State budget proposal focuses on cutting spending, promoting efficiency

On Feb. 1, Gov. Andrew Cuomo unveiled his plan for cutting New York State's $11 billion deficit with a budget totaling $132.9 billion – it is the first state budget in over a decade to reduce the state's year-over-year spending.

"We spend too much money," Cuomo said in a plain assessment of the state's financial failures. "We spend more than we make." In response to charges that New York's great spending renders great results, Cuomo retorted that in fact New York ranks near the bottom of all states in terms of the quality of two of its most highly funded programs: Medicaid and public education.

With this in mind, Cuomo's proposal called for slashes in various areas of spending: it cuts Medicaid by two percent, K-12 education by 2.9 percent and state-operated agencies by 10 percent. Cuomo justified the cuts by re-affirming his commitment to balancing the state budget without increasing revenues through tax increases. According to Cuomo, New York is the worst state in terms of demanding costly taxes, which discourages residents from living here.

Cuomo said that he organized a redesign team to "rewrite the whole Medicaid program." Cuomo cited the model for home health care as an inefficient area needing attention. The current system involves two different agencies before actually making a patient-caregiver connection; 52 cents of every dollar spent on these programs now goes toward administrative overhead instead of patient care.

Medicaid will be cut from $53 billion to $52 billion, a two percent year-over-year decrease. Cuomo said that in the future, the rate of growth for Medicaid has to be calibrated to a "fair and objective standard." He will be using the health care Consumer Price Indicator Formula to determine an acceptable growth rate for Medicaid.

Cuomo also proposed cutting the allocation to K-12 public education from $52.9 billion to $51.4 billion, a 2.9 percent year-over-year decrease. He pledged to eliminate formula grants and instead "fund competition."

To do so, Cuomo proposed a $250 million competitive grant program that would reward school districts that demonstrate the greatest improvement in performance and a corresponding competitive grant program rewarding school districts that demonstrate the greatest financial savings. He also suggested that New York public school districts should begin thinking about consolidation.

Cuomo did say that he would propose to increase education funding by four percent next year.

In an effort to show that the state is willing to lead by example, Cuomo proposed cutting the budget for state operations by 10 percent.

Applying a strategy he worked on while working under the Clinton administration in the White House, Cuomo said he would split the state into regions. "That's how economic development happens," he said.