NYS Budget News

Barbara Crosier, Vice President, Government Relati0ns for CP of NYS, offers these news accounts from across the state in an effort to provide some perspective on the current situation in Albany. For more information about legislative issues important to people with disabilities call Ms. Crosier at (518) 436-0178.

Deal Floated On Health Spending
Spitzer Aboard Plan For Cost-Of-Living Boost And An End To Tax For Hospitals, But Downstate Groups Object
by JAMES M. ODATO, Albany Times Union March 21, 2007

ALBANY -- Gov. Eliot Spitzer and the Healthcare Association of New York Tuesday floated a potential settlement to the health care funding wars that would add about $300 million to Spitzer's budget.

Although the deal was unacceptable to a downstate hospital group and its union allies, some parties in the negotiations saw the proposal as a positive step.

A handshake on health care spending could advance other areas of the budget, although Senate Majority Leader Joseph L. Bruno was holding firm to his conference's demands for greater education funding to ensure Long Island's traditional share of school aid. Bruno also was touting the need for an across-the-board tax rebate program not tied to income levels, as Spitzer's STAR expansion program is designed.

As for the health care deal, some parties were optimistic.

"We've continued discussions with the Assembly, Senate and governor and we are close to a conceptual agreement," said William VanSlyke, a spokesman for HANYS. "But the devil's in details."

People apprised of the deal said the plan calls for providing hospitals 75 percent of the 2.5 percent cost-of-living increase they have been counting on. Spitzer has proposed no increase and a freeze on rates paid hospitals and nursing homes.

The deal would be worth $136.5 million, half from the state and half from federal aid for hospitals.

Also, Spitzer would agree to let the gross receipts tax on hospitals expire, as scheduled, at the end of this month, saving hospitals $136.9 million. Spitzer had proposed extending the tax and freezing rates as part of his $1.3 billion in cuts to the industry.

A deal with hospitals on providing an inflationary rate hike likely would lead to one for nursing homes, too.

Spitzer still could declare victory because he would hold to his policy of redirecting Medicaid funds to hospitals based on the actual number of Medicaid patients they care for.

Kenneth Raske, president of the Greater New York Hospital Association, said he is aware of HANYS' meeting with Spitzer's aides. The plan, he said, would benefit upstate hospitals more than downstate ones.

The Assembly Democrats' budget plan, which restored all of the cost-of-living adjustment and killed the gross receipts tax, would benefit downstate hospitals by tens of millions of dollars more.

Jennifer Cunningham, a lobbyist for Local 1199 of the Service Employees International Union, said downstate hospitals would lose $110 million if HANYS' plan replaces the Assembly Democrats' proposal. "HANYS does not speak for 265,000 health care workers of 1199," she said.

The HANYS deal takes $24 million that would normally be used for graduate medical education, largely in New York City hospitals, and redirects it upstate.

The HANYS plan would be about $74 million less expensive than the Assembly plan and much less costly than the Senate's proposal to restore more than half the cuts Spitzer seeks, a source familiar with the deal said.

News of the talks came amid little other progress on the budget. Assembly Speaker Sheldon Silver, Senate Minority Leader Malcolm Smith, Assembly Minority Leader James Tedisco and Bruno met publicly with Spitzer on Tuesday morning. Spitzer and Silver said Bruno's budget plan adds $3.2 billion to the governor's $120.6 billion budget proposal and wrongly assumes the state will have nearly $5 billion more in available funds for budgeting.

"Five billion dollars is not real," Silver said.

Bruno said Senate Republicans historically have been better at estimating revenues. He complained that conference committees now under way have been a joke because Bruno, Silver, Smith and Tedisco haven't met to set guidelines on spending.

"They've been playing ring-around-the-rosy," Bruno said in an attempt to get the leaders to meet with him.

http://www.timesunion.com/AspStories/storyprint.asp?StoryID=573789
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Budget Debate Exposes Rifts
In Contentious Capitol Conference, Silver, Spitzer Blast Senate Majority Leader Over His Tax Cut Plans
by DAN JANISON Newsday March 21, 2007

ALBANY - Assembly Speaker Sheldon Silver, who had been playing a relatively low-key role in the annual state budget battle, emerged yesterday to close ranks with Gov. Eliot Spitzer by attacking the Senate's proposals for taxes, school spending and Medicaid.

Spitzer and Silver, the state's top Democrats, prodded and lectured Senate Republican Majority Leader Joseph Bruno across the table during a contentious Capitol budget conference, exposing wide rifts over a $120-plus-billion budget just 11 days before the fiscal year ends.

….But Bruno contested warnings of future deficits, noting that these were predicted in prior years but never materialized. He defended his proposals for more sweeping restorations to hospitals and nursing homes slashed in Spitzer's budget and for more aid to suburban school districts. Silver has proposed more modest restorations in those areas.

Bruno accused Silver of playing partisan politics. "We used to partner," he said. "Where are you now? What happened? Oh. We have a Democratic governor ... That's OK. I understand politics."

He said state aid to public schools is proportionally less for Long Island than under the formula that Spitzer proposes to change. "You drive 8 percent of your school aid to the Island," he said. "There's 17 percent of the students there. We've always given them 13 percent. Those are the highest-taxed people."

Spitzer said: "Your budget would send money to those school districts that ... are not the high-needs districts."

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Spitzer Moving To Isolate GOP's Bruno
BY JACOB GERSHMAN – New York Sun March 21, 2007

ALBANY — With the help of Assembly Democrats, Governor Spitzer is tightening the screws on the Republican Senate majority leader, Joseph Bruno, whose increasingly lonely position in budget negotiations could force him to succumb to the governor's demands on health care, education, and taxes.

At a feisty negotiation session in the executive chamber, Mr. Spitzer and the Assembly speaker, Sheldon Silver, ganged up on the 77-year-old silver-haired Senate leader, who is battling to restore the entirety of the governor's proposed Medicaid cuts, pour more money into Long Island school districts, and substitute in a property tax relief plan that does not exclude wealthier homeowners.

Mr. Bruno came under attack from multiple directions: Messrs. Spitzer and Silver; the Republican Assembly minority leader, James Tedisco; the Democratic Senate minority leader, Malcolm Smith, and the Democratic lieutenant governor, David Paterson, each criticized Mr. Bruno for proposing a budget they said was unrealistically high.

"What I'm saying to you, Joe, is that it's time to make those tough decisions," Mr. Spitzer said.

...Maintaining calm, Mr. Bruno refused to budge and insisted his spending plan was affordable, arguing that Albany annually underestimates its available revenues. Spitzer administration officials calculated Mr. Bruno's spending plan at just under $124 billion, more than $3 billion more than the Senate's estimate, which does not include money spent on giving rebates to homeowners.

The governor proposed a budget of $120.6 billion, and the Assembly came out with a plan totaling $121.2 billion.

Mr. Bruno defended the Senate's efforts to eliminate the governor's proposed $1 billion in cuts to hospitals and nursing homes, saying that slashing Medicaid funds doesn't "represent reform."

He said Mr. Spitzer's plan to slightly increase New York City's share of public school funding would unfairly punish Long Island schools, which are receiving more money but a smaller slice of the pie.

He argued that much of his proposed new spending helped businesses and residents by lowering taxes for more people and blocking Mr. Spitzer's plans to close a variety of tax loopholes. "If you want to count that as spending … then we're big spenders," Mr. Bruno said.

....In the Pataki era, Mr. Bruno was ensconced in the role of middleman and no-nonsense dealmaker, playing off the vulnerabilities of the governor and the intransigence of Mr. Silver. With a Democratic governor in power, Mr. Bruno has had to assume the role that Mr. Silver played so well, the odd man out.

While Mr. Silver famously used a stubborn stance to wrench concessions from Governor Pataki, Mr. Bruno is finding it difficult to exploit the same tactic of delay. One problem for the majority leader is that Mr. Silver — eager to mend his relationship with Mr. Spitzer after defying him during the comptroller search — has decided to abandon Mr. Bruno and ally himself with the governor.

"Last year we partnered," Mr. Bruno told Mr. Silver. "The year before we partnered. Where are you now? What's happened?"

Albany lawmakers said yesterday it was possible that Mr. Spitzer and Mr. Silver could pass a two-way budget, putting even more pressure on Mr. Bruno to compromise.

Mr. Bruno also must watch out for Mr. Spitzer gaining an advantage by picking off votes from his conference, which holds a slim two-seat majority in the Senate. Mr. Spitzer suggested yesterday that he was in talks with other Republican senators.

Also, a late budget could hurt Mr. Bruno more than Mr. Spitzer, whose popularity among voters and his support from other lawmakers would make it easier for him to pin the blame for delays on the veteran Senate leader.

Mr. Spitzer, who has said he would not hesitate to prolong negotiations into April and beyond if he doesn't get the concessions he wants, would likely use a breakdown in talks to batter Mr. Bruno, giving his conference bad publicity at a time when its trying to preserve control.

Albany has just started getting accustomed to passing its budgets on time after annually missing the April 1 deadline between 1985 and 2004, a streak of gridlock that had come to symbolize Albany's disarray.

"The issue of an on-time budget is not going to be a significant factor in what happens here," a top adviser to Mr. Spitzer, Lloyd Constantine, told The New York Sun. "If you've got a threat, and they say make my day, then the threat has been substantially taken away."

Lawmakers outside Mr. Bruno's conference described the Republican Senate's position as a lose-lose situation: "He's either seen as a big caver or seen as doing business as usual," a Democratic state senator and former minority leader, Martin Connor, said.

http://www.nysun.com/pf.php?id=50847
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Spitzer, Senate, Assembly Budget Proposals
Associated Press March 19, 2007

ALBANY, N.Y. -- Here's a breakdown of the budget proposals that Democratic Gov. Eliot Spitzer and legislative leaders hope to resolve by the April 1 deadline to adopt a state budget.

The major differences include:

OVERALL BUDGET
_Spitzer proposed a $120.6 billion budget in January. That's an increase of 7.8 percent _ more than twice the inflation rate _ but still less than the current budget that increased state funds by 11.2 percent. Spitzer and legislative leaders have since agreed updated revenue forecasts provide another $575 million to work with.
_The Assembly's Democratic majority proposes a $121.2 billion budget.
_The Senate's Republican majority proposes additions that Spitzer's Division of Budget say add up to $3 billion. But Senate Republicans say the difference is really $1 billion, because they don't count tax rebate checks returning revenues to taxpayers as spending.

EDUCATION
_Spitzer proposes $1.4 billion in additional funding and would direct far more to high-needs schools, although every district would get at least a 3 percent increase. State school aid currently is about $17 billion. This would be the first installment of Spitzer's plan to increase annual school aid by $7 billion by 2010-11.
_Assembly Democrats supports Spitzer's plan, but would increase it by $532 million over four years for pre-kindergarten for every child in the state by 2010-11.
_Senate Republicans would add $358 million to Spitzer's school aid proposal, but would restore the state's practice of "shares." That would make sure low- and medium-needs districts _ which often face the highest local school taxes _ get a larger share of the increase than under Spitzer's plan.

HEALTH
_Spitzer would cut nearly $1.4 billion in Medicaid and other health care spending, much of it which had been directed to large hospitals and nursing homes. Instead, he hopes to redirect funding to less expensive at-home and community-based care that emphasizes preventive care to avoid more expensive emergency room care.
_Assembly Democrats would restore $483.3 million in the cuts, but maintain most of Spitzer's reforms and cuts.
_Senate Republicans would restore $544 million in Medicaid and health spending, much of it directed to hospitals which senators note are major employers in their communities. Hospitals say they can't afford the cuts. The Senate GOP said it agrees with almost half of Spitzer's reforms.

TAXES
_Spitzer calls for $1.5 billion in state aid to subsidize local property tax relief as the first installment on a three-year, $6 billion plan targeted to help middle class homeowners most. For example, an upstate middle class family making $60,000 or less with a $640 STAR savings now would see that grow to $1,152 this year. The income level and savings would grow for middle class families in New York City and its suburbs.
_Assembly Democrats support Spitzer's plan.
_Senate Republicans would instead provide $2.6 billion in tax relief checks directly to taxpayers. That would triple the amount of checks this year to about $500 to $600 to most taxpayers and $800 to over $1,000 to senior citizens. The Senate Republicans also call for $723 million in tax breaks for manufacturers and small businesses.

SOURCES: Governor's office, Senate and Assembly majorities.