Tough financial decisions could be on the horizon for New York State after more than $10.5 billion in new bond debt was approved for the fiscal 2018 budget amid declining tax revenue projections and federal funding uncertainty, according to State Comptroller Thomas DiNapoli.
A report DiNapoli released Thursday says the state reduced tax revenue estimates four times in the 2017 fiscal year and finished $2.8 billion below initial projections. DiNapoli noted that federal aid cuts under consideration in Washington for healthcare and other services could “pose unpredictable challenges” for the state.
“It should concern all New Yorkers that budget decisions in Washington may force tough fiscal choices for the state and raise new questions for local governments and nonprofits that rely on state funding,” said DiNapoli in a statement. “Federal actions that could adversely affect New York, as well as economic uncertainty, are key risks to this budget.”
DiNapoli notes that the 2018 fiscal plan’s more than $10.5 billion in total state-supported debt authorizations is an 8% increase from previously authorized amount that can be issued by public authorities without voter approval. The comptroller also expressed transparency concerns about the budget’s $385 million in appropriation and bonding authority for the bond-financed State and Municipal Facilities program that he says lacks specifics on how funds will be allocated.
“Billions of dollars in spending lacks key details that would better inform the public about how their tax dollars are being spent,” said DiNapoli.
Morris Peters, a spokesman for the state Division of Budget, said in response to DiNapoli’s report that the state’s enacted budget financial plan will be presented in the next few days with more detail on borrowing and spending plans.
New York State has bond ratings of Aa1 from Moody’s Investors Service and AA-plus from S&P Global Ratings, Fitch Ratings and Kroll Bond Rating Agency.