Despite projected budget gap, Cuomo seeking tax cuts
Now that the elections are over, state budget deadlines are rapidly approaching. Comptroller Thomas DiNapoli has released a largely positive budget outlook for the new year, though he warns of some uncertainties.
Under reforms adopted a few years ago, state officials including the comptroller, are required to start the budget process, which ends in late March, even earlier.
DiNapoli is out with his report, and he says the state budget is largely in balance.
“The economy is in a recovery mode,” said DiNapoli. “It’s a slow and tentative recovery, but we benefit from that.”
Still, the comptroller says there’s a lot of uncertainty out there, including the continued instability in Washington that led to October's partial government shutdown.
In its mid-year report, Gov. Andrew Cuomo’s budget office projects structural gaps of $1.7 billion in the new budget, growing to nearly $3 billion in 2016, if nothing is done to curb spending.
The governor’s budget report also cites uncertainties, including possible higher interest rates and the impacts of weak job growth.
Despite that, Cuomo said he thinks there will still be money for tax cuts in the new year. He says he’s held the line on spending for the past three years.
“The economy is starting to pick up,” Cuomo said. “We’re in a position now to do additional tax cuts.”
Cuomo has created two tax commissions. One is co-chaired by former Gov. George Pataki, and will look at cutting property taxes, which in New York are among the highest in the nation.
“We have to get that property tax down,” Cuomo said. “That’s what’s chasing people from this state. It’s chasing business from this state.”
New York state doesn’t collect property taxes, so a reduction in property taxes would not impact the state budget. Local governments and school districts do depend on property taxes for their budgets.
Richard Iannuzzi, the head of the state’s teacher’s union, New York State United Teachers, says he hopes the tax cuts don’t come at the expense of schools. He says he’s a little concerned about the governor’s tax cutting commissions.
“I would prefer they focus on issues of equity,” Iannuzzi said. He says poverty is a growing problem in New York.
DiNapoli, who has remained neutral on the topic of tax cuts, says the numbers have to add up.
“If you want to propose tax cuts and there’s not a windfall of revenue to accommodate that, then that means you have to do cuts on the spending side,” DiNapoli said.
He says he’ll wait and see what the governor’s tax commission actually says.