As New York struggles to close a $13 billion budget gap for fiscal 2010, projected revenue in the next fiscal year has fallen by $1.02 billion compared to projections in the executive budget Gov. David Paterson released in December, the state Assembly said in a report yesterday.
The state is heavily reliant on Wall Street, which provides about 20% of New York's tax revenue. Wall Street bonuses in the current fiscal year will fall by a projected 47.9% compared to the previous year, the report said. Personal income taxes, which are the state's largest source of revenue, are projected to decline to $34.42 billion in fiscal 2010, a $2.27 billion drop compared to the current fiscal year.
While some lawmakers have proposed raising taxes on high-income individuals to help close budget gaps, Paterson remains opposed. At a press conference in Albany yesterday, he said the budget should be balanced by spending cuts and revenue from the federal stimulus package.
"The most important thing that we have to do at this time is to make sure we have real and recurring cuts, because if we don't we're not bringing down our out-year deficit, and if we're not bringing down our out-year deficit we're feeding the spending addiction we already have," Paterson said.
The governor had pushed lawmakers to pass the budget well before the April 1 deadline but lowered expectations yesterday, stating that the goal was to have it passed on time.
Meanwhile, state Attorney General Andrew Cuomo yesterday outlined a legislative proposal to consolidate local government entities. Speaking at a breakfast in New York City sponsored by the Citizens Budget Commission, a business oriented fiscal watchdog organization, Cuomo said his office has counted 10,521 government entities in the state, including municipal governments, special taxing districts, and public authorities. The overlapping taxing districts contribute to the state having the highest local tax burden in the nation, he said.
Cuomo's proposal would allow local governments, with voter approval, to consolidate overlapping districts. Inconsistencies and anachronisms in current laws governing overlapping municipalities and districts make consolidation difficult and in some cases impossible, according to the attorney general's Web site. He acknowledged that consolidation has been proposed many times before without result, but said the state's dire economy could prompt taxpayers to act.