Message to the Members: Solving the Budget Crisis

John A. DeFrancisco NYS Senator

John A. DeFrancisco
NYS Senator

Currently New York State is projected to face a shortfall of between $2.9 and $3.5 billion from a budget that was crafted behind closed doors by Three New York City Democrat leaders this past spring.  As part of the most secretive budget process in state history, spending was raised by $12 billion, taxes were raised by $8.5 billion and property tax rebates were eliminated.

Moreover, during the budget hearings, as the Republican Ranking Member on the Finance Committee, I warned, as did my Republican colleagues, of how irresponsible it was to increase spending and raise taxes and fees with the economy in a serious downturn and people losing their jobs.

Despite the sound arguments of the Republican Minority members, the budget was passed, and very quickly the budget gap that New York State faces grew even deeper.  Governor Paterson has repeatedly stated that he will be calling a special session to deal with the ever-growing budget gap, although he has not announced a date yet. I encourage the Democratic leadership to come together in a bi-partisan way to revisit  the Senate Republican Minority plan to create jobs, cut taxes and reduce government spending. Quite simply, if we do not improve the business climate now, we will not recover from our downward spiral any time soon.

It is time to think outside the box and assist our small business community’s ability to grow and prosper by taking a number of important steps which my Senate Republican colleagues and I proposed during last year’s budget session -- and which we continue to advocate for today -- including:

• cutting taxes in half for small businesses and eliminating taxes altogether for small manufacturers,
• creating new tax credits tied to job creation and training,
• helping small businesses obtain loans to grow,
• reducing health insurance costs for small businesses, and,
• expanding tax credits for emerging technologies businesses.

While Democrats have defended their tax and spending decisions as the only solution in difficult economic times, Senate Republicans have shown there was a better way.

During last year’s budget hearings we proposed the “Better Budget for New York” to provide a road map to fiscal responsibility. While this plan was ignored by the Democratic leadership last year, it remains relevant today.

Our plan rests on the following premises:

• No new taxes,
• Cap state spending to force the State to live within its means,
• Ensure federal stimulus moneys are used only to create jobs,
• Eliminate any new spending added during last year’s secretive budget process,
• Consolidate redundant or under-utilized state agencies,
• Create a Berger-style commission to conduct a top-to-bottom review of every single regulation in New York State,
• End state subsidies to a bloated and inefficient shadow government, made up of hundreds of unnecessary public authorities, and
• Instead of tax hikes, returning surplus State properties to the private sector.

Our budget crisis last spring was an opportunity to get the State going in the right direction and that opportunity was squandered.  Next year, without stimulus money, the situation will be even worse.  The Governor says the State is on the brink of economic disaster.  Businesses are being forced to close and family members and friends are saying good bye to loved ones and leaving the state.  We still have another opportunity to exercise fiscal discipline, and this time we must not squander it.

Senate Republicans are committed to writing a new chapter, so long as the Democrats are ready to address the economic crisis facing New York.

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