State ready to pay $140M ‘step’ hikes

by Rick Karlin

50,000 state workers to get increases as PEF, CSEA contracts expire

ALBANY — The state is moving ahead with “step” or longevity-based raises for some 50,000 state workers, despite suggestions earlier this month that giving up the pay hikes could help trim the budget deficit — and possibly avoid at least some layoffs.

Gov. Andrew Cuomo earlier said he wanted to negotiate away the step increases, which go into effect in Friday.

The increases, which range from $744 to $3,600, were outlined in a budget bulletin that the comptroller’s office posted on its website late Wednesday. The absence of the bulletin before Wednesday afternoon had prompted some state workers and labor activists to wonder if the Cuomo administration was attempting to withhold the hikes as part of the ongoing contract negotiations with PEF and CSEA. They noted the bulletins usually go up earlier in the process.

But the bulletin took off the table — at least for this year — any fears that the administration would try to hold back those pre-negotiated increases.

Stopping the raises, as well as longevity bonuses between $1,250 and $2,500 for more than 30,000 employees, would have been difficult: They’re long-standing elements of the union contracts.

Under the state’s Triborough Amendment, the payments remain in place even after a contract expires.

Aside from that, members of the administration as well as PEF and CSEA would say only that they are continuing to talk about their contracts, which expire Friday.

“We are still negotiating,” said PEF spokeswoman Darcy Wells. “We have been negotiating. We have met several times and we continue those meetings.”

CSEA spokesman Stephen Madarasz said no more talks were planned for this week, but negotiators would be talking again on Tuesday.

Like the unions, Cuomo administration officials declined comment, saying they didn’t want to negotiate a contract in public.

Letting the step increases proceed could be viewed as a good sign, Madarasz said. “That would sort of suggest that they want the negotiating process to work,” he said.

Under the step system, state employees begin at a “hiring rate” and get increases for seven years until they hit the “job rate,” or top of the pay scale. Then there is longevity pay after five and 10 years.

The increases will cost a total of $140 million.

The contracts are expiring as lawmakers are working to finalize the $132.5 billion budget for the 2011-2012 fiscal year, which begins Friday.

While the governor’s office is involved in the budget, Cuomo also has a special team of negotiators, including the Governor’s Office of Employee Relations as well as consultants Joseph Bress and Todd Snyder, working on the labor contracts.

Cuomo’s budget books $450 million in work force savings to be achieved through negotiations with public workers unions.

There are any number of ways the savings could be realized, ranging from a freeze and higher health insurance co-pays to the use of a so-called “fat tax,” where workers who are overweight or smokers would pay more for their health insurance.

Furloughs — or unpaid vacations — as well as an additional “lag” or delay in payment are other options.

The administration has said it will lay off up to 9,800 employees as a last resort. Officials have said that planning for that eventuality will begin the day after the contracts expire.

New research by UCLA Anderson professor examines public-sector collective bargaining

By Neha Kumar

March 21, 2011

David Lewin, a professor at the UCLA Anderson School of Management, and Thomas Kochan, a professor at the Massachusetts Institute of Technology’s Sloan School of Management, have released new research comparing compensation for public-sector and private-sector employees.

Their paper, “Getting It Right: Empirical Evidence and Policy Implications From Research on Public-Sector Unionism and Collective Bargaining,” proposes “grand bargains” to address state budget problems, provide better services to the general public and treat employees fairly. It includes research contributions from various professors at the Employment Policy Research Network.

“Our research says unequivocally that public-sector workers accept a lower total wage and benefits package than their private-sector counterparts,” said Lewin, an authority on public-sector collective bargaining and author of a classic paper on New York City municipal labor negotiations.

The trade-off, the researchers say, is that public-sector jobs are more secure, and health and pension benefits are generally greater than in the private sector.

Rutgers University professor Jeffrey Keefe’s research shows that, nationally, public-sector employee pay is 11.5 percent lower than pay for comparably educated private-sector employees. When health and pension benefits are included, public-sector employees still earn 3.7 percent less than those in the private sector. (See: http://bit.ly/f2O1cb.)

University of Illinois professor Craig Olson found that between 1995 and 2009, private-sector employees in Wisconsin saw their pay rise by an average of 10 percent (not including fringe benefits, but accounting for inflation). During the same period, pay for Wisconsin public school teachers declined by an average of 10 percent. (See: http://bit.ly/eu005g.)

Public-sector union–management relations have changed significantly, according to Joel Cutcher-Gershenfeld, dean of the School of Labor and Employment Relations at the University of Illinois, Urbana–Champaign.

“Dispute-resolution procedures, such as fact-finding, mediation and arbitration, have proven themselves as alternatives to strikes and served as a foundation for the alternative dispute-resolution movement in society,” he said.

He goes on to say that given states’ budget problems, negotiations present opportunities for public employers and employees to work together in ways that provide better, more efficient service to the public while also recognizing and respecting employee rights.

Two major issues facing state and local governments are rising health care and pension costs. These issues need to be addressed state by state on a coalition bargaining, problem-solving basis, Cutcher-Gershenfeld said. When approached by management and labor as a mutually beneficial process, new-style collective bargaining provides an ideal venue for tackling these issues.

Kochan said he and the other researchers envision a three-step, state-by-state process to come to terms with budget deficits while still respecting public-employee rights:

* Perform an evidence-based analysis of wages, benefit costs and funding arrangements for state employees.

* Use the findings for state public-sector summit meetings to clarify and define the issues and problems that need immediate attention, and use problem-solving tools such as interest-based negotiations and mediation–arbitration to agree on statewide “grand bargains” that address the most critical budget problems and are fair to both taxpayers and employees.

* Charge a broadly representative group to carry out evidence-based analysis to modernize public-sector collective-bargaining practices.

“We need nothing less than a transformation of labor-management relationships in the public sector,” Kochan said. “Public employees want to do a good job and provide service at a high level, and they deserve to have good jobs and effective work systems.”

According to Lewin, “citizens have a right to expect accountability and high performance from public employees and those who manage them.”

The paper is posted on the Employment Policy Research Network website. The EPRN was formed in 2010 under the auspices of the Labor and Employment Relations Association (LERA), with grants from the Rockefeller and Russell Sage foundations. The EPRN presently has 120 affiliated researchers in economics, law, sociology, psychology and labor–management relations. Founded in 1947, the LERA is a national not-for-profit, nonpartisan organization whose members are drawn from the ranks of academia, management, labor and “neutrals.”

Governor Cuomo Announces On-Time Passage of Historic, Transformational 2011-12 New York State Budget

State budget eliminates $10 billion deficit, includes sweeping reforms and efficiencies

Albany, NY (March 31, 2011)

Governor Andrew M. Cuomo today announced the passage of the 2011-2012 budget that eliminates a $10 billion deficit. The budget includes historic reforms that redesign state government, create efficiencies through consolidation, cap spending increases for education and Medicaid, and transform the future budgeting process.

The approximately $132.5 billion budget reduces spending overall by more than 2 percent from the previous year, eliminates 3,700 prison beds, establishes Regional Economic Development Councils, brings performance funding to education, redesigns Medicaid, and caps next year’s education and Medicaid spending.

This budget reaches its fiscal goals with no new taxes and no borrowing, and will also cut the 2011-12 projected budget deficit from $15 billion to about $2 billion. Combined four-year gaps are reduced from $63 billion to less than $10 billion.

Based on preliminary estimates, all funds spending will total approximately $132.5 billion, a decrease of $3.6 billion from the previous year. State operating spending will total $88 billion, an increase of $1.2 billion or 1.4 percent. The budget closes the current gap with $9.3 billion in spending reductions or nearly 90 percent of the plan.

“Tonight the Legislature not only passed an on-time budget, but a historic and transformational budget for the people of the state of New York,” Governor Cuomo said. “This bi-partisan and bi-cameral cooperation will give New Yorkers the good budget they deserve. It was an invaluable public service for the state government to ‘function’ so well at this difficult time and I especially applaud the leadership of Senate Majority Leader Dean Skelos and Assembly Speaker Sheldon Silver for this demonstration of competence and performance in state government.”

Senate Majority Leader Dean G. Skelos said, “This budget is a responsible budget that meets our goals of cutting spending, reducing taxes, and empowering the private sector to create jobs. By passing this budget on-time, we have shown that Albany can be functional and accountable once again. I congratulate Speaker Silver, and all of the members of the Senate and Assembly, and I thank our Governor for providing the leadership to get a sound bipartisan budget in place for New York.”

Assembly Speaker Sheldon Silver said, “We are confident that this will be the first of many agreements the Legislature will reach in concert with the Governor; agreements that will restore New Yorkers’ faith in our government, make it more efficient and more productive, and help to make our great state a better and more prosperous place in which to live, to work, and to do business. The final product, the 2011/2012 state budget, is a sobering one. Difficult and painful decisions had to be made to address the fiscal reality facing our state. The Assembly Majority, working with the Governor, was able to achieve some critical restorations that will soften the cuts affecting working families, students, senior citizens and or most vulnerable populations.”

Senate Democratic Leader John L. Sampson said, “With the passage of this budget, Governor Cuomo has taken us through the crossroads and closer to a government that works better and costs less for taxpayers. I believe this budget sets the table for the kind of state government Middle Class families deserve. I commend Governor Cuomo for his leadership and for his commitment to restoring New York’s standing as the Empire State.”

Assembly Minority Leader Brian M. Kolb said, “This is not a perfect budget, but a realistic one. It involves tough choices that begin a long overdue – and painful – process of reducing spending, rightsizing state government and reforming Albany’s culture of tax-and-spend. The budget contains important victories including defeat of a ‘Success Tax’ extension, closure of the state’s $10 billion budget deficit, enactment of Power for Jobs, decreased spending, along with no new borrowing or tax increases, all of which are priorities our Assembly Minority Conference has long championed.”

2011-2012 Budget Fact Sheet

The budget reflects significant initiatives proposed by Governor Cuomo to transform the state budget and control spending growth while redesigning programs in every area of state government.

The budget closes a $10 billion shortfall and puts in place mechanisms to control future spending. The budget puts the state on a sustainable path that will lead to an 85 percent reduction in projected out-year gaps.

Putting the State’s Fiscal House in Order

The 2011-2012 state budget contains no new taxes, includes 2-year appropriations for education and Medicaid, caps the growth of both education and Medicaid spending, closes unneeded and outdated state-run facilities and includes no new funding for member items.

Redesigning and Rightsizing Government

The budget contains several wide sweeping measures to redesign and right-size New York’s government, including:

• State operations: The budget reflects Governor Cuomo’s proposed 10 percent year-to-year general fund reductions for all state agency operations, with comparable reductions for the State and City University Systems. State operations reductions will total $1.4 billion for 2011-12. This includes workforce cost reductions by $450 million. Negotiations are ongoing with unions to avoid the last-resort option of up to 9,800 layoffs.
• Mergers and consolidations: The budget reflects the consolidation of eight agencies or authorities into four, saving more than $50 million in 2011-12. These include merging:
  • Department of Insurance and Department of Banking into the new Department of Financial Services
  • The Foundation for Science, Technology and Innovation into the Department of Economic Development
  • Department of Correctional Services and Division of Parole into the new Department of Corrections and Community Supervision
  • The Consumer Protection Board into the Department of State
• Executive Reorganization Act of 2011: The budget authorizes the Executive Reorganization Act of 2011, which will provide broad authority to reduce the number of agencies, authorities, and commissions. The legislation will allow for sweeping reorganization of state government, providing savings over many years and more efficient government services. The reorganization will be accomplished through the Governor’s Spending and Government Efficiency Commission (SAGE).
• Citizen Empowerment Tax Credits: Funding would be available to incentivize local government consolidation or dissolution, providing a bonus to the newly combined local government’s tax levy where at least 70 percent of the state bonus must be used for property tax relief.

Realigning School Aid

The budget realigns education financing to meet New York’s fiscal reality and provide sustainable and predictable funding while reaffirming the commitment to improve educational outcomes in the classroom. Prior to this budget, education spending was projected to grow at an unaffordable rate of 13 percent for the 2011-12 school year.

The budget includes school aid of $19.6 billion for the 2011-12 school year. This reflects a reduction of $1.3 billion or 6.1 percent from 2010-11 including state operating funds and $608 million of federal Jobs Bill funding. This reduction represents an average of 2.5 percent of school districts’ total spending.

Without consideration of the Federal Jobs bill funding given to districts last year, the year-to-year reduction in state funding is $698 million or 3.5 percent. This represents 1.3 percent of school districts’ total spending.

The budget provides a two-year appropriation and reflects permanent law changes to limit future school aid increases to growth in the New York state personal income rate. This action will help reduce the state’s large out-year gap between spending and revenues. Even after this year’s reduction, New York’s schools will continue to have among the highest spending per pupil in the nation.

The budget creates new education performance and efficiency grants with $500 million in total appropriations for districts that demonstrate significant student performance improvements or that undertake long-term structural changes to reduce costs and improve efficiency.

The budget continues state support for summer school special education programs at current levels, and maintains the commitment to children who attend schools for the blind and deaf (4201 schools).

Redesigning Medicaid and Health Care

Total Medicaid spending including federal, state and local spending of $52.6 billion represents a decrease of $337 million, or minus 1 percent. Future growth in Medicaid will be limited to the 10-year rolling average of the Medical CPI, currently 4 percent. As with education, the budget includes a two-year appropriation.

The budget includes a cap of $15.3 billion on Department of Health Medicaid state expenditures, which represent the largest and one of the fastest growing component of state spending.

The budget process brought together health care providers, labor, government and other Medicaid stakeholders to form Governor Cuomo’s Medicaid Redesign Team (MRT). Tasked with identifying ways to provide critical health care services at lower costs and control unsustainable growth, the MRT recommended a series of proposals to fundamentally restructure and reform New York extensive Medicaid program.

Overall, the budget implements a majority of the MRT recommendations. The budget reflects $2.3 billion in spending reductions supplemented by $425 million in lower-than-expected expenditures to achieve the Governor’s original savings target of $2.85 billion.

The budget implements significant reforms including a major expansion of patient-centered medical homes, better control of home health care services, and care management for individuals with complex and continuing health care needs. New models of integrated care, such as Accountable Care Organizations, will help assure long-term control of health care spending.

Savings will be assured by an overall spending cap, enabling the Commissioner of Health to make additional savings actions during the year, if necessary.

Promoting Real Economic Development

By refocusing economic development efforts to incorporate regional decision-making, the budget will reform the delivery of economic development programs and make results-oriented investments to create jobs. The budget:

• Provides Funding for Regional Economic Development Councils: The budget will provide resources to support efforts of the 10 Regional Economic Development Councils, to be chaired by Lieutenant Governor Robert Duffy. They will act as one-stop shop for all state-supported economic development and business assistance programs in each region.
• Improves the Excelsior Jobs Program: The budget strengthens the Excelsior Jobs Program, which was created in 2010 to provide job creation and investment tax credit incentives to businesses in targeted industries. A total of $500 million will now be available annually to provide enhanced tax credits that will produce better results for New York’s economy. Businesses will be able to benefit from this program over a 10-year period. The Governor will make $70 million of these enhanced tax credits available to support the efforts of Regional Economic Development Councils.
• Creates the Recharge NY Power Program: Recharge New York will enhance and make permanent the current Power for Jobs Program. It will create and maintain hundreds of thousands of jobs by allocating a blend of stable, low-cost hydropower and market power for use by businesses that seek to grow and create jobs in New York state.
• Expands Fresh Food into Urban Centers: The budget includes funding to support the expansion of farmers’ markets in urban areas, providing a great opportunity for New York farmers and consumers. There are currently approximately 450 farmers markets in New York State, 130 of which are located in New York City. The budget also creates a new “Share NY Food” Community Supported Agriculture (“CSA”) program, which reduces the farmers’ need to borrow money at the beginning of the season in order to purchase equipment, seeds, fertilizer and other necessary items for production.
• Creates New Market Tax Credits: Authorizes the Empire State Development Corporation to finance up to $30 million in federal New Market Tax Credits to support job creation and development efforts in low-income communities through the state.
• Increases the Limit of the Excelsior Linked Deposit: The budget increases the lifetime limit on low-interest loans permitted by the Linked Deposit Program from $1 million to $2 million, making more dollars available for small businesses to grow and create jobs.
• Creates Economic Transformation and Facility Redevelopment Program: To off-set the impact of local prison and juvenile justice facility closures the budget includes a new tax credit program that will incentivize the creation of new businesses in those communities where the closures occur.

Recognizing the potential economic development impact of the University of Buffalo for the city of Buffalo, Governor Cuomo will hold a summit with stakeholders to discuss how to make UB 2020 a reality.

Streamlining and Improving Human Services

The state will provide $9.4 billion for human services programs in 2011-12. The budget reforms the state’s juvenile justice system to encourage greater use of community-based alternatives, while downsizing the state juvenile facilities system by more than 30 percent and investing in enhanced services for juveniles that remain in OCFS custody. While continuing to ensure that core services are available for needy populations, the budget recalibrates spending in all areas of social services including housing, youth delinquency prevention and other services.

The budget also extends the low-income housing tax credit by $4 million in aggregate credit awards to taxpayers that develop qualifying housing projects for low-income New Yorkers. The total amount of credits to be awarded becomes $40 million.

Making Public Protection Efficient and Effective

The budget supports public protection at lower cost though right-sizing initiatives that reduce excess prison capacity, improve the management of offenders as they move from prison into civilian life, and reduce bureaucracy.

To realign the prison system’s capacity with its significantly reduced offender population and achieve real and recurring savings for state taxpayers, Governor Cuomo, in consultation with the Legislature, will reduce the number of beds in medium and minimum security facilities by 3,700. Economic development capital funding of $50 million will be made available to communities impacted by prison closures or consolidations, in addition to tax credits to spur new business.

Preserving the Environment

The budget maintains the Environmental Protection Fund at the 2010-11 funding level of $134 million, and delivers on the Governor’s promise to use the Fund only for the purposes for which it was created.

The budget also eliminates the requirement of a state license to fish in salt water.

Ensuring Affordable Higher Education

The budget funds SUNY and CUNY senior colleges at more than $2 billion in operating assistance and $1.3 billion in new capital appropriations. The budget also extends provisions for the Tuition Assistance Program to allow an increase of $19 million, or 2.3 percent.

The budget enables SUNY and CUNY to streamline procurement processes to allow them to generate efficiencies.

Other budget actions include funding for Community College at $2,122 per full-time equivalent, and funding for SUNY hospitals at $60 million.

Improving Delivery of Mental Hygiene Services

The budget includes mental hygiene system funding of $8.2 billion in 2011-12. By preserving critical direct care services, the budget develops a more efficient system that directs the most help to those with the greatest needs.

Maintaining Transportation Infrastructure

The budget provides operating support to transit systems totaling $4.2 billion. The MTA will receive $3.8 billion and other transit systems will receive $401 million. Cash support for both MTA and non-MTA programs will increase year-to-year.

The budget supports the adopted two-year DOT transportation capital plan that balances core infrastructure preservation with fiscal necessity and continues prior year funding levels for the core transportation programs supported by the Dedicated Highway and Bridge Trust Fund, including:

• $501 million of Dedicated Funding for State roads and bridge construction (part of a $1.8 billion construction program)
• $363.1 million for the Consolidated Highway Improvement Program (CHIPS)
• $39.7 million for the Marchiselli program for local governments
• $16.9 million for Amtrak services and additional rail capital investments

Transportation spending from all sources will total $8.5 billion under this budget.

Recalibrating Local Aid

The budget reduces Aid and Incentives to Municipalities (AIM) to all cities, towns and villages by 2 percent from current year levels, far less than the 10 percent reductions to the state’s operations.

A New York State of Mind by Wallace Ford

As you are reading this column the New York State legislature will have passed a budget that contains over $10 billion in spending cuts. The budget largely reflects proposals from recently elected New York Governor Andrew Cuomo and it appears that the New York budget scenario is being played out in state capitals across the country.

A few facts – Governor Cuomo is the son of the historically liberal former New York Governor Mario Cuomo and worked for the historically progressive former President Bill Clinton as Secretary of Housing and Urban Development. He was elected as the presumably progressive alternative and antidote to the toxic right wing of the right wing candidate Tom Golisano.

The public in New York and throughout the country has understood that local, state and federal budgets are in need of reformation and restructuring. The damage wrought by the great economic collapse of 2008 cannot be overstated. Years of treating taxation as punishment instead of part of the price that all people (and corporations) pay for living in a civil society has created unsustainable imbalances that have to be rectified.

The turning point in these fiscal discussions has been focused upon whether these budget battles are going to be about dollars and sense or will they be about reforming the social and political landscape in this country. There are those who are willing to pursue a prudent social services agenda while also being fiscally prudent. And then there are those who are willing to use the public sector fiscal crisis as a Trojan horse that will permit entry inside the gates built by a century of progressive reform so that they can begin to dismantle the safety nets for all citizens.

The New York state budget is a case in point. Governor Cuomo and the legislature have determined that no tax increases are possible. Indeed, the new budget any New York citizen who makes over $200,000 per year will get a tax cut. Meanwhile statewide aid for education will be cut by $1.25 billion and Medicaid benefits will be cut by $2.8 billion. And certainly, and most clearly, the citizens of New York who earn the least, who own the least and who control the least will be the ones who will bear the brunt of these budget cuts.

This scenario is being replayed from Wisconsin to California to Washington, D.C. The balanced budget mantra is overlaid with the themes of reducing the tax obligations of the wealthiest Americans (and corporations) and reducing the services provided to citizens, especially the citizens with the fewest resources and the greatest need.

There is an empty and heartless meanness to this approach that transcends the numbers and figures that are in a budget discussion. The suggestion that it somehow makes sense that a corporate behemoth like General Electric has a final tax bill of zero while Headstart programs are closed and veterans’ benefits are cut is difficult to comprehend. Just as no one is entitled to great wealth, no one is entitled to unnecessary hardship and misery – particularly in a country with the highest standard of living in the history of the Planet Earth.

The sense of community that brings citizens together into a caring and cohesive entity is clearly fraying. Perhaps this is attributable to the fact that the sense of shared obligation has been diluted to a point that it is hardly noticeable. Spending has been supported at the local, state and federal level for everything from football stadiums to bridges to nowhere and the taxation consequences have been largely deferred or ignored.

As is the case for every celebration, there is a bill that has to be paid. It would seem logical, fair and patriotic that those who have benefited the most from American society would have to pay their fair share of the cost of that society. The constant caterwauling about “no new taxes” might make sense in some other circumstance, but not during a time of crisis. That point seems to be lost upon those who see taxes as punitive and view cutting social services as the only logical choice.
Americans who lived through the Great Depression and World War II learned about shared responsibility and common sacrifice out of necessity. And out of that necessity was born the G.I. Bill and the beginning of the largest middle class expansion in world history up to that point. The sense of shared responsibility and common sacrifice resulted in everything from the national highway initiative to the Great Society to the landmark civil rights bills.
If you wonder if any of those bills would pass today you only need to look at the scorched earth that resulted from the debate and passage of the recent healthcare bill and you will have your answer.
Blanche Dubois was probably wrong to depend on the kindness of strangers. But I do believe that Americans should be able to depend on the compassion and concern of their fellow citizens.

Wallace Ford is the Principal of Fordworks Associates, a New York-based management consulting firm and is the author of two novels, The Pride and What You Sow. Please post your comments on this Point of View column at www.wallaceford.wordpress.com where you can also read prior columns, guest columns and other features.

Weiner Makes the Rounds on Health Care Anniversary

By Meghan Keneally

Nearly one year after passing sweeping changes to the nation’s health care laws, one of its biggest boosters was getting philosophical about the matter.

“Health care is a little bit like Buddhism,” said Rep. Anthony Weiner, “we know its going to change we just don’t know how its going to change. We were on a path for the last four years of kind of letting it change by itself, and finally last year we said we cant keep going like this.”

Weiner, who unsuccessfully, but loudly, advocated for a single-payer provision for the law, was speaking at a breakfast hosted by a non-profit called Small Business Majority, a group founded by small business owners nationwide, set to mark the anniversary of the legislation’s passage in Washington.

The criticism that the government is forcing people to buy insurance is moot, according to Weiner.

“The experience that we saw in RomneyCare in Massachusetts was actually that people, when incentivized to get it, want to get it,” he said.

“What we did was something that was ultimately good for the country and particularly good for New York,” said Weiner, as a few dozen business leaders munched on their breakfast. “We’re a healthcare economy we’ve lost 17 hospitals in New York City since the year 2000 because of the inextricable math of more people being uninsured.”

Rima Cohen, an advisor from the Department of Health and Human Services, also spoke at the breakfast, and said the government is actively trying to implement the bill, despite ongoing litigation to declare it unconstitutional, and congressional efforts to defund it.

“[W]e just keep going on and trying to get the benefit out there to people,” said Cohen.

Cohen said some of the tax benefits that could help small business owners go into affect this April because the bill was passed in 2010, (more tax benefits go into effect in 2014).

The legislation was a big deal when it was signed by President Obama, but quickly became a rallying point for Republicans in the 2010 elections, who said it was an example of big, expensive government intruding on individual’s freedom. During the mid-term elections, many Democrats were weary of touting the legislation as a major achievement, leaving the door open, for some, to keep debating the merits of the bill.

Weiner, for his part, joked at the breakfast that the health care debate had taken a toll on him, physically.

“When we started debating healthcare, I was 6’4”, 290 (pounds). This,” the rail-thin congressman said, “is all that’s left.”

Governor Cuomo, Senate Majority Leader Skelos and Assembly Speaker Silver Reach Agreement on 2011-12 New York State Budget

Historic Budget Provides Transformational Plan for State

Albany, NY (March 27, 2011)

Governor Andrew M. Cuomo, Senate Majority Leader Dean Skelos and Assembly Speaker Sheldon Silver today announced an agreement on a 2011-2012 budget that eliminates a $10 billion deficit.

The agreement includes historic reforms that redesign state government, create efficiencies through consolidation, cap spending increases for education and Medicaid, and transform the future budgeting process.

The approximately $132.5 billion budget will reduce spending overall by over 2 percent from the current year, eliminate 3,700 prison beds, establish regional economic development councils, bring performance funding to education, redesign Medicaid, and cap next year’s education and Medicaid spending.

This budget reaches its financial goals with no new taxes and no borrowing, and will also cut next year’s projected budget deficit from $15 billion to about $2 billion.

Recent changes to the budget include an additional $272 million in education which includes restoration of funding for schools for the blind and deaf (4201) and summer school special education. Human services funding of $91 million was added and $86 million for higher education including SUNY hospitals, SUNY and CUNY community colleges. There are also miscellaneous program additions of $33 million including aid to localities and agriculture programs. The budget proposal requires the Office of Court Administration (OCA) to reduce its budget by $170 million to reflect a more proportionate share of the state’s reductions. There were also $54 million in miscellaneous cuts. As a result, the net add spending to this budget is approximately $250 million. In addition, there are no new member items.

“I have said that New York is at a crossroads – one road leading to further dysfunction and decline, the other towards fiscal responsibility and government efficiency. I believe this budget puts us on the right path,” Governor Cuomo said. “This budget makes tough choices, which is what you sent me to Albany to do. It closes a $10 billion dollar deficit with no new taxes or borrowing, redesigns government to force it to cut waste and inefficiency, and finally delivers real results for hard-working families across New York State. I applaud and thank Majority Leader Skelos and Speaker Silver for working together to reach this agreement.”

Senate Majority Leader Dean G. Skelos said, “This budget agreement keeps our Senate Republican commitment to reduce spending, cut taxes and empower the private sector to create jobs, and will begin to put New York on the path to fiscal recovery. By working together to reach consensus on a responsible spending plan that eliminates a $10 billion deficit without raising taxes, we have tightened our belt and protected middle-class families in every region of this State. I am particularly pleased with Governor Cuomo’s commitment to making UB2020 a reality, which will bring jobs and hope to Western New York, as well as improvements to the other university centers, which are important priorities of our Senate Republican conference. Today’s developments ensure we are moving full speed ahead to an on-time budget.”

Assembly Speaker Sheldon Silver said, “Speaking for the Assembly Majority, I commend Governor Cuomo for his leadership in bringing about this agreement and for providing the Legislature with an executive budget that was strong and firmly grounded in reality. Government had to tighten its belt with the same sense of urgency that working families have been tightening their belts since the economy went into freefall in 2008. The sole consolation is that working with the Governor, we were able to achieve critical restorations which will soften the cuts affecting working families, our senior citizens, our most vulnerable populations and the children in our classrooms.”

The 2011-2012 budget agreement contains critical components first proposed in Governor Cuomo’s executive budget, including redesigning Medicaid and recalibrating the cost of state government, in part, by merging and consolidating agencies as well as curbing spending growth to sustainable and affordable levels.

Policy reforms in the 2011-2012 budget include:

* Changing Permanent Law and Provides 2-Year Appropriations and Caps for Education and Medicaid: Education will be increased at a rate of personal income growth next year – roughly 4 percent. Medicaid will be increased at a rate tied to healthcare CPI which is roughly 4 percent. Together, these actions reduce next year’s deficit from about $15 billion to about $2 billion and change decades-old practice of overspending.

* Redesigning the Medicaid System: The budget includes a global cap on State Medicaid expenditures of approximately $15 billion and implementation of the majority of recommendations by the Medicaid Redesign Team (MRT) to redesign and restructure the Medicaid program to be more efficient and get better results for patients. There are reallocations within the MRT cap that reduce some areas while targeting increases to others. Among the notable changes: the cap on medical malpractice is not included and EPIC is increased by $22 million. The MRT reduction of $2.8 billion and the overall spending cap to the state will be enforced by the Department of Health’s “superpower” provision, whereby the commissioner has authority to make reductions during the year to enforce the cap.

* Creating Regional Economic Development Councils: The budget establishes 10 Regional Economic Development Councils, chaired by Lieutenant Governor Robert Duffy. These councils will create a region-based approach to allocate economic development funds to speed up the creation of jobs. They will act as one-stop shop for all State-supported economic development and business assistance programs in each region, and will be supported with $130 million in capital that is reprogrammed from existing resources.

* Creating the Recharge NY Power Program: Recharge New York will enhance and make permanent the current Power for Jobs Program that will significantly boost the state’s economy by creating and maintaining hundreds of thousands of jobs. Recharge New York will improve upon the existing program by opening it to new participants and allocating a blend of stable, low-cost hydropower and market power for use by businesses that seek to grow and create jobs in New York state.

* Authorizing the SAGE Commission: The budget authorizes Governor Cuomo’s Spending and Government Efficiency (SAGE) Commission to reduce the number of agencies, authorities, and commissions by 20 percent. Currently, the consolidation of Parole and Corrections will save $16.8 million, the merging of NYSTAR into Department of Economic Development will save $1.9 million, and the merging of Consumer Protection into the Department of State will save $500,000.

* Creating the Department of Financial Services: The budget merges the state’s Banking and Insurance Departments into a new Department of Financial Services.

* Authorizing Governor to Close Prisons: The state will eliminate 3,700 prison beds throughout New York at the sole discretion of the administration in consultation with the Legislature.

* UB 2020: The Governor has also agreed to hold a summit with stakeholders to discuss how to make UB 2020 a reality.

* Reforming the Juvenile Justice System: The budget includes significant reforms of the state’s juvenile justice system by encouraging greater use of community-based alternatives, downsizing the state juvenile facilities system by more than 30 percent, and investing resources into enhanced services for juveniles that remain in OCFS custody.

* Creating New Education Performance and Efficiency Grants: The budget enacts initiatives Governor Cuomo proposed to make districts more efficient and improve student performance. Funds totaling $500 million will be awarded competitively to districts that demonstrate significant improvements in student performance and to districts that undertake long term structural changes to reduce costs and improve efficiency. The budget also restores $270 million in education related funding.

* Improving the Excelsior Jobs Program: As proposed in the executive budget, the budget strengthens the Excelsior Jobs Program, which was created in 2010 to provide job creation and investment tax credit incentives to businesses in targeted industries.

NYSUT VOWS TO KEEP FIGHTING ON BEHALF OF SCHOOLS, COLLEGES

ALBANY, N.Y. March 28, 2011 — New York State United Teachers vowed today to continue fighting for budget restorations, saying the state’s brightening fiscal picture — and widespread public support for more education funding — support pressing state leaders to restore investment in public education in order to preserve valuable school programs.

NYSUT President Richard C. Iannuzzi acknowledged the Legislature’s restorations as “positive steps,” but said they fall far short of what’s needed to avoid devastating program cuts to public schools, community colleges and SUNY and CUNY campuses. He noted today’s Siena Research Institute poll shows strong opposition to education cuts, and broad support among all demographic groups for even larger restorations to the education budget.

“While we will continue to seek further relief at the state level through restorations and added revenues, we must redouble our efforts to be sure that as great a portion of these cuts as possible be absorbed outside the classroom,” Iannuzzi said. “When all is said and done,” he continued, “efficiencies alone, however, are unlikely to avoid a devastatingly negative impact on kids and programs.”

NYSUT Executive Vice President Andrew Pallotta said the union would continue to fight for continuation of the income tax surcharge on the wealthiest New Yorkers. The Siena Research Institute poll also showed 71 percent of New Yorkers support asking millionaires to share the pain and help alleviate the worst of the budget’s cuts.

“Despite all the rhetoric about valuing education, choices had to be made in this budget and the choice was to protect millionaires at the expense of teachers and students,” Pallotta said. “Students who are struggling will not be getting the extra support they need. Class sizes will grow. Schools are closing. And high school juniors and seniors applying to colleges are losing opportunities in the arts, music and sports.”

NYSUT said early reports indicate the budget may make some vitally needed restorations to community colleges and SUNY hospitals. But, the union said, cuts that remain “have us deeply concerned about the ability of SUNY hospitals to sustain services and remain solvent; and the capacity of community colleges to maintain academic programs as enrollment skyrockets. Additionally, we are deeply concerned that this budget appears to prevent CUNY from spending more than $40 million already collected in student tuition revenue to benefit its own students.”

Pallotta added, “We will never give up fighting on behalf of the hard-working teachers, school staff and higher education faculty, and the more than 3 million New York students they serve.”

UFT Statement on State Budget

The final state budget, which was reached on March 27, adds more than $200 million to Governor Cuomo’s proposed education budget, though the cut to statewide education aid still totals more than $1 billion. The final budget did not include an extension of the millionaire’s tax. Assembly Speaker Sheldon Silver, who fought to keep the millionaire’s tax in place, has said that he has not given up hope of convincing the governor and Senate Republicans to agree to extend the tax before it expires in December.

UFT President Michael Mulgrew released the following statement in response:

Mayor Bloomberg will now receive more than $200 million for schools from the state budget than the governor originally planned. And since the city continues to run a multi-billion dollar surplus, New Yorkers should wonder why the mayor insists on laying off teachers.

While we wish Albany could have done more, the mayor could have helped add $5 billion to the budget by backing an extension of the millionaire’s tax, but he refused to do so. Given this new revenue and the city’s continuing multi-billion-dollar surplus, as the governor and his staff have said repeatedly, no teacher layoffs are necessary.

The children of New York City are too important to be pawns in Bloomberg’s political games.

Statement by Ron Deutsch

Statement by Ron Deutsch

“The big winner in this years budget battle is Governor Cuomo and his extremely wealthy friends and partners at the Committee to Save NY. This budget will give a $5 billion a year tax cut to the wealthiest New Yorkers (New Jersey also wins and will see a $350 million tax windfall) and allow the rest of us to fight over scraps. Far more restorations could have been made that would have helped school children, seniors, the poor and working families throughout this state. Unfortunately, the Governor insisted on doling out tax cuts to the folks that can afford to attend his $15,000 a plate fundraiser’s at the expense of the rest of us.”

“According to today’s Siena Poll, the Governor continues to enjoy great popularity among voters. It seems that the only thing as popular as the Governor is the one policy issue he has chosen to reject, the millionaires tax. Thanks to the Governor we are now going to revert back to an income tax system where Donald Trump pays the same top rate as the custodian in Trump Towers. Now someone making $25,000 per year will pay the same top rate as someone making $2 million or $20 million.This budget is bad news for the working families of this state and will only further increase the income disparities between the haves and have-nots which are already at record highs.”

Bloomberg Statement on State Budget Agreement

Largest Cut of State Aid to New York City Ever

“At the outset of the budget process, we urged the Governor and State Legislature to adopt a budget that treats New York City equitably and provides the mandate relief and reform that would allow us to absorb the State’s heavy cuts. This budget agreement appears to fail on both counts, and worse, it passes heavy new costs down to the City. Voters should remember that New York City was singled out by Albany and eliminated from the revenue sharing program, while other localities took no more than a three percent cut.

“We appreciate that some of the cuts in education aid were restored. But make no mistake: the final budget still cuts New York City more than ever before. The restorations are merely a fraction of the $600 million necessary to avoid additional layoffs and cuts in the City’s budget – beyond what was announced in February – for the upcoming fiscal year.

“While the outcome is disappointing and the results will be painful, it is encouraging that the Governor and State Legislature have worked together to produce an on-time budget. We hope that same spirit of collaboration leads to action on the hard work that remains to enable the City to do more with less: by stopping pension costs from skyrocketing further with a new tier for the City and ending the last-in, first-out law that exacerbates the negative impact of Albany’s teacher layoffs on our public school children.”