Tom Dinapoli New York State Budget Update
NEW YORK NOW - State Comptroller Tom DiNapoli (D) joins us to discuss the state's finances six months after the state budget was passed, his role as a check on state spending, and his bid for re-election.
DAN CLARK: We are about six months after the state budget was passed in April. You are the state's money manager. In that time, we're halfway through the fiscal year of the state. How are we doing right now in terms of finances? TOM DINAPOLI: The budget is holding together and keep in mind: division of budget lowered the projections as to what revenue would be. But in our last month's cash report, we're still up by $157 million. So it's still a bit higher than anticipated. But I think the challenge is it's a very uncertain time. You see how poorly the stock market's been performing in recent weeks. So I think for the rest of the year, we need to be cautious. I think we need to be cautious in our personal lives as far as spending. And certainly for the state as well. Be mindful that as secure as it seems right now, it might be very different six months from now. Already we're anticipating a budget gap next year at around $310 million. It's possible those numbers will grow again, depending on how it looks a month or two from now as we get into the fall.
|TOM DINAPOLI|| |
"There were big bets made this year. Investments, I should say, in education and health care, child care. I don't think folks are going to want to see that spending curtailed because much of that is very important to continue the recovery to get more people back into the workforce."
DC: Yeah. I was going to ask you about the budget gap. So $310 million is a lot of money. But in the context of the state budget, it's not that much money. The state budget is $220 billion. That being said, are we prepared to handle closing that gap right now financially? TD: Well, first of all, we're in better shape because we're finally building up the reserves, which I think you and I have talked about the past. And New York's done a very poor job of that historically. And that's something we've recommended in all of our budget reports. And certainly the voice of the comptroller has always been we're not well prepared for an economic downturn. So I'm very pleased that this governor and this legislature did make a commitment to significantly boost our rainy day reserve. So we have that cushion. You know, I would also say on the scale, as you point out, down of the size of our state budget, three or $10 million gap can be managed even without going into the reserves. There are other ways to make decisions about spending. The challenge is going to be if that number grows, number one. Number two, we have to be mindful that the federal money that's helped us tremendously, thanks to Senator Schumer and the Biden administration, our congressional delegation. That money is will be winding down. And if the economy is not picking up, you know, there are many programs that people support, believe in. There were big bets made this year. Investments, I should say, in education and health care, child care. I don't think folks are going to want to see that spending curtailed because much of that is very important to continue the recovery to get more people back into the workforce. So I think the challenge in next year's budget is going to be whatever the size of the gap is, and we hope it will be a modest one. How do we make decisions about spending that will keep us on a sustainable path of budget balance in the context of a problematic economy and federal support that obviously is winding down? So I think it's going to be a challenging budget debate next year. And, of course, we have elections. So depending on who the players are. Will there be any changes? Might that impact that whole process? I think it's going to be a very interesting year next year in Albany. DC: You know, speaking of the budget, historically, this previous governor, Governor Andrew Cuomo, had used the budget to kind of curtail some of your oversight powers early in his administration. And now there is legislation that has before this governor, Governor Kathy Hochul, that would codify that oversight back into law. There was an agreement between you and the governor's office to bring it back. But now this is putting it in stone. She is deciding to sign that bill in the next couple of months if she doesn't sign the bill. What do you think the consequences of that are? TD: Well, in terms of immediate consequences, because we do have that memorandum of understanding, which, you know, just in terms of context, you're right, the previous governor, this was a priority for him all under the umbrella of increasing efficiency. But we're actually very efficient in turning around contracts in compromised independent oversight, which I think is important to the integrity of a procurement process, a contracting process, important to ensure best value for taxpayers. And it was done not unilaterally. The legislature approved it. We think it's very important for the future that this is not about me. It's about controllers forever. To restore this, we've seen too many problems of perhaps some decisions that weren't the best ones. We've seen some cases of corruption. And while no system is perfect, having an additional set of eyes to look at these kinds of transactions, I think is very important. So I think it's key for the governor to sign it. I've been very pleased not only that the legislature overwhelmingly voted in favor of what we're seeing just the past couple of weeks. Editorial ads are coming out very strongly in favor of this. So I'm hopeful. I know Governor Hochul has made a commitment to doing things differently and have a different atmosphere. I think this legislation signing it would be the strongest signal that the governor could put out there that in fact, the page has been turned. And this is an administration that's doing things differently and is open to the kind of accountability that is there to serve the taxpayers. DC: We had a similar situation during the pandemic where some of your oversight powers were suspended. At the time, Governor Andrew Cuomo had said it was because we had to respond to the pandemic quickly. We didn't have time to go through the controllers oversight process, which you say is very fast. There are now claims that that governor and this governor may have made decisions that were tied to campaign donors, whether intentionally or not. But do you think that was a mistake to suspend? TD: Well, I mean, I think it's a fair question as to how long should the emergency period have been in place. You know, it's always easy to look backwards. When COVID first hit, it really was a crisis, desperate for ventilators and personal protective equipment. I mean, I would still argue because there are there are always some situations where where we still have contract oversight, when it's an emergency situation. We work closely with the agency that's putting a contract forward to turn it around, sometimes within a day. So I think even at the peak of the emergency, we could have added value again, you know, by having that authority there. Some questions have been raised about certain contracts and vendors who got a contract approval that gave money, political money. First of all, in New York state, it is not illegal for a contract or a vendor to make a political contribution. It just isn't right. So you look at any number of elected officials, a lot of focus right now is on the governor. But you could go across the state and look at mayors, executives, a lot of folks and I'm sure you'll find many people doing donations that are involved, procurements right at every level of government. I think unless you have a clear we got this contract or this payment because of the contribution, which is very hard to prove, a clear quid pro quo. And there are all kinds of court rulings on that. What I really think the answer is: I think it's a valid concern. The appearance is as important as anything else, right? There is legislation pending reform that would say that during a procurement period, if you're participating in that procurement or that bid, you're not allowed to give a campaign contribution. And if you receive that, if you win the award and you get the contract six months after that, you can't give. And we could argue about what the right timeframe is, but I think it would be beneficial, whether it's 90 days, six months, whatever, where you're precluded from making contributions. I just think it would just be a more credible way of doing all this.
|TOM DINAPOLI|| |
"For over a decade now, we've been involved with cases that have resulted in over 200 arrests of elected officials, appointed officials, heads of nonprofits, managing public money."
DC: Now, speaking in political season, you're running for another term as state comptroller over another four years. Wondering if you have anything that you want to do in those next four years. Any big goals? I know you're working on divesting the pension fund, making it carbon zero by 2040. Do you have anything else on your plate? TD: Fully implementing our climate action plan with the pension fund is certainly something that's very important to me. I think I would also say that the recovery is not complete here in New York. So continuing to monitor trends, giving information to people about not only the state but each region about how we're performing, what sectors of the economy are doing better. I think that's an area we want to continue to focus on. I think also there are still many people that are really hurting during this time and I think doing more reports and audits to look at issues like food insecurity, that's a big issue out there of housing affordability. We've done reports perhaps will do more on broadband access, Internet access across the state. I think we need to have more thoughtful discussion about all these issues that are complex and it needs to be presented in a way that's not politicized. So I would really hope to position our office even more forcefully or more credibly than we've done in the past as a source of helpful information to guide us through this challenging time. So I guess, Dan, it's more of the same, but tailoring it to the times we're going through. DC: Is there anything that you would like? I know you say you're not a policy shop, but is there anything that you would like to see the legislature do to expand the powers of your office? Your opponent's main criticism of you has been that you haven't done enough to combat corruption. But I know that there are limited things that you can do there. Do you want more power? TD: We have elevated the role of our investigative unit. We work with the AG's office and DA's and U.S. attorney's offices. Over the past, oh, I guess for over a decade now, we've been involved with cases that have resulted in over 200 arrests of elected officials, appointed officials, heads of nonprofits, managing public money. And we've gotten back now about over $82 million in restitution. So I'm actually very involved in the corruption issue. And sometimes our audits uncover that. Look, would I like to see some of our audits where we make recommendations be those recommendations actually be enforced or followed because they're not right now we make a recommendation and the entity that we in a state agency, a local government school district, they can say, great, will implement it or they can say. No, thanks, we're not doing that. And we have no ability other than other than, you know, shining a light and hoping that the citizens and the press back up what we're saying and call these entities accountable to deal with what we recommend. Now, should there perhaps be a bit more teeth where they there might be compelled to respond to our audits in a way that is not dismissive? I'm not sure quite how you'd word it, but I guess I would say if we can strengthen the the impact that our audits could have, I think that would be helpful. But I think a criticism that we're not on top of the issue is just wrong. Unfortunately, there's a lot of it going on. And that's why we have days in 62 counties and we have U.S. attorneys across the state. We have an attorney general, we have FBI, we have state police. We're not going to substitute that law enforcement role, but we are going to complement it. And we've been really stepping up for many years now to be a partner with law enforcement. THE PRECEDING IS A TRANSCRIPTION FROM THE BROADCAST VERSION OF NEW YORK NOW AND HAS BEEN CONDENSED FOR CLARITY.