Canceling millions of dollars in unused pork-barrel spending and freezing teacher salaries are among steps that could save New York $30 billion over three years, a fiscally conservative think tank said Monday. That would be a considerable reduction in state budgets now totaling more than $130 billion a year.
The Empire Center for Public Policy’s recommendations were released two days before Gov. David Paterson is scheduled to give his State of the State speech. The Democrat has sought his own plan to reduce what he’s called years of overspending that can no longer be sustained by taxpayers.
The organization’s “Blueprint for a Better Budget” lists specific — and often politically dicey — proposals to lift the state from its fiscal crisis and multibillion dollar deficits. The report proposes selling state-owned golf courses and ski resorts as well as its off-track betting agencies; a wage freeze for teachers and state workers; and caps on school aid and Medicaid spending.
Several have been individually proposed before by anti-tax and pro-business advocates, but failed to gain legislative support in less dire fiscal times.
The report notes New York is the eighth biggest spender among states, paying out $6,579 from every adult and child in 2008. That compares to a national average of $4,948 per capita.
“The report contains the kinds of big ideas that will need to be considered seriously if the state is to deal successfully with the enormous budget gaps it faces in the next couple of years,” said Elizabeth Lynam of the Citizens Budget Commission, an independent budget watchdog.
But Frank Mauro, a fiscal analyst for the union-backed Fiscal Policy Institute, said the report omits some critical context. Mauro notes that the report often compares New York to the national average for spending, but doesn’t make it clear that New York is much closer to the spending — and costs — of northeastern states including New Jersey and Massachusetts.
He also disputes the Empire Center’s conclusion that New York’s $44 billion Medicaid system is bloated by overspending, compared to other states. But New York pays for more of its services to the mentally disabled through Medicaid, has higher poverty rates, and has created two Medicaid-supported health care programs for the working poor that most other states don’t have.
Mauro also criticized the Empire Center proposal to cut school aid by 7.5 percent, followed by two years without increases in aid until the state’s revenues rebound. The report notes school aid would still be 14 percent, or $2.5 billion a year, higher than in 2006-07. Mauro said that proposal ignores a finding by the courts that New York must make up for years of shortchanging public schools.
Business interests support the Empire Center’s proposals. Mike Elmendorf of the National Federation of Independent Business/New York called them realistic and necessary. There was no immediate comment from the governor or legislative leaders.
“This is a very serious situation and they can’t finagle their out of it,” said E.J. McMahon, co-author of the Empire Center report with Josh Barro. “It’s hard to change, but something has to give.”