Cuomo reveals 2012-13 budget plan

Last week, Governor Andrew Cuomo unveiled his 2012-13 Executive Budget and Reform Plan, which he says will close the $2 billion budget gap and increase state aid to schools and municipalities.

The spending plan, which includes no new taxes or fee increases, aims to reduce costs by streamlining the state government and relieving unfunded mandates. The governor’s proposal increases the operating budget by less than two percent and honors the agreement made in 2011-12 to increase school aid and Medicaid funding by four percent.

“Because of the tough choices and the historic reforms we achieved last year, we are able to propose a pro-growth budget, tackle broad fiscal reform, drive accountability in our schools to put students first, and leverage tens of billions of dollars of new investment to create jobs without significant cost to the taxpayer,” Cuomo said in a release. “Through fiscal discipline and working in partnership with the private sector, we are making New York a pro-growth state once again. This budget represents the next step in our plan to transform New York State.”

One of the biggest points of Cuomo’s plan is the investment of $1.3 billion in state money to spur job growth and economic development. The New York Works Fund and Task Force will use $1.3 billion in state funds to spur up to $25 billion in investment from private companies, the federal government and more. It will also allow major projects to move forward and help improve the state’s infrastructure.

The plan also includes a second round of $200 million for the Regional Economic Development Councils. This had different regions in the state competing for money for projects in different areas of the state. The previous round of funding awarded $101.6 million to Long Island.

Cuomo’s budget also phases in the state paying the complete costs of Medicaid growth. As it stands now, counties are responsible for three percent of the growth in costs of Medicaid — anything over three percent is paid by the state. Under the governor’s plan, the county’s share would fall to two percent in 2013 and then one percent in 2014. By 2015, the state would pay 100 percent of Medicaid growth costs, saving counties and New York City $1.2 billion over the next five years. Nassau County alone would save nearly $37 million over that span.

“Not only is the governor balancing New York’s budget, he is also finally addressing the burden of state-imposed mandates on local municipalities with his mandate relief plan,” said Nassau County Executive Edward Mangano in a statement. “His proposal to take over the growth of Medicaid costs for counties is especially welcome news.”

But the most celebrated — and controversial — aspects of Cuomo’s spending plan revolve around school aid. The budget restores $805 million in aid to schools, following many years of cuts. The extra money keeps many Long Island districts at the same level of aid they were receiving, and even gives some a little bit more.

The controversy comes from the governor’s proposal to link $250 in aid to a teacher evaluation process. Cuomo said that the State Education Department and the teachers’ unions will have 30 days to agree on a new teacher evaluation system. If they don’t, Cuomo will propose his own evaluation system in the 30 day budget amendments. Schools, he said, will be given one year to implement the system or risk losing out to an increase in state aid in the 2012-13 and the 2013-14 school years.

The governor’s spending plan now moves to the floors of the Senate and the Assembly, where it will be debated and amended before the budget deadline of April 1.