Report says move start of state fiscal year, add budget office

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Moving the start of the state fiscal year to July 1 and establishing a Legislative Budget Office are among the recommendations of the Empire Center to improve accountability in the budget process.

The fiscally conservative think tank released a policy paper last week titled “Unbalanced by Design: New York State’s Strong Executive Budget” System by E.J. McMahon’s, the center’s research director, and hosted a conference.

The paper explains that the governor has strong powers over the budget, which have been developed over a century of legal decisions and legislative action. In the early 20th century, the Legislator wielded a lot of power and often passed a series of spending bills and there was not an overarching budget for the state that the executive oversaw.

In the last few years, Gov. Andrew Cuomo has flexed his muscle and used the budget bill to push through legislative items such as an increase in the minimum wage and criminal justice reform.

“This year, the governor went further than ever, packing virtually his entire 2019 legislative agenda into the initial 2019-20 Executive Budget bill package,” McMahon said in the report.

The Empire Center believes that some of the power should be shifted back to the Legislature. It recommends that the start of the fiscal calendar be pushed to July 1 to allow more time for lawmakers to discuss these policy issues.

Another recommendation is to establish an independent Legislative Budget Office similar to the Congressional Budget Office would help provide input into the fiscal impact of these bills. There is staff on four separate committees in the Legislature that does this work, but McMahon said that this is duplicative and the reports on the impact of the legislation on state and local government have been “inconsistent and incomplete” and often not released to the public.

In addition, the Empire Center recommends that the Legislature adopt higher accounting standards – the so-called “modified accrual” method, which “requires revenues to be recognized when actually earned, and expenditures to be recognized when a liability is incurred.”

The governor’s financial plan report states that if this method is used, the state has a $2.1 billion deficit for all its funds.

The fourth recommendation is to enforce the deadlines that require the governor to submit the quarterly financial reports.

“A Legislature that aspires to play a more meaningful role in the budget process should at a minimum insist on having timely access to information required by law – and meet its own obligations in the bargain,” he said.

McMahon concluded that these reforms would not totally tamp down “Albany’s checkered history of excessing spending, debt and taxation.”

“The worst budget outcomes of the last half-century have overwhelmed constitutional mechanisms designed to promote fiscal restraint. But politics, not constitutional flaws, are ultimately to blame for the most frequently criticized aspects of New York’s’ budget process today.”

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