Nick Langworthy

Congressman Nick Langworthy has introduced legislation to prevent New York State from clawing back federal funds meant for counties.

The “Protect Local Taxpayers Act” is in response to Governor Kathy Hochul’s Budget Proposal that would claw back $625 million in Federal Medical Assistance Percentage (FMAP) funds that have been designated to counties since 2011. Congresswoman Claudia Tenney (NY-24) and Congressman Brandon Williams (NY-22) are co-sponsors of this bill.

The act will prevent state governments from further shifting state Medicaid expenses onto local county governments.

New York’s per capita spending on Medicaid is the highest in the U.S. and more than double the national average. The county share of Medicaid is currently $7.6 billion per year and, if Hochul’s plan moves forward, Langworthy said counties in the 23rd congressional district will face a budget shortfall in the tens of millions. The impact to Chautauqua County would be $4 million.

Langworthy said in a statement, “These federal funds are dedicated specifically to help cover local government’s costs, not to be used for Kathy Hochul’s slush fund.” He added, “We need to stand up in Congress and tell the Governor she can’t raid these federal funds.”

Chautauqua County Executive PJ Wendel delivers State of the County address (March 22, 2023)

Chautauqua County Executive PJ Wendel said the county is “on the precipice of greatness” in his  State of the County address.

Wendel said the 2022 contribution to the general fund balance was $19.4 million, “This contribution is created in part by holding our teams to fiscally responsible budgets, an increase in the tax foreclosure auction, an overdue settlement of the tribal compact, as well as continued success in our sales tax revenue. With the work of our fiscal team and my guidance, we’ve been able to provide a tax rate reduction for the last two years, totaling 71-cents per thousand while maintaining the ability to provide contributions to the fund balance.”

Wendel said the fund balance contributions over the last three years have met and exceeded recommended levels under the five-year financial management plan.

He said there were record investments in the county in 2022, “The Chautauqua County Industrial Development Agency reported 50 approved projects with a combined total of $501 million of committed investments. The committed investments will create nearly 300 new jobs, retain an additional 774 existing jobs, and create construction projects and construction jobs throughout our county.”

Wendel also cited the restructuring of the Department of Mental Hygiene with the Department of Social Services, that included the separating of the Department of Health out as a separate department. He also recognized the Sheriff Department‘s new Unsolved Cases Teams that has resulted in new leads on homicides and missing persons cases.

Securing state and federal funds for the phase two expansion of the West Side South and Center Chautauqua Lake Sewer District, was another highlight for Wendel, “I remain committed to improving our water and sewer infrastructure around Chautauqua Lake. And this phase two will divert an estimated 62 million gallons of wastewater a year to the proper wastewater treatment facilities.”

Wendel said he’s continuing to advocate for healthcare in the north county, including contacting Governor Kathy Hochul‘s office to push for funding to be released for the Brooks Memorial Hospital project.

He also said the county and Chautauqua County Industrial Development Agency are working on creating a 150 acre shovel ready industrial site in the western part of the county.

Wendel cited record inflation, unfunded state mandates like Medical Assistance Treatment at the County Jail, as well as the possible clawback of over $4 million in Enhanced Federal Medicaid Assistance Percentages in the proposed state budget as challenges facing Chautauqua County.

Chautauqua County Executive PJ Wendel’s State of the County slideshow – March 20, 2023

The federal funding received for Phase 2 of the South & Center Chautauqua Lake Sewer Districts meant that some of the ARPA funds designated for it could be used for other projects.

Also, the County canceled two other ARPA funded projects involving purchasing deterra pouches and a paving project at the Emergency Services Center for a drive-through public health clinic.

Resolutions for new ARPA funding to be voted on tonight include $4 million for Phase 2 of Shovel Ready Sites. The resolution states that the $1.4 million in ARPA funding for Phase 1 and from other sources fell well short of what is necessary to cover the cost of a large site.

The Legislature also will consider using $880,000 to purchase a Landfill Trailer. The resolution states that using ARP funds will “reduce the financial burden on the Landfill Equipment Capital account, allowing for the purchase of additional machinery to support daily Landfill operations.”

Another $500,000 in ARP funds is proposed to be used to upgrade the Sherman Shop Fuel System. The resolution states the fuel system in Sherman is need of upgrades and below grade fuel tanks are nearing the end of their life expectancy

Other ARPA-funded resolutions include $210,000 for a Waterways Master Plan project to evaluate the Marden Cobb waterways as well as $100,000 to repair trail sections and bridges on the Overland Trail at Harris Hill.

The County Legislature also will vote to designate $20,000 in Occupancy Tax Program monies toward the installation of a drainage system on Wright Park Drive in Dunkirk.

Under motions for consideration, the Legislature will vote on calling on New York State to continue passing on Enhanced Federal Medicaid Assistance Percentage Funds to counties, a motion urging New York State to approve a new Brooks Hospital, as well as a motion urging New York State to support natural gas.

The County Legislature meeting will take place at 6:30 p.m. in the Legislative Chambers of the Gerace Office Building in Mayville. It is open to the public and also will be livestreamed on https://www.youtube.com/@ChautauquaCounty

The New York State Association of Counties provides more information about what the EFMAP, or Enhanced Federal Medical Assistance Percentage, program is and how a proposed clawback of those funds will affect counties in New York.

Chautauqua County Executive PJ Wendel discusses the potential impact a clawback of Enhanced Federal Medical Assistance Program funds (eFMAP)would have on Chautauqua County.

PJ Wendel

Nick Langworthy

Congressmen Nick Langworthy and Marc Molinaro are leading the charge against Governor Kathy Hochul’s 2024 state budget proposal to clawback Enhanced Federal Medical Assistance Program (eFMAP) funds.

These are funds designated for counties and local governments and the proposed clawback could result in up to $1 billion in new Medicaid costs for those municipalities.

According to a press release sent out by Senator Chuck Schumer in March 2020 about the bipartisan Coronavirus bill that was passed by Congress, FMAP is a matching rate enacted in 1965 that determines the federal funding share for state Medicaid programs. The federal government matches state funds spent on Medicaid, based on the state’s FMAP, which varies by state.

For example, New York’s FMAP is 50%. This means that for every dollar spent on Medicaid in New York, New York’s share of the cost is fifty cents (this fifty cents, in turn, is split between the State and Counties and localities), while the federal government chips in the other fifty cents. Schumer’s efforts increased the federal share of New York’s Medicaid program to 56.2 percent, thereby dropping the state’s share to 43.8 percent. This delivers more federal dollars immediately to the state and localities, to the tune of more than $6B annually.

In the breakdown of what counties could expect to receive as a result of that legislation in 2020, and, thus, what they are expected to lose due to the clawback by the Governor, is as follows for local counties:
– Allegany County: $1.97 million
– Cattaraugus County: $3.35 million
– Chautauqua County: $6.24 million
– Erie County: $41.66 million

Langworthy and Molinaro said the diversion of these funds will force municipalities to raise property taxes and drastically cut services. Together, with other members of the New York delegation, they sent a letter imploring the governor to reverse her decision that will have grave consequences for communities across the state.

Their letter stated, “Your decision to divert the necessary local support from eFMAP will force our state’s local governments to shoulder the shortfall. This will lead to a reduction in access for the very services that eFMAP is intended to support, leading to harm for the most vulnerable.. Other localities could be forced to raise property taxes.”

PJ Wendel

Chautauqua County Government could be hit with a $4.3 million shortfall this year should New York State move forward with clawing back Medicaid funds.

The Enhanced Federal Medical Assistance Program (E-FMAP) funds are monies from the federal government to New York State that are meant to go to local counties, but Governor Kathy Hochul‘s proposed budget holds onto those monies.

County Executive PJ Wendel said if this stays in the budget, it would put counties back 20 years. He said the idea of the state holding onto E-FMAP monies isn’t new and that former Governor Andrew Cuomo had proposed doing the same in the past, “But the Budget Director, who was the Budget Director under Governor Cuomo, Robert Mujica; we were told kind of slipped this in without the Governor’s (Hochul) knowledge. Well, we all said this on a meeting last week, if anybody slipped anything into our budget without our knowledge they probably wouldn’t be working for us. This person has since left, so there’s a vacant position for.. I think there’s an Acting Budget Director now. So the Budget Director position is really vacant so we’re going after a ghost.”

Wendel said the claw back of funds is going into the state’s fund balance and not designated for any specific program.

He said he learned this week that the state is also behind on Medicaid reimbursements to counties to the tune of $8 million for Chautauqua County alone.

Should the Medicaid claw back continue to be part of the state budget when it’s passed April 1, Wendel said the $4.3 million that Chautauqua County would lose in funding is a large portion of the budget, “As you know, we have a very favorable fund balance. This year we did use $4 million in capital projects. So, I’d hate to cancel any of those capital projects cause they are necessary and sometimes, it’s most often times, deferred maintenance and stuff we’re putting off. We do have the ability right now to cover that, but why is it that we are being punished for being fiscally prudent when the Governor can’t seem to get their budget under control?”

Wendel added the New York State Association of Counties, which he is a member of and sits on the board of directors, is working to negotiate with Hochul’s office on this item. He said he hopes those who have pull with Hochul, like Erie County Executive Mark Poloncarz, can sway her to pull this out of the budget. Wendel said he doesn’t believe the State Legislature has any say over the budget item and that it’s at the Governor’s discretion.

Governor Kathy Hochul presents her 2024 State Budget

Governor Kathy Hochul has unveiled her $227 billion state budget for 2024-25.

This budget is $5 billion more than the current year, with a 2.4% increase in all spending.

Hochul said public safety is her top priority, budgeting $337 million.

She is proposing $40 million for funding discovery law changes that have required local prosecutors to make evidence available to defense counsel on a fast basis. The budget also backs $20 million for pre-trial services.

Hochul has also proposed $50 million to aid communities affected by gun violence and $35 million in capital grants for combating hate crimes.

Annual school aid will increase $3.1 billion, or 10%, for a total of amount of $34.5 billion. This includes fully funding the Foundation Aid formula for the first time in 17 years.

Also under education spending is $125 million to expand full day pre-kindergarten and $250 million for tutoring programs to help students recover from learning loss.

As previously announced, Hochul allocated $1 billion toward Mental Health with that multi-year funding going toward the creation of 1,000 inpatient beds, $30 million to expand school-based mental health care, and increased funding for outpatient services.

Hochul wants to expand housing in the state by building 800,000 new units, counting those that are already in development. The budget includes a plan that would allow projects to move ahead over the objections of local zoning regulations if a community is failing to meet targets. Funding for housing includes $250 million for infrastucture support and $20 million for planning assistance.

Child care assistance will receive a $7.4 billion increase over four years. Hochul said this is the most ever. The budget also would provide instant eligibility for child care assistance for anyone receiving government support. Co-pays would be lowered and more support is being proposed for child care providers.

Under health care, the budget seeks to address access issues by adding more than $1 billion in health care capital funding, expanding Medicaid coverage for 7.8 million low-income New Yorkers, and improving access to aging services and high-quality long-term care.

However, the New York State Association of Counties (NYSAC) President Michael Zurlo said Hochul’s budget includes an “unprecedented shift that will saddle local taxpayers” with up to $1 billion in new Medicaid costs by pocketing Enhanced Federal Medical Assistance Program (eFMAP) funds that were intended to go directly to local governments to help hold costs

While there is no personal income tax increase in Hochul’s budget, she is proposing to extend a higher tax rate for wealthy corporations that had been set to expire at the end of the year.

In 2021, former Governor Andrew Cuomo had increased the tax rate for corporations taking in at least $5 million a year in revenue from 6.5% to 7.25%. The increase was only supposed to be temporary and set to end after three years, but Hochul wants to extend it for another three years. The extension would bring in between $800 million and $1.1 billion annually. Democrats are expected to support the extension.

The State Legislature now has until April 1 to approve a fiscal plan.