Civil Service
Enforcement/Research Department
TO:
Kenneth Brynien
FROM:
Thomas E. Cetrino, Susan Mitnick, Kristie Sammons, Steve Connolly, Jeff Waggoner
and Mike Marinello
DATE:
RE:
21-day Amendments to Executive
Budget
This week the
Governor released his 21-day amendments to the Executive Budget for
For SFY 2007-08, DOB projects the State would close the fiscal year in
balance with reserves of $2.626 billion. The balance consists of $1.0 billion in
the Tax Stabilization Reserve (to cover unanticipated operating deficits), $175
million in the new Rainy Day Reserve, $21 million in the Contingency Reserve for
litigation, $1.0 billion to finance new labor settlements and $354 million in
the Community Projects Fund to support existing spending commitments. While the
State expects to take in $150 million less in personal income tax revenues than
projected in January, these losses are offset by other revenue re-estimates
including higher than expected estate tax and real estate transfer tax payments.
In State Operations, SFY 2008-09
savings are achieved through a range of management actions, including staffing
controls, overtime management, reduction in “non-essential” activities, and
maximization of federal revenues. Agencies with savings include: Department of
Taxation and Finance, Department of Mental Hygiene, Department of Health, Office
of the Medicaid Inspector General, Department of Motor Vehicles, Division of
Housing and Community Renewal, and the Office of Temporary and Disability
Assistance.
Other State Operations
savings recommendations include having the State pay one-half of the 1 percent
student loan default fee in SFY 2009-10 and beyond ($10 million); revising the
value of specialty psychiatric outpatient rates ($1 million); enhanced patient
income account revenues ($5 million); converting certain Statewide Financial
System software development costs to bond financing ($6 million in 2008-09); and
reducing the interest rate paid on judgments in the Court of Claims to market
rates rather than a fixed statutory rate of nine percent ($3 million).
There are other savings and new sending proposals in the 21-day
amendment; Attachment 1 is a chart from the Financial Plan that briefly explains
all of them. The pension proposal is due to a reconciliation charge for larger
than expected salaries in SFY 2006-07. Prepayment of this obligation in SFY
2007-08 costs $86 million, but results in interest savings of $1.4 million.
The 21-day
amendments also contain legislation to implement the Executive Budget’s
recommendation that the Department of Civil Service conduct
an audit of health insurance benefits
eligibility. The audit would ensure that
State and participating municipal employees and their dependants receive only
the benefits for which they are eligible. The audit is targeted to the use of
health benefits by dependents. The
proposed legislation (Part W of S6806-A/A9806-A)
would:
None of the major
changes made by the 21-day amendments in State Operations program appropriations
within State agencies for SFY 2008-09 are expected to have an impact on any
State agency’s authorized fill levels, except in the Department of Labor.
However based on these proposed cuts and the State’s current difficult fiscal
situation it is very likely that all State agencies will be slow to fill new and
vacant positions. The major changes are as follows:
Adirondack Park Agency
The agency’s overall
appropriation is increased by $100,000 which is added to the contractual
services appropriation in the Administration Program.
This results in an overall agency appropriation of $6.2 million which is
an increase of $100,000 over the enacted SFY 2007-08 budget.
Office of Alcoholism and Substance Abuse
Services
The agency’s overall
appropriations are increased by $3.2 million. This results in an overall agency
appropriation of $135.38 million, an increase of $45.5 million from the SFY
2007-08 enacted budget. The changes are as follows:
Council of Arts
Creates a new Council on
the Arts Account, with $100,000 in federal funding for non personal services.
Department of Banking
The department’s overall
appropriations are reduced by (-)$2.3 million for an overall agency
appropriation of $96 million, which is a decrease of $559,000 from the overall
·
(-$1.3 million)
Contractual Services – Regulation Program; the total appropriation is now $11.2
million, a $2 million decrease from the
·
(-$557,000)
Personal Services – Regulation Program; the total appropriation is now $36.1
million, a $1.4 million increase from the
·
Other minor
reductions in the Department’s fringe benefits and indirect cost appropriations.
Office of Children and Family Services
The agency’s Special
Revenue Other personal services appropriation in the Youth Facilities Program is
reduced by $200,000. This results
in an overall agency appropriation of $511.45 million which is an increase of
$5.7 million from the SFY 2007-08 enacted budget.
State Education Department
Technical corrections are
made to the department’s budget for the Office of Higher Education and the
Professions and the Cultural Education program. The special revenue federal
appropriations for these programs were originally in a lump sum appropriation
and have now been separated into two separate federal accounts for each program.
Department of Environmental Conservation
There are no changes in the
department’s overall appropriations. However the Executive proposes to increase
the proposed $100 million transfer from the Environmental Protection Fund (EPF)
to the General Fund by $25 million for a total transfer of $125 million.
Department of Health
The department’s personal
service appropriations are reduced by $1 million from the following programs:
Division of Housing and Community Renewal
The division’s General Fund
personal service appropriations are reduced by (-$861,000) in the Housing, Rent
Administration, and Housing Information Systems programs.
This results in an overall agency appropriation
of $101.7 million which is an increase of $3.1 million from the overall SFY
2007-08 enacted budget appropriation.
Department of Insurance
The department’s overall appropriations are reduced by $1.8 million. Over $1.3 million of these cuts appear in the personal service and fringe and indirect costs appropriations for the Regulation program with smaller cuts in the personal service appropriations of the Administration and Consumer Services programs. This results in an overall agency appropriation of $314.5 million, which is an increase of $14.3 million from the SFY 2007-08 enacted budget.
Department of Labor (
There are no cuts in the
department’s overall appropriations, however the department’s authorized fill
level for SFY 2007-08 and SFY 2008-09 has been reduced by 100 FTEs from 3,647 to
3,547 (07-08) and from 3,643 to 3,543 (08-09).
According to DOL management the eliminated FTE positions are all
currently vacant positions.
Office of Medicaid Inspector General
The agency’s overall MA
Audit and Fraud Prevention Program’s personal service appropriation is reduced
by $2 million. This results in an appropriation of $18.9 million, which is an
increase of $2.05 million from the SFY 2007-08 enacted budget.
According to the 21-day amendments’ appropriations narrative this
reduction reflects vacancy savings.
Office of Mental Retardation and Developmental
Disabilities
The department’s overall appropriation is increased by $35 million which results in an overall agency appropriation of $2.0 billion which is an increase of $546.9 million from the enacted SFY 2007-08 budget. All increases are in the non-personal services, supplies and materials appropriations for the following programs:
·
Central Coordination (+$4.1 million), Community
Service (+$20.6 million), and Institutional Services (+$10.6 million).
Department of Motor Vehicles
The Department’s overall
appropriations are reduced by $1.2 million, all of which occur in the Compulsory
Insurance Program. The Department’s overall budget is $123 million which is an
increase of $1.86 million from the
·
(-$500,000)
personal services; the total appropriation is $3.1 million, a $287,000 decrease
from the
·
(-$500,000)
contractual services; the total appropriation is $4.8 million, a $514,000
decrease from the
·
(-$250,000)
fringe benefits and indirect costs; the combined total appropriation is $4.5
million, a $335,000 decrease from the combined
State University of New York
The agency’s All State
University Colleges and Schools Program’s Infrastructure and Technology account
is increased by $1 million for expanding the nursing programs.
This increase results in an total appropriation of $2 million for the
nursing program (a new appropriation for SFY 2008-09) and overall a $41.3
million appropriation for the Infrastructure and Technology account, which is an
increase of $2.7 million from the SFY 2007-08 enacted budget.
Department of Taxation and Finance
The department’s General Fund appropriations are reduced by $4 million. The department’s All Funds appropriation is now $445 million, an increase of 2.2% from the enacted SFY 2007-08 budget. The largest reductions include:
Office of Temporary and Disability Assistance
The department’s
non-personal service System Design and Modification appropriation in the
Information Technology Program is reduced by $1.5 million.
This reduction was from the contractual
services appropriation for the design and implementation of modifications to the
welfare-to-work case management, welfare management, and child support
management systems. This results in a
proposed appropriation of $7.4 million for SFY 2008-09 (this appropriation is a
new stand alone appropriation for SFY 2008-09).
Workers Compensation Board
The Board’s personal
service and non-personal service appropriations for the Workers’ Compensation
Program (SRO), Maintenance Undistributed (MU) Account which are sub- allocated
to DOL (for its statewide survey of occupational injuries and illnesses) and DOH
are slightly adjusted.
If all the Executive’s
proposals are adopted DOB projects
to end SFY 2008-09 with a balance of $2.2 billion in the General Fund, also
unchanged from the Executive Budget estimate. The balance consists of $1.0
billion in the Tax Stabilization Reserve, $175 million in the new Rainy Day
Reserve, $21 million in the Contingency Reserve, $708 million to finance new
labor settlements, and $291 million in the Community Projects Fund.
DOB currently projects General
Fund budget gaps of $3.6 billion in SFY 2009-10, $6.1 billion in SFY 2010-11,
and $7.2 billion in SFYV 2011-12 for a three year projected total of almost $17
billion. The 21-day amendments and
revisions to the SFY 2008-09 Executive Budget projections increased the gaps by
$289 million in SFY 2009-10, $452 million in SFY 2010-11 and $359 million in SFY
2011-12.
The next step in the budget
process is for an agreement to be reached by March 1, 2008 on how much revenue
is available to spend. In the event that the Executive and Legislature fail to
reach consensus by March 1, 2008, the State Comptroller must provide a revenue
forecast by March 5, 2008 for SFY 2007-08 and SFY 2008-09.
According to the Legislature’s agreed budget schedule, on March 12, 2008
Senate and Assembly budget bills will be passed by each house and Joint
Senate/Assembly budget conference committees will commence the next day.
Conference committee reports are to be
issued no later than March 27, 2008 in anticipation of passage of a budget by
March 31, 2008. It is unclear as to
whether this schedule can be met.
We will continue to update you on