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Cuomo's cuts bug Bloomberg

Herb Boyd | 5/25/2011, 9:23 a.m.

Gov. Andrew Cuomo was overjoyed this past weekend that state legislators had reached an agreement on his $132.5 billion budget proposal, which he said would go a long way toward closing the state's $10 billion deficit.

Cuomo praised the legislators for getting the budget in on time. In a press release he stated, "The budget makes tough choices...redesigns government to force it to cut waste and inefficiency, and finally delivers real results for hard-working families across New York State."

There was special kudos to Senate Majority Leader Dean Skelos and Assembly Speaker Sheldon Silver "for working together to reach this agreement," he said. "It's a new day in New York."

According to the governor, the tentative proposal would trim state spending by 2 percent. The plan includes no tax increases or borrowing, and the "millionaire's tax" proposed by the Assembly was rejected.

Skelos, a Republican from Nassau County, said the "state is now functioning well in a bipartisan way," and some of that bipartisanship was expressed when he joined the governor in rejecting the "millionaire's tax."

The budget, said Silver, is "grounded in reality." In his estimation it is "fiscally responsible" and "protects the most vulnerable among us. This is a sober budget. Government had to tighten its belt."

It is obviously a bit too tight for Mayor Michael Bloomberg, who expressed outrage at the results.

Cuomo's cuts, the mayor said, would disproportionately impact the city, a city that is the economic engine of the state.

"We are the jewel of the financial crown, if you will, in New York State," Bloomberg charged at a recent press conference. "We're the one that's generating money."

The mayor seemed to be particularly incensed by the failure of the proposal to provide a $600 million addition by changes in the pension system, more revenue-sharing funds and putting more money into education. However, it appears that only $200 million will be forked over, though the mayor admitted that he wasn't fully aware of all the details of the cuts.

How this will impact the mayor's plans to strip the city of more than 6,000 teachers and some 20 fewer fire companies and close 100 senior centers may mean more devastating austerity moves.

Michael Kink of the Strong Economy for All, a coalition of labor and other groups, seconded Bloomberg's disappointment. "It's now clear that wealthy New Yorkers are doing all the talking while middle-class and poor New Yorkers are doing all the giving. This budget will make our state's already frightening levels of income inequality even worse."

On the other hand, Kathryn Wylde of the Partnership for New York City applauded the budget. "This budget agreement marks a dramatic reversal in the tax-and-spend habits of Albany that drove this state to the brink of fiscal disaster," she said. "They have sent a clear message to employers that New York is open for business."

In a week or so the residents of the state will get a better idea of what kind of business will prevail after the various conference committees began to assess the plan and proposed cuts.

Education, according to the proposal, will be increased at a rate of personal income growth next year, or roughly 4 percent.

Medicaid, which along with education is the bellwether of the budget, will be increased at a rate tied to health care consumer price index, which is about 4 percent. Taken together, the actions will reduce next year's deficit from $15 billion to about $2 billion, thereby ending the normal overspending.

The plan calls for the elimination of 3,700 prison beds across the state. The budget includes significant reform in the state's juvenile justice system that will encourage the use of community-based alternatives and downsizing state juvenile facilities by 30 percent.