New York's Cuomo Said to Oppose Bond Sales to Balance State Budget Deficit
New York Attorney General Andrew Cuomo, whose associates say plans to run for governor, opposes selling $2 billion of bonds to help narrow the state’s budget deficit, according to a person familiar with his positions.
The borrowing, proposed by Lieutenant Governor Richard Ravitch in March, is favored by Assembly Speaker Sheldon Silver as a way to reduce spending cuts needed to shrink the $9.2 billion budget gap for the year that began April 1. Ravitch, Silver and Cuomo are Democrats.
Governor David Paterson, 56, also opposes resorting to a debt sale, which he called “kicking the can down the road” because it would leave the next state chief executive with a larger gap between spending and revenue.
The governor’s financial plan, which would cut spending by about $5.8 billion and raise $1.2 billion of revenue through new or increased taxes, would result in a deficit next year of $5.4 billion, according to budget documents.
Ravitch, 76, included borrowing in his recommendation to end the state’s chronic deficits because closing the current imbalance, a year after a record $17.9 billion gap, was a “political impossibility” that would be too painful to the state’s workers and those dependent on its services, the lieutenant governor said in March.
Cuomo, 52, plans to declare his candidacy on or about May 25, when the state Democratic Party convention begins, according to three supporters who declined to be named. They said they spoke with him about the strategy and asked to remain anonymous out of concern they not appear to be breaching a confidence.
The attorney general has refused to publicly comment on the budget deficit or the inability of the Senate and Assembly to agree on a plan to balance spending and revenue. Their impasse has made this year’s budget the latest since 2004, when agreement wasn’t reached until August, a record 133 days after the fiscal year started.
New York Democrats next week will select candidates for state-wide offices or determine who would be on the Sept. 14 primary ballot. There are no announced candidates for the Democratic gubernatorial nomination.
Cuomo, whose father Mario was a three-term New York governor, opposes parts of the Ravitch plan that may reduce the governor’s power, according to the person familiar. He doesn’t favor creating a financial review board to oversee the state’s budgeting and opposes loosening limits on what the Legislature can do to a budget after the governor submits it, said the person.
Property Tax Cap
If elected governor, Cuomo intends to propose a cap on annual increases in local-government and school property taxes equal to 2 percent or the rate of inflation, whichever is lower, the person said. Previous proposals for property-tax caps have stalled in the Assembly. Senate Democrats now favor a plan for state-financed property-tax rebates for senior citizens, at a cost of more than $1 billion.
Cuomo favors parts of the Ravitch plan including the adoption of generally accepted accounting principles, which would require the state to shift its books from a cash basis, where expenses and revenue are recorded as they happen, to an accrual basis, where they are counted as they are incurred or earned.
He also favors starting the fiscal year on July 1 to give budget makers more time to assess April collections, which include taxes paid on Wall Street bonuses.