Archive for September, 2008

As federal bailout fizzles, state warns of ominous budgetary ripple effect

By Tom Precious

ALBANY — Just hours after defeat in Washington of the bailout package for the financial system, State Comptroller Thomas P. DiNapoli warned Monday that the state’s finances are starting to stare at the same ominous challenges that New York encountered after the terrorist attacks of 2001.

While he did not provide an actual number, the comptroller’s forecast means that the projected budget deficit for the fiscal year beginning next April 1 could top $9 billion.

In his most ominous fiscal message yet, DiNapoli said the Wall Street crisis could cost the state up to $3.5 billion in lost revenues over the next 17 months and the evaporation of up to 40,000 jobs in the securities industry alone.

The downturn is on track to reduce revenue — both personal and business taxes — to Albany by about $1.1 billion for the rest of this fiscal year and $2.4 billion next year, DiNapoli aides said.

DiNapoli acknowledged that the forecast was made more difficult by the fluidity of the nation’s financial troubles. Indeed, the documents his office released Monday used the word “could” — as in “could lose up to $3.5 billion” — 12 times.

Nonetheless, the forecast is a further sign of the state’s coming budget problems that will trickle down to hospitals, schools, parks, police, roadways and everything else that relies on state and local government funding.

The comptroller’s outlook comes in advance of a meeting Friday in Manhattan with Gov. David A. Paterson and legislative leaders to try to deal with the worsening budgetary picture.

In August, the state trimmed $425 million. Those cuts were relatively painless to most groups that rely on state funding. The next round, with less time in the fiscal year to absorb the cuts, will likely be much more painful.

Paterson praised DiNapoli’s assessment and said he is reviewing the situation, especially since New York relies on Wall Street for 20 percent of its government revenues.

Senate Majority Leader Dean G. Skelos, R-Rockville Centre, said he, too, is monitoring the problem and pledged to help work on a solution. Assembly Speaker Sheldon Silver, D-Manhattan, called for hearings.

This year’s Wall Street bonuses are expected to total $40 billion, according to state projections from last spring. Every 10 percent drop below that level translates into $350 million in lost tax revenue for the state. Monday, DiNapoli warned that the bonus money could match the 50 percent drop seen after 9/11. If that happens, he said, the $33.2 billion bonus level from 2007 could plummet to about $16 billion.

Job losses of 40,000 in the securities industry would have a ripple effect. DiNapoli said that as many as three additional jobs — from restaurant workers to lawyers — are created by every job in the securities industry.

The warning signals are everywhere these days in Albany. On Sept. 15, estimated quarterly tax payments — mostly by self-employed people who do not have taxes directly taken out of their paychecks — were due to the state. DiNapoli aides said Monday that the revenues from those payments are down by $120 million from the same time a year ago. The 2008 state budget is about $120 billion.

A fiscal report by DiNapoli’s office said the impact of the financial crisis on state and local economies in New York “will be substantial.”

There were some positives: Income tax revenues were up for the first five months of the year, and the number of nonfarm jobs — 8.8 million — is up from last year. But any bright spots won’t last, DiNapoli said, noting that the August unemployment rate of 5.6 percent was a full point higher than the figure a year ago.

Uninsured Young Adults in NY – Forum Oct. 14, 2008

October 14, 2008 8:30am – 12:30pm
at the Greenberg Room, NYU School of Law
40 Washington Square South, 1st Floor, New York, NY 10003
(click here to register for the Forum)

800,000 YOUNG ADULT NEW YORKERS DO NOT HAVE HEALTH INSURANCE! WHAT ARE THE SOLUTIONS? A FORUM SPONSORED BY BALCONY, AMERICAN CANCER SOCIETY, DEMOS, FREELANCERS UNION and NYU WAGNER ALUMNI ASSOCIATION.

WHAT: NEW YORK’S UNINSURED YOUNG ADULTS FORUM

WHEN: October 14, 2008, 8:30 – 9:00 am Registration & Coffee, 9:00 am – 12:30 pm panel discussion

WHERE: Greenberg Room, NYU School of Law, 40 Washington Square South, 1st Floor, New York, NY 10003

BALCONY, the Business and Labor Coalition of New York, American Cancer Society (ACS), Demos, Freelancers Union, and the NYU Wagner Alumni Association will host a provocative forum about UNINSURED YOUNG ADULTS IN NEW YORK on October 14th from 8:30 A.M. – 12:30 P.M. at the Greenberg Room, NYU School of Law. The forum will examine the issue of uninsured young adults in New York and the state’s health care system. In New York State, 31% or more than 800,000, of the 2.6 million uninsured are in the 19 to 29 age bracket, according to the New York State Department of Health.

The forum will feature several human interest stories of young adults on the financial and health consequences of not having health insurance. Included will be an excerpt performance from “Hot Cripple,” the award winning play by actress Hogan Gorman.

The panels feature distinguished experts and organizations in the area of health care and public policy including Catherine Abate from the Community Healthcare Network, Jennifer L. Nicholson of the Commonwealth Fund, Sara Horowitz of Freelancers Union, Tamara Draut of Demos, Peter Slocum of the American Cancer Society, Henry Amoroso of Saint Vincent’s Catholic Medical Center, Arthur Cheliotes of CWA Local 1180 and Troy Oechsner, Deputy Superintendent for Health of the NYS Insurance Department.

The October 14th forum will review health care access and reform proposals in the State of New York with a focus on uninsured young adults. These young people “choose” not to have health insurance because they cannot afford it, their employers do not provide coverage or believe they likely will not need coverage.

(click here to register for the Forum)

Proposal for Tappan Zee Bridge & I-287 Corridor Unveiled

Team Recommends Bridge Replacement, Addition of Bus Rapid Transit & Commuter Rail

The leaders of the New York State Department of Transportation (NYSDOT), the State Thruway Authority and Metropolitan Transportation Authority Metro-North Railroad (MNR) were joined today by Westchester County Executive Andrew J. Spano and Rockland County Executive C. Scott Vanderhoef when the agencies announced their recommendations for the Tappan Zee Bridge/I-287 Corridor. The three-agency team has recommended that the bridge be replaced with a transit-ready bridge and that bus rapid transit and commuter rail transit be added to the corridor.

The proposal was announced at a news conference in Tarrytown after the Tappan Zee Bridge/I-287 Corridor Environmental Review project team briefed the Westchester Rockland Tappan Zee Futures Task Force, which had been appointed by the two county executives. The proposal calls for a complete replacement of the existing bridge and the construction of a bus rapid transit system along the 30-mile highway corridor across Rockland and Westchester counties in the lower Hudson Valley. Bus rapid transit will be operational when the new bridge opens. The proposal also recommends a commuter rail transit system across Rockland County and the new Tappan Zee Bridge to provide New York City commuters access to Grand Central Terminal.

“The Tappan Zee Bridge is a vital link in the transportation network of New York State. It is a central part of life for people in this part of the state and, with planning and foresight, we can make even better use of this stretch over the Hudson River,” said Governor David A. Paterson. “I am pleased the project team and the county executives have come to resolution on the best way to move forward. Focusing on New York State’s critical infrastructure needs must continue even during this challenging economic time, as these projects keep our economies strong and our state thriving.”

Project staff will be hosting public information meetings on October 28, 29, and 30 in Westchester, Rockland and Orange counties, respectively, to explain the recommendations in detail. The project team will then move forward with the environmental study, while at the same time developing a comprehensive plan and innovative ways to finance the project.

“Improvements to the I-287 corridor are critical to the health of our region and the continued high quality of life in Westchester,” Westchester County Executive Spano said. “A new east-west transit link will provide the backbone for appropriate growth and continued revitalization of our downtowns. I commend the state Department of Transportation, the project team and the task force for their thoughtful and rigorous work. We are happy to see this project moving forward.”

Rockland County Executive Vanderhoef said, “Rockland County will continue to move toward a bright and thriving future only if it is served by a comprehensive transportation infrastructure that includes more transit options. We believe the project team has come up with the right solutions for the region. We look forward to working with the team as it advances this project.”

Today’s announcement means that the project team will focus exclusively on studying the replacement of the Tappan Zee Bridge with a transit-ready bridge and construction of cross-corridor bus rapid transit as well as commuter rail transit across Rockland County and on to New York City. The project team is made up of NYSDOT, MNR and the Thruway Authority and is led by NYSDOT.

Accompanying the announcement was the release of the project team’s two voluminous in-depth studies: “Alternative Analysis of Rehabilitation or Replacement of the Tappan Zee Bridge” and “Transit Mode Selection Report.” Both documents are available on the project Web site www.tzbsite.com.

Full implementation of the project team’s proposal would cost: $6.4 billion for a new bridge accepting bus rapid transit and commuter rail transit; $2.9 billion for bus rapid transit and highway improvements; and $6.7 billion for the build-out of commuter rail transit in the future. The preliminary cost estimates may change as choices are made on alignment, bridge design and other details during the next few years. NYSDOT is finalizing a contract for a financial advisor to develop options for funding the project and will release the initial phase of a finance study soon.

In developing the recommendations announced today, NYSDOT, MNR and the Thruway Authority worked in cooperation with the Federal Highway Administration and the Federal Transit Administration. Since last year, the project team has analyzed seven bridge rehabilitation or replacement options and eight transit mode alternatives. Those analyses, which also incorporated a lengthy public comment record, have been completed, resulting in today’s recommendations.

The recommendations announced today, once finalized in a Final Scoping Report to be issued after the public information meetings next month, will be the subject of a Draft Environmental Impact Statement (DEIS). The DEIS is scheduled to be completed by late 2009, with a Final Environmental Impact Statement to be completed in early 2010.

The DEIS will evaluate the environmental impacts of various ways to implement the chosen plan, including alternative bridge designs, highway improvements and alignments, all of which will accommodate both bus rapid transit and commuter rail transit. The project team will present the final DEIS alternatives to the public at an open house early next year. The Record of Decision that will result in 2010 will identify the preferred alternative.

“After extensive planning, public outreach and analysis, the project team has developed an environmentally responsible proposal that will address the transportation needs of this critical interstate corridor for decades to come,” NYSDOT Commissioner Astrid C. Glynn said. “We have insisted on the utmost rigor in all the analysis that we are releasing today, and I and my partners at the Thruway Authority and Metro-North greatly appreciate the support the project team has received from county executives Spano and Vanderhoef throughout this process. We will continue to work with them as we move the project forward.”

Thruway Authority Executive Director Michael R. Fleischer said, “After intensive scrutiny of whether rehabilitation of the Tappan Zee Bridge could yield the engineering, environmental, safety and mobility goals set forth in this study, a new bridge is the best option for the traveling public, the corridor and the economic well-being of the region and state. While the process of finding the best transportation solution for this region continues, the Authority will continue to fulfill its responsibility to maintain and operate the Tappan Zee Bridge by continuing to make the necessary investments to assure safe and efficient travel for the millions of motorists that use the bridge annually.”

Metro-North President Howard Permut said, “This region will see enormous growth throughout this century and needs a transit system that will help it grow in a sensible and environmentally sustainable manner. Our recommendation that the cross-county corridor be served by bus rapid transit and that the huge travel market to and from New York City be served by new commuter rail service will provide a transit system for the 21st century. Our plan links new rail infrastructure with Metro-North’s existing network while providing an additional east-west transit solution to congested roadways, high energy prices and long travel times.”

The Bridge

In the analysis just completed, the project team’s objective was to determine which rehabilitation and replacement alternatives are reasonable options to be evaluated in the DEIS. Alternatives analysis found that replacing the bridge is the best way to provide better engineering performance, lower maintenance costs, shortest construction time, least environmental impacts and the longest life cycle for the bridge.

The Tappan Zee Bridge, constructed 52 years ago, was built according to prevailing standards in the early 1950s. While the bridge is safe, its design does not meet current national standards for structural elements and some of its deficiencies can not be addressed – even in the most robust rehabilitation scenarios – because of the structure’s basic design characteristics.

Bridge replacement options proposed for study include three scenarios designed to accommodate bus rapid transit and commuter rail transit, as well as bicycle-pedestrian access. The options feature single- or dual-level bridge designs.

The Transit Solution

The recommended transit solution calls for full-corridor bus rapid transit from Suffern to Port Chester with transfer points and new stations in between, as well as a new, two-track commuter rail transit service from the Port Jervis Line at Suffern, across Rockland County with several new stations and over the new bridge, connecting to the Hudson Line south of Tarrytown and thus providing direct service to Grand Central Terminal in Manhattan. Some bus rapid transit service routes would extend beyond the project limits and could be modified as demand changes.

Anticipated growth in travel demand in this region and the ability of the proposed transit modes to accommodate it were among the most important considerations in making this recommendation. The combination of bus rapid transit and commuter rail transit also would provide the most flexibility to accommodate multiple markets, including the cross-corridor and New York City travel markets. Completion of the Access to the Region’s Core project was taken into account in the developing the recommendation.

Public Meetings

Public meetings to present the recommendations in detail will be held at the following times and locations:

* Westchester County – Tuesday, October 28, 2008, at 4:30 p.m. and 7:00 p.m.

White Plains High School, 550 North St, White Plains, NY

* Rockland County – Wednesday, October 29, 2008, at 4:30 p.m. and 7:00 p.m.

Rockland Community College, 145 College Rd, Suffern, NY

* Orange County – Thursday, October 30, 2008, at 4:30 p.m. and 7:00 p.m.

Central Valley Elementary School, 45 Route 32, Central Valley, NY.

Tappan Zee Bridge Will Be Replaced, Not Fixed

TARRYTOWN, NY (AP) — State planners recommend spending $16 billion to build a new Tappan Zee Bridge capable of carrying a commuter railroad line.

When completed, the bridge would feature dedicated lanes for enhanced bus service that will include stations along Interstate 287 in New York City’s northern suburbs.

Transportation Commissioner Astrid Glynn says it’s hoped the bus system will be ready when the bridge opens, and that commuter rail eventually would follow. The bridge itself would cost $6.4 billion, the bus project $2.9 billion and commuter rail $6.7 billion.

The project was announced Friday, in the midst of the national economic crisis. The transportation department is working on a contract for a financial adviser to develop funding options.

New York City Wants Cuts by Agencies Across Board

By Michael Barbaro and Fernanda Santos

With an eye on Wall Street’s turmoil and New York City’s fragile economy, Mayor Michael R. Bloomberg ordered city agencies on Tuesday to cut spending by about $500 million this year and $1 billion next year.

The cuts are to be made across the board, affecting agencies including the Police Department, which must cut costs by $95 million this year, and the school system, which needs to trim $185 million.

Over all, the reductions represent 2.5 percent of the agencies’ budgets this year and 5 percent next year.

The midyear budget cuts are intended to provide a financial cushion should the city’s tax revenue, which is heavily dependent on Wall Street’s profits, drop further, as many expect.

The timing of the announcement suggests that Mr. Bloomberg may be seeking to soften the political fallout of a possible 7 percent property tax increase, which he disclosed on Monday. The spending cuts, aides said, showed that everyone, including government, will feel the pain from a slowing economy.

So far, the city expects tax revenue to fall by 6 percent during the 2009 fiscal year, which began in July. That projection was made before a worldwide financial crisis erupted, forcing Lehman Brothers, a major employer in New York City, to file for bankruptcy last week.

The 2009 budget remains balanced, but Edward Skyler, the deputy mayor for operations, said that “after the events of recent weeks, it’s the equivalent of putting your head in the sand to hope the projections will hold.”

“Taking no action would border on irresponsibility,” he added.

Mark Page, the director of the city’s Office of Management and Budget, sent out a letter to city agencies on Tuesday asking them to find ways to achieve the cuts for the 2009 and 2010 fiscal years by early October.

The City Council will vote to approve or modify the cuts in November. In the past, the Council has largely taken the mayor’s recommendations in midyear budget negotiations, according to members of the mayor’s staff. Since there is a citywide election in 2009, there may be greater opposition to cuts this time.

The 2.5 percent reduction that the mayor is seeking this year would translate into cuts of $11.9 million from the Department of Transportation, $7.8 million from the Department of Homeless Services and $6.7 million from the parks department. The mayor has also ordered the Fire Department to cut $33.8 million, which could force some firehouses to close, mayoral aides said.

Council Speaker Christine C. Quinn defended the cuts on Tuesday, saying, “Obviously for all of us in city government, keeping our streets safe is one of our highest priorities, keeping services going for seniors is a key priority, and schools and health care.”

She added: “But we need to look at everything and keep everything on the table at a time like this.”

Mr. Bloomberg has sought to cut the city’s budget in the middle of the year before, at rates ranging from 1.5 percent to 5 percent. The current budget has already been cut twice, and the latest reductions could prove contentious, especially when it comes to the city’s schools.

After a tough budget negotiation in June, the City Council voted to restore $120 million in cuts to the Department of Education this year. Now, Mr. Bloomberg is demanding that the school system cut spending by $185 million.

“We just went through this battle,” said Councilwoman Melinda Katz, a Queens Democrat. “Now we are back to Square 1. Actually, we are back below Square 1 and it seems very disappointing.”

After learning of the cuts, Randi Weingarten, the president of the United Federation of Teachers, said in a statement that “it is imperative that we immunize kids through these tough times and keep cuts away from the classroom.”

Advocates fear that the spending reductions could undo the progress made by agencies like the Administration for Children’s Services, which more than doubled the number of caseworkers assigned to child protective services since 2005.

“You start to wonder when it is that these cuts might start reaching into the heart of these services that have done so much to make sure no child slips through the cracks,” said Andrew White, director of the Center for New York City Affairs at the New School.

Downturn Drives Up New York’s Jobless Rates

By Patrick McGeehan

The unemployment rates for New York City and State shot up in August as the rapidly spiraling economic downturn left more people without jobs, the state’s Department of Labor said on Thursday.

The city’s unemployment rate rose to 5.8 percent from 5 percent in July — the largest monthly increase in more than 30 years — as about 5,200 private-sector jobs were eliminated, the department reported. Many of the layoffs came in the tumbling financial sector, which is one of the city’s biggest employers and the provider of nearly one-fourth of its annual wages and salaries.

Skelos Seeking Phaseout Of Empire Zone Program

By Peter Kiefer

The state Senate majority leader is seeking the dissolution of the state’s Empire Zone program, the $600-million-a-year economic stimulus effort that has been widely criticized as inefficient.

During a speech yesterday outlining a new job-creation plan, Majority Leader Dean Skelos proposed phasing out the Empire Zone program and replacing it with a statewide tax credit plan for small businesses.

Comptroller Thompson opposes any new fare hikes

COMPTROLLER THOMPSON TESTIMONY BEFORE RAVITCH COMMISSION

New York City Comptroller William C. Thompson, Jr., today provided the following testimony at the Ravitch Commission on MTA Financing at New York University’s Kimmel Center:

Fiscal Policy Institute says: A combination of revenues are needed to fix MTA’s financing crisis

A combination of funding measures are needed, including periodic (but modest) fare increases, restoration of the inflation-adjusted value of state and New York City subsidies, more federal assistance, expansion of some of the existing dedicated revenues, and one or more new dedicated taxes.

Read the entire document: Fiscal Policy Institute

Time for federal government to invest more in mass transit system

By Hillary Clinton

New York City puts the mass in mass transit. Our rails, buses and subways carry nearly one- third of the nation’s transit passengers. They provide 8.5 million rides each day and more than 2.6 billion rides a year. The system is larger than the next 10 transit systems combined.