S.365 (Robach)


Vice President


S.365 (Robach)


Statutory Cap on State Spending



The Business Council supports this legislation that would impose a statutory cap on state spending.  Specifically, it would limit growth in state operating funds spending to a rate based on the average inflation rate of the previous three years.    The bill would allow the cap to be exceeded in response to emergencies such as a “natural disaster, invasion, terrorist attack, or economic calamity.”  The bill also increases the size of the state’s “rainy day fund” from five to ten percent of average state spending.

Even with historic fiscal constraint over the past six budget cycles, New York remains a high spend, high tax state.  High tax burdens, especially considering the combined impact of state and local taxes, has made New York an expensive place to live and do business, and has impaired its economic growth and retention of population.

And even thought the current Administration has focused on controlling spending growth, there is nothing in statute to restrict renewed high growth rates by future administrations, nor prohibit the shifting of spending items to disguise actual spending levels.

While a constitutional spending cap is preferable, its enactment would require an uncertain, multi-year process.

We believe that adoption of a statutory spending cap would be an expedient, effective mechanism to maintain the fiscal process achieved so far, and to protect New York taxpayers from unreasonable tax increases going forward.

For these reasons, The Business Council supports adoption of S.365.