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Governor’s Budget Reforms Medicaid, Pension System, Boosts Education Aid Some

By Will Barclay

Date:

Gov. Andrew Cuomo proposed his executive budget recently. Overall, it’s a good start that addresses contentious issues and has the taxpayers in mind. It keeps spending at the same level as last year. It also proposes reforms to Medicaid and the pension system that will reduce the bloated, built-in increases my colleagues and I have talked about for years. Aid to education did increase. However, we still need a more equitable school-aid distribution formula if we are to provide real education reform in this state.

The governor likened this budget to putting the state on a new diet. I like this analogy. You may not see results overnight, but with discipline and a reformed way of living, the state will reduce its cholesterol and weightiness. I wanted to take some time this week to provide some highlights of the governor’s budget speech on Jan. 17. 

 

Medicaid

The lion’s share of our counties’ budgets goes to pay for Medicaid. In Oswego County, the cost is estimated at 66 percent of the total budget. In Onondaga County, costs were estimated at $100 million in 2011 — the largest portion of its budget as well. Earlier this year, I signed onto legislation that would require the state to take over the local share of Medicaid. A number of years ago, the state did cap the local share of the growth of Medicaid. The governor’s budget, while not proposing a total takeover, is lowering that cap so that eventually, the counties will not be responsible for any increase in Medicaid.

This would help counties, but it does not completely reduce the bill counties still have to pay. The governor also is proposing reducing the overall cost of Medicaid spending by $136 million. While we still have to reform Medicaid further, the governor’s proposal is a good start to providing some relief to counties.

 

Education

I was pleased to hear the plan to increase school aid. School districts are still reeling from the two previous budgets, which significantly cut state aid. The governor’s budget proposes an overall 4 percent increase in state aid. Some districts have stated this increase will not help in their overall operating aid and they’ll still be finding ways to trim their budgets. 

To find a report on how the governor’s proposed budget will affect local districts, visit https://stateaid.nysed.gov/output_reports.htm. Type in your district’s name on the left hand side of the page for this report. This report breaks the budget categories down so taxpayers can see how dollars are spent. According to superintendents, a percentage of the increase in aid will go to pay for state mandates associated with transportation, students with disabilities, and BOCES.

 

Pension reform

The governor is proposing a new Tier VI. This is a big step toward real budget reform and is expected to save the state billions of dollars over a period of time. The governor estimates savings of $83 billion over the next 30 years. New York City estimates a savings of $30 billion over the same time period.

With the proposed Tier VI, those hired after April 1, 2012, would have the choice to (a) opt into a defined-benefit system with a retirement option, or (b) opt into a defined-contribution option, that would offer public employees a 401(k)-style retirement benefit, similar to plans found in the private sector. 

Employees who opt for the 401(k)-style contribution plan would be able to transfer their benefits, even after being employed just one year. This is a big change in the way government employees are currently managed. With this new proposal, we’re enabling public employees to take their pensions with them if they choose another career or another employer.

This budget sets the tone for negotiations going forward. While more work needs to be done, I’m hopeful the process will be transparent and that the full legislature will be involved in negotiations, rather than just three men in a room.         

 

William (Will) A. Barclay is the Republican representative of the 124th New York Assembly District, which encompasses parts of Oswego and Onondaga counties, including Oswego, Fulton, Camillus, and Skaneateles. Contact him at barclaw@assembly.state.ny.us or call (315) 598-5185.

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