ALBANY — Gov. Andrew Cuomo on Tuesday presented his budget proposal for the upcoming fiscal year, including solutions to close the state’s looming $6.1 billion deficit.
The governor’s nearly $178 billion proposal is a roughly 2% increase over the previous year, and includes legislation and funding allocated for infrastructure, environmental initiatives and Medicaid — some of which he previewed during his State of the State address at the beginning of the month.
“You can be a progressive and be fiscally sound,” Cuomo said to the audience at The Egg in downtown Albany. “The answer is to reduce the level of growth, not cuts, and that’s exactly what we have done in this budget.
Of largest concern to most municipalities and legislators has been Medicaid funding, which makes up about $4 billion of the state’s deficit. During his Jan. 8 State of the State address, Cuomo suggested the state could potentially shift Medicaid spending back onto localities, spreading panic and confusion among agencies and municipalities.
New York’s roughly $80 billion Medicaid program is shouldered by the federal government, state and its counties. While the federal government funds about half the cost, localities paid a smaller share of $7.6 billion of the remaining cost in 2019, leaving the state to cover the remaining $32.4 billion.
Cuomo quelled those concerns during his budget address.
“I know many of (local governments) are fearing we would go back and undo what we did in 2013,” Cuomo said. “We don’t do that and it won’t impact beneficiaries. But local governments have to have a financial stake in the game. We have to get those increases under control.”
State Budget Director Robert Mujica cited a plethora of contributors to the Medicaid gap after Cuomo’s address Tuesday: Overall health care costs; increased use of managed, long term care; $15 minimum wage; local municipalities’ takeover of Medicaid; increased enrollment in the program; and distressed hospitals.
Cuomo proposed that localities have to stay within the 2% tax increases, and that they cannot exceed 3%. Otherwise, localities will have to assume their Medicaid costs.
The MRT assignment also comes with conditions, including not harming local governments or beneficiaries, and rooting out “waste, fraud and abuse.”
The New York Greater Hospitals Association expressed optimism about the MRT plan in an emailed statement.
“We will work closely with all stakeholders in the MRT process to fix Medicaid’s structural problems and the incentives driving unnecessary growth while ensuring that hospitals, nursing homes and home care workers continue to have the ability to deliver high-quality care,” said Kenneth Reske, the association’s president.
The governor also addressed rising tension and conflict over the bail reform laws passed last year, which release individuals charged with misdemeanors and nonviolent felonies pre-trial. Cuomo said he and legislators would have to “act on information and not hyperbole.”
“Reform is an ongoing process,” he said. “Let’s understand the facts and consequences and discuss it rationally and make the decisions that we need to make, and we will do that as we move forward in the coming weeks.”
Advocates were swift to criticize Cuomo.
The Legal Aid Society called the governor’s proposal to go back to the drawing board a “slap in the face to communities of color who have shouldered the brunt of a racist and carceral criminal legal system” and in an emailed statement urged the state government “to resist calls to revert to a system that ignored the presumption of innocence and inflicted punishment on New Yorkers without any finding of guilt, solely because they lacked the deep pockets to purchase their freedom.”
The budget proposal also includes an $826 million increase for school aid, a 3% increase, and ensures the vast majority of that funding — 85% — goes to high-need schools and districts.
The funding is a mere fraction of the $4 billion the state owes to Foundation Aid, according to the state Education Department. The allocation of funding addresses concerns voiced over the Foundation Aid formula, which education advocates said is botched and doesn’t distribute appropriate funding to the individual schools that need it most.
Cuomo agreed during his address, calling for a new formula. He cited data from his office that wealthier schools spend $36,000 per student while lower-income schools spend $13,000 per student — an “outrage,” Cuomo said.
“Education is the civil rights injustice of our day,” Cuomo said, met with a roaring applause from Democrat and Republican legislators alike. “The current formula is designed to achieve political needs, not equity. Use your state funds to equalize the disparity in the funding.”
Massarah Mikati covers the New York State Legislature and immigration for Johnson Newspaper Corp. Email her at firstname.lastname@example.org, or find her on Twitter @massarahmikati.