February 02, 2009

Midyear cuts would be 'irresponsible'

Source: NYSUT News Wire

A coalition of groups, including NYSUT, spoke out at a news conference Monday at the Capitol against the governor's proposed deficit reduction plan. The groups said the proposed midyear cuts would wreak havoc on community colleges, numerous social services and health care programs, while a federal stimulus package that is days away from passage is intended to help state reduce deficits.

"These cuts will not only be harmful, but they're unnecassary," said Alan Lubin, executive vice president of NYSUT. "The federal stimulus funind we're antiicpating will be retroactive, so it makes no sense to cut when help is on the way."

For immediate release, February 2, 2009

Contact:
Ron Deutsch, New Yorkers for Fiscal Fairness 518-469-6769 (cell), mkd67@aol.com
Bob Cohen, Citizen Action NYS 518-465-4600, bcohen@citizenactionny.org
Karen Schimke, SCAA 518-463-1896, kschimke@scaany.org

Federal Stimulus On the Way! Groups Urge Legislature to Reconsider Cuts

Deficit Reduction Plan Will Needlessly Hurt the Economy, Cut Jobs and Put Vulnerable Populations at Further Risk in our Fragile Economy

(Albany, NY) The Better Choice Budget Coalition, the One New York: Fighting for Fairness Coalition, Citizen Action of New York and many others groups joined forces today to tell the Governor and the Legislature to reject the current Deficit Reduction Plan and wait for federal relief which could be agreed upon as early as this week.

The plan being considered by the governor and legislative leaders to close that gap is drawing passionate opposition from non-profit service providers, environmental and education groups, religious leaders, and labor leaders, who gathered today to call attention to the so-called dark side of the plan.

While the details of the plan may be subject to change, the legislation (A.163/S.250) identifies programs that will be cut by nearly half, including child care programs, HIV/AIDS programs, services for older adults, services for runaway and homeless youth, chronic homelessness, after school programs, newborn home visiting, and funds for community colleges. The cuts would be immediate and affect many existing contracts the state already has in place.

The groups say that the harm these cuts would wreak has not been seriously considered, and that there are gap-closing strategies that would avoid the harshest impacts. They also point to the Federal Stimulus Package - now being debated in Congress - which is expressly intended to help states reduce current as well as future deficits.

"Justice Louis Brandeis reminds us that, 'Most of the things worth doing in the world had been declared impossible before they were done,'" said Susan Hager, President, United Way of New York State. "So in response to the outcry for change in our state and country, and the formidable challenges we face, we call upon the governor and the legislature to abandon this attempt to save money by reneging on 2008 funding promises to community service providers. Instead, we urge them to join us in a new dialogue to find ways to balance the state budget, while continuing to provide assistance to those who need it most."

Karen Schimke, president of the Schuyler Center for Analysis and Advocacy, said, "We believe strongly that New York's priorities should be to protect the vulnerable, protect our future "seed corn" investments and to support programs that have proven outcomes. There is no reason to violate these priorities in view of the fact that a stimulus package is coming. Human Services organizations across the state have already laid off staff in anticipation of the Governor's budget. That should not be acceptable.

"Currently not-for-profits are suffering from a loss of private and public dollars while trying to serve an increasing number of people in need of their services. Now is not the time to remove critical dollars, and the Deficit Reduction Plan will have severe repercussions not only for vital programs, but for New Yorkers in desperate need of help, said Allison Sesso, Human Services Council, Deputy Executive Director.

"In the midst of this economic crisis, civil legal services providers outside New York City are turning away at least 55 low income New Yorkers in need of legal assistance every hour our doors are open because we do not have enough funding to meet the need. Those numbers will only increase as the recession deepens. We urge the Governor and the Legislature to reconsider this short sighted cut and to focus instead on ensuring greater access to justice in New York," said Anne Erickson, of the Empire Justice Center speaking on behalf of the Legal Services Funding Alliance, a coalition of the 20 civil legal services providers outside New York City.

"These cuts will not only be harmful, but they're unnecessary," said Alan Lubin, New York State United Teacher's executive Vice-President. "The federal stimulus funding we're anticipating will be retroactive, so it makes no sense to cut when help is on the way."

Bob Cohen, policy director of Citizen Action of New York, agreed: "Given that Congress is set to pass an economic stimulus plan in February, it doesn't make sense for the Legislature at this point to make mid-year cuts to vital programs that New Yorkers depend on. Instead we should wait to find out how much in aid New York State will receive as part of the federal economic stimulus plan before the Congress, and then determine a state response. And when we receive the federal dollars, this shouldn't let Governor Paterson and the Legislature off the hook for passing Fair Share Tax Reform, which would raise taxes on high income individuals. Governor Paterson should be working in tandem with President Obama for change – not undermining the President's efforts to stimulate the economy."

According to Ron Deutsch, executive director of New Yorkers for Fiscal Fairness, "There has been no serious analysis about how these cuts will hurt already fragile community services. What we find the hardest to accept is that our leaders seem to be willfully passing over some of the tools available to them - tools meant for this very purpose. What can you call it but irresponsible?" In addition to the anticipated federal stimulus, he pointed to funds the state could find on its own.

"Citizen Action of New York and the Alliance for Quality Education were two of the main organizations that fought and won the fight for equitable funding of schools in New York State," said Ivette Alfonso, Citizen Action of New York board member and AQE committee chair. "The Governor is backing away from that victory by proposing to cut school funding in his executive budget. The new federal money should target the school districts where the need is greatest. There's no reason to do mid-year cuts until we know how much New York is getting in the stimulus bill."

The state's so-called Tax Stabilization Reserve Fund is a rainy day fund designed for unanticipated mid-year deficits; that fund alone has a balance of over $1 billion. Other reserves identified in the executive budget include: a $306 million reserve from NY Power Authority, $166 million in Department of Law and Manhattan District Attorney legal settlements; $25 million from transferring the bottle bill deposits to the state; and $106 million in general fund transfers.

Mark Dunlea, executive director of the Hunger Action Network of New York State, said, "The last thing any government wants to do in an economic recession is to cut spending for low-income families, since such funds are the most effective way to stimulate the economy. Instead of trying to push through draconian cuts in essential services, it would be far more fiscally prudent to utilize the 'rainy day' funding to close the immediate gap, especially in light of the significant fiscal relief the state expects from the federal stimulus package. Lawmakers should also recognize however that the state's fiscal problems stems from decades of excessive tax cuts for the wealthy rather than excessive spending on the poor and working families. They should support tax reform that begins with making the rich pay their fair share."

"Our leaders should 'just say no' to cutting programs that serve the homeless, low-income families and people with disabilities who are already struggling," said Shelly Nortz, deputy executive director for policy at the Coalition for the Homeless. "The fact is that Governor Paterson, the Senate and the Assembly can plug this year's budget deficit without devastating critical services for the most vulnerable groups."