New York: Governor signs 2016-2017 budget bill
At the end of March, New York Gov. Cuomo announced that he and lawmakers had reached an agreement on the 2016-17 budget. Holding growth in state spending of $96.2 billion to 2 percent for the sixth year in a row, the budget “includes a number of landmark policies that will strengthen opportunity for working and middle class families.”
Key spending provisions contained in the budget are the “record” $24.8 billion in education aid, which is a 6.5 percent increase, and the $7.2 billion Higher Education fund, a 2 percent increase.
In addition, there is a middle class tax cut that will reach $4.2 billion when fully effective in nine years. Included in that $4.2 billion figure is a new $55 billion State Transportation Plan that commits $27.14 billion to the Department of Transportation and Thruway, and $27.98 billion to the Metropolitan Transportation Authority.
The Medicaid provision increased by 3.4 percent, to $18.5 billion.
Gov. Cuomo’s announcement focused on social and economic justice goals underlying his budget:
With a statewide $15 minimum wage and the nation’s only 12-week paid family leave program, we are going to prove that the economy can and should work for all. We’re cutting taxes for the middle class, making record investments in education with $1.4 billion in new funding, turning failing schools into community schools, and ending the [Gap Elimination Adjustment] in New York once and for all because we believe that our tomorrows can be better than our yesterdays. At the same time we are prioritizing infrastructure and transportation to not only restore what is, but also [t0] imagine and realize what can be.
The $434 million Gap Elimination Adjustment is an amount that the state has deducted annually, since the 2009-2010 school year, from each district’s state aid allocation, in order to help the state fill its revenue shortfall. The New York State School Boards Association criticizes this measure as an unfair shifting of burdens that has hurt students because it required cuts to personnel, programs and services, thereby depleting district reserves.
Here are some additional budget details:
- Middle class tax cuts: In 2012, lawmakers lowered rates for two middle income tax brackets. For the $40,000-$150,000 bracket, rates dropped from 6.85 percent to 6.45 percent. For the $150,000-$300,000 bracket, rates fell from 6.85 percent to 6.65 percent. Starting in 2018, the rate will begin another decline until it reaches 5.5 percent.
In the first four years, taxpayers in these brackets will save $6.6 billion, and, as noted above, annual savings should reach $4.2 billion by 2025.
- Schools and education: At an average of $19,818 per child, which is almost twice the national average of $10,700, New York spends more on its 2.8 million K-12 students than any other state. The $24.8 billion budget amount is the highest ever, and has steadily grown over the last several years, as follows:
• 2011-12: $19.64 billion
• 2012-13: $20.35 billion ($805 million increase, 4.1 percent)
• 2013-14: $21.23 billion ($992 million increase, 4.9 percent)
• 2014-15: $22.24 billion ($1.13 billion increase, 5.3 percent)
• 2015-16: $23.5 billion ($1.35 billion increase, 6.1 percent)
• 2016-17: $24.8 billion ($1.5 billion increase, 6.5 percent)
In addition to the traditional school aid, the budget maintains $340 million in annual funding for the Statewide Universal Full-Day Prekindergarten program, continues the $2 billion Smart Schools program, allocates $175 million to transform failing schools and other high needs schools into community schools, and increases charter school spending by $430 per student. The budget increases Foundation Aid by $627 million, or four percent.
- Infrastructure: This budget’s $55 billion of transportation investments is the largest state transportation plan ever approved. As noted above, this includes $27.14 billion for the State Department of Transportation and Thruway, and $27.98 billion for the Metropolitan Transportation Authority.
Contained within the Department of Transportation and Thruway’s $27.14 billion are:
• $21.1 billion for capital improvement of highways, bridges, rail, aviation infrastructure, non-MTA transit, and facilities throughout the state.
• The launch of three new initiatives – BRIDGE NY, PAVE NY, and the Extreme Weather Infrastructure Hardening Program to further improve conditions on state and local roads and bridges, as well as provide resiliency to roadways that are particularly susceptible to weather events.
• $4 billion for capital investment for a sixth year.
• $2 billion in Thruway Stabilization funding that will support capital improvements on the entire Thruway system and the New New York Bridge, allowing the Authority to freeze tolls on the system until at least 2020.
The Metropolitan Transportation Authority’s $27.98 billion includes:
• $26.6 billion for improvement of capital facilities operated by the New York City Transit Authority, Long Island Rail Road, Metro-North Railroad and MTA Bus and major initiatives, including $1.5 billion for Phase II of the Second Avenue Subway.
Gov. Cuomo applauded the work of all involved. “We in New York are doing all of this by coming together – democrats and republicans – to make our state stronger, safer and fairer now and for years to come.”