New York state budget (2010-2011)

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The New York FY 2011 Comprehensive Annual Financial Report (CAFR), compiled by the state government, can be found here.

The state budget follows an annual cycle.[1] The state's fiscal year runs from April 1 to March 30.[2]

As of July 2010 New York had a total state debt of $122,527,873,429 when calculated by adding the total outstanding debt, pension and OPEB UAAL’s, unemployment trust funds and the 2010 budget gap as of July 2010.[3]

2011 State spending & deficit in billions[4]
Total spending Pension Healthcare Education Welfare Protection Transport Debt Budget gap
$117 $11 $45.4 $15.2 $10.2 $8.1 $12.5 $138.2 $5.4
2011 Local spending & deficit in billions[4]
Total spending Pension Healthcare Education Welfare Protection Transport Debt
$181 $8.9 $16.8 $56.1 $17.2 $15.9 $20.4 $181

Fiscal Year 2011 State Budget

See also: Archived New York state budgets

New York Comptroller Thomas DiNapoli said state tax collections for FY 2011 were $926 million below the original projections in the state budget. For the fiscal year, New York collected $133.3 billion, five percent more than FY 2010. Spending, however, rose to $134.8 billion, an increase of 6.3 percent.[5]

New York had the highest debt per capita for general obligation borrowing at $3,135 per person in 2011.[6] The FY 2011 budget as it was passed increased spending by 2.4 percent over the previous budget.[7]

In December 2010, the National Conference of State Legislatures said that the state faced a shortfall of $315 million, which represented 0.6 percent of the FY 2011 state budget.[8] On December 31, 2010, 900 state employees were laid off.[9] The New York State Senate Democrats exceeded their $29 million legislative budget by at least $7 million, which was expected to result in layoffs of 200 Senate staffers in mid-January 2011.[10]

Governor David Paterson called special legislative session that began on November 29, 2010 to address a $315 million budget deficit, but legislators declined to do so.[11][12] The governor's bill was delivered to the legislature two hours after the special session was to begin, leading Senate Democrats to say that they had insufficient time to consider it. When the Senate decided to pass, there was no need for the Assembly to act on the bill. The governor said he would not call another special session unless legislative leaders decided they wanted to address the deficit. Special sessions were estimated to cost more than $50,000 a day in per diem expense checks of about $170 for lawmakers and the price of travel, staff lodging, meals, etc.[12]

The same week that the governor called the special session, he awarded $16.7 million in grants, including funding for a youth chess program and to promote a New Jersey-New York Super Bowl.[13]

Comptroller DiNapoli placed the state deficit at $1 billion on November 15, 2010.[14] The budget hole was the result of several factors, including a decrease in taxes paid to the state, higher Medicaid costs, and the inability to collect $150 million in projected revenue from the sale of cigarettes to non-Indians on reservations.[11] Republicans opposed closing the deficit with new taxes or fees and the governor did not release a proposal prior to the start of the special session.[11] Some legislators said they thought it was more appropriate to wait to cut any spending to address the deficit until January, when the governor-elect and new lawmakers took office.[15]

On Nov. 1, 2010, the Division of the Budget reported that tax revenue failed to increase as much as projected in August when lawmakers passed the state's spending plan and, as a result, the state faced a $315 million budget.[16][17] In October 2010, the governor announced that he planned to save $250 million in the FY 2011 budget by firing 898 state workers by the December 31, 2010.[16]

On August 3, 2010, the State Senate finalized the $135.5 billion budget by passing a revenue bill along party lines that completed the state budget and was expected to generate an additional $1 billion through a mix of tax hikes and other measures.[7][18]

The budget raised taxes on the sale of clothing, eliminating a sales tax exemption on clothing and footwear purchases of less than $110 starting on October 1. The increase was expected to generate about $330 million in revenue. It also increased taxes on a variety of businesses.[7]

The budget also increased the state's share of revenue from video gambling machines and permitted casinos to stay open later and reduced charitable deductions for those who made $10 million or more.[7] The FY 2011 budget included a five percent cut -- about $1.4 billion -- in school aid.[2]

The budget required the booking industry, including Expedia, Orbitz and travel agencies, to collect sales tax on lodging, a move that was expected to bring in $10 million in FY 2011.[19]

As hedge funds were being wooed to move out of the state, legislators rejected a plan to make earnings by hedge fund managers “ordinary” income, subject to New York State taxes.[7]

Gov. Paterson said, “It was a meaningful budget in that in spite of all the discussion earlier in the year, there was no borrowing. We didn't borrow a dime.” The governor said he accepted the sales tax but was not happy about it and also said he was not behind the property tax relief that the New York General Assembly wanted. The governor planned to have the Assembly vote in October on the tax cap.[20]

The budget did not include the sugary drink tax the governor pushed for, nor a plan to sell wine in grocery stores or a plan to let SUNY and CUNY schools set their own tuition rates.[20]

The $134 billion state budget relied on sources of revenue that critics called risky because they could fall short of predictions. Some of those sources included:[21]:

  • $45 million from expanding video lottery gaming.
  • $221 million from additional tax audit recoveries.
  • $300 million from Medicaid fraud recoveries.
  • $330 million from a temporary 4 percent sales tax on clothing that was previously exempted.
  • $440 million in new cigarette taxes, including collecting taxes from tobacco sold on Indian land.
  • $250 million in workforce reductions, which would require cooperation from public employee unions, which the state had not yet received, and the budget director said this estimate was likely high.
  • 5.6 percent of the budget went to transportation.[22]


The state collected $529 million less in taxes during the first six months of FY 2011 than the state budget office projected in August 2010.[23]

Federal Funds

The state received approximately $2 billion from the federal government under H.R. 1586, a $26 billion plan to give states money for Medicaid and education that the president signed into law on August 10, 2010. U.S. Sen. Charles Schumer said New York was to get $2 billion in Medicaid funding from the federal government that was feared lost and over $600 million in new education aid to avoid teacher layoffs.[24] State budget director Robert Megna said that the federal funds may not alleviate the need for layoffs.[25]

Negotiations and Emergency measures

The state legislature passed the $135.5 billion state budget for FY 2011 on August 3, 2010, 125 days late.[7] The state's fiscal year runs from April 1 to March 30, but the New York State Legislature failed to pass a budget for FY 2011 prior to the end of FY 2010.[26] At that time, the state had met its budget deadline only six times since 1975.[27] The FY 2011 budget increased spending by 2.4 percent over the previous budget.[7]

Prior to the 4th of July holiday and recess, the Assembly approved a $136 billion spending plan, but the Senate left Albany for the recess without voting on revenue legislation needed to pay for the budget and did so in early August.[28]

On July 15, 2010, Comptroller DiNapoli released a report finding that spending to fund state government had increased 7.6 percent in 2010, and, even when adjusted for payments that were delayed from FY 2010, the rate of state spending was more than twice the inflation rate, up 4.2 percent.[18] The report also stated that "optimistic budgetary assumptions" could have left the state up to $4.8 billion in the hole for the year — more than half of the $9.2 billion budget gap that lawmakers were trying to eliminate.[18]

For the 125 days the state did not have a budget, it operated on more than a dozen emergency legislations signed by Gov. Paterson.[29] As of June 2010, the governor had signed 11 emergency spending measures to keep the government operational.[29][30][31] The measures delayed a four percent pay increase due April 1 for 130,000 state workers.[31] The emergency spending measure passed on June 14, 2010, included about $326 million in cuts to programs for the mentally disabled and social services.[29]

Some of the bills included long-term budget cuts, including cuts to Medicaid, so the budget was partially cobbled together through the emergency bills.[29] One of those long term provisions included increasing the state cigarette tax by $1.60 per pack as of July 1, 2010.[32] The measure also more than doubled the tax on smokeless tobacco to $2 an ounce from 96 cents an ounce, starting on August 1, 2010, and the wholesale tax on cigars, dips and other kinds of tobacco would rise to 75 percent from 46 percent. The state planned to collect taxes on cigarettes sold on Native American reservations to off-reservation visitors, an issue that led to violent protests during the early 1990s. One chief had said that trying to collect taxes would be considered an act of war.[32] The tobacco taxes were expected to provide $440 million in revenue, which would go toward health care programs.[32] The day before collection of the tax was to begin, Judge Samuel Green issued a temporary restraining order preventing the state from collecting the taxes.[33]

Size of the State Work Force

The New York Times reported that the state had two separate public payrolls, one controlled by the governor, with approximately 131,000 employees, and another encompassing approximately 163,000 more workers that was not under control of the governor and consisted of independent public authorities and agencies. The independent public authorities received their revenue from the dedicated sources they were created to oversee and not directly on taxpayer dollars, but their employees did collect state benefits like public pensions. While the payroll under the governor's control declined 25 percent over the previous 20 years, the independent agency payroll grew.[34]

Budget background

See also: New York state budget and finances

The initial phases in creating each state budget begin long before the fiscal year starts. Every summer, the Division of the Budget (DOB) sends a call letter to state agencies that sets out the governor’s priorities for the year, anticipated fiscal constraints and a schedule for submitting budget requests. The DOB is responsible for analyzing agencies' requests and aiding the governor in creating the final state budget.[35]

Agencies usually submit their budget requests to the DOB by early fall. The DOB and New York Comptroller must release a detailed estimate of anticipated income and expenses by November 5. The DOB evaluates the budget requests in light of trends in income and spending, assesses the state’s economic situation and presents their recommendations to the governor.[35]

By mid-January (or February 1st following a gubernatorial election year), the governor must submit his budget plan to the legislature along with related appropriation, revenue and budget bills. Along with the Executive Budget, the governor must submit the state’s Five-Year Financial Plan, Five-Year Capital Program and Financing Plan, and any financial information supporting the Executive Budget. The legislature then analyzes the governor’s proposals, holds public hearings and works with the DOB in evaluating the proposed budget measures. Both houses of the legislature must agree on the income and spending appropriations in the budget bill and submit the amended budget to the governor for his approval. The budget is then sent to the governor for approval, and a final state budget is created for the upcoming fiscal year.[36]

In approving the final state budget, the governor may use a line-item veto to cancel out specific provisions without having to veto the bill in its entirety.[36] The state legislature can override the governor's veto only by a two-thirds majority vote by the members of each house.

Accounting Principles

See also: New York government accounting principles

The Office of the State Comptroller audits state agencies, public authorities, and all local governments in New York, including New York City. The Comptroller's audit reports are published online and can be found The Comptroller's here. Thomas DiNapoli has been New York State Comptroller since February 2007. The State Comptroller is New York State's chief fiscal officer. The breadth and scope of its responsibilities are unique among the states.[37]

The Institute for Truth in Accounting (IFTA) rates New York “tardy” in filing the state’s Comprehensive Annual Financial Report (CAFR) – the annual report of state and local governmental entities. IFTA rated 22 states timely, 22 states tardy, and six states as worst. IFTA does not consider New York's CAFRs, and those of the other states, to be accurate representations of the state’s financial condition because the Generally Accepted Accounting Principles (GAAP) basis does not include significant liabilities for the pension plans and for other post employment benefits, such as health care.[38] New York's CAFRs are prepared and published online by the New York Office of the State Comptroller FY 2009's CAFR was completed and publicly posted timely.[39][40]

Credit Rating Fitch Moody's S&P
New York[41] AA- Aa3 AA

Budget transparency

See also: Evaluation of New York state website

New York government spending is partially transparent and currently has several transparency resources, which are listed below. The first two are government-sponsored, while the third is sponsored by the Empire Center.

Government tools

The following table is helpful in evaluating the level of transparency provided by a state spending and transparency database:

Criteria for evaluating spending databases
State Database Searchability Grants Contracts Line Item Expenditures Dept/Agency Budgets Public Employee Salary
Open Book New York Y
600px-Yes check.png
600px-Red x.png
600px-Yes check.png
600px-Red x.png
600px-Yes check.png
600px-Red x.png
Project Sunlight Y
600px-Yes check.png
600px-Red x.png
600px-Yes check.png
600px-Red x.png
600px-Red x.png
600px-Red x.png

Limitations and Suggestions for Improvements

Public employee salaries should be placed online, as should specific spending details and line-item expenditures.

Independent transparency sites

The Empire Center for New York State Policy has created an independent transparency website, which can be found See Through New York here.

Public employee salary information

The Journal News' offers this database of public employee salaries in Yonkers. For the article introducing the project, click here.

The Times Herald-Record offers this analysis of public salaries in the Hudson Valley with a searchable database of payroll records.

A great resource is See Through NY, a new website offering "New Yorkers a clearer view of how their state and local tax dollars are spent."

Economic Stimulus Transparency

  • The state received approximately $2 billion from the federal government under H.R. 1586, a $26 billion plan to give states money for Medicaid and education that the president signed into law on August 10, 2010. U.S. Sen. Charles Schumer said New York was to get $2 billion in Medicaid funding from the federal government that was feared lost and over $600 million in new education aid to avoid teacher layoffs.[42]
  • New York established an economic recovery website to show how legislators and government officials in New York were spending federal funds, which can be found here (timed out).

Budget Figures

General Fund 2009-10[44]

Category FY2009 Amount in millions Actual FY 2010 Amount in millions Estimated
Beginning Balance 1,304 614
Revenues 29,060 27,338
Adjustments 562 0
Total Resources 30,926 27,952
Expenditures 30,312 27,442
Adjustments 0 10
Ending Balance 614 500
Budget Stabilization Fund 0 0

Fiscal 2010 Tax Collections Compared With Projections Used in Adopting Fiscal 2010 Budgets (Millions)[44]

Category Amount
Sales Tax Original Estimate 10,390
Sales Tax Current Estimate 10,005
Personal Income Tax Original Estimate 37,239
Personal Income Tax Current Estimate 34,380
Corporate Income Tax Estimate 5,495
Corporate Income Tax Estimate 5,688

Cuts made to FY2010 budget after passage (in millions)[44]

Category Amount
K-12 Education 40.0
Higher Education 160.0
Public Assistance 23.0
Medicaid 140.0
Corrections 70.0
Transportation 186.0
Other 464.0
Total 1,083.0

Changes Over 20 Years

In 20 years, the state budget grew from to $48.9 billion to a projected $136.5 billion.

The State University of New York grew by 14 percent over the last two decades, and the workforce of the state judiciary increased by 31.6 over that period.[34]

See also

External links


  1. National Conference of State Legislatures, "State Experiences with Annual and Biennial Budgeting," April 2011
  2. 2.0 2.1 The Wall Street Journal, "New York State Passes Budget," March 31, 2011
  3. State Budget Solutions, “States Hide Trillions in Debt,” July 22, 2010
  4. 4.0 4.1 USA Spending, "State Guesstimated* Government Spending"
  5., "New York State Tax Collections Below Projections," April 18, 2011
  6. The San Francisco Chronicle, "How much did California owe?" January 19, 2011
  7. 7.0 7.1 7.2 7.3 7.4 7.5 7.6 The New York Times, "125 Days Late, a State Budget With New Taxes," August 3, 2010
  8. The Wall Street Journal, “States Face Budget Shortfalls of $26.7 Billion,“ December 8, 2010
  9. Cite error: Invalid <ref> tag; no text was provided for refs named mess
  10. New York Daily News, "Albany pols - $7M over budget - would be forced to fire 200 workers next month," December 29, 2010
  11. 11.0 11.1 11.2 The Rochester Democrat and Chronicle, "Budget fix focus of today's special session," November 29, 2010
  12. 12.0 12.1 The Wall Street Journal, "NY Legislature rejects addressing $315 deficit," November 29, 2010
  13. State Budget Solutions, "Report: NY's Paterson doled $16.7M in state grants," December 7, 2010
  14. Cite error: Invalid <ref> tag; no text was provided for refs named billion
  15. State Budget Solutions, "NY Legislature heads into special session," November 29, 2010
  16. Cite error: Invalid <ref> tag; no text was provided for refs named bloomberg
  17. Cite error: Invalid <ref> tag; no text was provided for refs named midyear
  18. 18.0 18.1 18.2 The Albany Times Union, "State fiscal woes grow," August 22, 2010
  19. The New York Times, "Hotel Room Resellers Must Now Pay Room Tax," August 4, 2010
  20. 20.0 20.1 Fox 23 News, "Impact of the finally passed New York State budget," August 4, 2010
  21. The Syracuse Post-Standard, "NY state budget built on risky assumptions about payroll cuts, cigarette taxes," August 16, 2010
  22. The Wall Street Journal, "New Yorkers Dazed and Confused by State Budget," October 6, 2010
  23. Bloomberg, "New York State Tax Collections $529 Million Less Than Foreseen in August," October 19, 2010
  24. Businessweek, "Cash-strapped NY, public schools may get windfalls," August 11, 2010
  25. The New York Daily News, "State Budget Director Bob Megna: Medicaid Money Won't Affect Layoff Plans," August 2010
  26. New York Times, "Albany Misses Its Deadline on Budget," April 1, 2010
  27. My Fox NY, "No State Budget. Now What?" March 30, 2010 (dead link)
  28. Cite error: Invalid <ref> tag; no text was provided for refs named adjourns
  29. 29.0 29.1 29.2 29.3 New York Times, "Another Emergency Bill Averts Albany Shutdown," June 14, 2010
  30. Business Week, "New York State's Paterson Pushes for Action on Past-Due Budget," May 3, 2010
  31. 31.0 31.1 Business Week, "New York State Legislature Approves Emergency Spending Bills," April 19, 2010
  32. 32.0 32.1 32.2 New York Times, "Cigarette Tax Increased to Keep State Running," June 21, 2010
  33. Bloomberg, "New York was Blocked From Collecting Taxes on Indian Reservation Cigarettes," September 2, 2010
  34. 34.0 34.1 New York Times, "Albany’s Two Payrolls: One was Anybody’s Guess," July 27, 2010
  35. 35.0 35.1 Division of the Budget, "Division of the Budget Review"
  36. 36.0 36.1 Division of the Budget, "Legislative Action"
  37. The New York Office of the State Comptroller Website, accessed November 2, 2009
  38. Institute for Truth in Accounting, “The Truth About Balanced Budgets—A Fifty State Study,” Page 35
  39. New York Office of the State Comptroller Web site, accessed November 2, 2009
  40. CAFRs
  41. State of Indiana, “State Credit Ratings," June 24, 2009"
  42. Businessweek, "Cash-strapped NY, public schools may get windfalls," August 11, 2010
  43. [1]
  44. 44.0 44.1 44.2 National Governors Association and National Association of State Budget Officers, "Fiscal Survey of States," June 2010 (dead link)