Senate Republicans Propose Budget Cutting Measures

SENATE REPUBLICANS PROPOSE BUDGET CUTTING MEASURES

     Senate Republican Leader Dean Skelos today outlined a plan to close
the state’s projected budget deficit resulting from a budget that raised
spending by more than $13 billion and taxes by more than $8 billion.

     “Just as I warned last spring, the Democrats’ decision to raise taxes
and spending hurt our economy, caused more pain for taxpayers, and still
left us with an enormous budget deficit,” Senator Skelos said.  “Despite
billions in federal stimulus aid, we now find ourselves in a deficit
situation that is largely the result of spending money we don’t have and
taxing people and businesses who can’t afford to pay any more.  Our only
course of action is to cut spending.”

     At a leaders meeting last month, Senator Skelos was the only one to
propose specific spending reductions to help close the deficit.  Today, he
offered new proposals that would result in additional savings.
Specifically he proposed:

     > Cutting back the $2.2 billion in general fund spending added to the
        2009-10 budget by legislative Democrats;
     > Cutting state agency non-personal services by ten percent to save
        $480 million;
     > Freezing state purchases of recreational lands to save $78 million;
     > Freezing planned Medicaid expansions to save $200 million;
     > Reinstating welfare and Medicaid anti-fraud protections to save $34
        million;
     > Cutting Medicaid optional services to save $150 million; and
     > Cutting state agency contract balances by five percent to save $300
        million.

     “In cutting state spending we cannot simply off-load costs to local
governments that would force them to raise property taxes,” Senator Skelos
said.  “In addition, we should not take any action that hinders our ability
to create jobs.”

     Senator Skelos said he was disappointed that there have been no
proposals by Legislative Democrats to close the deficit that was largely of
their making.  “Speaker Silver is still not ruling out tax increases and is
refusing to put any ideas forward to cut spending.  As for Senate
Democrats, waiting for their plans is like waiting for a slow boat to
China.”

     Senator John A. DeFrancisco, Ranking member of the Senate Finance
Committee said: “If New York City leadership had had open budget
discussions and adopted the proposals in the
2009-10 budget made by the Republican Conference, we wouldn't be in the
deficit situation that now exists.  Hopefully, these Republican proposals
will now be part of the solution, and the tough choices that most of our
residents are making will now be made by State leadership to
comprehensively attack the budget deficit."

Senate Republican Recommendations For Cost Cutting and Budget Savings

• Review $2.2 billion in General Fund spending added to the 2009-10 Budget

        by the Legislature for possible reductions (table attached).

 
The  SFY 2009-10 budget includes over $2.2 billion in General Fund spending
that  was  added  to  Governor  Paterson’s Executive budget proposal by the
Democrat  majorities  in the Senate and Assembly. In other words, more than
$2.2  billion in General Fund spending which was not originally proposed by
Governor  Paterson  was  included  in the final adopted budget. All of this
additional  spending  was  discretionary  and  was  not  required under the
American Recovery and Reinvestment Act.


Approximately  $1.2  billion was used to restore reductions proposed by the
Governor  in  his Executive budget and approximately $1 billion was used to
finance  new  spending.  All  of these spending items should be immediately
reviewed for potential reductions. Freezing all funds for new and increases
to  current  spending  programs  alone  would  save hundreds of millions of
dollars.  In  addition,  the  Democrats  in  both  houses  rejected many of
Governor  Paterson’s  proposed legislative changes in the budget that would
have  saved  over $100 million this year. Lastly Governor Paterson proposed
$700  million  in health care savings initiatives that were not included in
the adopted budget which should be revisited.


(See attached file: legaddstoexec09_10.pdf)

• 10% Cut in State Agency Non-Personal Service - $480 million

Efficiency  savings  of  10%  are  assumed  under  this  proposal. Selected
categories include: equipment spending; employee travel; lease, maintenance
and  repairs; supplies and materials; telephone services; employee benefits
and general state charges and utilities and centralized services. Potential
actions   include:  Freeze  all  new  vehicle  purchases;  Freeze  all  new
equipment/furniture  purchases;  Suspend  all  unnecessary travel for State
employees;  Limit  agency printing to essential services only; Limit agency
mailings/postage  expenses to essential services only; Eliminate all agency
non  emergency  blackberry/cell  phone  usage;  Turn down the heat in state
buildings everyday and not just weekends; Freeze agency spending from state
operation  reappropriations;  Freeze agency spending for employee training;
Close agency regional offices; Reduce the size of agency public information
offices;  Freeze  agency spending for conferences; Freeze all pending State
rental  agreements-  new  or  renewal  -  to reduce space; Freeze all State
agency  advertising  and marketing spending; Freeze all state agency public
information  office  spending;  Eliminate  all  State agency intern program
spending;  Freeze all new technology spending; Freeze  equipment leases not
executed;   Freeze   nonessential   building  repairs;  Freeze  all  agency
subscription  service  spending;  Freeze  agency  membership  payments  for
professional  entities; Competitively bid State Employee medical/ hospital/
dental programs.

• Freeze State Purchases of Recreational Land – Savings $78 million

This  proposal would freeze the purchase of additional recreational land by
the  State.  Given  the State Fiscal Year (SFY) 09-10 Executive proposal to
renege  on the State’s current local tax obligation on existing State owned
lands,  the  State  cannot continue to purchase land. Current cash balances
for  this  purpose  would  be transferred from the Environmental Protection
Fund.

• Freeze Planned Medicaid Expansions – $200 million by 2011-12.

All initiatives to expand the State’s Medicaid program should be stopped
immediately as the State cannot afford the current program which is the
most expansive in the nation. The Paterson administration is seeking to
expand eligibility for Family Health Plus (FHP) to 200 percent of the
federal poverty level. FHP enrollment in New York is projected to grow by
another 128,000 families over the next four years. Expansions in
eligibility to the Child Health Plus program should also be reevaluated.
Higher Medicaid enrollment and use will add $975 million to the
state-taxpayers' share of Medicaid costs by 2011-12, according to the
governor's financial plan. Meanwhile, federal stimulus aid is supposed to
expire the year after next, which will leave New Yorkers to cover more than
$3 billion a year now temporarily underwritten by federal stimulus aid.

• Reinstitute Medicaid and Welfare Anti-Fraud / Taxpayer Protections - $34

       million

The adopted budget includes an initiative to “streamline access to
coverage”.  This “streamlining” of the Medicaid and welfare application
process works by eliminating mechanisms designed to protect the taxpayers
from fraud, waste and abuse such as the requirement for face-to-face
interviews, fingerprinting and asset tests for determining eligibility.
All of these safeguards should remain in place to insure that those
receiving Medicaid and welfare benefits are indeed eligible under the law.

• Cut Medicaid Optional Services - $150 million

The New York State Medicaid program offers nearly 2 dozen optional services
not  required  under  the  Federal Medicaid program. Reducing the number of
optional  services to those required by the Federal government would reduce
costs. Eliminating all optional services would save the state $150 million.

• Cut 5% from Select Agency Contract Balances - $300 million

As  of  September  of  2009,  the  undisbursed  balance  of  existing state
contracts  totals  more  than  $129  Billion.  This  proposal  excludes the
following  types of contracts: authority, revenue generating, repayments to
state   contracts,   community  project  fund,  construction,  construction
related,  non  general  fund, Department of Health, State Ed, and contracts
with  zero  balance. The proposal assumes a 5% reduction in all undisbursed
balances, of which 1% would be General Fund savings.



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