New York wants to impose stiffer penalties on homeowners who cheat the state's popular STAR program.

The $3 billion a year program provides a break on homeowners' school taxes, but Gov. Andrew Cuomo has sought to cut out fraud within a program that benefits more than 2.6 million New Yorkers.

The proposal, part of his state budget plan for the fiscal year starting April 1, would impose a six-year moratorium on recipients who provide false information to the state to get the lucrative tax breaks.

STAR is available to homeowners on their primary residence who have an adjusted gross income of $500,000 or less. The state found some New Yorkers had been getting the break on second homes.

Checks are a better way to run the program, state officials said, and it is also a bookkeeping move.

Sending checks allows the state to account for them as credits that reduce state tax revenues, rather than counting the program as additional spending in the state budget, the Citizens Budget Commission, a business-backed think tank has pointed out.

After Amazon dropped its plans to build a new headquarters in New York City, Gov. Andrew Cuomo criticized the loss of an estimated 25,000 jobs and $27 billion in tax revenue, calling it “the greatest tragedy that I have seen since I have been in government.”

Not everyone agrees, but the abrupt pull-out after New York initially won Amazon’s “HQ2” contest has raised questions about whether the Cuomo administration is taking the right approach in its efforts to create jobs and spur economic development.

Earlier this week, we asked our readers what they thought. As of Tuesday evening, roughly three out of four voters said that New York’s economic strategy is not working. Asked what the state should do differently, the most common response was to improve the tax and regulatory climate.

We also reached out to the experts to see what they have to say. In our latest “Ask the Experts” feature, we reached out to Donnie Charleston, diirector of state and local fiscal engagement at the Urban Institute; David Friedfel, director of state studies at the Citizens Budget Commission; Bruce Gyory, a senior advisor at Manatt, Phelps & Phillips and a Democratic political consultant; Jim Heaney, the founder, editor and executive director of Investigative Post; and E.J. McMahon, research director at the Empire Center for Public Policy.

Does New York need to overhaul its economic development strategy?

David Friedfel: Yes. The state and local governments allocate almost $10 billion annually to economic development with scant evidence that taxpayers are getting a good return on their investments. Economic development will be best served by a combination of strategic human and capital infrastructure investments that provide the foundation for growth and targeted performance-based incentives that are holistically planned, transparently presented with standardized metrics, and regularly evaluated.

Under a pilot program championed by Dr. David Prezant, the Fire Department’s Chief Medical Officer, the Federal Government will experiment with ending primarily the practice of Medicare reimbursing local Emergency Medical Service agencies primarily for runs to hospital emergency rooms.

Under the new approach, ambulance teams will be encouraged to triage fee-for-service Medicare patients and take them to their doctor's office or to an urgent-care center, rather than to a hospital’s emergency room if that’s the most-effective course of action for the patient.

In a 2013 white paper published in the journal Health Affairs, researchers looked at national Medicare claim data for EMS utilization for 2005 through 2009. They estimated that such EMS triaging could save as much as $560 million a year, while also “improving continuity of patient care.” If private health-insurance providers followed suit, “overall societal savings could be twice as large.”

In November, the Citizens Budget Commission issued a report that raised several of the same issues the Federal pilot program aims to address.

The CBC, a business-funded fiscal watchdog, concluded the FDNY Emergency Medical Service was inefficient and shortchanged responses to life-threatening calls because it dedicated an “excessive share of resources” “to noncritical incidents.”

According to the CBC, its research indicated a significant number of EMS runs were being made “when professional medical care is not actually needed; when the sick person could have gotten to the hospital or to another medical-care provider safely on his or her own; or when the situation could have been avoided with earlier care or behavior change.”

This January, Mayor de Blasio unveiled NYC Care, a healthcare plan for undocumented immigrants and other New Yorkers who do not qualify for insurance. The $100 million investment hopes to guarantee healthcare coverage for all New Yorkers, as well as bolster the pre-existing public insurance option, MetroPlus. All patients on NYC Care will have direct access to facilities within the Health + Hospitals system.

The initiative has raised questions about the health of the public hospital network. That system was in a state of critical condition in 2016. In order to keep Health + Hospitals afloat financially and temporarily stabilize the system, de Blasio made a series of emergency payments, totaling $497 million.

“It appears [Health + Hospitals] is making progress,” Mariana Alexander, research associate at Citizens Budget Commission says, explaining that the system has started to cut down on headcount, hire more primary care staff and better bill through insurance.

According to President and Chief Executive Officer of Health + Hospitals Mitchell Katz’s testimony at the New York City Council Executive Budget Hearing in May 2018, the system was on track to achieve $616 million through revenue generating initiatives in the fiscal year and $345 in expense reductions.

By identifying enhanced reimbursements in the Medicaid and Medicare appeals process, Health + Hospitals says it was able to improve revenue collections.

An increase in revenue flow, combined with headcount and procurement savings, has provided offsets to budget gaps in excess of $1 billion each year.

In his 2018 testimony, Katz predicted Health + Hospitals would close out the fiscal year with a cash balance of over $600 million. The system exceeded this projection, which suggests financial improvement.

“[Health + Hospitals] closed fiscal year 2018 with $747 million cash on hand,” Alexander says, an amount that was $130 million more than they ended with the previous year.

When Gov. Andrew M. Cuomo saw a surprise $2.8 billion drop in state income tax revenues in December alone, the Democrat blamed most of it on President Donald Trump's tax overhaul. The new law caps state and local tax deductions, or SALT, on federal income taxes. But fiscal analysts say there are other factors that could have played larger roles.

Wall Street bonuses, which traditionally contribute as much as 20 percent of state income tax revenue, are on track to be hundreds of millions of dollars less than a year ago, the analysts say. In addition, because of a 5 percent drop in the stock market at the end of the year, many investors took losses, reducing their tax liability. And they said other drivers likely included international trade turmoil, a weakening housing market and cooling economy, and even errors in the difficult task of forecasting income tax revenue.

“There are really too many different factors in play and it’s really hard to say what is the impact of SALT deductions versus other factors,” said Lucy Dadayan, a senior research associate with the Urban-Brookings Tax Policy Center at the Urban Institute, a Washington, D.C.-based research group. “I think it’s too early to come to any definite conclusions because we just don’t have enough data.”

“Determining the relative magnitude of these causes will take additional analysis and experience,” said David Friedfel, director of state studies for the independent Citizens Budget Commission, in his analysis. “However, some of these causes also will likely drive lower personal income tax receipts in the future.”

“That’s why the state needs to work on its reserves, so it could absorb these kinds of shocks,” Friedfel said. “If this is an indication of a slowdown, then one month could wipe out our rainy-day fund.”

Gov. Andrew Cuomo says it’s irresponsible for political opposition to stop Amazon from locating a headquarters in Long Island City. The project, which Amazon pulled out of last week, would have brought 25,000 jobs to the New York City area.

Isn’t it also irresponsible to spend $3 billion in tax and other incentives without legislative approval, particularly given the state’s recent economic development record?

State spending on economic development reached $9.9 billion in 2018, a 17-percent increase from 2016, according to the Citizens Budget Commission. A state facing a $2.3 billion budget gap this year spent $9.9 billion on economic development with precious little formal evaluation to make sure the money was spent wisely. And as we know from the Buffalo Billion, some of that money is spent on projects that fizzle out without creating the jobs promised or are pots of money so large they invite fraud and corruption. Cuomo has proposed approval of the much-discussed database of deals that was approved by the Republican-led state Senate last year but wasn’t approved by the state Assembly. Further, the Citizen Budget Commission’s authors suggest a unified economic development budget that includes information on the costs of all economic development programs for the coming fiscal year; standardization of metrics across economic development programs to allow for comparability of results; and program design improvements so that benefits follow private sector investment, eligibility is standardized and results are evaluated regularly.

The amount of money New York doles out to subsidy jobs has long faced criticism.

An investigation by the USA Today Network in New York in 2017 found New York spent more than $8 billion a year on economic-development programs, but they often produced lackluster results and had limited oversight.

The spending has grown since then, according to the Citizens Budget Commission, a business-backed think tank.

The group said spending on state and local economic-development efforts last year reached $10 billion, a 17 percent increase from 2016.

"Between 2016 and 2018 state and local economic development costs continued to increase, state spending shifted toward discretionary grants and away from as-of-right tax breaks, and transparency has not meaningfully improved," the group said.

The Citizens Budget Commission is suggesting that Gov. Andrew Cuomo cut his proposed education aid increase in half and eliminate the property tax relief credit in order to plug a $2.3 billion hole in the deficit.

The commission, which is a nonpartisan fiscal advocacy group, suggested the state limit the growth in spending to no more than 2 percent. In order to accomplish that, the CBC said the governor should increase education aid by about $450 million, instead of the $956 million he is proposing by directing more education aid only to those districts that need additional resources to fund a “sound basic education,” according to a news release.

Education advocacy groups are seeking about a $2 billion increase in education aid.

New York state needs to have a plan in case billions of dollars in cuts to the Medicaid Disproportionate Share Hospital program take effect Oct. 1, the Citizens Budget Commission wrote in a new analysis.

Without a plan, dire cash shortages at some public hospitals are likely to resurface as they did in 2017, when the cuts went into effect before Congress approved a delay. The Medicaid DSH cuts were part of the Affordable Care Act and were set to start in fiscal 2013, but Congress has delayed them four times.

The report described the state's method of distributing $5.3 billion in supplemental Medicaid payments, including from the DSH program, the Upper Payment Limit program and other state initiatives.

New York divides its DSH program into a $1.1 billion indigent care pool and $2.6 billion in support for public hospitals.

Because of the state's distribution formula, H+H is first to be affected by federal cuts, and the state should work to more equitably distribute the impact, the report said.

Several recent analyses have said the state is too broadly distributing the indigent care pool funding, with 175 hospitals receiving some money while hospitals providing the most care to Medicaid and uninsured patients don't receive enough.

One of the amendments to the governor's budget proposal released Friday was a reduction in indigent care payments. "It's geared not to impact the distressed hospitals but hospitals with higher margins and better payer mix," state Budget Director Robert Mujica said. He said his staff was compiling reports on how the amendment would affect individual hospitals.

Patrick Orecki, the CBC report's author, said that is still not enough. "To just look at just the indigent care pool is still to narrow, he said. " A more comprehensive proposal would consider the full $5.3 billion slate of programs." —J.L.

City Councilman Brad Lander has stirred up an ant nest by pushing for accountability in city capital spending.

The Brooklyn Democrat notes that public tracking is inadequate when it comes to some 10,000 city capital projects, large and small. He points out that half of all large projects are overbudget and behind schedule — on average, $14 million in overruns and 515 days late.

Meanwhile, the Citizens Budget Commission says Lander’s bill isn’t enough: It should also force the city to retain historical data and link to official budget line items.

The CBC fears the city’s capital plans underfund projects in coming years — meaning City Hall will have to find more cash, or mothball half-finished work. Sure sounds like the de Blasio approach, doesn’t it?

Who would dare stop Amazon from creating 25,000 to 40,000 high-paying jobs in Long Island City? Who would be stupid enough to chase away billions of dollars in tax revenue for transportation and education and affordable housing? Listening to the chorus of journalists, editorial boards, and pro-Amazon politicians, this is everyone’s fault but Amazon’s.

NY1 political anchor Errol Louis described it as “another case where so-called progressive politicians allowed middle-class jobs, and dreams, and hopes, to die.”

“The New York State Senate has done tremendous damage,” Governor Andrew Cuomo said in a statement. “They should be held accountable for this lost economic opportunity.”

In their editorial, the Times warns of the consequences of spurning Amazon “if New York gets a reputation for the smugness of its politicians and their hostility to business.”

Hostility to business? A 2015 study by the Upjohn Institute for Employment Research showed that New York was second in the nation to New Mexico (and above Louisiana) in corporate incentives. Just last week, the Citizens Budget Commission reported that New York gave corporations roughly $10 billion in economic incentives in 2018 alone, with very little real oversight.

Andrew Rein, the CBC’s president, told Gothamist that it was “incredibly unfortunate” that New York was losing out on Amazon’s jobs, but that he hoped it would spur a conversation about how to make sure that economic incentives go to companies that truly need them.

“ICAP and REAP in the city... we should really revisit and modify those, it would be good to do,” Rein said. “That doesn't mean we don't need some performance-based economic development programs, but they need to keep pace with changing geography and changing industries and changing jobs over time.”

Gov. Andrew M. Cuomo is proposing to close up to three state prisons, redistribute health care funding, cut Medicaid provider reimbursements, and impose a tax on opioids to begin addressing an unexpected revenue shortfall of more than $2 billion.

The fiscal measures were introduced on Friday in the governor's budget amendments, which were largely a response to the recent revelation that the state's anticipated revenue drop will be worse than projected. The updated financial plan anticipates a $2.6 billion hole for the upcoming fiscal year beginning in April, and $1.2 billion the subsequent fiscal year.

The Citizens Budget Commission warned that the amendments failed to prepare the state for the possibility of an economic recession. The fiscal watchdog was hoping the governor would take steps to build reserves and propose reductions to future spending and costs.

The governor's office noted that - despite the gloomy revenue forecasts - the budget still calls for a $250 million deposit into the state's rainy day reserves.