Reports

The meltdown of the national housing market continues to threaten homeowners with foreclosures and reduced home values. Fortunately, New York had fewer subprime mortgages and has fared better than many other states.1 Nonetheless, the decline in home sales and home values is being felt, particularly downstate.

The worst recession since the Great Depression appears to be coming to an end, but it has cost the nation 8.4 million jobs. While the downturn has been less severe in New York State and New York City than in the nation, the impact has been painful nonetheless. New York City lost 186,900 jobs and tax revenues fell by 7.1 percent in FY 2009 ($2.8 billion)—the steepest decline in at least 30 years.

The proposed State Fiscal Year (SFY) 2010-11 Executive Budget released in January projected a five-year cumulative current services deficit exceeding $60 billion.

As local governments address fiscal challenges posed by stagnant or declining State and local revenues, increased demand for social services and growing fixed costs, local government officials should be mindful of the impact that budget decisions can have on the cost of borrowing. These costs can increase significantly if prudent budget decisions are not made within the context of multiyear capital planning.

In State Fiscal Year (SFY) 2009-10, All Funds spending for New York State amounted to $126.9 billion. Of this amount, approximately $38.4 billion or 30.2 percent was spent on Medicaid.

With the 2010-11 State Budget now six weeks late, local governments and school districts are struggling to budget and plan for the upcoming year. Under these circumstances, there is the distinct possibility that aid payments will be delayed and some localities may have to resort to short-term borrowing until they get paid by the State.

Over the last several years, OSC has increased its oversight of IDA operations through audits and performance reports. The Comptroller also began suspending State tax exemption powers for IDAs that failed to file financial reports. Additionally, the Public Authorities Reform Act that became effective in March 2010, will further enhance IDA transparency by requiring additional reporting on governance, operating structure and financial condition.

IDA Projects in 2008 - .xls

While the State ended State Fiscal Year (SFY) 2009-10 with a positive General Fund balance and all restricted reserves intact, this was accomplished because the Executive delayed $1.1 billion more in payments than had been anticipated in February.

The General Fund is the main operating fund of the State and is traditionally used to measure the State’s projected budget deficit.

The report is an update to a report on the sales tax first issued in 2006, "Local Government Sales Taxes in New York State." The report highlights new issues related to this important revenue source, including the potential impact of the upcoming 2010 Decennial Census on the share of tax revenues flowing to individual governments.

One tenet of the “smart growth” movement is that communities should strive to preserve open space, farmland, natural beauty and critical environmental areas.

The film and television production industry plays an important role in the economy of New York State, but states across the nation and certain Canadian provinces are aggressively competing for film and television jobs by offering tax incentives.

The nation is slowly emerging from the worst recession since the Great Depression, but the recovery is expected to be slow and uneven. Although the national economy grew at 5.9 percent during the fourth quarter of 2009, the strong growth could not offset the deep contractions that occurred in the first half of the year. As a result, the economy contracted by 2.4 percent in 2009, the largest annual decline in 63 years.

According to Office of the State Comptroller (OSC) records, there are currently 4,172 local government entities in New York. These include over 1,600 county, city, town and village governments, as well as 697 school districts and 872 fire districts. The nearly 1,000 other local government entities include libraries, community colleges, industrial development agencies and consolidated health districts, among others.

New York State has relied far too heavily on debt for far too long. Ten years after enacting legislation to slow the growth in borrowing and end the use of debt for fiscal gimmicks, New York continues to rely heavily on debt. A

The need for fiscal reform in New York State could not be more compelling. Despite significant spending cuts and revenue increases proposed in the Executive Budget, New York State still faces major projected budget gaps in future years—a cumulative three-year General Fund budget deficit that could exceed $30 billion through State Fiscal Year (SFY) 2013-14.

New York’s dairy farms are a vital part of the upstate economy. Dairy industry losses in local communities have a ripple effect throughout their economies, negatively impacting local businesses that provide supplies or services to dairy farms, and the property and sales tax base.

Agriculture is important to New York State’s economy, and takes place in almost every region of the State.

Wall Street bonuses paid to New York City securities industry employees rose by 17 percent to $20.3 billion in 2009.

The Executive Budget released in January 2010 proposed to roll the projected $500 million current year General Fund deficit into State Fiscal Year (SFY) 2010-11.