David Friedfel, Director of State Studies at the Citizens Budget Commission, shared the findings of the organization’s report on New York’s climate transition.

The leadership of the Transport Workers Union (TWU) formally approved a new labor contract for its nearly 37,000 members at the MTA after months of often tense talks.

One budget watchdog criticized the deal, saying the MTA missed an opportunity to control costs.

Against the backdrop of a national economy that has expanded for much of the past decade, New York leaders are scrambling to address a projected $6 billion budget deficit, much of it driven by escalating Medicaid spending.

Another area of concern for some budget hawks is the state’s effort to stimulate job growth through taxpayer-funded economic development grants. Some projects that have received grants in recent years, they argue, have failed to deliver on the state’s publicly stated projections for job creation.

“Some of these one-shot attempts to revive a regional economy by building a massive plant for a company haven’t produced the results we would have hoped for,” said David Friedfel, director of state studies for the Citizens Budget Commission, a watchdog group.

Friedfel suggested that the funds poured into regional “silver bullet” efforts to prop up local economies could have been better spent by building state financial reserves or trying to identify ways to contain the state’s share of Medicaid spending.

The state-run Metropolitan Transportation Authority is hiring 500 state cops without giving them a clear goal to meet. Meanwhile, the New York Police Department, which has some 2,700 officers traditionally policing subways and buses, is pulling back on criminal enforcement in the transit system.

The risk is that the two police forces will end up working at cross purposes. To avoid that, the MTA should rethink its approach to its biggest low-level scourge, fare evasion. As with many things transit, Europe does it better — and with more civilians, not cops.

The MTA could give people two hours from fare payment to complete their trips.

Rather than issue a summons, the deterrent would be a “penalty fare” — something the MTA board could also implement. In London, the penalty fare is about $90, half that if paid within three weeks. In Paris, the penalty is about $35, payable on the spot. (Carol Kellermann, former Citizens Budget Commission head, recently wrote about her experience with Parisian enforcement after failing to retain her ticket.)

New York state’s chief fiscal officer wants Gov. Andrew Cuomo to quickly provide more information about potential cuts to the Medicaid program, which the governor’s office recently put on the table to deal with a $4 billion cost overrun.

Comptroller Tom DiNapoli said in an interview last week that he’s concerned about the situation, which has been developing since the state began its new fiscal year in April. A midyear update released by Mr. Cuomo’s Division of the Budget last month said the state could reduce payments and reimbursements to health-care service providers by $1.8 billion. Details will be coming in January, the update said.

Mr. DiNapoli, a Democrat, said he believed Mr. Cuomo should be more forthcoming.

“Whenever you have a challenging situation with the numbers and difficult options, the more information you can give all the stakeholders, so there can be thoughtful discussion, the better,” Mr. DiNapoli said.

The budget update also said the state would defer $2.2 billion of Medicaid payments into the next fiscal year—essentially pushing more than half of this year’s overrun into the future. Last year, the state deferred $1.7 billion of Medicaid payments into the current fiscal year.

David Friedfel, director of state studies for the Citizens Budget Commission, a nonpartisan fiscal watchdog, agreed the Budget Division should release more details and blasted the planned deferrals.

“Their plan was one part fiscal gimmick and one part punt,” Mr. Friedfel said.

The economy has been churning along. Wall Street has delivered a strong 2019. Personal income in New York State is growing and tax receipts are healthy. And not a day goes by without some big spending announcement – for this program or that community – by Gov. Andrew M. Cuomo.

Against that backdrop, New York State, according to Cuomo, is facing the greatest operating deficit in its budget since the Great Recession.

Much of the reason for the red ink is Medicaid, the insurance program for more than 6 million low-income New Yorkers. Medicaid services in the Empire State will cost the state, federal and local governments more than $74 billion this year.

But Medicaid has been facing a growing deficit, one that was not so quickly acknowledged in public by the governor. It wasn’t until the summer before a fiscal watchdog group, the Empire Center, found that the state last March, in the closing days of the state’s fiscal year, rolled over $1.7 billion in Medicaid payments to some 80,000 providers, like hospitals, into April – and, thus, the start of a new fiscal year.

A variety of factors are causing the Medicaid problem. “The state would have known all those things, but it just didn’t adjust the budget the way it should have to find a way to curtail them or account for the rising costs,’’ said David Friedfel, director of state studies at the Citizens Budget Commission, another fiscal watchdog group. He had previous jobs on the Assembly’s fiscal staff and as a staff expert on Medicaid in the state’s budget division.

A state budget crisis is looming, and taxpayers will be seeing red.

New York State is facing the largest budget deficit in years of more than $6 billion.

The president of the Citizens Budget Commission , Andrew Rein, is highly critical of how the state plans to try to stop the budget bleeding.

“The governor’s proposal is one-part gimmick – which is basically just keep rolling two billion dollars – paying those bills late, so it looks like things are solved, but it really just papers over the problem. And one-part delay – saying well the other half of the problem – we’ll tell you later how we are going to solve it,” Rein said.

New York faces budget deficits between $6 billion and $8 billion over the next three years amid ballooning costs for Medicaid.

Budget documents released Friday afternoon showed the state faces its worst fiscal problems since the recession in 2010, when a $10 billion budget gap needed to be closed.

In Cuomo’s first year, he and lawmakers had to cut school aid by $1.3 billion or 6%, cut health-care costs and lower overall spending by 10%, leading to a series of concessions by labor unions who represent state workers to avoid mass layoffs.

Now they will face new pressures on how to balance the budget in the coming months.

Cuts shouldn’t be done solely within the Medicaid system, said Andrew Rein, president of the Citizens Budget Commission, a business-backed think tank in New York.

“Developing and implementing a plan to solve the entire budget problem need not be done entirely within the Medicaid program,” he said in a statement.
The state Legislature and Gov. Andrew Cuomo will need to come up with a balanced budget for the next fiscal year that starts April 1.

In order to address the $6.1 billion dollar budget gap that my colleague Nick Reisman wrote about here, Gov. Andrew Cuomo doesn’t need to wait for the Legislature.

He doesn’t even need to wait until January.

“This governor has more authority under law now to control spending in a variety of ways, than any of his predecessors,” according to E.J. McMahon of the Empire Center for State Policy. “He can unilaterally reduce payments to hospitals. He can impound aid in all forms.”

It’s something David Friedfel of the Citizens Budget Commission refers to as “super powers.”

“The Department of Health and the Division of the Budget have something called ‘super powers’ when it comes to Medicaid spending. They have the ability to cut reimbursement rates and make some other cuts without going to the Legislature.

New York faces budget deficits between $6 billion and $8 billion over the next three years amid ballooning costs for Medicaid.

Budget documents released Friday afternoon showed the state faces its worst fiscal problems since the recession in 2010, when a $10 billion budget gap needed to be closed.

Now they will face new pressures on how to balance the budget in the coming months.



Cuts shouldn’t be done solely within the Medicaid system, said Andrew Rein, president of the Citizens Budget Commission, a business-backed think tank in New York.

“Developing and implementing a plan to solve the entire budget problem need not be done entirely within the Medicaid program,” he said in a statement.

The state Legislature and Gov. Andrew Cuomo will need to come up with a balanced budget for the next fiscal year that starts April 1.

The 2020 legislative session is shaping up to be a deeply challenging one for state lawmakers and Governor Andrew Cuomo.

This is, arguably, the biggest budget challenge Cuomo has faced since he took office and inherited a $10 billion budget gap.

Meanwhile, it’s not entirely clear what the plan is for closing the gap, other than delaying billions of dollars in spending.

The Citizens Budget Commission called the details outlined in the report “one part gimmick and one part delay.”

“Developing and implementing a plan to solve the entire budget problem need not be done entirely within the Medicaid program,” the group said in reaction to the report. “Other portions of the budget also should be considered, including mistargeted school aid and unproductive economic development programs.”

New York State is facing a large hole for next year’s budget driven by escalating Medicaid costs.

Gov. Andrew Cuomo’s administration released a mid-year report last week estimating a $6.1 billion gap for the 2021 fiscal year that begins April 1. The shortfall was largely attributed to a $4 billion rise in the state’s Medicaid expenses.

An October analysis released by the Citizens Budget Commission fiscal watchdog group criticized New York State for being slow to respond with a plan to confront a growing Medicaid cost burden. The CBC report noted that New York has deferred Medicaid payments in recent years in order to remain within budgeted spending levels and that delay of $1.7 billion bill due in 2019 into the 2020 budget cycle has contributed to the state’s current predicament. A rising cost per Medicaid enrollee between 2016 and 2018 caused total spending to increase more than 25% in the past three years despite flat program enrollment, according to the CBC.

“The state’s plan to address the Medicaid-driven budget gap is one part gimmick and one part delay,” CBC president Andrew Rein said in a statement Friday. “Delays only serve to make the solution more painful.”