TO: Executive Board Members and Statewide Labor Management Chairs

FROM: Thomas Cetrino, Martin O’Connor, Susan Mitnick, Stephen Connolly, Michael Marinello, Amy Sisson

DATE: January 14, 2000

RE: Executive Budget SFY 2000-01 – Summary of Major Provisions

There will be 1,700 positions added to the State workforce by the end of the SFY 1999-00 (March 31, 2000) to bring the State workforce up to 194,400 employees. This is about 3,000 more employees than the Governor proposed in his original SFY 1999-00 budget. The State has not provided a breakout as to which State agencies will gain these positions. The Division of the Budget has informed us, however, that the agencies with the largest gains will be the Department of Correctional Services (DOCS), the Office of Mental Health (OMH), and the Office of Mental Retardation and Developmental Disabilities (OMRDD). Statewide Labor Management Chairs should contact their agencies and ask them how many positions the Division of Budget (DOB) has authorized them to fill by March 31, 2000 and the titles of those positions. We would appreciate it if you would forward that information to the Research Department.

Appendix A was provided to PEF by GOER and reflects projected workforce changes in SFY 2000-01. In SFY 2000-01 another 2,930 positions will be filled by the end of the fiscal year but they will be offset by a loss of 1,110 positions through attrition, the abolition of 100 positions, and an Office of Technology (OFT) offset of 200 positions for a net gain of 1520 positions. The OFT offset is necessary because some employees who will transfer to OFT are also counted in their agency position counts.

The State expects the workforce to reach 195,900 employees by March 31, 2001. No layoffs are anticipated under the proposed budget. The newly created Department of Justice (DOJ) will have a net gain of 604 employees, the largest of all agencies, primarily due to the opening of a new prison in Seneca County in September 2000. Overall, DOJ gains 885 new positions, which are offset by the abolition of 100 positions and the attrition of 181 positions. Most of the lost positions in DOJ will be administrative, grant management, and management information system positions which the Executive believes can be eliminated due to the efficiencies gained through the consolidation of eight criminal justice agencies.

OMRDD will gain 694 new positions offset by the loss of 248 positions through attrition for a net gain of 446 employees. OMH will gain 452 new positions offset by the loss of 248 positions through attrition for a net gain of 320 positions. The Department of Tax and Finance will lose 118 positions through attrition offset by a gain of 10 new positions for a net loss of 118 positions.

Attachment B shows a net increase of 790 ASAFL positions in the State workforce from SFY99-00 to the end of SFY2000-01. The large difference between the net gain of 1,500 positions as claimed by the State in Attachment A and the net gain of 790 ASAFL positions inferred by the Research Department in Attachment B may be due to the timing of position additions. It is important to remember that if the State targets a gain of 1,520 positions but does not fill them until later in the fiscal year, a smaller number of ASAFL position increases will be indicated. We are particularly concerned that while the State claims OMH will gain 320 positions by March 31, 2001, the Executive Budget shows a decrease of 33 ASAFL positions. This indicates that most of the new positions would probably be added in March 2001. We have requested additional information from OMH on this issue.

It is important to remember that the ASAFL is a "theoretical" number that states the total average annual salaried positions for which an agency is budgeted. For example, if the Department of Correctional Services (DOCS) were to add 800 positions on October 1, 2000, that would only require an increase of 400 ASAFL positions because the State is only filling the 800 positions for half of the fiscal year. While the two sets of numbers concerning the elimination of or increase in State employee positions are not comparable, the recommended budget fill levels do give an indication of where positions may be eliminated or added in an agency. When this memo and the agency program details refer to ASAFLs or recommended budget fill levels, they should be interpreted with this caveat in mind when discussing the elimination or addition of positions.

It is also important to note that GOER has informed PEF that the Governor will introduce legislation to extend the current early retirement incentive program which will expire on March 31, 2000. No changes will be proposed to these programs. Since the State does not plan any layoffs and plans to eliminate relatively few positions, they anticipate opening few windows in 2000 for the early retirement program. They are likely to open a window for employees in certain targeted titles in the eight criminal justice agencies to be consolidated into the new Department of Justice.

In addition to this memo, we are forwarding to the respective Executive Board members and Statewide Labor Management Chairs our department’s line by line analysis of the Program Details–State Operations portion of the budget for the thirteen State agencies with the most significant changes in their budgets. Next week we will distribute any revised drafts of the major agency summaries sent this week as well as State Operations summaries for all other agencies. We have also included on PEF’s website a complete copy of Executive Budget Appendix I and all State budget legislation. This includes the Article VII bills which we obtained from the Division of Budget’s website; however, it is important to note that these Article VII bills have not yet been introduced in the Legislature and are therefore subject to change. Executive Board members and Statewide Labor Management Chairs who do not have a computer to access PEF’s web site and who want a copy of their agency’s budget should call the Research Department at 1-800-342-4306 ext. 280 and request that we mail you a copy.

The Executive Budget proposes three major agency consolidations:

1. The consolidation of the Department of Correctional Services (DOCS), Division of Parole (DOP), Division of Probation and Correctional Alternatives (DPCA), Division of Criminal Justice Services (DCJS), Division of State Police (DSP), Crime Victims Board (CVB), Office for the Prevention of Domestic Violence (OPDV), and State Commission of Correction (COC) into a new Department of Justice (DOJ). The Governor believes the benefits of this consolidation include the centralization of criminal justice technology, a "one stop shop" for local criminal justice officials for grant management and technical assistance, and the elimination of "redundant administrative services." Over 200 administrative, grants management, and management information system positions will be eliminated in the consolidated agencies.

DOCS and DSP will become their own separate Divisions within the new Department and COC will remain a separate entity within DOJ. The other agencies, as well as units within DOCS and DSP, will be consolidated into three Divisions and one Bureau: the Division of Community Supervision, which appears to contain most of DOP and DPCA, the Division of Local Assistance, the Division of Technology and Information Systems, and the Bureau of Administrative Services. The staff of the Bureau will formulate and oversee DOJ policy and provide operational support to the other Divisions within DOJ.

It should be noted that Governor Cuomo proposed a similar consolidation that was rejected by the Legislature. Senator Volker, who has a great deal of influence on how criminal justice issues are handled in the State Senate, has stated that while the Senate will look at this proposal, they have rejected it in the past and have questions about it.

More details on this consolidation are contained in the agency specific summary at the end of this memo and the DOJ State Operations budget analysis, which will be provided to all Executive Board members and Statewide Labor Management Chairs in the affected agencies.

2. The consolidation of the State Museum, State Library, and State Archives into a new Office of Cultural Resources (OCR) within the Council of the Arts. The Executive Budget proposes that this consolidation occur in October 2000. Funds for OCR’s operations and grant programs will be transferred from the State Education Department’s Cultural Education Program and Office of Management Services. The Executive Budget states that OCR will have a staff of approximately 465 employees and that no staff reductions are anticipated. The consolidation seems to be motivated by making these cultural entities directly accountable to the Governor rather than the Board of Regents, who are appointed by the Legislature and not the Governor. Its prospects for passage are unclear.
3. The consolidation of nineteen data centers serving seventeen state agencies into a single operation directed by the Office of Technology is not a new initiative but it will be implemented during SFY 2000-01. OFT will have a staff of 458 employees, most of whom will transfer from other State agencies. 436 positions will be supported by a $93.2 million Internal Service Fund consisting of funds deposited by the State agencies receiving services from the consolidated data center. This fund will also pay for the cost of upgrading and operating the center’s computers. OFT will also oversee the operation of the Human Services Application Service Center that is developing the new Welfare Management System. It does not appear that it is currently contemplated that HSASC employees who are from the Office of Temporary and Disability Assistance (OTDA), the Department of Labor (DOL), the Office of Children and Family Services (OCFS), and the Department of Health (DOH) will be transferred to OFT in SFY 2000-01 as was originally planned. It appears that the State is having problems getting approval from the federal government to use its money to fund the cost of OFT employees.

The Executive Budget forecasts a $625 million surplus for SFY99-00 and only uses $32 million in non-recurring revenues (one-shots). This surplus is largely due to increased State tax revenues from the record profits generated by Wall Street and $251 million in net lower estimated revenues. The Assembly has stated that they believe the SFY99-00 surplus will be significantly larger than the $625 million projected by the Governor. The State’s Financial Plan forecasts "…a moderate slowdown in New York economic growth for 2000." The Financial Plan also forecasts a 8.5% increase in cash receipts for All Governmental Funds from $72.620 billion in SFY99-00 to $78.815 billion in SFY2000-01.

The State still faces structural budget gaps of between $1.226 billion in SFY2001-02 and between $2.642 billion in SFY2002-03. This is largely due to the back loading of the STAR Property Tax Relief program and other tax cuts. In SFY 2000-01, already enacted tax cuts will reduce State revenues by $11.7 billion. The annual cost of the already enacted tax cuts increases to $13.4 billion in SFY2001-02 and to $14.1 billion in SFY2002-03. This does not include the $700 million in new tax cuts that the Governor has proposed in the SFY 2000-01 budget. This $700 million dollar cost will occur when all the proposed new tax cuts are fully implemented. The largest of these tax cuts is the proposed elimination of all gross receipts taxes on energy, which will cost $500 million when fully implemented.

It is important to note that these budget gaps are based on economic forecasts of moderate growth in the next two fiscal years. They will be significantly larger if the State experiences a sharper slowdown in the State economy that the Executive Budget forecasts. It is also important to note that last year’s Executive Budget forecasted at least a $1.113 billion structural deficit for SFY 2000-01 and a $2.076 billion structural deficit for SFY 2001-02, and that those structural deficits are now significantly lower.

• A $1.8 billion Tax Reduction Reserve to help pay for the cost of the STAR school tax reduction program and other already enacted tax cuts. $615 million of this reserve will be used to pay for tax cuts taking effect this year and the remaining $1.2 billion will be deposited in the STAR Fund to finance a portion of the cost of STAR in SFY 2001-02.
• A $473 million "Tax Stabilization Reserve Fund" commonly referred to the "rainy day" fund.
• A $250 million the Debt Reduction Reserve Fund (DRRF).
• A $107 million Contingency Reserve Fund for litigation risks. The Governor proposes to deposit another $43 million in SFY 2000-01 to increase the fund to $150 million.
• A $100 million reserve for collective bargaining agreements, $50 million of which has already been used to fund the UUP agreement and the cost of the State assuming CSEA’s prescription drug program.
• A $265 million Community Projects Fund.

These reserves do not count the $302 million the State has received in tobacco settlement funds, which will be spent in SFY2000-01 along with another $366 million in tobacco settlement funds

The Governor proposes not to use SFY98-99’s $625 million surplus in this fiscal year and will put all of it in reserves to bring the total reserves of the State to $3.6 billion. $300 million of the $635 million SFY99-000 surplus would be put into a new tax reduction reserve fund to fully fund the SFY 2001-02 and SFY 2002-03 cost of his new proposed tax cuts. An additional $250 million would be put into the Debt Reduction Reserve Fund (DRRF) which would be supplemented with $250 million in one-time revenues from the State’s tobacco settlement funds. This would bring the DRRF to a total of $750 million. $500 million of this money would be used in SFY 2000-01 to reduce State debt. The remaining $250 million is proposed to be used to reduce State debt in SFY 2001-02. The remaining $75 million of the SFY 1999-00 surplus would be put into the "Tax Stabilization Reserve Fund," which would increase to a total of $548 million. In addition, $425 million will be added to the remaining $50 million in collective bargaining reserves to bring this reserve fund up to $475 million. After all these proposed actions the State, according to the Executive Budget, would have approximately $2.9 billion in reserve at the end of SFY 2000-01.

The Executive Budget proposes to put in a General Fund reserve a total of $475 million in SFY 2000-01, $505 million in SFY2001-02, and $715 million in SFY 2002-03 for collective bargaining agreements. The State has informed PEF that these reserves would fund a "UUP type agreement" and represents the funds that will be needed to meet salary expenses currently not budgeted for in the Executive Budget. The State has not told PEF how it arrived at these figures except that they are based on the UUP settlement (i.e. 3% raises implemented half-way through the year).

The Governor’s budget address refers to the SFY 2000-01 Executive Budget as a $76.8 billion all funds budget, a $4 billion or 5.5% increase over last year’s estimated $72.8 billion all funds budget. The Executive Budget proposes increases in General Fund (i.e. State income not earmarked for a particular program or activity) spending by $777 million, or 2.3%, to $37.9 billion. However, these figures only reflect the cash spending proposed for SFY 2000-01 budget. The total recommended appropriations for all funds in the proposed SFY 2000-01 budget equal $121.838 billion; a $6.742 billion or 5.85% increase over the SFY99-00 all funds appropriations.

State Operations all funds cash spending for SFY2000-01 would be increased by approximately $435 million, or 6.5%, from estimated SFY99-00 all funds cash spending. This reflects the annualized costs of the UUP collective bargaining agreement, the loss of federal funds that offset General Fund spending in criminal justice programs, the costs of staffing a new State prison, and growth in the Judiciary budget. It also reflects "a $61 million reduction in one-time receipts from the State University that offset General Fund spending in SFY99-00." It appears that this means that the State has forgiven the SUNY hospitals $61 million in revenues they were expected to give to the State. SFY98-99 all funds cash spending for Local Assistance is decreased by approximately $ 87 million, or 0.4%, from SFY98-99 all funds spending.

GENERAL GOVERNMENT (S6402/A9502)

The Executive Budget recommends the reduction of 128 positions through attrition and the addition of 10 new positions for a net loss of 118 positions. The Executive Budget also:

• Eliminates 33 ASAFL positions in the Audit Program bringing the total to 1945 ASAFL positions.
• Eliminates 98 ASAFL positions in the Revenue and Information Management Program bringing the total to 1655 ASAFL positions.

The Executive Budget recommends:

• The establishment of a $128.9 million Internal Service Fund which includes:
• $93.2 million for the operation of the consolidated State Data Center which will be staffed by 436 employees. It is expected that employees will transfer to OFT from other State agencies at the beginning of the new fiscal year.
• $16.8 million for the New York Intranet (NYT) that will provide the State and local governments with data, voice, and video communications. NYT will replace several independently operated systems with a single, centrally managed network.
• $19 million to coordinate the development of computer systems that will be used by "various agencies and statewide enterprise agreements".

The Executive Budget proposes:

• An ASAFL of 3,904 positions, which represents a decrease of (-11) positions from the previous year. The FTE workforce is estimated to be 3,778 employees at the end of SFY2000-01. The (-11) ASAFL positions are accounted as follows: (-1) Administration program, (-5) Air and Water Quality Management Program, (-4) Operations, and (-1) Solid and Hazardous Waste Management Program. Approximately, 38% of these positions are financed by state general fund tax dollars, 47% are financed by State-imposed fees, and 15% are financed by Federal grants.
• $4.6 million, an increase of $3 million over last years funding, to implement the NYC Watershed Agreement. This appropriation shows an increase of $1.447 million over the amount allocated last year. These funds will support State enforcement and monitoring efforts in the Watershed and the provision of technical assistance to participating communities.
• An increase in licensing fees to support Conservation fund programs and cover a projected negative balance. The fee increases range from 10% to 36% in the major license categories.

The Executive Budget proposes:

• An ASAFL of 10,692 positions, which represents a decrease of (-18) positions available from the previous year but an increase of 59 over the Executive Budget proposal of January 1999. The 18 position reduction is found in the Design and Construction program. The FTE workforce is estimated to be 10,692 employees at the end of SFY2000-01.
• Proposes a reduction of only ($500,000) in capital project funds from the Engineering Services budget. It is not clear how this reduction is distributed between private contractual engineering services and state-provided engineering services because the appropriation no longer breaks out the Engineering Services Budget by personal service, non-personal service, and contractual services.
• Proposes a $14.3 billion five year capital program with $8 billion for highway and bridge construction that averages $1.6 billion annually. A coalition of transportation advocates has noted that New York’s roads and bridges are ranked 43^rd in the nation and need $26.5 billion to repair and reconstruct them over the next five years. Senate Majority Leader, Joseph Bruno, has stated that DOT’s capital program should be increased to the size of the Metropolitan Transit Authority capital program which will be $16.5 billion over the next five years.

The Executive Budget proposes:

• An ASAFL of 253 positions, which represents a decrease of (-10) positions from the previous year accounted for as follows: Administration (-1), Marketing and Advertising (-1), Science and Technology (-8). The eight Science and Technology positions have moved to the New York Office of Science, Technology and Academic Research (NYSTAR) that was created in November 1999. The FTE workforce is estimated to be 253 employees at the end of SFY2000-01.
• State tax dollars from the General Fund will finance 89 percent of the Department’s budget. The balance is supported by revenues raised though licensing of the I Love NY logo, sale of advertising, and seminars and programs run by the Department.

The Executive Budget recommends the addition of 885 positions offset by the attrition of 181 positions and the addition of 100 positions for a net gain of 604 positions. The ASAFL for DOJ will only increase by 178. The FTE workforce will be 41,116 positions or 40,804 ASAFLs at the end of SFY2000-01. The Executive Budget also recommends (analysis as of January 13, 2000):

• Consolidation of the following eight criminal justice agencies into a single Department of Justice (DOJ):
• Department of Correctional Services (DOCS)
• Division of Criminal Justice Services (DCJS)
• Crime Victims Board (CVB)
• Office for the Prevention of Domestic Violence
• Division of Parole
• Division of Probation and Correctional Alternatives
• Commission of Correction
• Division of State Police
• The actual implementation process for the consolidation is unclear. Article VII legislation provides for transfer of all functions, powers and duties of each former agency effective April 1, 2000. It also establishes a temporary executive transition commission to develop a comprehensive legislative proposal for the transfer, which does not have to report to the Legislature until December 1, 2000. Employee transfers will be pursuant to Section 70.2 of the Civil Service Law (a transfer of function).
• A new 1,500 bed maximum security prison in Seneca County is expected to open in September, 2000
• $180 million in Capital funding is proposed for a new 1,500 bed maximum security prison
• $5.9 million is proposed for expansion of the DNA Databank
• $10 million in savings is attributed to operational efficiencies resulting from the consolidation
• $10.277 million in savings is attributed to operational efficiencies in correctional facilities and State Police services. The Appendix refers to savings from food service and energy related efficiencies, but also refers to savings from "program restructuring", which may indicate personal service reductions.
• Probation and correctional alternatives local assistance funding will be consolidated into a $76.5 million block grant, a reduction of $10.4 million

The Executive Budget recommends the addition of 452 positions offset by the attrition of 132 positions for a net gain of 320 positions. The estimated FTE workforce will 18,440 positions on March 31, 2001. The Executive Budget also recommends:

• An average annual fill level of 18,390 for the Office of Mental Health, a net reduction of 33 ASAFLs. Reductions will be in the adult services program, with a loss of 383 FTEs, and Children and Youth Services (6 FTEs), offset by additions in Enhanced Community Services (270 FTEs), Forensic Services (71 FTEs), and Administration (15 FTEs). According to GOER OMH will have an increase of 320 positions in SFY 2000-01. Based on the ASAFL decrease, we believe these positions will be added at the end of SFY 2000-01
• A reduction of 100 administrative and support positions at Pilgrim and Manhattan Psychiatric Centers, to be achieved through attrition.
• An increase of 82 positions in the forensic program to accommodate increased capacity in the special housing units in the Department of Correctional Services ($3.3 million), a new satellite unit at the new Seneca Correctional Facility and expanded discharge planning services at DOCS facilities.
• Funding for shared staff equivalent to the 66 positions restored by the Legislature in the SFY 1999-00 budget. The remaining 150 positions that were eliminated in last year’s budget are not restored. OMH has stated that employees in these positions will remain in them until March 31, 2000. It is possible that these employees may be transferred to the new positions that may be created in the SFY2000-01 budget. This issue is a major concern to PEF.
• $15.9 million in General Funds (supported by the Health Care Reform Act) will fund the State Operated portion of the Enhanced Community Services program, including:
• five transitional residences (240 beds) on the grounds of NYC Psychiatric Centers;
• Mobile Mental Health Teams at Office of Children and Family Services facilities ($1.3 million); and
• increased monitoring and oversight of community mental health programs by central and field office staff.
• The transfer of appointing authority from facility directors to the Commissioner, within the following regional groupings of facilities (pursuant to Article VII legislation):
• Pilgrim PC, Sagamore Children’s PC, Creedmoor PC and Queens Children’s PC
• Bronx PC, Kingsboro PC, Kirby Forensic PC, Manhattan PC, NYS Psychiatric Institute, South Beach PC, Bronx Children’s PC and Brooklyn Children’s PC
• Elmira PC and Binghamton PC
• Capital District PC
• Mohawk Valley PC, Central NY PC, Hutchings PC
• Buffalo PC, Western NY Children’s PC,
• Rochester PC
• Middletown PC, Mid-Hudson PC, Hudson River PC, Nathan S. Kline Institute for Psychiatric Research, Rockland PC, Rockland Children’s PC
• St. Lawrence PC

This means that an employee can be reassigned within each regional grouping. In the past, PEF has opposed giving the Commission a broader statewide appointing authority.

The Executive Budget recommends the addition of 694 positions offset by the attrition of 248 positions for a net gain of 446 positions. The FTE workforce will be 22,188 positions. The Executive Budget also recommends:

• An average annual fill level of 22,018 for the Office of Mental Retardation and Developmental Disabilities, a net increase of 335 FTEs. Reductions will be in the Institutional Services Program (531 FTEs), offset by an increases in Community Services (854) and Central Coordination and Support (12). According to GOER, OMRDD will have a net increase of 446 positions.
• Discharge of 250 clients from institutional care, with new admissions restricted to emergency situations and special treatment units.
• $2.97 million for expansion of specialized treatment units for persons with severe behavioral problems, including:
• 24 new secure beds will be opened at the Regional Behavior Intensive Treatment Unit at Finger Lakes DDSO.
• Staffing for 60 new secure Center for Intensive Treatment beds at Norwich will come on-line in 2000-01.
• A $12.6 million increase in Personal Services in the Community Services Program (and the associated increase of 854 AFLs) is related to, but may not be limited to, the following initiatives:
• 24 new State operated community beds in NYC for referrals of severely disabled children;
• Operating funds for 100 state-operated NYS-CARES beds approved in the 1999-00 budget;
• Enrichment of staffing ratios for the Intensive Treatment Units of Multiply Disabled Units (including services for 40 of 60 new dually diagnosed clients transferred from OMH); and
• Service coordination to Family Care.

The Executive Budget recommends:

• An ASAFL of 6,209 which represents an decrease of (-42) ASAFL positions. This differs from the information provided by GOER which estimates an increase of 53 FTEs and a 3/31/2001 estimate of 5,834 FTE positions.
• Collects fees from water companies for deposit in the Public Water Supply Protection Account. This account is appropriated $2 million and is to be used for, among other things, conducting water supply regulatory activity.
• Adding $60 million to the Medicaid Management Information System for a replacement Medicaid system, $43.85 million of which is paid with federal funds.
• Adding $900,000 in a Special Revenue-Other appropriation to the Medicaid Management program for a Medicaid fraud hotline.
• Adding $5 million to Wadsworth Laboratories for the newborn screening program.
• Adding $2.4 million for to prevent the potential spread of the West Nile virus and to respond to other "West Nile like" events. The funds will support epidemiology, surveillance and laboratory testing staff as well as equipment and other needs. It is not clear where this appropriation is in the budget although it is likely that it is in the Community Health program.
• Roswell Park is no longer part of the Executive Budget, however, there was mention that HCRA revenues will support a portion of Roswell Park totaling: up to $90 million for 2000; up to $60 million for 2001; up to $40 million for 2002; and up to $20 million for January 1 to June 30, 2003.
• Adding $10 million to Helen Hayes, $9 million of which is for "special projects" pursuant to a plan developed by DOH.

The Executive Budget recommends:

• An ASAFL of 2,468 which represents no change from the current level. GOER indicates that the FTE estimate for 3/31/01 will be 2,627. This is no change from the 3/31/00 estimate.
• A $35 million increase in funding, $15 million in Maintenance Undistributed and $20 million in Special Revenue-Federal, for the Human Services Application Service Center (HSASC) in the Systems Support and Informational Services program.
• Cutting $3.9 million in the Administration program in a Maintenance Undistributed for the HSASC.

The Executive Budget recommends:

• An ASAFL of 4,702 which represents an increase of 175 in ASAFL positions. According to GOER OCFS will have 84,582 FTE positions at the end of SFY 2000-01.
• $18.5 million to fingerprint all regulated child care providers, expand oversight and monitoring activities, and increase the percentage of inspections for registered programs. However, the Child Care program is cut by $1.3 million in personal services. The Appendix also shows an increase of 170 positions. We are unable to identify the $18.5 million in funding for these increases in positions.
• $75 million to construct a new secure center to replace Harlem Valley.
• The addition of 13 limited secure beds for girls at the Lansing Residential Center.
• $66 million in the Systems Support program for the continued development of CONNECTIONS. This represents a $35.5 million increase over last year’s Maintenance Undistributed and Special Revenue-Federal appropriation. OCFS has "retained a quality assurance contractor to assist CONNECTIONS project leadership in managing this project."
• $6.5 million of a $10 million Special Revenue-Other appropriation in the Systems Support program to implement a common computer platform agency-wide.
• $1.2 million Maintenance Undistributed appropriation in the Administration program for services associated with the special hearing program.
• Reducing nonpersonal services in the Family and Children Services program by $6.6 million. This appears to reflect the completion of the State Central Registry relocation.

The Executive Budget recommends:

• An ASAFL of 2,931 which represents a decrease of (-39) positions. The information provided by GOER indicates and end of year FTE estimate of 3,143 which includes (-58) positions lost through attrition and (-465) transferred to the Council on the Arts due to the proposed transfer of the State Library, State Museum, and State Archives to a new Office of Cultural Resources within the Council.
• Consolidating the Higher Education Program and the Office of the Professions into an Office of Higher Education and the Professions on October 1, 2000.
• Eliminating the accreditation of college and university programs. This will be done by national or regional accreditation services. An appropriation of $3 million of General Funds in the Elementary, Middle, Secondary and Continuing Education program.
• That the Department be required to submit a staff deployment plan to streamline its remaining operations and reduce its General Fund staffing by 10 percent through attrition by March 31, 2001.
• That the Department be limited to five percent of federal funds for administrative costs.
• Redirecting administration of funding for Charter Schools to SUNY.
• Major changes in how members of the Board of Regents are selected which would give the Governor more direct control over the Regents.

• An ASAFL of 234 positions which represents a loss of one (-1) position. The information provided by the GOER showing agency by agency break downs of position changes indicates an end of year FTE fill level of 527. We can account for some of this change due to the proposed transfer of 465 SED employees halfway through the fiscal year. However, this FTE figure still seems about 100 too high based on the ASAFL.
• Moving the State Museum, State Library and State Archives from the Education Department to the Council establishing a new entity the Office of Cultural Resources on October 1, 2000.

The Executive Budget recommends:

• That all of the SUNY hospitals receive increased funding. It also appears that the State has forgiven the hospitals for $61 million in revenues that they did not generate for deposit to the General Fund in SFY1999-00.
• The Appendix also states that, "the fiscal challenges facing the SUNY hospitals are further exacerbated by the operational inflexibility caused by the State agency status. It then goes on to note that, "A nationally recognized health care consulting firm has been engaged to assess the current finances of SUNY’s teaching hospitals and recommended short-term and long-term actions needed to maintain their fiscal viability in today’s changing health care environment." UUP has criticized the proposed Executive Budget for not dealing with the SUNY hospitals’ annual problem in generating the revenues DOB projects them to generate for deposit into the General Fund.

The proposed Executive Budget has an excellent chance of being adopted on time. The disputes over Medicaid funding that delayed adoption of last year’s budget have already been settled through the adoption of legislation that funds hospitals and health care. The Legislature has already indicated that it will add to the $355 million increase the Governor has proposed for local school aid. The Senate Majority has also indicated it would like to increase funding for the EPIC Program, which provides prescription drugs to senior citizens, and implement additional tax cuts. Many of these needs can probably be accommodated because the end of SFY1999-00 surplus is likely to be significantly larger than the $625 million surplus the Executive Budget forecasts. PEF is particularly concerned about the proposed consolidation of eight criminal justice agencies into the Department of Justice and the loss of 200 positions that will result from this consolidation. PEF is also concerned about the failure to restore 150 shared services staff in OMH and the proposed movement of 465 SED employees to the new Office of Cultural Resources.

We will keep you informed as we get more details about the Executive Budget. It is important that all Labor-Management Chairs schedule meetings with their agency management as soon as possible to get more budget details. Please call the Research Department if you have any questions about or have further information to add to our budget analysis.