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BUDGET TODAY

Tax cuts, education funding expected from Cuomo's state budget

Monday, January 20, 2014
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BUDGET TODAY


Gov. Andrew Cuomo, in this file photo from Jan. 22, 2013,  is scheduled to deliver his Executive Budget for 2014-2015 today in Albany.
Photographer: Marc Schultz
Gov. Andrew Cuomo, in this file photo from Jan. 22, 2013, is scheduled to deliver his Executive Budget for 2014-2015 today in Albany.

— Gov. Andrew Cuomo is expected to push for $2 billion in tax cuts, a $2 billion education bond act and funding for pre-kindergarten statewide during his budget address tomorrow in Albany.

Education advocates are urging Cuomo to increase school aid by up to $1.9 billion to support more faculty and programs. New York spends a total of $20 billion a year on education.

Larry Spring, superintendent of Schenectady schools, said he is not looking for a boost in education aid, but a shift in how that aid is distributed among schools statewide.

“I would be looking for the governor to say that he is going to apply more than a homogenized analysis of school spending and look at the relationship between spending and performance in terms of the distribution of aid,” Spring said.

The district is pressing a civil rights complaint against the state regarding how education aid is distributed. Spring said Schenectady only gets 54 percent of the total aid it should receive.

“It is districts that are predominantly white that get the funding and those that are significantly black that get less funding,” he said.

If Cuomo does not propose a change in the way school aid is distributed, Spring said Schenectady would suffer additional cuts. The district is projecting a $10 million budget deficit.

“It means as a school district we are going to have to be very efficient and we’re engaged in that budget process now,” Spring said. “We know we are going to have to make cuts. Some elements of programs are going to have to be eliminated.”

A focus of Cuomo’s State of the State Address earlier this month was a plan to cut taxes in New York.

Cuomo is looking to use a projected $2 billion surplus to cut taxes in the state over the next few years. Since 2011, Cuomo has eliminated a $10 billion budget deficit and implemented a two percent spending cap.

“We have gone from a $10 billion deficit to a $2 billion surplus in just three short years,” Cuomo said during the State of the State. “This year within the two percent spending cap, we can increase our investments in education, healthcare, economic development and still provide more tax relief.”

Cuomo is proposing $1 billion in business tax cuts and $1 billion in property tax cuts. The package includes a property tax freeze for two years, cutting the corporate income tax rate from 7.1 percent to 6.5 percent and eliminating the corporate tax rate for upstate manufacturers.

“The problem was our taxes are outweighing our benefits,” Cuomo said during a news conference earlier this month announcing his approval of the cuts. “With the changes we made in taxes, I think this turns it around.”

But state budget documents project a $1.7 billion budget deficit next year and an estimated $3 billion deficit in three years. That could mean cuts in other programs and services.

Cuomo is backing a plan to borrow money through a $2 billion education bond act, which would get computers, tablets and high-speed Internet into New York’s classrooms.

But the focus on technology in schools would knock out the chance of a $5 billion environmental bond, which would fund upgrades to the state’s water and sewer infrastructure.

“We aren’t against seeing additional funding for education, but we are disappointed,” said John Sheehan, director of communications at the Adirondack Council.

Sheehan said the state environmental group is also concerned that Cuomo would not move forward with a $200 million environmental protection fund in his budget plan.

“The governor’s office said they don’t think they can go that high, which means we would have to persuade the Legislature to add money to that fund,” he said.

With limited funding for the environmental protection fund and without the $5 billion environmental bond, the state would have to rely more heavily on federal assistance, Sheehan said.

“There are many needs in terms of water and sewer infrastructure and far too little money to handle the issue right now,” he said. “That needs to be addressed.”

Cuomo is looking to boost state funding by downsizing the number of local governments in the state. He said New York currently has 10,500 local governments, which is expensive and costly.

On Monday Attorney General Eric Schneiderman said he would give the Cuomo administration $81.5 million from the settlement money he won with JPMorgan Chase. That money would be added to the state’s general fund.

“When you look at by percentage of home value, the highest costs are in upstate New York, literally in the country,” Cuomo said during the State of the State. “So why are our property taxes so high? Because we have too many local governments and we have had them for too long.”

Cuomo’s budget address will be streamed live starting at 2 p.m. on Tuesday. You can watch it here.

 
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