New York’s rate of borrowing is unsustainable, according to a report released by Comptroller Thomas DiNapoli Friday.
“New York State is addicted to unaffordable borrowing,” DiNapoli said in a press release. “Our per-capita debt is through the roof. Taxpayers have little or no say in how much the state borrows, but they’re the ones who have to foot the bill.”
State-funded debt has grown to an estimated $60.4 billion in fiscal 2010 from $48.5 billion in fiscal 2006, a 24.6% increase, according to the report.
The amount of state-funded debt includes $3.4 billion of general obligation bonds and $47.05 billion of state-backed public authority debt, as well as $9.95 billion of debt that is not included in the state’s statutory bond cap, such as tobacco bonds and certain school construction bonds secured by state building aid. State-funded debt is projected to rise to $67 billion by fiscal 2015.
DiNapoli called for capping state-funded debt to 5% of personal income tax receipts. Currently, state-funded debt is 6.36% of PIT receipts, according to the report.
The comptroller also obliquely criticized a plan by Lieut. Gov. Richard Ravitch to overhaul the state’s budget process because part of that plan includes deficit borrowing. DiNapoli would prohibit using state-funded debt for non-capital purposes.
Ravitch has said the borrowing is an essential component to his overall plan, which last week received the endorsements of the Citizens Budget Commission, Partnership for New York City, and the New York Building Congress.
“Borrowing is not a way to get out of the mess we’re in, it’s a way to get us to the point in time where we can have a chance of investing in our future again,” Ravitch said in an interview earlier last week.
DiNapoli repeated a proposal to ban state authorities from issuing state-funded debt and requiring most debt to be voter approved. Ravitch was previously dismissive of that idea.
“He’s right in his abstraction, but it’s not a practical solution,” Ravitch said in the earlier interview. “At this point in time, I can’t imagine the public would approve any debt.”