policy reforms grounded in free-market principles, personal responsibility, and the ideals of effective and accountable government.