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For Local Governments, Relief Is Spelled "M-A-N-D-A-T-E"

12:09 AM, Oct 3, 2012   |    comments
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By Joseph Spector, Albany Bureau Chief

ALBANY -- The Cuomo administration on Tuesday defended its efforts to limit unfunded mandates on local governments, saying they have capped Medicaid costs and reformed the pension system.
But it wasn't enough for local leaders and the state's School Boards Association.

During a two-hour panel discussion Tuesday, local government officials said the state's moves have been helpful, but more are needed.

"What we are seeing right now is governing by triage," said Stephen Acquario, executive director for the state Association of Counties.

The state's 57 counties outside New York City, as well as towns and smaller cities, are developing their budgets for the 2013 fiscal year, which starts January 1.

Local governments said they are being squeezed by revenues that aren't keeping up with growing costs, particularly pension expenses for employees and state-mandated programs.

They said they are limited in how much they can raise taxes because of a property-tax cap implemented last year. It limits the growth in property taxes to 2 percent a year.

For counties, the tax cap will hold counties to raising $114 million in new tax revenue. Their expenses are set to grow by $244 million, Acquario said.

"It's not what to cut. It's when and how much," Acquario said.
Acquario was joined on the panel by Cuomo's budget director Robert Megna; Sen. Betty Little, R-Glens Falls; and Timothy Kremer, executive director of the state School Boards Association.

It was sponsored by the Rockefeller Institute of Government, which is part of SUNY Albany.

Megna said Gov. Andrew Cuomo this year agreed to have the state cap counties' Medicaid costs at 3 percent a year. Medicaid, the health insurance program for the poor and disabled, is the largest state mandate on counties.

The state also implemented a new pension tier, Tier VI, that is estimated to save the state more than $80 billion over the next 30 years. The new pension tier lowers benefits for new public employees.

"We believe significant mandate relief, in taking over those costs, will over time provide a substantial local benefit," Megna said.
Upstate cities said they face bankruptcy without state help. Cities have lost population and manufacturing jobs, leading to an erosion of their tax base.

Megna said the state, despite its own fiscal woes and spending cuts, has been able to keep aid flat to cities. He said the Democratic governor is looking at ways to help cities.

"I think it's premature to talk about any specifics," Megna said.
Kremer said the state needs to reform the Triborough Amendment, the oft-criticized law that allows union contracts to continue even after they expire. The law, critics say, makes it difficult to negotiate new deals with unions; unions say it offers them job protection.

"We don't want to dismiss anybody. We don't want anybody to lose their job," Kremer said. "But these contracts have expired and people are getting automatic step (salary) increases every year, on average 2 percent."

Little said a mandate-relief panel formed by the Cuomo administration this year will hopefully find more ways to curb unfunded mandates.

"We have the tax cap, and the tax cap is bringing mandate relief to the fore," she said.

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