ALBANY – Gov. Andrew Cuomo and legislative leaders agreed Saturday on a feel-good, election-year budget that spreads around the money, tax breaks and new business opportunities for everyone from homeowners and manufacturers to title insurance agents and maple syrup producers.
Education, though, was a key part of the deal, as overall state aid for public schools increases by about double the inflation rate and relaxations are scheduled for the much-criticized Common Core program.
Lawmakers are scheduled to vote Monday on the $138 billion budget.
Among the agreements in the budget is creation of a pilot taxpayer-funded campaign finance system, but only for the state comptroller’s race. The budget deal also gives tax breaks to estates in an attempt to discourage wealthy residents from moving out of state before they die.
“It’s a piece of work that the people of this state … will be proud of," Cuomo said Saturday, about 12 hours after sleep-deprived negotiators submitted the final round of budget bills for the 2014 fiscal year that starts Tuesday.
Cuomo also agreed to end a panel that he appointed to investigate outside incomes of some legislators; lawmakers claim he exceeded his legal authority anyway. Cuomo said he will disband the Moreland Commission after lawmakers agreed to several plans, such as making it easier for district attorneys to prosecute public officials on bribery charges and creating a new enforcement mechanism at the state elections board to monitor spending and money-raising by politicians and political action committees.
As in most election years, the budget focused on education issues, with overall state aid to education rising 5.3 percent.
Parents, students and teachers also watched how the budget will address problems in the state’s Common Core program, which includes standardized math and English exams.
Changes are coming to Common Core, but kept intact is the test scores’ impact on teacher-performance evaluations. The changes will:
• Ban standardized tests for students in kindergarten through grade two and prohibit districts from putting Common Core test result information onto a student’s permanent record for students in grades four through eight; results of the tests can go to parents for “diagnostic purposes.”
• Prohibit decisions about grade promotion to be made “solely or primarily” on Common Core test results.
• Provide certain exemptions to the program for disabled students and those still learning to speak English.
• Limit the amount of time teachers can spend preparing students for the standardized tests to 2 percent of the total classroom time in a year.
• Require the state to provide parents with “instructional tools and outreach materials" to help understand the program.
• Create teacher training programs and establish safeguards to protect against the dissemination of personal information about students.
• Delay for two years the use of Common Core tests for grade-promotion decisions for students in third through eighth grades.
Property tax rebates
Elsewhere in the budget deal is Cuomo’s plan to give what will amount to modest rebate checks to 2.8 million property taxpayers, totaling about $1.5 billion over three years. His demand that tax breaks go only to communities that agree to reduce spending was watered down in the final deal.
In a telephone call with reporters Saturday, Cuomo called the property tax freeze the “single most transformative component" of the budget. He said it will force localities to cut expenses and eventually property taxes, instead of just slowing the growth. His political hammer: In year two of the program, residents will only get a property tax rebate check from Albany if their taxing jurisdiction – county, town or school district – starts shaving at least one percent in savings through shared-services deals with neighboring localities.
Lawmakers, though, insisted on changes that soften the savings edict. That includes letting localities count savings they achieved in the past – how far in the past is uncertain – to count in the property tax program’s equation.
Fiscal watchdogs, who praised the corporate tax cuts Cuomo got into the budget as helpful job creators, dismissed the property tax program as just moving around pots of taxpayer money in the guise of a tax cut.
E.J. McMahon, president of the Empire Center for Public Policy, called it a “wasteful gimmick" that uses state taxpayer money to give these same state taxpayers modest rebate checks on what they would have paid on property tax bills.
McMahon estimated that the rebate checks will total $160 in the program’s second year for a homeowner in Western New York paying a total of $4,000 in all property taxes and living in a community that qualifies for the maximum savings.
Other critics said the governor’s original “circuit breaker" property tax cut program, which was to kick in after his rebate program ends in several years, was amended and now will only apply to New York City residents. New York City renters will also get their own tax break program.
Education spending rises
In the education component, the total state aid increase to 700 public school districts will be $1.1 billion above the approximately $22 billion the state now provides. Individual school district allotments will not be available until Sunday night or Monday.
The Gap Elimination Adjustment – a fiscal maneuver the state used the past four years to grab money back from schools to help balance the state books – gets more than $500 million in relief in the new budget, state officials told The Buffalo News. Precisely how that affects individual schools was not available; a formula to determine that program, understood by only about three people in Albany, took up 2,419 words in the new budget that will show up on school budget computer runs as a single line item.
The budget also includes a $2 billion bond act – which voters will consider in November – with money to help schools do everything from purchasing computers and building broadband systems to building classroom space for a new statewide, voluntary pre-kindergarten program in public schools.
A new pre-kindergarten program has been allotted $340 million this year; $300 million of that is earmarked solely for New York City.
The budget creates a “teacher excellence fund” to award up to $20,000 in bonuses to teachers deemed “highly effective” on their teacher performance evaluations, partly determined by students’ performance on Common Core tests. The program seeks to emphasize the work of teachers serving in schools “with the greatest academic need.”
High school students graduating in the top 10 percent of their class who go to a state university and major in certain science, technology, engineering and math programs will be eligible for a new scholarship program.
Other tax breaks
Big tax breaks are on the way for manufacturers, and the state will move to more quickly phase out a surcharge on utilities that is passed along to consumers. Other tax breaks include everything from those who buy automatic external defibrillators to owners of vending machines that dispense candy and soda. The threshold for when estate taxes kick in rises from $2.1 million in 2014 to $5.2 million in 2017, according to the budget bills.
Other tax breaks include a $4 million program for the pre-production costs that touring companies spend on musical and theatrical productions at theaters outside New York City. Upstate theaters, especially Shea’s in Buffalo, say the deal will convince more major touring companies to begin their productions in upstate.
Cuomo’s vision for a statewide taxpayer-financed campaign system was gutted in the final budget bill; Senate Republicans said their constituents made clear they do not want taxpayer money going to candidates who do not share their political views. The compromise: a pilot program affecting just the state comptroller’s race – typically one of the cheapest statewide campaigns run every four years – will be covered with state matching funds for certain small-level donations. Government reform groups condemned the deal before state copiers even printed the budget.
The deal includes release of more information about often-mysterious “independent expenditure committees” that spend money promoting political candidates or policy causes. It also creates a new enforcement counsel office at the state Board of Elections to better monitor election law abuses by campaigns. The governor will select the new enforcement head, approved by both houses. That enforcement officer will serve a five-year term.
There are also new criminal sanctions for public officials engaging in “corrupting the government” and new lawmaker financial disclosure requirements. It mostly affects the lawyers in private practice and requires them, after Jan. 1, 2015, to reveal certain details about their clients, though with some major loopholes, such as if the client might be “embarrassed” by the public disclosures.
Line items, shout-outs
Line item appropriations pots range from relatively small – $150,000 for maple syrup producers for marketing to $900 million for state university capital programs.
As expected, Cuomo and lawmakers agreed to appropriate the remaining $680 million of what’s left of the $1 billion economic development program announced for Western New York. But it could be years before it’s known precisely how that money will be spent. The budget includes another annual allotment – $2.2 million – for renovation work at Ralph Wilson Stadium.
If there was any mistaking 2014 as an election year for the governor and all lawmakers, the budget makes it clear. There are fiscal shout-outs to millions: business owners, homeowners, renters, parents of school children, sick people, fire houses, health care workers, and hunters.
People who agree to become a farmer for the first time and run a farm with less than 100 acres could get a grant from the state for up to $50,000 while certain “young farmers” could be eligible for up to $10,000 in college loan forgiveness grants for agreeing to keep farming.
Funding stretches the gamut: $1 million for a special heroin treatment program, $6.1 million for snowmobile law enforcement and trail maintenance programs, $162 million for the Environmental Protection Fund, and money for thousands of entities, such as museums, libraries, indigent defense services and parks.
The budget also legalizes crossbow hunting in New York.
Overall, Cuomo said the budget’s growth will be 1.9 percent over 2013’s fiscal plan.