The New York State Senate passed the revenue portion of the budget

The Senate passed the revenue portion of the budget last night, the last remaining piece that had previously been passed by the Assembly. Here is today’s story from the Albany Times Union, followed by the Governor’s statement about the passage of the FMAP contingency plan.


It's a state budget!
By RICK KARLIN Capitol Bureau
Published: 01:00 a.m., Wednesday, August 4, 2010
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Senate Majority Leader Pedro Espada Jr., center, huddles with aides on the Senate floor Tuesday afternoon at the Capitol. The Senate passed the budget Tuesday evening. (John Carl D'Annibale / Times Union)
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Senate Republican Leader Dean G. Skelo holds his minority together Tueday to oppose the state budget. (John Carl D'Annibale / Times Union)
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Saratoga Republican Sen. Roy McDonald appears Tuesday on the Senate floor. (John Carl D'Annibale / Times Union)ban

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ALBANY -- Four months late and hundreds of millions of dollars in additional taxes later, the state Senate finally completed the 2010-11 budget on Tuesday evening.
The final party-line vote -- 32 to 28 -- arrived after the sun had set on a dizzying day of last-minute negotiations, one-house bills that have almost no chance of passage in the Assembly, and frenzied efforts to round up two Democratic senators who spent much of the day missing in action.
In other words, it was a fairly typical day in the Senate, which all year has veered between chaos and inertia due to the Democrats' razor-thin 32-to-30-seat majority.
In order to pass the revenue plan that for more than a month has been the remaining piece of the budget puzzle, Democrats needed all 32 votes on deck. Senate Republicans have been rejecting almost all spending measures en masse this summer.
The Democrats' dilemma was put into stark relief early Tuesday when one of their more unpredictable members, Pedro Espada Jr. of the Bronx, announced he would stay away unless the conference took up two of his measures: a farmworkers bill of rights and legislation relating to New York City rent control.
By 2 p.m., Espada had relented and traveled to Albany. But hours into session, it became apparent that another senator, Manhattan's Tom Duane, hadn't appeared in the chamber for key votes.
It turned out he had sequestered himself in his office, holding out for his own housing bill to be taken up.
Eventually, both measures were brought to the floor Tuesday -- presumably in order to get Espada and Duane's votes on the budget.
The two temporary delays came as another human logjam was clearing: Buffalo's William Stachowski, who for a month had been denying his budget vote in exchange for a push to give individual SUNY and CUNY campuses greater autonomy to raise tuition on their own, gave up his holdout.
"Variable tuition" has no traction in the Assembly and is opposed by several Senate Democrats. Stachowski, facing primary and general election opponents, had been counting on the plan greatly benefiting SUNY Buffalo, which has major expansion plans.
Later in the day, however, Stachowski said he realized he could only hold out for so long. "We may have to take a position where (the budget passes) and we continue to try to push to get something done for SUNY," he told the Buffalo News.
Gov. David Paterson earlier tried to separate the SUNY issue from the budget, with the governor offering it as a stand-alone bill. But lacking adequate votes in the Senate -- even after Duane appeared -- it was laid aside. Stachowski, Democratic Conference Leader John Sampson and Sen. Brian Foley, D-Long Island, later released a statement that a "framework agreement" had been worked out on SUNY-CUNY plan -- although the details remained to be hammered out with the Assembly and the governor.
Senate Democrats and Republicans came together to pass a property tax cap supported by the governor. It faces long odds in the Assembly, where Speaker Sheldon Silver has opposed the measure.
The Assembly passed the revenue portion of the budget weeks ago.
Lawmakers came within a week of breaking the record for late budgets, set in 2004 when it was 133 days past the April 1 deadline.
In passing the revenue bill, Senators put their stamp of approval on more than $800 million in new revenue, including the re-institution of a state sales tax on clothing and shoes under $110.
One element of that bill that initially passed in the Assembly but was dropped in both houses on Tuesday: a revenue action that would have taxed income earned by out-of-state hedge fund managers operating in New York as if they were state residents.
The tax was dropped amid reports that Connecticut was actively wooing New York-based hedge funds to open shop in the Nutmeg State. "It means that Connecticut spent a lot of money wining and dining them (for naught)," quipped Assemblyman Jack McEneny, D-Albany.
Both houses managed to pass a contingency plan for the increasingly likely loss of more than $1 billion in federal Medicaid funds. The plan institutes across-the-board cuts to localities, with the proceeds placed in a "lock box" that would be opened only if the funds appear.
Reach Rick Karlin at 454-5758 or rkarlin@timesunion.com.
News from New York State Office of the Governor
For more information contact: Morgan Hook, 518-474-8418/212-681-4640
Governor Paterson Announces Passage of FMAP Contingency Plan
ALBANY, NY (08/03/2010)(readMedia)-- Governor David A. Paterson today announced passage of legislation that would implement a plan to keep the State budget in balance in the event the Federal government does not extend enhanced Federal Medical Assistance Percentages (FMAP) through the end of the current fiscal year. The Governor's Program Bill No. 324 is a prudent measure in response to the financial uncertainty caused by the Federal government's inaction on FMAP.
"While I will continue to advocate for full FMAP funding from Congress, passage of this contingency plan is the responsible measure to keep our budget in balance and avoid mid-year cuts should the funds not materialize," Governor Paterson said. "I'm pleased the Legislature has realized the importance of this legislation and joined me in supporting it."
Key provisions of Governor Paterson's Program Bill No. 324 include:
• Starting September 16, and continuing through the fiscal year, payments from aid to localities appropriations in the General Fund and State special revenue funds would be reduced by a uniform percentage established by an allocation plan. The reductions would continue until $1.085 billion in FMAP savings have been realized.
• The savings from the reductions would be deposited into a new FMAP Contingency Fund "lock box" established in the State Treasury.
• Certain types of appropriations would be exempt from the uniform reductions, including those for public assistance, debt service, and court judgments.
• If an FMAP extension ultimately were to be approved during the 2010-11 fiscal year, the payment reductions would cease.
New York, like 30 other states, assumed enhanced FMAP funding in its current year budget after legislation that would have provided the funding passed both houses of Congress. The extension of FMAP was expected to provide $1.085 billion to the State in the 2010-11 fiscal year, as well as an additional $1.06 billion in 2011-12 and approximately $800 million to New York City and counties in the first six months of 2011. Given that Congress has not yet enacted legislation which includes an FMAP extension, there is a significant risk that an FMAP extension will not be approved, or will be approved at a level less than expected in the State's financial plan.
Governor Paterson has advocated tirelessly on behalf of full enhanced FMAP funding for the states. Last month, the Governor travelled to Washington, D.C. to join a bipartisan group of governors from across the country in calling on Congress for full FMAP funding.