Archive for March 2017

The State Budget Deadline Looms

Posted by NYPIRG on March 27, 2017 at 10:31 am
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Governor Cuomo and state lawmakers are now heading into the final week of the fiscal year.  New York’s fiscal year starts on April 1st and in order to have a budget in place, the governor and the legislature should have a plan in place by midnight Friday, March 31st.

During the Cuomo tenure, the state budget agreement has occurred either by April 1st or within hours of the deadline.  Getting a budget in place more or less on time has been a metric by which the governor makes his case that he has brought order to chaos in Albany.

Of course, there are other metrics – such as the number of public officials indicted and convicted of corruption that tell a different story – but the governor does get credit for pushing through state budgets that are “on time” and keep within growth estimates set by the governor.

This, however, is the governor’s first state budget being hammered out during a Republican Administration in Washington; an Administration that is making noises about cutting programs that could hurt New York State.

It appears that the state dodged its first fiscal “bullet” when the Trump Administration and the House Republican leadership could not agree on a measure to eliminate health insurance for tens of millions of Americans.  Had that plan been approved, the state could have experienced a budget hit worth hundreds of millions, if not billions, of dollars in federal aid.

The failure in Washington should make it easier for the governor and the legislature to put together a state budget.

There are a number of state issues that loom large and are still under consideration.

First, will the state extend – or increase – its tax rates on high income earners?  Despite the failure of health insurance changes in Washington, there can be no doubt that federal aid will be curtailed to some extent.  The state’s current income rate tax structure expires this year.  If it reverts to previous law, the state could lose big in its revenues.  Can it afford to do so?  Or will another extension curtail economic activity?

Second, what will the state do about college affordability?  The governor has advanced perhaps the most important change in higher education in a generation.  His Excelsior scholarship program, which would make the State University tuition-free for those with incomes up to $125,000, would help many middle income New Yorkers attend public college.  Yet, his higher education budget keeps state support stagnant for public colleges, and he cuts programs to help lower income students.  Will the governor’s initiative lead to broader access or essentially lead to cuts?

Third, will anything happen to curtail political corruption?  The former legislative leaders were convicted of corruption and joined a long and growing list of public officials facing prison time.  Currently, top associates of the governor are under indictment for allegedly using the state’s contracting process as a way to get rich and funnel campaign contributions to the governor.  The governor has proposed measures that would essentially add new oversight entities, but that are reportable to him, not independent.

Given the silence surrounding reform plans, will Albany kick the can again?

Lastly, the governor’s multibillion dollar bailout of upstate nuclear power plants has drawn the ire of lawmakers in both houses of the legislature – not only for the price tag, but for the secrecy surrounding the deal.

Will the legislature, a co-equal branch of government, use its constitutional powers to put a halt on the deal in order to ensure that there is a full public airing?

Budgets are about meeting the demands of the public.  With limited resources, and faced with unlimited demands, budgets are also the government’s primary tool to set policy priorities.

How Albany answers the budget this year will determine the quality of life for all New Yorkers, not just college students, ratepayers, and others who rely on the state for direct public help.

Washington Prepares to Take Away Health Insurance for Millions of Americans

Posted by NYPIRG on March 20, 2017 at 10:27 am
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The Trump Administration continues to distract the nation with a daily stream of misinformation that often provides cover for the policy work of the Administration and the Congress.  The latest is the Trump Administration’s accusations (without evidence) that the Conservative Government in Britain and the Obama Administration had wiretapped the Trump campaign in the months leading up to the election.

As the uproar over the unsubstantiated claims increased on both sides of the Atlantic, Congress and the Administration have been busy trying to piece together a plan to rob millions of Americans of their health insurance.

After years of pledging to “repeal and replace” the Affordable Care Act, the Congressional leadership and the Trump Administration are now faced with the task of actually doing so while claiming to the public that it can be done without loss of insurance to anyone.

Of course, it would be possible to repeal and replace the Affordable Care Act with something that would insure everyone at a lower cost; by expanding the federal Medicare program to everyone instead of only those over the age of 65 or with disabilities.

But that’s not what they are talking about.

Instead, Congress and the Administration are trying to develop a plan that moves their bumper sticker promise into public policy without taking the political hit of admitting that such a move would hurt millions of people.

Reality, however, is hard to ignore. The non-partisan, independent Congressional Budget Office (CBO) reviewed the plan being offered by the President and the House leadership.  Here is what they concluded:

CBO estimated that several major provisions affecting Medicaid (the federal/state health insurance for the poor) would decrease direct spending by $880 billion over the 2017-2026 period.  If the Administration’s plan was in place in the year 2026, Medicaid spending would be about 25 percent less than what CBO projects under current law. Most of the reduction in spending would be the result of lower enrollment.

By 2026, CBO estimates 14 million fewer people would be enrolled in Medicaid compared to current law. Overall, the Administration/House leadership’s plan would reduce federal deficits by $337 billion over the 2017-2026 period primarily from cuts to the Medicaid program and the elimination of subsidies for those lower and moderate income Americans covered by health insurance provided under the Affordable Care Act (ACA).

As a consequence of the changes proposed by the Trump Administration and the House leadership, CBO estimated that the total uninsured in America would reach 52 million in 2026, or 24 million more than what is projected under current law with the ACA.

That’s right; 24 million Americans who would have health insurance if the Affordable Care Act is kept in place would lose it under the Administration’s plan.

Not surprisingly, this analysis set off a firestorm on Capitol Hill with many members of Congress stating that they could not support the plan.  As the first committee votes on the legislation were due, the Trump Administration issued – without offering any evidence other than that of one Fox News commentary (who had no proof) – that the Obama Administration and the Conservative Government in Britain had wiretapped the Trump campaign.

While the blowback from that baseless assertion may end up solidifying the view that the Trump Administration’s statements can never be trusted, in terms of moving the Affordable Care Act repeal along, it worked.

The first vote was taken and the legislation – a plan to rob tens of millions of Americans of their health insurance – was approved in committee.

And while there is no way to know if the legislation will ultimately become law, one thing is clear: The deceptions of the Trump Administration may not only be the result of a careless President, but ones that distract the American public from the unpopular moves that the Congress is considering.

The nation must keep on alert, not only to what is said in Washington, but what is also being done.

Trump Fires Bharara

Posted by NYPIRG on March 13, 2017 at 8:37 am
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U.S. Attorney Preet Bharara’s statement was brief, but packed a punch: “Today, I was fired from my position as U.S. attorney for the Southern District of New York.”

And so ended the tenure of a prosecutor who took on and won convictions against organized crime, Wall Street scoundrels, terrorists, and corrupt politicians.  Despite a promise by then-President-elect Donald Trump to keep Bharara on, the President fired him this past Saturday anyway along with scores of other Obama-appointed U.S. attorneys across the nation.

The rationale?  Probably the best case that the President can make is that he was exercising his prerogative by clearing the deck for his own appointees.  How can he defend welching on his agreement?  Hard to say, it could be simply that he wasn’t serious in November or it could be that Bharara’s zealous pursuit of justice was simply becoming too uncomfortable.

But for New Yorkers hoping for ethical government, the news was devastating.  Bharara has been, after all, the single most significant player in cleaning up Albany in at least a generation.

And his work was far from complete: he was reportedly looking into pay-to-play schemes involving people at the highest levels of New York State and New York City governments.

But his firing also draws into stark relief the problems with government prosecutions.  In Bharara, the nation has had one of the most successful prosecutors.  Yet, apparently because he wasn’t part of the partisan team, he got the heave-ho.  And while it is understandable why a new Administration would want its own people, independent enforcement should matter most.

It is fair to guess that New York’s political elite, Democrats and Republicans alike, both feared and hated Bharara.  He followed the evidence and enforced the law without fear or favor.  He played no favorites.  Apparently, that standard was too high for the new Administration, and certainly won no friends in official Albany.

But the Bharara firing also highlights the weaknesses of state ethics enforcement.  With Bharara walking the beat, New Yorkers could feel somewhat assured that someone was watching out for their interests.  With him gone, we are left to rely on state watchdogs – entities that are too often limited by weak laws or controlled by those whom the watchdogs are supposed to be watching.

For example, one of Bharara’s investigations focused on pay-to-play schemes in which (it has been alleged) that top associates of the governor used state contracts to enrich themselves and to shake down contractors for campaign contributions to help the governor.

Those contracts were issued during the time that the governor and the legislative leaders were negotiating new laws to limit the power of the state’s Comptroller to monitor contracts.  The state Comptroller is supposed to be an independent monitor of New York’s finances – that’s why he is a separately elected official.

Whether the Comptroller would have arrived at the same conclusions as the U.S. Attorney’s office is unknowable, but what is crystal clear is that the state’s leaders wanted to limit the power of the Comptroller to monitor government contracts at the same time the governor’s close associates allegedly were gaming the system for their own benefit.

Also, the state’s ethics watchdog, the Joint Commission on Public Ethics (JCOPE), is controlled by individuals who are directly appointed by the governor and the legislative leaders.  And it is precisely the governor and the legislative leaders (as well as other public officials and lobbyists) who are subject to JCOPE’s scrutiny.

It is noteworthy that the first three executive directors of JCOPE have been all former employees of the governor.

If New Yorkers want to ensure that government is acting in the public’s best interests and not some partisan or personal ones, they should demand independent oversight of the state’s contracting and its ethical standards.  With negotiations over the state’s $150 billion budget in full swing, ethics reform doesn’t appear to be on or even near the table among the governor and the legislative leaders.

Sadly, reform is not happening.  In Albany, there is a lot of noise about improving contracting and ethics, but at the end of the day it ends up being more sound bites and posturing.

New Yorkers must demand independent oversight; the best laws in the world only work if they are enforced.

With Preet out of the picture, the pressure is taken off and that’s not what will be happening – unless New Yorkers collectively raise their voices loudly and say enough.

Governor’s Higher Education Budget Wilts Under Scrutiny

Posted by NYPIRG on March 6, 2017 at 8:00 am
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A few months ago, Governor Cuomo held a news conference with the U.S. Senator from Vermont, Bernie Sanders, to announce a new initiative: to make public college tuition free for families whose incomes were no more than $125,000.

At that time, the governor remarked: “A college education is not a luxury – it is an absolute necessity for any chance at economic mobility.”  He went on to say that “(College) is incredibly expensive.”

For many New Yorkers, the governor’s proposal was a welcome change.  After all, it was Governor Cuomo’s Administration that had changed New York law to automatically allow annual increases in public college tuition.  During his time as governor, the cost of attending the State University of New York has shot up by 30 percent over five years.

Making public college more affordable is a great idea, not only for educating the next generation of workers, but the next generation of citizens as well.

Now that the state budget process is shifting into high gear, flaws in the governor’s tuition-free plan, as well as his overall higher education budget, are becoming more and more clear.

While the governor deserves praise for advancing the innovative concept of making public college more affordable, the evolving plan seems less and less compelling.

Governor Cuomo’s desire to create a “free tuition” program at a reduced cost has cut out all students attending private colleges and all students who do not take at least 15 credits (which is more than currently considered to be “full time”) every semester. In addition, the plan proposes that the public college defer billing the student for the tuition, and the college does not receive the scholarship money until after the semester.  Thus, if the student fails to maintain the Excelsior program’s standards, the public college receives no income from the scholarship and must charge the student for the cost.

Of course, offering even a limited “free tuition” program will likely mean an increase in the number of students attending public colleges in New York.  But the State University of New York and City University of New York campuses that would receive these new students will receive no additional state resources.  What will happen?

And the governor has proposed a tuition increase to those families making over $125,000.  And in what appears to be a cruel twist, the Excelsior program is going to cover the current level of public college tuition, not future tuition levels.  Thus, as tuition costs go up under the governor’s plan it appears that the colleges could be forced to make up the difference.

As a result, stagnant state support not only means inadequate resources now, but the future tuition hikes mean future college cuts – unless the state adds resources, which the governor has not proposed to do.

Not only is the tuition free plan much more limited than initially advertised, but the governor’s budget hammers the higher education budget in other ways.

As just mentioned, the governor proposed that operational funding for SUNY be kept at this year’s level.  Since the inflation rate is a bit over 2 percent, the governor is effectively proposing a cut of 2 percent in state funding for SUNY.

The governor also proposed cuts to programs that provide support to college students that come from educationally disadvantaged backgrounds.

The Legislature now must deal with the governor’s plan.  We can’t forget that the governor deserves credit for serving up a good idea, but it is now up to lawmakers to make it work.  Here are a few steps that they can take:

  1. Set up the Excelsior scholarships along the lines of the already-in-existence Tuition Assistance Program. Not only would that reduce bureaucratic costs, but would eliminate some of the weaknesses of the governor’s plan.  And while they’re at it, try to help students in private colleges too.
  2. Boost state support for public colleges and eliminate the governor’s tuition hike.
  3. Boost funding for programs that help poorer students – students who often already have their tuition covered, but who face budget cuts in the governor’s proposal.

The budget clock keeps ticking; this could be a very big year for the state’s higher education system.  Let’s hope the Legislature uses the governor’s plan as a budgetary floor, not a ceiling.