Cuomo Reminds New York Lawmakers a `Shutdown’ May Happen Without a Budget

New York Governor Andrew Cuomo reminded lawmakers that if there is no agreement on the budget they are negotiating, he could force them to choose between accepting his plans or shutting down the government.

Cuomo, a Democrat, said he was still optimistic that a budget deal will be reached by the April 1 start of the fiscal year, even though there are unresolved issues about spending for education, health care and prisons.

“I’m hopeful we can get it on time, amicably,” Cuomo, 53, said at a press conference in Albany yesterday. If there is no agreement, “there’s a new option,” he said, referring to his ability to submit spending bills that lawmakers would have to pass, or else the government would shut down.

“If the Legislature fails to pass the budget on time, the government will not have the funds to operate and it may be forced to shut down,” Cuomo said in a video released to television stations today.

Cuomo said the government would be prepared for a shutdown, without elaborating on what services might be exempted. Lawmakers approved appropriations for the state’s $56.4 billion of debt on March 16, so those interest and principal payments wouldn’t be interrupted by the lack of budget appropriations for other activities.

Paterson’s Move

That threat of a shutdown was used last year by then- Governor David Paterson to push through a budget in August, after lawmakers failed to reach an agreement.

If legislators are adamant in rejecting the budget he wants, “well then I’ll send you a bill, it will be an extender bill. You don’t want to do it, don’t pass it, shut down the government and then let’s take the case to the people,” Cuomo said at the press conference.

An extender bill is submitted after the start of the fiscal year so the state has legal authority to spend money. State law doesn’t allow lawmakers to change the governor’s appropriation bills.

Cuomo, elected with 61 percent of the vote in November, said, “I’m confident in taking the case to the people.”

Medicaid, School Funds

Cuomo’s $132.5 billion budget would cut $2.85 billion from aid to schools and $2.85 billion from Medicaid, compared with spending required under state laws. Most lawmakers in both chambers of the Legislature favor smaller cuts in school aid.

Democrats, who hold a majority in the Assembly, favor extension of the state’s top 8.97 percent income tax rate, which Cuomo and Republicans want to let expire at Dec. 31.

Republicans, who control the Senate, oppose some of the governor’s Medicaid cuts and plans to close upstate prisons based in districts they represent. Republicans also are against a proposal favored by Cuomo and Democrats to require a “living wage” higher than the federal minimum for health-care workers. Democrats oppose a Cuomo proposal for limits on medical malpractice awards that are favored by Republicans.

Cuomo said he doesn’t expect any budget agreement to include extension of New York City rent-control laws sought by Democrats in the Assembly or a cap on property taxes set at the lower of 2 percent or the rate of inflation, which Republicans want. Both issues may be deemed by lawmakers as “too complex” to include in the budget, he said.

To contact the reporter on this story: Michael Quint in Albany, New York, at mquint@bloomberg.net.

To contact the editor responsible for this story: Mark Tannenbaum at mtannen@bloomberg.net

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