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Cuomo’s budget tries to appeal to everyone

ALBANY – Gov. Andrew M. Cuomo on Wednesday sought to appeal to everyone from left-leaning New Yorkers to upstate small businesses.

But in the end, he proposed a 2015 state budget that divided many groups and enraged organized labor as he presented a mix of new ideas and familiar plans that have died for years in Albany.

The second-term governor sought to allay Catholic leaders by introducing another private school tax cut plan, appeal to certain middle-income homeowners living in high-tax areas with a state-subsidized property tax break, and reach out to upstaters with soaring rhetoric about what he has done for places such as Buffalo and what he will be do for other regions across the state in the coming year.

Although he stressed his fiscally moderate ways, the governor is seeking to tap into an unexpected $5.4 billion legal settlement fund to help bring some major transit and bridge projects downstate, $1.5 billion to three of seven upstate regions outside of Buffalo in what has been described as a “Hunger Games” competition and balance the budget to the Thruway Authority to keep tolls flat – for this year.

As Cuomo sought to portray a state – especially upstate – in full economic-recovery mode, he also picked another major battle with teachers and others in the education system with a call for ways to improve classroom instruction and more charter schools, and linked all of it to a potentially big boost in state education aid.

In all, the governor proposed a total budget of $141.6 billion, up 2.8 percent, exclusive of certain federal money and the windfall funding. The state taxpayer portion of the budget would rise just under 2 percent.

“New York State is back,” Cuomo told lawmakers and others in a state convention center at Empire State Plaza near the Capitol as he delivered his fifth State of the State address and released his 2015 budget proposal.

In his policy bows to the left, which came after his recent call to continue the ban on hydraulic fracturing for natural gas, the governor called for changes to the grand jury system while renewing calls for a taxpayer-funded campaign finance system and state aid for children of undocumented immigrants. All were immediately dismissed as dead on arrival by Republicans in control of the Senate.

Perhaps showing the signs of a fifth year in office, many of the Cuomo proposals are either old or merely reshaped from previous years, as the words “continue” and “expand” were peppered throughout his budget address.

With a $1 billion spending program for the Buffalo area still underway, gone from his State of the State speech were any big, showy projects for Western New York. But he said his administration had brought an economic revival to Buffalo that he now wants to take elsewhere upstate. “The days of downstate flourishing and upstate suffering are over,” he said.

The governor proposed a $1.5 billion fund – to be awarded to three upstate areas – and $1.3 billion for the Thruway, much of which will eventually be destined to help pay for the $4 billion Tappan Zee Bridge project across the Hudson River.

That money is all coming from an unexpected $5.4 billion legal settlement fund between the state and financial institutions over the last year. Senate Majority Leader Dean G. Skelos, a Long Island Republican, said he wants all portions of the state to benefit from that money, setting up the always predictable geographic fight in Albany as the budget is negotiated.

Assembly Speaker Sheldon Silver, D-Manhattan, raised questions about Cuomo’s tax credit program to benefit parents of children in private schools, as well as the governor’s call to raise the cap on the number of charter schools allowed.

Businesses liked some of the tax breaks but lashed out at his call for another increase in the minimum wage. Environmentalists praised his added funding commitments for their programs. Farmers thanked him for additional agriculture program aid but wondered why his main funding for a $50 million earmark was targeted only for the Southern Tier and Mid-Hudson Valley. Unions, led by the AFL-CIO, suggested that his attacks on public school teacher abilities were an affront to organized labor.

It was, as one analyst put it, the usual good and bad from a fiscal standpoint. Cuomo got praise for holding state spending under 2 percent. But E.J. McMahon, president of the Empire Center for New York State Policy, called Cuomo’s property tax subsidy for only some New Yorkers a “gimmick” while adding that his plan for the $5.4 billion legal settlement funds is a “blown opportunity” because it does not focus on the most needed transportation problems in the state.

Cuomo did propose making the state’s 2 percent property tax cap program permanent; otherwise, it would expires this year.

He called for additional types of gambling devices at racetrack casinos, such as in Hamburg, to bring the state $40 million in revenue. He called for a modest increase in operating aid money for the state university system and laid out plans he already had revealed for relaxing criminal-justice laws pertaining to minors.

Nearly 20 percent of the $5.4 billion legal settlement is going to Washington to end a dispute over federal Medicaid money that the state received.

The Cuomo budget also would give financial incentives to state university presidents “who provide leadership resulting in commercialization of research” and begin a pilot program at 12 community colleges to provide community services – from family counseling and elder care services to health care services – in areas of the state deemed especially distressed.

The governor said he wants to adjust the way state colleges are funded from a system based on student enrollment to a portion of financial support based on student performance.

The electronic cigarette industry could become regulated in New York, Cuomo is proposing.

In addition, Cuomo is calling for one of his favorite types of gatherings: summits. He wants to hold them on topics from how to help small businesses to how to assist localities in controlling tax increases. Localities for years have asked Albany to reduce state-imposed mandates, such as in the Medicaid program, as the best way to control taxes. Not in the budget: any major plans to help localities reduce the costs imposed by state-mandated services.

Cuomo proposed making beer and liquor tastings tax-exempt, and requiring state approval of local industrial development agency projects if they include state sales tax breaks.

He proposed a 3.6 percent increase in Medicaid spending along with $1.4 billion in health care capital spending. His high-end plan for public school spending would boost state aid by 4.8 percent to $23.1 billion. With those increases, that would leave state agencies scrambling to make up the difference to keep the state-funded portion of the budget under 2 percent: Their budgets will grow by just 0.6 percent this year.

The governor’s budget has a mix of winners and nonwinners.

Small businesses – but only a minority of them – would get a tax break. Homeowners would get a portion of their property taxes paid for by the state, but only those with incomes under $250,000 and tax burdens higher than six percent of their incomes. And minimum-wage workers would see their pay go to $11.50 an hour, but only if they live in New York City; others would get $10.50 an hour. Also, Roswell Park Cancer Institute’s funding from the state would be cut by $15 million. The hospital’s current annual state aid is $102 million.

News Medical Reporter Henry L. Davis contributed to this report. email: