ALBANY, NY – New York continues to be in limbo, waiting to see what Washington does in regards to another stimulus as the state faces a 14.5 billion dollar budget gap.
NewsChannel 34’s Corina Cappabianca spoke with the Citizens Budget Commission for insight into where things stand.
A recent report from the State Comptroller’s Office shows sales tax receipts are down 3.2 billion dollars from last year.
((David Friedfel, Citizens Budget Commission Director of State Studies)) The Comptroller’s report pointed out that the receipts here today are substantially below last year. But, they’re actually slightly above what the state was projecting, really kind of meaning things are bad but August collections didn’t make it any worse.
Governor Cuomo has said if the Federal government doesn’t pass a stimulus with aid to states, schools and localities could see 20% cuts.
Due to a temporary “less than 1 percent” withholding of school funding, school districts started announcing cuts.
After backlash, state officials announced yesterday that there would be no withholding on September payments for schools.
((David Friedfel, Citizens Budget Commission Director of State Studies)) first and foremost it’s important to say that the federal government should be providing the states and localities with additional aid, because we’re in the middle of an economic and public health crisis that we haven’t seen in lifetimes, that being said the state and everyone that relies on state aid including those school districts would have been better served if the state had released the public plan.
Friedfel says lining out exactly how to close the budget gap if additional federal aid didn’t materialize could have allowed for better planning.
He also says there are other options that can be utilized.
((David Friedfel, Citizens Budget Commission Director of State Studies)) Like utilizing cash that was previously earmarked for capital spending, using debt to fund those projects instead. There could be some targeted cuts to school aid, but those cuts could allow high need districts to continue to get their aid, and then leveraging the state’s rainy-day reserves, because the state has over 5 billion in those reserves and it’s raining.
Friedfel also says while finding new revenues like legalizing and taxing recreational marijuana or sports betting may help it takes a while for those revenues to accrue.