Photo Courtesy of the State Comptroller Tom DiNapoli’s Office
“New York is beginning the new fiscal year in a better position than projected,” Comptroller DiNapoli said. “However, continuing concerns regarding revenue volatility, the forecast for a slowing economy and detrimental federal fiscal policies leave open questions going forward.”
By Forum Staff
As the new fiscal year kicks off, the State finds itself in a good place, but it looks like the clear financial skies will soon give way to a gloomy economic outlook, Comptroller Tom DiNapoli noted in his recently released analysis of the State Fiscal Year 2019-2020 Enacted Budget.
“New York is beginning the new fiscal year in a better position than projected,” said DiNapoli. “However, continuing concerns regarding revenue volatility, the forecast for a slowing economy and detrimental federal fiscal policies leave open questions going forward. The recent addition to the Rainy Day Fund is a good first step toward building more robust reserves before the next economic downturn.”
The $175.5 billion FY 2019-2020 Enacted Budget includes actions to manage spending and generate nearly $1 billion in additional revenue this year, while providing increased funding for education, health care and mass transit, according to DiNapoli’s report. At the end of March, the Division of the Budget made the first deposit into the state’s rainy day reserves since 2015.
Enacted revenue actions are estimated to increase All Funds revenues by more than $5.4 billion by Fiscal Year 2022-2023, excluding off-budget actions related to the Metropolitan Transportation Authority DiNapoli noted. On-budget revenue actions include extension for five years of the top Personal Income Tax rate on upper-income earners, and broader imposition of the sales tax on online sales.
Major public policy changes enacted with the budget include the establishment of a congestion pricing program in Manhattan’s Central Business District, no earlier than Dec. 31, 2020, sufficient to fund $15 billion for the MTA’s 2020-2024 capital program. DiNapoli pointed out that many key decisions regarding this initiative, including toll levels, have yet to be determined.
Other highlights of the Enacted Budget, according to DiNapoli, include:
• State aid for public schools for the 2019-20 school year is $27.9 billion, an increase of $1 billion, or 3.8 percent, over the previous year and $44 million over the Executive Budget.
• The budget provides increases of $28.6 million for SUNY and $14.5 million for CUNY, compared to the Executive Budget. Those changes include additional funding for educational opportunity programs and a 3.5 percent increase in per-student base operating aid for community colleges.
• Single-use plastic carry-out bags will be banned, with certain exceptions, for most retail stores effective March 1, 2020. Cities and counties are authorized to adopt a 5-cent charge for paper bags used by such stores, with any resulting funds going to the state and localities that impose the charge to pay for programs encouraging use of reusable bags.
• The budget eliminates $59 million from the state’s primary general purpose municipal assistance program, Aid and Incentives for Municipalities, affecting some 1,300 towns and villages. County sales tax revenues where such municipalities are located are to be used to replace these lost payments.
Funding of $500,000 for the creation of an online database of economic development projects is provided. While this is a positive step toward enhancing much-needed transparency for economic development spending, the budget does not require such a database or specify details as to how it should be structured or what type of information it should include.