The following appeared on Friday, October 27, 2023, in the Blank Slate Media newspaper chain and on its website, theisland360.com:

Last week I read a disturbing report, “Increasing the Transparency and Accounting of Empire State Development,” issued in July by the fiscal think-tank, Reinvent Albany.

Here’s the study’s finding in a nutshell: “ESD is among the state authorities and agencies most vulnerable to corruption, pay-to-play, and political abuse.

ESD has an amorphous mission that reduces its public accountability, and the board and senior management are completely controlled by the governor and show very few signs of acting independently.

ESD, by design, engages in massive, secretive, sole-source deals totally at odds with basic principles of government spending and procurement that emphasize transparency and competitive bidding.”

Not exactly a ringing endorsement.

For those not familiar with the state’s ESD, here is a little historic background. Back in the 1990s, Gov. George Pataki consolidated a number of state agencies and public authorities under one umbrella called ESD.

These subsidiary organizations include the Department of Economic Development, the Job Development Authority, and the biggest of all, the Urban Development Corporation, a.k.a. the Empire State Development Corporation.

The UDC leviathan has more than 50 active and inactive subsidiaries and more than 40 housing project-related corporations.

Pataki publicly proclaimed that he founded this agglomeration in the name of “efficiency.”

But the reality is that it gave the governor huge power to distribute state subsidies to favored corporations. Since inception, ESD has served business interests before it served the public interests.

A governor rules ESD with an iron fist. Gov. Hochul appoints most of the board members to the various boards—many of them political cronies or contributors.

The governor also “hires and fires the person who is the combined CEO and president of the UDC; … the president, CEO and chair of the Job Development Authority, and the commissioner of the Department of Economic Development. This person also serves as an ex-officio member of the ESD board and has the ability to hire and fire ESD staff …. The board of directors cannot fire the president and CEO of UDC.”

In effect, ESD officers serve at the pleasure of the governor and, as you might guess, they follow the governor’s orders on grants, irrespective of project merits.

As for the board of directors, they act as rubber stamps. “Projects,” the Reinvent Albany report points out, “are initiated by the governor’s office and presented to the board for a perfunctory and performative vote.”

ESD keeps most of the information about projects under cover. They rarely disclose the amount of grants, cost per job, feasibility studies, or evaluations of the progress and success, or failure of projects.

The criteria for supporting a given project is not spelled out or released for public review. It also “engages in sole-source bidding, a non-competitive purchasing process that favors a particular company.”

At the end of 2021, ESD reported it had invested in 4,717 loan, grant and tax benefit projects. Taxpayer dollars expended on the programs, many of which have failed (i.e.: the “Buffalo Billion” deal with Tesla) are in the billions of dollars.

In October 2022, for example, Gov. Hochul and Senator Schumer announced to much fanfare, a deal with Micron to build four chip plants. Subsidies offered to the company total a staggering $5.5 billion.

When the state and Micron were pushed by fiscal watchdogs to explain the methodology for the grant, Reinvent Albany noted, the REMI Inc. study on the economic and fiscal impact ESD provided, “was a post-hoc rationalization for the terms already agreed to buy the aforementioned mention parties.”

As for corruption, readers may recall that two ESD programs have been the subject of federal corruption trials that convicted two of Gov. Andrew Cuomo’s former associates.

The Reinvent Albany report concluded that “the governor and legislature use ESD to oversee misguided and discredited programs and projects they manufacture and … do very little to ensure agency success and effectiveness.”

Quite a mess.

Do you think Albany will do anything about the lack of public accountability?

Don’t hold your breath.

The following appeared on Monday, July 10, 2023, in the Blank Slate Media newspaper chain and on its website, theisland360.com:

The good news is members of the state Legislature have gone home—hopefully for the remainder of the year.

However, the long road to adjournment is strewn with fiscal and policy debris.

First, there’s the state spending plan. In May, the governor and the Democratic-controlled legislature agreed to a record-breaking $229 billion budget, $9 billion more than Hochul’s January proposal.

Albany potentates showed little concern about the consequences of their actions: budget shortfalls of $5 billion in 2025 and in 2026, $8 billion.

Since the governor signed the budget into law, the numbers have only gotten worse.

Tax collections for the first quarter of the year were $4 billion less than expected. Not a good sign.

Then the revised state financial plan released in June acknowledged that deficit gaps have doubled. The state now projects the gap will be at least $9 billion in 2025 and $13 billion in 2026.

Then there is the job-killing policy Albany approved. Raising the minimum wage from $15 to $17 an hour, and then indexing to inflation, will hurt low-skilled employees. Significant wage increases always lead to layoffs, fewer hirings and price increases.

Next, the Legislature refused to renew the 421a tax abatement for new construction or renovation of multifamily housing projects. While leftists are moaning that there is a shortage of apartments, their inaction will hurt the growth of affordable housing.

On top of that, the Public Authorities Control Board, manned by the governor and legislative leaders, put off a vote to approve the building of the 900-foot-tall, 5 World Trade Center. The New York Post reported, “the culprit for the delay appeared to be state Senate Majority Leader Andrea Stewart-Cousins.”

Cousins’ last-minute move not only angered Gov. Kathy Hochul, who blessed the plan, but hurt the cause for affordable housing.

Thirty percent of the 1.2 million square feet of apartments to be built at 5 World Trade would be affordable rentals.

So much for Sen. Cousins’ devotion to working class folks.

The teachers union bullied the Legislature into stifling the growth of charter schools. Instead of agreeing to Hochul’s recommendation to open 100 new ones, they approved legislation to revive 20 “zombie” charter schools that had closed.

Given the record of charters outperforming traditional public schools, the opposition to these alternative public schools, whose students are largely minorities, is disgraceful.

A recent report released by Stanford University Center for Research on Educational Outcomes revealed that New York’s charter schools are among the best-performing in the nation.

For example, the students attending “New York Achievement First” schools, “achieved 66 more days of learning in reading and 146 days of more learning in math than their traditional public school peers,” the report said.

Apparently, campaign contributions from the unions mean more than enhancing the educational prospects of minority students.

One scheme that backfired: The executive branch bid to get carte blanche power to negotiate a new gambling compact with the Seneca Nation of Indians in Western New York.

Although Hochul had recused herself from any dealings that might impact her husband’s Buffalo company, Delaware North—which operates 2,000 slot machines throughout the state—her staff was not restricted.

Hochul’s office, acting in secret, “kept private all the crucial details of what was negotiated with the tribe,” The New York Times reported.

After the state Senate passed the unread bill “nearly unanimously,” it stalled in the Assembly after local officials complained about the governor’s crass power play.

The chairwoman of the Senate Finance Committee, Manhattan’s Liz Krueger, reacting to the blowback, admitted “we sort of got hoodwinked.”

Although the fast-track bill has been held up, The Times concluded “Ms. Hochul has taken actions that align with Delaware North’s interests.”

Rickey Armstrong Sr., the president of the Seneca Nation agreed. In a statement, he said, “Gov. Hochul may have recused herself from negotiations, but apparently could not recuse her own staff from the expectation that they prioritize corporate interests, Delaware North first and foremost, over those of a sovereign Native Nation.”

Whatever happened to Hochul’s “transparency” pledge?

Looking back on Albany’s follies these past months I’ve come to appreciate more than ever Mark Twain’s quip, “No man’s life, liberty, or property are safe when the legislature is in session.”

The following appeared on Monday, May 29, 2023, in the Blank Slate Media newspaper chain and on its website, theisland360.com:

With the ink barely dry on Gov. Kathy Hochul’s budgetary fiscal plan, newly released data reveals there are already flaws in her tax revenue assumptions.

A report made public by State Comptroller Tom DiNapoli in mid-May disclosed that tax receipts in April were $4 billion less than the governor’s budget division had projected.

Total personal income tax collections came in at $7.5 billion, not the expected $12 billion, while business taxes came in $300 million higher than anticipated—$1.5 billion vs. $1.2 billion.

“After the historic spike in tax receipts in April 2022 amid record-high capital gains” Ken Girardin of the Empire Center for Public Policy has written, “budget officials had expected PIT [personal income tax] receipts to fall by 17% from April 2022 to April 2023, but the actual drop appears to have been 49%.”

This means that budget deficits projected to be $5.1 billion in fiscal 2025 and $8.6 billion in fiscal 2026 are too low and will have to be significantly revised.

And growing operating deficits mean reserve funds will be consumed to balance the governor’s bloated, record-breaking $230 billion budget.

There are additional problems with the governor’s fiscal plan that have been identified in the “Enacted Budget Report” released by Comptroller DiNapoli on May 18.

While the amount deposited in the statutory rainy-day reserve funds has grown to $6.2 billion, those balances as a percentage of general fund spending are well under the national median.

DiNapoli quotes a Pew Charitable Trust analysis that determined New York’s statutory rainy-day reserves would fund the state for only 25.2 days, while the national median for the 50 states is 44.5 days.

Also, the bulk of the state’s additional reserves, which are projected to grow to $19.5 billion, are described as “informal reserves” as opposed to statutory ones, which “are governed by statutory requirements, including terms and conditions for withdrawals and mandatory repayment provisions.”

In other words, the “informal reserves” are legal slush funds that can be tapped into at any time by the governor to fund favored projects and programs.

Then there is in the budget the continued reliance on “backdoor borrowing” to pay for $21 billion in capital spending.

“Back door borrowing” evades voter approval at the ballot box. The debt is issued by public authorities, “further adding to the states already high debt burden and utilizing limited remaining capacity under the state’s debt caps.”

Total state-supported bonded debt authorizations will increase to an astounding $222 billion during the 2023–2024 fiscal year.

In recent years tens of billions of dollars spent on various vendor contracts were approved by the governor’s office without any oversight from the comptroller’s office whose job it is to “validate that a contract’s costs are reasonable and its terms are favorable to the state and … ensure a level playing field for vendors.”

Readers may recall that in 2022, Gov. Hochul gave a $650 million no-bid COVID home test contract to Digital Gadgets Incorporated, whose owners and family members had written checks to the Hochul campaign treasury totaling $330,000.

Although Gov. Hochul signed into law on December 30, 2022, legislation to restore Comptroller DiNapoli’s “independent oversight to review certain SUNY, CUNY and Office of Government Services contracts,” the budget continues to authorize state spending without protections, such as competitive bidding and state comptroller review and approval of contracts before they become effective.

Such unsupervised spending this year will be about $5 billion. This includes “a $4.2 billion Office for People with Developmental Disabilities appropriation”—whatever that is.

Finally, the comptroller notes that the governor’s budget “continues to include problematic provisions with respect to accounting standards that have the potential to distort the appearances of reported receipts, distributions, and liabilities; and obscure the picture of true spending growth.”

Gov. Hochul’s budget contains inaccurate tax revenue projections, borrowing abuses, accounting gimmicks, no bid contracts and lax oversight.

So much for Hochul’s promise that she would have the most transparent and straight-shooting administration in the state’s history.

The following appeared on Monday, May 15, 2023, in the Blank Slate Media newspaper chain and on its website, theisland360.com:

During Albany’s annual budget battle, a take-charge governor can exercise extraordinary power over the process.

In 2010, for example, when Gov. David Paterson and the state Legislature could not agree on a spending plan by the end of the fiscal year, the governor threatened to use the “nuclear option”— a short-term spending extension (aka a continuing resolution) to secure a balanced budget.

What is the “nuclear option”?

Here’s Gov. Paterson’s explanation: “The difference between the budget process and the extenders is that the governor writes the extenders, the legislature has to vote it up or down, there are no amendments, no changes, no rejections, or overriding the governor’s veto. It’s either take it or leave it…. We then put our cuts in the next week’s budget extender and the legislature either had to vote it into effect or shut down the government.”

The threat worked and the Legislature backed off and negotiated a budget to the governor’s satisfaction.

Patterson did not fear to use what then Assembly Speaker Sheldon Silver called “naked political power” to impose his will on the Legislature.

Unfortunately, this year Gov. Kathy Hochul, fearful of exercising her budgetary authority, was steamrolled by the state Legislature.

In February, the governor, ignoring the signs of economic slowdown — particularly on Wall Street, which provides 22% of state income tax revenue—proposed a record-breaking $227 billion budget, up $7 billion from the previous year.

The release of the governor’s budget is only the opening gambit. The legislative branch, which has an insatiable appetite, always counters with even more spending.

Unable to agree on a budget plan, the state missed the March 31 deadline.

Refusing to use the “nuclear option” the governor surrendered in late April and agreed to a $229.8 billion budget, up $9 billion.

While the 3.7% increase may appear low — keep in mind this is on top of increases that totaled 22% over the past three years.

Most of the additional spending was allotted to school aid and Medicaid.

Education spending will hit an all-time high of $34 billion.

“School aid,” the Empire Center for Public Policy has reported will have “risen 76% since 2012 — while public school enrollment has fallen more than 5% during the same period.

Put another way, the state will be spending about $9 billion more on a smaller number of students than it would have if school aid had simply kept pace with inflation. Meanwhile, student achievement is declining on both state and national measures.”

As for Medicaid, the governor, who called for the state spending portion to increase by 9%, capitulated to the demands of the Legislature and healthcare unions and agreed to a 13% increase, up $4.2 billion.

“The state’s share,” healthcare expert Bill Hammond has noted, “is on track to be 53% higher in 2024 than it was in 2019.”

Total Medicaid spending for the fiscal year, which includes federal, state and local municipal contributions, is expected to top $100 billion.

New York, with 19.6 million people, will spend significantly more per capita on Medicaid than Florida (pop. 22.21 million) or Texas (pop. 30 million).

What did the governor get in return for knuckling under to the Legislature’s spending demands? Not much. Minor changes in the disastrous Progressive bail reforms.

New York’s spending trajectory is not sustainable.

The state’s budget division is already projecting major shortfalls in the out years; $5 billion in 2025, and in 2026, more than $8 billion.

Those dismal numbers do not, however, factor in an economic recession that will adversely affect tax revenue collections.

The governor, who holds a royal flush in the budgeting poker game, folded to the Legislature’s pair of deuces.

Hochul has proven to be a weak chief executive. And while that’s good news for legislators, unions, big government leeches, radical enviros, and various vendors—it does not bode well for overburdened taxpayers who get stuck paying the bills.