State's fiscal outlook improving but future gaps persist, says comptroller
ALBANY - New York State’s short-term fiscal outlook has improved, but long-term structural balance remains a challenge, according to a report on the state financial plan released today by State Comptroller Thomas DiNapoli. The Comptroller also released a report on the state’s first quarter fiscal results, finding tax revenue growth has been strong so far, but such gains are likely to moderate in coming months.
“There’s no doubt New York is in a better budget position now than it was a short time ago,” DiNapoli said. “Still, without doing more to align recurring spending with recurring revenue, out-year gaps will likely continue. For years, the state has used one-shots and temporary fixes to pay the bills. This leaves the state more susceptible to disruptive spending cuts and tax increases when unexpected shortfalls arise. While the state is in a reasonably good cash position right now, some of that is a result of temporary measures.”
The state’s Enacted Budget Financial Plan, prepared by the state Division of the Budget, projects budget gaps of $2 billion in state fiscal year (SFY) 2014-15 and $2.9 billion in each of the following two years, which are lower than projections from the executive’s earlier proposed budget. However, if temporary measures are allowed to expire, and barring significant economic expansion, future gaps could reach $6 billion or more, according to the Comptroller’s report.
The Financial Plan projects that General Fund receipts will grow an average of 4 percent annually from 2013-14 through 2016-17. Average annual growth in spending during that period is projected at 5 percent. If nonrecurring resources are excluded, projected growth in receipts over the period drops to an average of 2.9 percent, compared to projected spending growth of 5.1 percent.
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