DiNapoli: New York Must Curb Its Compulsive Borrowing
Debt Burden $60.4 Billion and Growing with Little or No Taxpayer Input
State Comptroller Thomas P. DiNapoli today released a debt impact study showing that the State has been borrowing at a rate that is unsustainable and called for a series of reforms, including an end to backdoor borrowing and prohibitions on borrowing for operating expenses and budget balance.
"New York State is addicted to unaffordable borrowing,” DiNapoli said. “Now it’s time to break that addiction. Our per capita debt is through the roof. Taxpayers have little or no say in how much the state borrows, but they’re the ones who have to foot the bill.
"New York families understand you don’t use a credit card to buy groceries or pay for every day expenses. The state has to learn the same lesson. It’s alarming that discussions have already begun to focus on more state borrowing to balance the budget. New York already has too much debt. More borrowing would become part of the problem, not the solution"
DiNapoli’s report found that New York’s debt per capita is three times the national median and second highest among the largest states. Approximately $9.8 billion of outstanding debt was issued for operating expenses and temporary budget relief. DiNapoli noted that 94 percent of State-funded debt has been sold by public authorities without voter approval and State-funded debt is projected to grow from its current level of $60.4 billion to $67 billion at the end of FY 2015.
DiNapoli’s debt reform proposals include:
- Limiting all State-funded debt to 5 percent of personal income and prohibiting the use of State-funded debt for non-capital purposes;
- Banning public authorities from issuing State-funded debt and requiring the Comptroller to issue all State-funded debt with voter approval – except for $250 million in non-voter approved debt annually and emergency debt;
- Including multiple bond acts on the same ballot to give voters greater say on State borrowing;
- Creating a State Capital Asset/Infrastructure Council, which would provide an inventory and status of all capital assets of the State, its public authorities and local governments that receive a significant state investment; and,
- Establishing a capital needs assessment, to help the State better manage its vast infrastructure by identifying needs across all areas, including transportation, education, environment and energy.
Click here for a copy of the report.