How Cuomo adhered to his 2 percent state budget cap

Despite two of the state’s larger expenses rising more than 2 percent this fiscal year – Medicaid rising 3.4 percent and aid to school districts growing 6.5 percent –  the Cuomo administration bragged that the budget increased less than 2 percent for the sixth consecutive year. 


Well, the initial executive budget proposal Cuomo unveiled in January only increased spending about 1.7 percent, which left him some room to work in various priorities from legislators. 

A state budget official said some of the governor’s proposals had not made it into the final budget, such as the Dream Act and small business tax cuts – though the governor’s administration argues the decision to curb taxes for the middle class will achieve most of what the small business tax cuts would have.

Additionally, the state was able to find savings by reworking the amount needed for school districts’ expense-based aid based on the claims the state has received. Budget officials also recalibrated how much the state was targeted to save through its debt management practices based on market conditions, which freed up another $100 million.

Because the state had not reached its 2 percent cap in last year’s budget, it also decided to use some of the funds towards expenses it had planned for the current fiscal year 2016-17 budget. This practice added about $200 million to the sum the state was already planning to pre-pay, as the practice is known.

It’s not uncommon for governments to use prepayments, according to Maria Doulis, a vice president of the Citizens Budget Commission, which published a brief initial analysis on the state budget. But she also described them as a “fiscal gimmick” and one example of why the CBC has been advocating for the budget to be managed according to the stricter accounting principles called the GAAP, which are used in New York City.