DiNapoli Report Highlights Structural Imbalance
Poor Decisions Contribute to Projected Gaps Totaling $38 billion Through 2012-13
New York will face a cumulative spending gap of $38 billion through State Fiscal Year (SFY) 2012-13 if steps are not taken to address the current imbalance between revenue and spending, according to a report State Comptroller Thomas P. DiNapoli released today.
“The state must look to the spending side of the ledger, rather than raising taxes and issuing large amounts of debt to pay for things it cannot afford,” DiNapoli said. “New York needs a strong dose of fiscal discipline, which has been lacking for far too long. The State must make difficult choices today to fix New York’s persistent budget troubles.”
DiNapoli’s annual financial condition report on the state’s fiscal health indicated that total state spending increased to $121.6 billion in SFY 2008-09, representing a 20.8 percent increase over the past four years, outpacing the rate of inflation over the same period. Spending in the state is projected to reach $149 billion by SFY 2012-13, an increase of more than 22 percent from SFY 2008-09. However, over the same period, revenue is projected to increase by less than 10 percent.
State-funded debt is also expected to increase by more than $10 billion to $67.5 billion in SFY 2013-14, up from $57 billion in the last fiscal year. The increase in debt is expected to add $2.5 billion to the annual cost of debt service, making it one of the fastest growing major categories in the budget.
Other findings in the report include:
- Foreclosures have increased substantially. In 2008, over 50,000 New York homeowners experienced a foreclosure, an increase of 29 percent over 2007 and 129 percent over 2006;
- In 2008, New York was the second most indebted state behind California and had nearly twice as much debt as the third most indebted state;
- Education and public health spending represents 68.4 percent of total State spending; and,
- In the SFY 2009-10 Capital Program and Financing Plan capital spending is projected to average $10.3 billion per year through SFY 2013-14.
The annual report of the Financial Condition of New York State provides the public with an overview of the fiscal situation of the state. DiNapoli also released the Comprehensive Annual Financial Report for SFY 2008-09 that contains an audited breakdown of state finances.
Click here for a copy of the Financial Condition of New York State for SFY 2008-09.
Click here for the Comprehensive Annual Financial Report for SFY 2008-09.