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Source: Newsday

$142B Cuomo budget: $4B Sandy aid, 3% school spending hike

BY EMILY C. DOOLEY

Posted: January 24, 2013
Originally Published: January 22, 2013

ALBANY -- Gov. Andrew M. Cuomo unveiled a $142.6 billion budget proposal Tuesday that includes about $4 billion in federal aid for superstorm Sandy recovery.

The governor proposed hiking school aid by 3 percent while keeping overall state spending growth under 2 percent. A $1.35 billion deficit would be addressed by freezing spending on state operations, closing two state prisons, reducing the projected growth in aid to localities by one-fourth and refinancing debt.

He also proposed a smattering of tax extensions, tax credits and fee hikes, raises for some nursing-home workers and a minimum-wage hike from $7.25 per hour to $8.75.

The Democrat, entering his third year in office, said his plan would "maintain fiscal responsibility."

"The taxpayer's pocket is not a bottomless piggy bank," Cuomo said during his budget presentation.

Overall spending would grow about 5 percent under his plan -- largely because of an influx in federal aid for rebuilding after Sandy ($3.6 billion) and to implement the new federal health-care law ($2.5 billion). Without the bump in federal aid, the state budget would be $136.5 billion and growth would be 1.9 percent.

New York expects to eventually receive about $32 billion in Sandy aid from Congress, although only a fraction of that ($5 billion) will be spent by the end of the 2013-14 fiscal year, the Cuomo administration projected.

The governor's proposal also includes smaller-scale initiatives, such as opening the state Department of Motor Vehicles on Saturdays, creating a tax break for electric-vehicle recharging equipment, allowing stores to sell more Quick Draw lottery tickets, and suspending the driver's licenses of delinquent taxpayers who are more than $10,000 in arrears.

Legislators by and large reacted positively to Cuomo's presentation, while stressing they had yet to be given the actual budget. Lawmakers are supposed to adopt a budget by April 1, the start of the state's fiscal year.

"I don't see anything that is a huge stumbling block right now," said Sen. Dean Skelos (R-Rockville Centre), co-leader of a new coalition controlling the state Senate. He praised the small spending increase and initiatives to help local governments cut costs.

Skelos, who opposed a minimum-wage hike last year, said it would be "more palatable" if it is paired with tax cuts for small businesses and if future increases aren't tied to inflation, as Assembly Speaker Sheldon Silver (D-Manhattan) and most rank-and-file Democrats have proposed. Cuomo's proposal doesn't include an inflation index.

"We want to make sure it's not counterproductive," Skelos said. "We will analyze it. We will see if this is the right year to raise the minimum wage."

Assembly Speaker Sheldon Silver (D-Manhattan) missed the speech following the birth of a grandchild. He later sent a statement praising the governor's "prudent" plan, but reiterated his call for a minimum-wage hike that is indexed to inflation.

The Sandy initiatives include money for rebuilding and to buy out homeowners who don't want to rebuild. Cuomo said the state wouldn't dictate rebuilding plans but instead review proposals submitted by local governments. He also proposed mitigation measures to keep subways from flooding.

Cuomo pitched a series of economic-development initiatives in his spending plan, including a $50 million venture capital fund. But he didn't include any new casino money in the budget -- even though he said he'll ask the state Legislature to approve a plan this year for three upstate Las Vegas-style casinos. He said it was unrealistic to count on any casino revenues till 2016.

The governor offered a series of measures to help local governments and schools stay within the state's 2 percent property-tax cap. One would allow municipalities and schools to freeze contribution rates to the state's Common Retirement Fund in the near term, although they may pay higher rates later.

For schools, Cuomo recommended earmarking $20 million for school districts that want to extend the school day or school year.
More highlights from Gov. Andrew M. Cuomo's proposed 2013-14 state budget:

ENVIRONMENT

$19 million increase for land preservation

The proposed budget calls for spending cuts at the Department of Environmental Conservation and the Office of Parks, Recreation and Historic Preservation. DEC spending would drop by 5.5 percent to $919 million next year, down from $972 million. Parks spending would decrease by 3.2 percent to $276 million from $285 million. The cuts at both agencies are primarily the result of discontinued local assistance projects, according to budget documents.

The Environmental Protection Fund, which was created in 1993 for the DEC, parks department, local governments and nonprofit groups to buy park lands and historic resources, would see an increased budget. Cuomo proposes $153 million for programs to support the fund -- a $19 million increase, or 14 percent, over last year's numbers.

Allocations to open space and farmland protection, and for water quality improvement, will increase, and a new category -- flood resiliency -- "is an exciting place to start and it's good to see the environment back on the agenda," said Adrienne Esposito, executive director of Citizens Campaign for the Environment.

The increase in the fund balance will come from a transfer of unclaimed bottle deposit receipts and increased enforcement of the bottle deposit program, which requires distributors and bottlers to refund the state a portion of the money earned from deposits but never reclaimed by buyers, budget documents said.

Friends of New York's Environment, a partnership of more than 100 environmental, agriculture and public health groups, applauded the increase to the Environmental Protection Fund. "While we look forward to learning more details of how this will be achieved, this proposal is an encouraging start, and represents a down payment on the commitment the governor made" to strengthen the fund," the group said in a news release.

The proposed budget also includes $90 million in new appropriations for capital projects for DEC, parks department, Department of Agriculture and Market, and Olympic Regional Development Authority.

Cuomo's proposal also includes a provision that would permanently extend the $2.50 waste tire management and recycling fee added to the purchase price of any new tire. The fee is set to expire at the end of 2013. On average, an estimated 18 to 20 million tires are generated each year by new tire purchases, according to the DEC.