Lieutenant Governor Duffy Joins County Executive, Mayor and Mohawk Valley Chamber of Commerce President at the Mohawk Valley Chamber of Commerce to Discuss How Plan Would Lower the Cost of Government for Taxpayers
Albany, NY (January 26, 2012)
Lieutenant Governor Duffy today joined Oneida County Executive Anthony Picente, Utica Mayor Robert Palmieri and Mohawk Valley Chamber of Commerce President Sam F. Berardino, III to discuss how Governor Andrew Cuomo's mandate reform proposals will save Oneida taxpayers more than $11 million over the next five years and his pension reform proposal will save $700 million over the next 30 years. To get more information on mandate relief and to get involved in the process, New Yorkers can visit www.NYGetInvolved.com.
Lieutenant Governor Duffy said, "As a former Mayor of Rochester, I saw local governments and school districts all across the state repeatedly request help from the state to cover their skyrocketing costs for Medicaid and pensions – payments required yet unfunded by the state government. Finally we are addressing that need with the Governor’s mandate relief and pension reform proposal which includes gradual state coverage of Medicaid growth, a new pension tier for new employees, and a plan to improve our preschool special education system. Under this plan, Oneida will save more than $11 million over the next few years. I thank County Executive Picente, Mayor Palmieri, and Mohawk Valley Chamber of Commerce President Sam Berardino for their hard work, and together we will continue to deliver results for their constituents."
Oneida County Executive Anthony Picente said, "The Executive Budget presented by Governor Cuomo for the next fiscal year again proves his commitment to turning around New York’s reputation as one of the highest-taxed states in the country. He delivered on his promise to establish a property tax cap in municipalities, and now his mandate relief plan, which will save us $11 million, helps us achieve the goals of that cap to lessen the tax burden on our families and stimulate local economies. I thank the Governor for his leadership and look forward to continuing our work together to rebuild Oneida County and all of New York."
Utica Mayor Rob Palmieri said, “I am pleased to welcome Lieutenant Governor Duffy, a former mayor himself, to Utica today. The City of Utica stands to benefit from Governor Cuomo’s leadership in putting pension reform as a central part of his plan to relieve local governments of burdensome costs. For too many years, these retirement costs have not been addressed by Albany, and finally with Governor Cuomo’s Executive Budget, relief is on the way. I also strongly support the Governor's renewed call for jobs, jobs, jobs, and we must continue to work together building up Utica’s economy. Our state is back on the path to prosperity, and I look forward to joining with the Governor to get our state back on track."
Sam F. Berardino, III, Chairman of the Mohawk Valley Chamber of Commerce, said, “For too long, local governments throughout our region have been forced to raise taxes to cover the ever growing expenses of unfunded mandates from Albany. New York State must become business friendly through tax relief and regulator reform in order to stimulate private sector investment and job creation. I applaud Governor Cuomo for his commitment to provide mandate relief for communities throughout the state, as lower taxes will enable small businesses to further invest in growth and create new jobs. I urge the State Legislature to act quickly on the Governor’s ambitious proposals, so that we can focus on putting New Yorkers back to work.”
The Governor's Executive Budget closes the current $2 billion budget deficit with no new taxes or new fees. It also proposes sweeping mandate relief and pension reform that will save taxpayers and local governments billions of dollars.
Highlights of the mandate relief plan include:
- Creating a plan for the State to take over 100% of the costs of Medicaid growth that will be phased in over three years, saving local governments $1.2 billion over the next five years;
- Creating a pension reform plan that will save State taxpayers and local governments outside New York City $83 billion, and will save New York City $30 billion over the next 30 years
More specifically, the Governor proposed sweeping structural reforms to relieve local governments of State mandates that drive up local costs. These reforms, which address the largest cost-drivers for local governments, will help municipal leaders meet the pressures of the prolonged economic downturn, and will help local governments meet the goals of the property tax cap.
Reduce burden on counties by taking over Medicaid growth costs: Medicaid growth is a major cost driver for counties. In 2006, the State capped the amount of Medicaid cost growth that counties have to pay. Currently, the cap is 3% of growth; all growth over 3% is paid by the State. To provide significant fiscal relief to counties and to New York City, the State will phase in a 100% takeover of the costs of Medicaid growth. Effective April 1, 2013, the county cap will fall to 2% of Medicaid growth; in county fiscal year 2014, the county share will be reduced to 1%. Starting in county fiscal year 2015, the State will pay 100% of the costs of Medicaid growth. The takeover by the State of a greater share of local Medicaid expenses will save counties and New York City $1.2 billion over the next five years.
Below are the 5 Year (SFY) savings totals from the State take-over of the Medicaid Growth for Oneida County.
|SFY12/13||SFY 13/14||SFY14/15||SFY 15/16||SFY16/17||5 Year Total|
Enact pension reform: Next to Medicaid, pension costs are the most significant burden on local governments. The Governor called for a new tier in the State pension system that will save the State and local governments outside of New York City $83 billion and New York City $30 billion over the next 30 years. As a result of the pension reform, Oneida County would save $700 million over the next 30 years. The new pension plan would have progressive contribution rates between 4% and 6% with shared risk/reward for employees and employers to account for market volatility. It includes a voluntary option for Defined Contribution following the TIAA-CREF model. Employees taking this Defined Contribution will vest in this system after one year. This option will be portable. No current employees will be affected by the Governor's pension reform plan.
Enact reforms to the Early Intervention and Preschool Special Education Programs: The budget also reforms the Early Intervention program to reduce counties' administrative burdens and cut their costs by $99 million over five years. As a result of these reforms, Oneida County would save $364,500 over the next five years. In addition, the Executive Budget reforms the Preschool special education program to reduce costs for counties outside of New York City by $150 million over five years. As a result of the reforms made to the Preschool special education programs, Oneida County would save $2,009,000 over five years. The Executive Budget does not include any cuts to Early Intervention or Preschool special education services.
Aid to Local Governments: In addition to these reforms, the Executive Budget provides $715 million to local governments in unrestricted operating aid, and an additional $79 million in grants to promote greater efficiency.