Message from Liz...
Another budget season has come to a close, which in terms of the process, resembled so many that have come before. Key decisions were made behind closed doors by the governor and majority leaders of both the Senate and Assembly, followed by a marathon session to pass the results of those secret negotiations. As you might expect from such a process, there are some real problems with a number of the pieces in the final product, but the good news is that this budget did include a number of very positive things for New Yorkers as well.
I'll start with the positive. Some of the most important issues addressed in the budget include:
- $300 million in funding for universal pre-kindergarten in New York City, and an additional overall increase of $1.1 billion, or 5.35 percent, in statewide school aid, with the option of using a portion of that funding for afterschool programs. Mayor de Blasio has indicated that this funding will allow him to go forward with both his universal pre-K initiative and an expansion of middle-school afterschool programs.
- An increase in the Senior Citizens Rent Increase Exemption (SCRIE) income eligibility limit to $50,000. I have carried legislation to do this since I first entered the Senate, so I'm extremely happy that it has finally happened. The budget language requires the New York City council to sign off on this change, and only authorizes this expansion for the next two years, but I am hopeful that this change will be made permanent in the future. It will make a huge difference for many seniors in my district and throughout New York City who are at risk of losing their homes due to high rental costs. While I can't overstate how pleased I am with this change, unfortunately the Disabled Rent Increase Exemption was not similarly expanded. I am working with advocates to rectify this oversight. If you want to know more about SCRIE, see the section below in the "Community Spotlight" section, which offers additional details.
- An increase in the income eligibility limit for the Elderly Pharmaceutical Insurance Coverage (EPIC) program to $75,000 for individuals and $100,000 for couples. This change will help many seniors address their high prescription drug costs.
- Creation of a Basic Health Plan which will provide additional low-cost health insurance options for low and moderate income New Yorkers. This program will actually save New York State money, since most of the funding will come from the federal government.
- New rules governing the handling of out-of-network insurance claims that will protect patients from receiving surprise medical bills and require that when there is a dispute over out-of-network charges, that dispute will be resolved between the insurer and the doctor, without putting the patient in the middle.
- An agreement to ensure New York City is able to offer housing subsidies to move homeless New Yorkers into permanent housing.
- A 2% cost of living increase for direct care workers who provide care to vulnerable seniors and adults and children with disabilities. This increase has been promised for years, but each year was taken out of the budget to save money. We rely on these relatively low-wage workers to care for the most vulnerable New Yorkers, and I am glad that they will finally get this well-deserved pay increase.
- A change in policy allowing people on public assistance to seek bachelor's degrees and have their education count as their work/training activity. College is still, by far, the most successful model for moving whole families up and out of poverty.
There were also many problems with the final budget, but I will highlight only three here.
The first, the failure to pass meaningful campaign finance reform or create a full public campaign financing system, is discussed in greater detail in the Policy Spotlight later in this newsletter. For now I'd just note that while there are a few new provisions in the budget that strengthen the investigatory powers of the Board of Elections and enhance penalties for corruption, these changes are undermined by the unwarranted dismantling of the Moreland Commission to Investigate Public Corruption. I am deeply concerned that the work the commission was doing will now be ended without proper follow-up on its investigations. Disturbingly, the Governor's weak ethics reform deal may actually send us backward rather than forward, certainly many good-government groups feel this way. I spoke out against this package on the floor of the Senate. You can watch the video at: http://www.nysenate.gov/video/2014/apr/02/sen-krueger-failure-pass-real-campaign-finance-reform-2014-budget.
Another major policy debacle is the language undermining mayoral and local control over New York City schools by imposing new rules and privileges advantaging charter schools. New York City will now be required to co-locate or pay the rent for charter schools it may not even have a role in approving in the first place. While the details are somewhat vague, it appears the city will have little ability to reject co-location requests by charters even when they will damage existing public schools. Community School District 2, which includes my Senate District, faces severe overcrowding, with more than half of middle and elementary schools at more than 100 percent of capacity, and these problems are hardly unique to my district. The language in the budget will upset the balance between charters and other public schools and undermine education for the 95 percent of public school students who do not attend charters.
The final major issue I have with this year's budget has to do with tax policy. Once again, the changes in taxes included in this budget are primarily regressive. Changes to the corporate and bank tax will cost the state over $1.5 billion in revenue over the next five years, with much of the benefit going to the largest banks in the state. I would not be opposed to across-the-board tax relief if it was linked to elimination of some of the more than $7 billion annual revenue loss from targeted corporate tax breaks, incentives, and handouts which distort our current tax system so much. Unfortunately, none of those changes were included in the budget.
Furthermore, while there is property tax relief in the budget, the final budget structures this relief in a way that will ensure that the wealthiest residents outside New York City receive the greatest benefit, rather than targeting it to those with the highest tax costs relative to their income. And finally, the renter's tax credit included in the final budget is too small to provide meaningful relief to those struggling to pay their rent, with most people who are eligible for the benefit receiving an average annual benefit of just over $50..
Overall, I would describe this budget as a fairly typical election-year product, where there is a little something for everyone, from seniors to parents to large corporate political donors. Because the state is in relatively good fiscal health, there were more resources to spread around than in recent years, and I am gratified that some extremely important programs were funded in this budget. I just wish we had done more to reform both our political system and our tax structure, as I fear that the failure to address these two areas will continue to have serious consequences for the state in the coming years.