Full transparency needed for current year’s budget of all withholdings, repayments, and cuts as end of fiscal year 2021 nears on March 31st 

Seventeen major New York State watchdog groups are asking Governor Andrew Cuomo, Senate Majority Leader Andrea Stewart-Cousins, and Speaker Carl Heastie to disclose full details about State funding withheld from agencies and local governments in the State’s current fiscal year 2021. The groups want full transparency about which programs had funding withheld and exactly how much the state is repaying. Importantly, the groups are also asking the Legislature to omit from the budget the extraordinary budget powers the Governor proposed for fiscal year 2022. 

The Legislature rolled back the Governor’s powers to issue directives related to the COVID-19 emergency on March 5th, but did not change the extraordinary budget powers enacted with the fiscal year 2021 budget.

The groups say the State’s current fiscal and economic conditions do not justify extension of the extraordinary Executive budget powers that were enacted last year, or the new powers proposed in the Fiscal Year 2022 Executive Budget. Compared to last year, the State’s economic conditions and tax revenues are more favorable and clear. The state also is expected to receive approximately $12.6 billion in direct fiscal aid from the passage of the federal American Rescue Plan.

In December 2020 many of the same groups asked the Governor and Legislature to fully disclose details of the State funding withheld by the Governor using extraordinary pandemic-related powers enacted last year. (Based on Freedom of Information requests, the groups say the State has not provided complete details on withholdings and payment adjustments, having only disclosed details of about 25 percent of funds withheld during fiscal year 2021 in formal notices to the Legislature.)

Watchdog groups request the Governor and Legislature make four changes: 

1. Fully disclose withholdings, repayments, and recurring reductions for fiscal year 2021 Budget: In response to the groups’ December 2020 letter, the Division of the Budget (DOB) said that a full breakdown of withholdings would be provided with the Governor’s Executive Budget in January 2021. However, the Executive Budget and 30-day amendment financial plan update did not provide that breakdown.

2. Remove the authority for the Governor to modify the budget midyear based on the State receipt of federal aid: The Executive Budget for fiscal year 2022 would give the Governor the extraordinary authority to revise the State’s spending plan if federal aid is not received by August 1, 2021, similar to the process that was adopted for this year’s budget, but which was not followed.

3. Remove State Operations appropriations transfer and interchange authority: The proposed budget for fiscal year 2022 includes broad provisions to allow DOB to transfer appropriations, including by “interchange.” State Operations spending should be managed within amounts appropriated for specific, clearly identified purposes by the Governor and Legislature in the budget.

4. Remove the COVID-19 Extraordinary Relief Fund controlled by the Executive: The Governor’s 30-day amendments to the Executive Budget for fiscal year 2022 would create a special fund controlled by the Governor for all receipts from new taxes and from the elimination of tax credits or deductions. This proposal should be omitted for three reasons. First, these revenues should be treated like all other general revenues and should be the subject of standard budget negotiations and enactment. Second, the disbursement procedures of these funds subvert Legislative budget authority. Lastly, the proposal fails to provide adequate public transparency of how these funds would be spent.

You can read the full letter here.