Restoring Faith in New York's Budget Process
New York State's legislature was once seen as an incubator of innovation-a training ground for United States Senators and Presidents. So as a member of the state Assembly, it's disheartening to me to see how far we've fallen in the public's view. A recent Marist poll found that found that 68% of the state's voters have no confidence in the legislature's ability to solve our state's fiscal crisis.
I can't say I blame them for their skepticism-but I came to Albany to ensure that government works for the people, and so did my colleagues in the legislature. We must rebuild that broken trust, starting with a return to the solutions we used to solve the budget crisis that almost wrecked New York City back in the 1970s.
In 1975, at the height of the fiscal crisis, the state set up an independent Financial Control Board to oversee New York City's finances and ensure that its yearly budgets met Generally Accepted Accounting Principles. If that was good enough to save the city then, it's good enough for the state now. Indeed, it's critical to Gov. Cuomo's plans to redesign our state's government.
GAAP accounting is nearly universal in the private sector, but most governments are held to looser standards. Its rules prohibit "cash budgeting" tricks -- like rolling this year's expenses into next year's budget and using next year's cash to pay this year's bills -- and so forced the city to adopt a fiscally responsible approach and put it on solid financial ground.
Over the last decade, state spending has gone up far faster than the growth in tax receipts, personal income or inflation. Yet even as state government spends too much, it produces too little for the people. We spend the most on education but we rank 34th in results; we're No. 1 in health-care spending but 21st in health outcomes.
The governor has proposed important reforms to slow down spending, but unless we fundamentally change the way our state's budget is prepared, there will be no strong incentive to ensure that these reforms survive past the current budget cycle. GAAP must be the spine we build our future budgets around.
I recently published an op-ed in the New York Post on the importance of adopting GAAP accounting in our state's budget process. This reform is critical to the success of the Governor's plans to remake New York's government, and to ensuring not only that we avoid more deficits, but that services aren't decimated in future recessions. It will also be an important step in renewing New Yorkers' faith in their government.