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Budget Reform is Budget De-form


Budget Reform is Budget De-form

E. J. McMahon December 14, 2004
Urban PolicyNYC

The state Legislature's failure to adopt a budget on time for the past 20 years is widely considered the leading symptom of Albany's notoriously "dysfunctional" government.

Two decades of abysmal failure is enough to embarrass even the New York State Legislature. And so, earlier this year, Senate and Assembly leaders agreed on a set of measures - a proposed constitutional amendment and an enabling statute - supposedly designed to guarantee an on-time budget every year.

On closer inspection, however, the Legislature's so-called "budget reform" is actually a fatally flawed budget de-form.

To understand why, it's important to understand how New York's budget process works.

Article 7 of the state Constitution requires the governor to send the Senate and Assembly a complete set of appropriation bills and supporting legislation for the coming fiscal year. If the Legislature wants to reduce or even eliminate any of the governor's appropriations, there's not a thing he can do about it. But if the Legislature wants to add money to the governor's budget, it has to do so in separate line items subject to his veto.

To avoid a veto, legislators need to get the governor to agree to any spending add-ons. In any case, the Legislature cannot appropriate any money until it has first taken "final action" on all the governor's budget bills.

There are solid reasons why New York, like most states, puts its governor in the budgetary driver's seat. After all, legislators are expected to focus mainly on bringing home the bacon to their home districts. The governor has to consider both the short- and long-term needs of the state as a whole. He is constitutionally required to submit a balanced bud get.

The Legislature's budget reform package calls for a couple of very important amendments to Article 7.

First, if a budget is not enacted before the start of a new fiscal year, a "contingency" budget based on the prior year's spending would take effect. That's not a bad idea.

Second, however, the pro posed amendment says that once a contingency budget kicks in, the Senate and Assembly could join forces to pass "supplemental" amendments to it.

Far from pushing legislators to settle their differences with the governor before the start of the fiscal year, the proposed change would provide them with an incentive to stall until the start of a new fiscal year triggers the contingency plan, which they could amend as they see fit.

Yes, the governor could veto their handiwork - but a determined Legislature can over ride vetoes, as we saw just last year. And the Legislature's "supplemental" contingency budget wouldn't have balance.

By making it even easier for the Legislature to dodge fiscal responsibility, the amendment would make things worse. The good news is, this change wouldn't take effect unless it was approved by the Legislature this year and next and submitted to voters at a referendum.

The governor has vetoed the budget reform bill, but that is not enough. He should take the lead in negotiating a compromise. Otherwise, we could by looking at another 20 years of failure.