governor cuomo budget 2 1 2011 (1) final -2

8/7/2019 Governor Cuomo Budget 2 1 2011 (1) Final -2

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-2 0 1 1 1 2 EX EC U TIV E B U D G E TNew York at a Crossroads: A Road to Recovery

February 1, 2011


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:CROSSROADS Road to Recovery


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Budget Presentation

It s about values and choices

It s N O T about numbers


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WHERE ARE WE? New York State is functionally

bankrupt

and needs restructuring


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WE SPEND TOO MUCH t s nothing ew

nly worse


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SPENDING IS DISCONNECTED FROMECONOMIC REALITY

-Increase in State Operating Funds 1999 2010%74

I n

m i l

l i

o n s


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-10 year average

SPENDING RATES AREUNSUSTAINABLE


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- .$17 9B

-201314

- .$15 3B

-201213

-$10B-2011

122

-$

-Out year deficits continue to gro

SPENDING RATES DICTATED BY LAWARE UNSUSTAINABLE


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S PE N D IN GIS HIGH, P E R FO R M ALOW

#34 In results

#1 in Spending

Education

#21 In results

#1 in Spending

Medicaid

#50 In results

.1 6 b

Ann

EconomicDevelopmen

t


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Government spends toomuch & produces too littl

for the people


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,$4 845%66 . . ,above the U S average ranking Wamong states

New York s per capita State and local

HIGH COST OF GOVERNMENT MAKUS ECONOMICALLY UNCOMPETITI


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,$3 755%96 . .higher than the U S average

Median New York property tax bill

HIGH COST OF GOVERNMENT MAKUS ECONOMICALLY UNCOMPETITI


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So we spend too much, gettoo little and it makes useconomicallyuncompetitive!


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And it has gone on for toolong


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THE N E E D TOR E D E S IG G O V E R N M E N T

IS LO N G O V E R D U E


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THE NEED TORECALIBRATE SPENDING

IS LONG OVERDUE


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THE NEED TO REBUILD TECONOMY

IS LONG OVERDUE


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W E W ILL T R A N S FO R M G O V E R N M E N TA R O U N

N EW VA LU ES A N D T E C O N O M IC R E A LITY


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Our government will:

R e d u ce costs

R e w a rd p e rfo rm an ce Pu t Peop le First

Studen

Patien

Taxpaye


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Foster Private Sector Job

Growth


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-Commit to Reality BasedBudgeting


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BUDGET Highlights, , Medicaid Education State Operations L

Government


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MEDICAID


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,More than 1 000 ideas collectedalread

Assumes Governor s Budget Target

MEDICAID R E D E S IG NTEA

Will find ways to serve the patients

:better reduce costs and increase quality and efficiency in the Medicaid program

Collaborative effort to collect and

evaluate reform ideas from health carestakeholders

h h


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Where Does the Money Go? Home Health Care

:Fastest growing program per

recipient spending has increased

. %89 5 -from 2003 2009 Medicaid Pays Certified Home Health Agency ( )CHHA for Home Health Aide Service

Amount CHHA Keeps for Administrative Overhead

Amount Licensed Home Care Service Agency ( )LHCSA Keeps for Administrative Overhead Amount LHCSA Pays in Wages to Home Health Aide


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ichael,owling

IJ

eorge G11

en,aske

GNYHA

,an SistoHANYS

ennis,ivera

SEIU

Stakeholders

.ssm Gottfried.ssm Giglio

APPLAUD THE WORK OF THE MEDICAID REDESIGN TEAM

ara,assel

edicaidMatters

.en

.en


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-010 11 -011 12 ChangeState ,14 356 ,18 011 ,3 65Federal ,31 921 ,26 885 ( ,5 0Local

,7 515 ,7 914 $399Total ,53 792 ,52 810 ( 92

( )n Mill ions

edicaid nReview


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edicaid l l Funds-ear to year cut is $982 mill ion

- %

( )In Millions


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nperspective

. %4%4. %3%3

10 ear Growth Rate- -001 02 to 2010 11

Medicaid( )l l funds

Inflation


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. %7%7 . %3%3

11 ear Growth Rate- -001 02 to 2011 12 Proposal

nperspective

Medicaid( )l l funds

Inflation


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-Using reality based budgeting as opposed

to


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Meets

ALBANY-BASED BUDGETING


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Albany budgets institutionally assume an

exorbitant growth rate that is disconnected from fiscal

reality

ALBANY-BASED BUDGETING


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Permanent law institutionalizesunsustainable spending and growth


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Rate of

Inflation?


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%4 ?


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%5 ?


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%6 ?


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%7 ?


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.3 2


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The budget that was passed last year calls for a 13.2% increase to nextyears Medicaid spending


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(Permanent) law has built-in ratformulas that continually drive upunsustainable spending


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(Permanent) Law Rates for Medicaid:Previous Years


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(Permanent) Law Rates for Medicaid:Future Years


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Nothing is increasing by theseamounts

Not Inflation & Not Income


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It has no factors to promotegovernment better serving thepeople


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The formula is really a specialinterest protection program


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By Albany budgeting a cut is defined as anything less than their anticipated

growth


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So for Medicaid any reduction from the budgeted. %13 2 growth is a cut

Year-to-year cut is $982 million(2% decrease)

By that language this

budget cuts Medicaid.$2 8 billion


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The deficit is the difference between revenues( . %and budgeted growth 13 2

)for Medicaid $10 billion


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If you assumed deficit was difference between revenue and rate of

inflation the deficit would be $1 billion


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We need to do two thingsClose this year s deficit

Stop next year s deficit from forming by changing permanent and reducing growth


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The new formula will be tito the National Health CPI which is currently %4

annually*Medical Care Component of CPI


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The days of unsustainable spendingMUST END


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The days of Albany being dominatedspecial interestsMUST END


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EDUCATION


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We must change ourthinking

Students, Graduation,Achievement

Put People First


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NEED TO INTRODUCECOMPETITIONS


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COMPETITIONS $250 MILLION GRANT PROGR

FOR SCHOOL DISTRICTS THAT ACHIEVE MEASUR STUDENT PERFORMANCE

Increase 4 rth and 8 th grade Math and Englishproficiency

Close the achievement gap ( . .Improve student outcomes e g graduation)rates

AWARDS TO THE SCHOOL DISTRICTS WITH THEGREIMPROVEMENTS

To Spur Achievement

NEED TO INTRODUCECOMPETITIONS


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COMPETITIONS

$250 MILLION GRANT PROGRA FOR SCHOOL DISTRICTS THAT IMPLEMENTED MA-EFFICIENCIES THAT WILL RESULT IN LONG TERM

SAVINGS OR REDIRECT SAVINGS TO THE CLASSR

To Spur Achievement

FOCUS ON MAJOR COST DRIVERS AND INNOVATIVE IDEAS


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Education Funding thisYear

d


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-2010 11 -2011 12( )Proposed

Ch tate Fiscal

Year,9 848 ,9 602 ( 2

chool Year ,0 925 ,9 380 ( 1

ducation Program in Review

( )In Millions


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ocal Management andedesign Options for


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edesign Options for ducation# Co nso lid ati ons a nd

hared services Out of 676 school dist over 200 districts have, . than 1 000 pupils How there have been only b

consolidations since 20


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-Using reality basedbudgeting

Recalibrate School Aid


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RATE OFINFLATION?


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6%?


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7%?


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. %13 1


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By Albany budgeting a cut is defined as anything less

than their anticipated growth


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.Going forward


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The new formula will be tied the fair and objective revised formula that constrains growth

in school aid to the rate of

(personal income growthdone in a way to ensure adequ funding to high needs districts


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If you don t change now the projected growth in Medicaid a,education next year s budge

deficit will be .15 3i l l ion


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and Albany s cycle of declin will continue


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TATE OPERATIONS


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STATE O PE R A TIO N SHasnt been redesigned since 1927


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STATE OPERATIONS :CORRECTIONAL FACILITIES


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1999

%1 decline

he 1999,4 830 per



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rison Consolidation mplementation Plan

Task Force appointed by the Executive and Legislature

,Assume the reduction of 3 500 beds

Decisions will be completed 30 days after budget is approved

Location of the closures will be decided by the task force



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rison Consolidation mplementation Plan Provide $10 million economic

transformation program for each community impacted by a prison

closing


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REDESIGNING AND RECALIBRATIN JUVENILE JUSTICE SYSTEM


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Reduce system capacity by more than 30percent

Invest in locally based alternatives todetention(State funding increases from $8 million to$48 million annually)

REDESIGNING AND RECALIBRATIN JUVENILE JUSTICE SYSTEM


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Provide $10 million economic

transformation program for each community impacted by a facility

closing

STATEOPERATIONSRi h i

$1.4 billion Total Savings


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Rightsize government save $1million

( SUNY Efficiencies Tuition increases will)not be necessary save $1millionCUNY Efficiencies save $7

millionSUNY Hospitals save $18

million-Cutting Non Personal Service save $48

million/Labor Management Partnerships Workforces

Savings save $45

million

STATEOPERATIONS$450 Million Under Workfor


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/Labor Management Partnerships

Wages and Compensation Public Employee Pensions Health Benefits

Last resort ,Layoffs 9 800

Redesign


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LOCAL GOVERNMENT PERFORMANCE BASEDINCENTIVE


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$75 million fund TO SPURCONSOLIDATION

-Citizen's Re Organization Empowerment Grants of Up to ,100 000Citizen Empowerment Tax Credits Provide

Additional Aid toMerging Local Governments %0

Aid M i i li i AID TO MUNICIPALITIES


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Aid to Municipalities payments will be reduced by % to all,cities towns and villages that received funds

-in 2010 11 BIG 4 CITIES The impact to each of the Big 4 Cities would be%less than 1 of their General Fund

budget

AID TO MUNICIPALITIES


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New York City AIM reduction flast year s budget continued Proportionate reduction of remainder of the

budget

Partnership with Mayor Michael Bloomberg cooperate wherever possible


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REBUILD THE ECONOMY


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New York State Economic DevelopmentProgram New York State Economic DevelopmProgram

CURRENT ECONOMIC DEVELOPMEPROGRAMS


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New York State Technology and DevelopmentProgram Regional Economic Development Program

Strategic Investment Program Community Enhancement Facilities Assistance Program Empire Opportunity Fund

Community Capital Assistance Program Restore NY Program

* *Gen NY sis Program-Multi Modal Program

Centers of Excellence Program

Arts and Cultural Program Economic and Community DevelopmentProgram Downstate Regional Program

- -Upstate City by City Program Downstate Revitalization Fund

Upstate Regional Blueprint Fund Upstate Agricultural Fund

New York State Capital Assistance P Empire State Economic Development

Jobs Now Program Urban and Community Development

-Minority and Women Owned BusinesProgram Entrepreneurial Assistance Program

Small Business Revolving Loan FundCommunity Development Financial InProgram

Innovation Economy Matching Grants Centers for Advanced Technology Pr

Technology Development OrganizationGrants Manufacturing Extension Partnership

High Technology Matching Grants Pr College Applied Research Technology Science and Technology Law Center Faculty Development Program

Technology Transfer Incentive Program

E S TA B LIS H ECONOMIC REGIONALC O U N C ILSHi h Ed D i


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0 RegionalCouncils .t Gov Duffy o Chair

Higher Ed Driven

Public Private Partnerships Single Point of Contact


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udget Recap

BUDGET RECAP General, State Operating and All Funds


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-2010 11 Projected Growth%

-2011 12 base(projecte

d last)year

-2011 12Proposed State

OperatingFunds

,87 204 %11 ,96 534 ,88 103

All Funds

,136 531

. %5 5

,143 981

,132 863

M i l l i

o n s

o f

d o

l l

a r s

BUDGET RECAP General, State Operating and All Funds


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nnual State spending will go up by i l l ion % nnual all funds spending will go

down .y $3 7 bil lion (- . %)7tate Spending up because of loss of

ederal funding 5 bill ion

ederal dollars fell off a cliffBUDGET RECAP Federal Dollars


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IF WE DO THISWE WILL HAVE MADE DRAMATIC PROG

A fair budget, an inclusive process, respects taxpayers,protects the vulnerable


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BEGIN GOVERNMENT REDESIGN FOR A NEW DAYAND START PERFORMANCE FUNDING TO

ETTER SERVE THE


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STOPPED UNSUSTAINABLE SPENDINGCLOSED THIS YEARS DEFICITSTOPPED NEXT YEARS DEFICIT FROM

HAPPENING


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COMMENCED REAL ECONOMIC GROWTH


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REPOSITION N.Y. NATIONALLY TO GROW AGAIN

NO LONGER TAX CAPITAL OF THENATION


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Its up to you


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governor cuomo budget 2 1 2011 (1) final -2

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