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A budget for New York; Spending agreement looks like a responsible way forward

Good News for New Yorkers: The $132.5 billion tentative budget agreement announced by Albany leaders on Sunday spends 2 percent less than last year, potentially leading state government toward a structurally sound model -- toward making government work.

Tackling his first budget as governor, Andrew M. Cuomo -- along with Senate Majority Leader Dean Skelos and Assembly Speaker Sheldon Silver -- has managed a series of accomplishments not seen in years:

*At five days before the March 31 budget deadline, the possibility exists for the first on-time budget in five years. The deadline is April 1.

*The agreement would reduce the state's overall year-to-year spending for the first time in more than a decade.

The two big pieces that bedevil New York State -- outrageously high costs of Medicaid and education -- are the largest growth areas of the budget and not areas in which there is great return. One graphic example: Per-pupil spending in New York is the nation's highest, yet produces only middling results.

Spending caps on both Medicaid and education that will go into place starting next year should force some restraint. If nothing else, they will force a longer conversation about reforming spending in those areas.

Cuomo also did well in wielding the hammer first picked up by his predecessor, former Gov. David A. Paterson. If lawmakers missed the budget deadline, he threatened to place his preferred cuts into an emergency spending measure, forcing legislators to vote for his budget or risk shutting down state government.

It worked. And so did negotiations with powerful health care interests in drafting a side deal to give him broad cuts in exchange for concessions that are said not to affect the budget.

There was no continuation of the "millionaires tax," as Democrats wanted -- and as this page reluctantly endorsed -- but there are also no new taxes, as Cuomo promised during his campaign. The result is a budget that does more to influence businesses to remain or locate in this state.

Other important elements that could help bring jobs to New York include:

*Creating the Recharge NY Power Program to provide a permanent economic development power program.

*Improving the Excelsior Jobs Program to support job creation and investment in targeted industries.

*Creating Regional Economic Development Councils to speed job creation and remove barriers to growth throughout the state.

This tentative budget agreement doesn't signal the end. The fiscal reform agenda must be completed with longer conversations on a real property tax cap and mandate relief for local governments and school districts. Both are urgent and must not be forgotten.

And such discussions must include reform of public employee collective bargaining agreements with an eye toward cost. Public employee pension and health benefits reform also must remain on the table.

This tentative budget agreement closes a $10 billion gap in a responsible fashion and, while it's too early to predict, next year's budget hole should prove much more manageable. By all accounts -- preliminary though they are -- this is a deal that moves state government in the right direction. Finally.

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