Tom DiNapoli

New York State collected $2.9 billion more in tax income in 2022 than forecasted, but still made less than in 2021.

State Comptroller Tom DiNapoli released a report Monday that had tax collections for the last fiscal year totaling $111.7 billion. This is higher than what the Division of Budget forecasted but $9.5 billion lower than the 2021-22 budget year.

DiNapoli said the decline was primarily due to a decline in Personal Income Tax (PIT) receipts resulting from a variety of factors including: a decline in year-end bonuses in the financial services industry, claiming of credits related to the Pass-Through Entity Tax (PTET), the acceleration of the final phase-in of the middle-class tax rate cuts, and financial market volatility over the course of 2022.

Sales tax collections totaled $20.6 billion, exceeding the prior year total by $964 million or 4.9%. Business tax collections totaled $28.6 billion which was $891.8 million higher than the previous year, reflecting a 24.6% increase.

He said that state policy makers should ensure that the state budget committs additional resources to the state’s reserve funds to improve long-term financial stability.

DiNapoli said, “While tax collections have exceeded projections, they were considerably lower than last year. Although easing, inflation continues to present challenges to economic growth. State policy makers should ensure that the enacted budget for State Fiscal Year 2023-24 commits additional resources to the state’s reserve funds to improve long-term financial stability.”

The report is being released as a state budget for the current fiscal year remains unresolved.

New York State Capitol

New York State is still without a budget as the State Legislature is expected to reconvene today to pass another budget extender.

State Comptroller Tom DiNapoli sent a letter to Governor Kathy Hochul on Thursday saying that a budget extender needed to be passed by noon today in order to meet payroll needs for State employees. Approximately 83,000 workers at state agencies are due to be paid later this week.

Meanwhile, state legislators’ pay is being withheld by law until a state budget is passed. Their next payroll date is April 12.

Assembly Minority leader Will Barclay released a statement Friday calling the budget process disappointing and expressing his concern over the closed-door negotiations between the Senate and Assembly Democratic Majority Leaders with Governor Hochul, referred to over the decades as “three men in a room.”

Kathy Hochul takes the oath of office as New York State’s first elected female Governor (January 1, 2023)

Kathy Hochul was inaugurated Sunday as New York State’s first elected female governor.

Hochul took office in August 2021 after then-Governor Andrew Cuomo resigned amid allegations of sexual harassment and inappropriate behavior.

She was elected by voters in November, defeating Republican challenger Lee Zeldin.

Hochul said she’d get into policy more in her State of the State address this month, but cited housing affordability and energy affordability among other topics in her inaugural address, “And the gun violence epidemic, my gosh. The loss of lives goes on and on. The rise in hate crimes. What happened here? Especially antisemitism, Asian hate, anti LGBTQ hate and the systemic racism that still persists to this day. Those are the fights we are called to take on. We must.”

Hochul also mentioned the lingering effects of the pandemic as well as women’s rights in the wake of the U.S. Supreme Court overturning Roe v. Wade.

Tom DiNapoli also took the oath of office on Sunday as New York’s second-longest serving Comptroller of more than 15 years. Letitia James was sworn in a second time as Attorney General and Antonio Delgado was sworn in as the state’s Lieutenant Governor, his first full term.

New York State Capitol

Governor Kathy Hochul and State Legislators have missed the deadline for an on-time state budget.

WXXI News reports the Senate and Assembly adjourned until Monday, when they say they will try again to reach an accord.

The next hard deadline for the budget to be in place is Monday afternoon. That’s when the state comptroller needs to process payroll for 62,000 employees who work at state-run hospitals, prisons and other institutional settings.

In a memo to state agencies, Comptroller Tom DiNapoli warned that if the budget is not completed by 4 p.m., it will delay the direct depositing of checks for the April 7 payday.

Senate Majority Leader Andrea Stewart-Cousins said she’s hopeful the budget can be in place by then.

The biggest sticking point has been whether to include revisions to bail reform in the budget and make other changes to the landmark 2019 criminal justice reform laws.

The Senate and Assembly did not include unrelated items like bail reform changes to their proposed spending plans.

And criticism continues over the deal struck Monday between Hochul and the owners of the Buffalo Bills football team. That agreement would require at least $850 million of state money. Some lawmakers and Hochul’s political opponents said it is too big a giveaway to the wealthy owners of a lucrative sports franchise.

Proposals including a gas tax holiday and allowing restaurants to serve to-go alcoholic drinks along with takeout food are still on the negotiating table.

Thomas DiNapoli

State Comptroller Tom DiNapoli, in review of Governor Kathy Hochul‘s executive budget, states concerns about how the Pandemic, inflation, and supply chain issues will affect the state’s economic recovery and financial plan.

DiNapoli also has concerns about how the budget proposes billions of dollars in spending that would bypass critical oversight if enacted.

He said unprecedented amounts of federal aid and tax collectings that are $10 billion higher than initially expected have put the state on solid fiscal footing. However, he said with “the pandemic’s continued uncertainty makes forecasting economic performance difficult. Policymakers should keep an eye on the years ahead when temporary federal funding will end and build up the state’s reserves, so we are better prepared for future emergencies or an economic downturn.”

DiNapoli said that thanks to significant increases in federal aid and tax revenue that has far outpaced the Division of the Budget’s projections, the state has the best opportunity to act on this.

The Executive Budget includes a commitment to set aside reserve funds equal to 15 percent of projected spending from State Operating Funds by 2024-25.

You can read the Executive Budget review here: https://www.osc.state.ny.us/files/reports/budget/pdf/executive-budget-review-2022-23.pdf

State Comptroller Tom DiNapoli‘s office issued a report saying the increased enrollment has contributed to a steep decline in the number of New York residents without health coverage. New York ranked 8th lowest in the country for uninsured residents in 2019, which is an improvement from 20 in 2008.

According to a report, the number of state residents without health care coverage declined from 2.2 million in 2008 to 1 million in 2019. The expansion of the Medicaid program played a large role in the sharp drop in the number of uninsured New Yorkers.

DiNapoli said while the drop in New Yorkers without health coverage is positive news, State budget projections rely on expectations for significant enrollment declines that may not materialize, which could drive significant unbudgeted costs.

Medicaid is the second largest category of state spending, estimated at $27.8 billion. As a result of the economic instability caused by the pandemic, monthly Medicaid enrollment swelled to more than 7 million people in February 2021. The Division of Budget currently estimates that enrollment will decline by more than one million individuals in state fiscal year 2022-23; however, should this reduction occur at a slower rate or should enrollment fail to decline by as much as projected, the State financial plan will incur additional costs.

The report recommended that to protect the long-term viability of the Medicaid program, State policymakers should closely monitor Medicaid enrollment and spending trends, and engage stakeholders in developing strategies to protect the quality of care for program participants while effectively containing costs.

In June, State Comptroller Tom DiNapoli released his annual IDA report, which focuses on over 100 different Industrial Development Agencies that operate across New York State, using data from the 2019 fiscal year. There were a total of 55 County IDAs within the report, along with 53 IDAs being operated within various cities or village.

The report included data sets in 11 different categories for all IDAs: Project Count, Total Project Values, Total Tax Exemptions, Total PILOTs (Payments In Lieu Of Tax agreements), Total Net Tax Exemptions, Estimated Jobs Created, Estimated Jobs Retained, Full-Time Equivalents Before IDA, Current Full-Time Equivalents, Net Jobs Gained, and IDA Expenses.

It also provided a region-by-region comparison of IDAs, focusing on the 10 economic development regions of the state.

READ: COMPTROLLER’S 2021 IDA REPORT

When compared to the previous year’s numbers, CCIDA saw a slight drop in total operating expenses, going from $4.4 million in 2018 to $3.8 million in 2019. However, the total Net Tax Exemptions ($18.0 million) saw a noticeable increase, up 17.6%, compared to the previous year when it was $15.3 million.

When compared to other county IDAs, CCIDA once again ranked among the top in the state in 2019 when it came to operating expenses – $3.8 million (3rd out of 55, same as the prior year); as well as net tax exemptions given to projects – $18.0 million (5th out 55, up from 9th in 2018). But despite the high rankings in those two categories, CCIDA ranked among the lowest in the state when it came to job creation – 263 net jobs (43rd out of 55, up from 48th in 2018).

As a result of the findings, in 2019 the CCIDA had a poor rate of return, compared to other counties, when it comes to how much is spent for each net job gained ($14,562 per net job gained), as well as the amount of net tax incentives that were given for each job gained ($68,441 per net job gained).

According to the comptrollers report, IDAs must pay for their own administrative expenses, including personnel and overhead costs. These expenses are largely funded with project fees, and IDAs may also collect rent on properties they own. That means that the IDA operating expenses of $3.8 million had little impact on taxpayers in the county. However, the net tax exemptions provided by the IDA does come from the local tax base, primary through lost property taxes, but also sometimes from sales and mortgage tax exemptions. That means local governments in Chautauqua County likely missed out on an estimated $68,441 in lost revenue for each of the 263 net jobs gained in 2019. That’s actually an significant improvement (23%) when compared to the average cost of $89,000 per job gained in the prior year.

For the other eight categories, CCIDA ranked as followed: Project Count (17th – 49 projects), Total Project Values (21st – $767.9 million), Total Tax Exemptions (12th – $19.6 million), Total PILOTs (30th – $1.6 million), Estimated Jobs Created (32nd – 543), Estimated Jobs Retained (20th – 1,899), Full-Time Equivalents Before IDA (21st – 1,900), and Current Full-Time Equivalents (30th – 2,163).

For population comparison, Chautauqua County ranked 23rd on the list with 127,657 people.

Tom DiNapoli

State Comptroller Tom DiNapoli has announced the launch of a dashboard that will track COVID-19 relief funding.

The new online tool will monitor spending of federal recovery aid and COVID-19 relief programs in the state, including funds for excluded workers, childcare providers, emergency rental and homeowner assistance, and small business recovery.

The dashboard explains each federal and state program, and how much has been received and spent to date. The data will be updated monthly and expanded to include additional programs and spending details as new information becomes available. New Yorkers can use the tool to understand how federal aid is used and to inform future conversations about budget priorities.

Funds received and spent through September 30th are currently available. The link to the dashboard is here: www.osc.state.ny.us/reports/covid-relief-program-tracker

The Comptroller said 30 local governments in New York State ended 2020 in some form of fiscal stress.

DiNapoli releases fiscal stress scores on municipalities twice a year. The Fiscal Stress Monitoring System was implemented in 2013 to keep the public informed about the factors impacting local governments’ financial health.

The system evaluates local governments on financial indicators including year-end fund balance, cash-on-hand, short-term borrowing, fixed costs and patterns of operating deficits and creates fiscal stress scores.

The system also evaluates information such as population trends, poverty and unemployment in order to establish a separate “environmental” score for each municipality which can be used to help describe the context in which these local governments operate.

Sales tax revenues

In 2020, Chautauqua County collected $15.7 million in sales tax revenues compared with $23 million this year.

DiNapoli reported year-to-date, statewide local collections in 2021 are up 18.8%, or nearly $1.5 billion, over the first six months of 2020. He said the results, where nearly every region in the state saw a surge in collections, may reflect a combination of pent-up consumer demand, along with purchases tied to recent spikes in home sales.

DiNapoli said the requirement for out-of-state vendors to collect sales tax and online marketplace providers, like eBay and Etsy, to collect and pay sales taxes may have prevented steeper declines.