Home

FY 2016 Executive Budget Summary

Overview

Governor Cuomo’s Executive Budget maintains the two percent growth cap on state operating funds, with non-capital state funds spending proposed to increase by $1.5 billion or 1.7%. All funds spending would grow 2.8% driven by a proposed 17.3% increase in capital spending. School aid would grow by $1.1 billion, or 4.8%, contingent on agreements on teacher evaluations and tenure and other performance improvement proposals. Medicaid would stay at its 3.6% growth target.

If enacted as proposed, the Executive Budget would produce a balanced budget for FY 2016, and modest operating surpluses for the next three fiscal years.

This proposal includes an unprecedented $5.7 billion in one time, “windfall” settlement funds. The Executive Budget proposes to apply $1.5 billion to a five year upstate redevelopment program, $1.28 billion for Thruway Authority relief (including Tappan Zee bridge funding), $850 million for the state’s reserve fund, $500 million for a statewide broadband initiative, $400 million for hospital improvements, and the remainder for various projects and purposes, mostly relating to transportation.

The Executive Budget includes a major new residential real property tax “circuit breaker” credit, that when fully implemented would produce $1.8 billion in relief to homeowners and renters.

Major business tax initiatives include: legislation to bring New York City’s business taxes into conformance with the state’s 2014 reforms; a reduction in corporate franchise tax rates applicable to small businesses; and an extension of the at risk youth employment credit. More than fifty “nuisance” regulatory fees are being repealed. And while the Executive Budget includes a ten year extension of the brownfield program, it also proposes significant limitations on its property redevelopment tax credits and repeals the program’s post-redevelopment real property tax credit.

Other positive legislation included in the budget include an extension and expansion of “design build” authority (albeit with unnecessary project labor agreement requirements) and provisions bolstering school performance and accountability.

On the downside, the Executive Budget proposes to extend the pre-existing utility gross receipt tax to cell phone services (an estimated $50 million per year) and to impose a new assessment on health plans to pay the cost of running the state’s health exchange ($70 million per year.)

The most significant employer cost-driver in the Executive Budget is its proposal to increase the state’s minimum wage to $10.50 per hour, and $11.50 per hour in New York City, effective January 1, 2017. The state’s minimum wage increased to $8.75 per hour on December 31, and under current law will increase to $9 per hour at the end of 2015.

Other proposals of concern include:

Missing from the Executive Budget were several reforms endorsed by The Business Council, including expedited repeal of the remaining section 18-a energy assessment, permanent extension of the real property tax cap, scaffold law reform as part of the state’s expanded infrastructure program, and a reduction in HCRA taxes related to bad debt and charity care.

The following provides a detailed review of the Executive Budget, with a focus on provisions impacting New York State employers. We welcome members’ comments and questions.

Construction / Transportation

Contract Procurement

Economic Development

Staff Contact: Ken Pokalsky

Capital Projects (S.2004/A.3004):

Education / Workforce Development

Election and Campaign Finance Reform

Staff Contact: Ken Pokalsky

Energy

Staff Contact: Darren Suarez

Environment

Staff Contact: Darren Suarez

Financial Services

Staff Contact: Cate Tully

Financial Settlement Funding

Staff Contact: Ken Pokalsky

New York received $5.7 billion in financial settlements in the current state fiscal year which exceeded budgeted financial settlement projections by $5.4 billion. The Executive Budget proposal has dedicated this money to the following initiatives in the State Financial Plan:

Special Infrastructure Account ($3.05 Billion)

Special Infrastructure Account
(Thousands of Dollars)
Program Name FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 Total
Broadband Initiative $59,350 $106,800 $130,500 $106,800 $96,550 $500,000
Municipal Restructuring $17,805 $32,040 $39,150 $32,040 $28,965 $150,000
Hospital Projects $47,480 $85,440 $104,400 $85,440 $77,240 $400,000
Disaster Prevention and Response $17,805 $32,040 $39,150 $32,040 $28,965 $150,000
Penn Station Access $29,675 $53,400 $65,250 $53,400 $48,275 $250,000
Thruway Stabilization $152,530 $274,476 $335,385 $274,476 $248,133 $1,285,000
Transit Oriented Development $17,805 $32,040 $39,150 $32,040 $28,965 $150,000
Infrastructure Improvements $13,330 $24,240 $29,900 $24,240 $23,290 $115,000
Southern Tier/Hudson Valley
Farm Initiative
$5,935 $10,680 $13,050 $10,680 $9,655 $50,000
Total $361,715 $651,156 $795,935 $651,156 $590,038 $3,050,000

Upstate Revitalization Account ($1.5 Billion)

Upstate Revitalization Fund 5 Year Cash Disbursement Chart
(Thousands of Dollars)
Program Name FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 Total
Upstate Revitalization Fund $178,050 $320,400 $391,500 $320,400 $289,650 $1,500,000

Miscellaneous ($855 million)

Health Care / Health Insurance

Staff Contact: Lev Ginsburg

Labor / Human Resources

Taxation

Staff Contact: Ken Pokalsky

Technology / Telecommunication

New NY Broadband Initiative
(Thousands of Dollars)
Program Name FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 Total
Broadband Initiative $59,350 $106,800 $130,500 $160,800 $96,550 $500,000

Tourism

Staff Contact: Ken Pokalsky

Workers' Compensation

Staff Contact: Lev Ginsburg

Archives - NYS Budget