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Fasten your seatbelts, New Yorkers. The state”™s in for an even bumpier ride.
Gov. David Paterson, flanked by new Senate Majority Leader Malcolm Smith and Assembly Speaker Sheldon Silver, on Feb. 3 announced a number of cost-cutting measures designed to close the state”™s $1.6 billion budget gap.
“It is clear that New York has to get its own fiscal house in order,” Paterson said in a prepared statement.
Small businesses will feel the pinch from cuts to the Healthy New York program, which offers a subsidy to eligible employers to help them provide insurance to employees. Workers whose employers do not provide health insurance may also buy coverage through the program. Healthy New York will now be financed through an insurance assessment which is expected to save the state $137 million in both the current budget year and in 2009-10.
The plan also calls for reducing funding for certain economic development programs that include tourism marketing ($1.5 million), the Jobs Now program ($1.5 million), Technology Transfer ($1 million) and Faculty Development ($1 million).
The Hudson Valley, which relies on tourism to keep its economy pumped, is still reeling from the loss of the Empire State Games. “Obviously, we are very disappointed in the cut,” said Kim Sinistore, director of Westchester County Tourism and secretary of the 10-member Hudson Valley Tourism Inc. “We are in an economic crisis. (We) all have to pull together and do some collaborative marketing and hopefully see better days.”
Susan Cayea, director of Orange County Tourism, said she isn”™t happy about another cut to the Hudson Valley”™s already suffering tourism economy. “For every dollar visitors spend, we see $12 to $15 in revenue,” said Cayea. “Do the math.”
At presstime, neither Sinistore nor Cayea had received the report on where the cuts are going to be made, but matching funds appear to be on the list. Art-grant funding will lose $7 million this year and in the new budget as well.
And for those municipalities that have been encouraged to consolidate services, the Local Government Efficiency grants administered by the Department of State will honor current grant awards in full, but reduce remaining available funds by 50 percent. “Disappointing, but it is not the disappointment we initially thought,” said Jonathan Drapkin, president of Pattern for Progress, which represents the nine-county Hudson Valley region. “Initially, we were shocked, but from what we”™ve been told, the $6 million cut (will) bring it back to the original amount that was in the Shared Municipal Services Agreement program … so there is still money available. The program will not grow past its original funding as planned.”
Jeffrey Gordon, spokesperson for the state Division of Budget, said the state”™s $1.2 billion “rainy day” funds will remain untouched. “This is what helps keep New York”™s credit rating in good shape,” said Gordon. “If we start taking money out of the ”˜rainy day”™ funding, essentially we”™re telling other states that we can”™t handle our fiscal affairs.”
Currently, New York state has a triple-A rating, one Gordon says the state would like to keep in place.
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