The following appeared on Monday, April 1, 2024, in the Blank Slate Media newspaper chain and on its website, theisland360.com:

Buried deep in the state Legislature’s budget is a frightening proposal that if signed into law by Gov. Kathy Hochul would increase the pensions cost for state and municipal employers to the tune of $4 billion.

To understand the impact of the Legislature’s sleight of hand ploy, a walk down memory lane will be helpful.

At the turn of the century, combined annual taxpayer contributions to the state’s defined benefit pension system was $1 billion. By 2010, that figure grew to a staggering $10 billion. (In recent years the cost has been about $16 billion annually.)

To address the ticking pension “time bomb,” Gov. David Paterson persuaded the Legislature to support a modest modified pension plan known as “Tier 5” that covers employees hired on or after Jan. 1, 2010.

While the Tier 5 benefit would cost less, there was a major flaw: New York City employees were not included in the plan.

After taking office in 2011, Gov. Andrew Cuomo realized that the Paterson initiative was not enough to shore up the pension system.

So, in 2021 Cuomo proposed “Tier 6” to further contain defined benefit pension costs.  That bold reform was projected to save state and municipal governments $113 billion over 30 years.

Tier 6 benefit changes included:

• An increase in the minimum full benefit retirement age from 62 to 63.
• Higher employee contribution rates, ranging from 3% to 6%, for those earning $75,000 or more.
• An adjustment in the final average salary calculation to cover five instead of three consecutive highest paid years, effectively reducing the base in most cases.
• A $15,000 cap, indexed to inflation, on pensionable overtime, which was unlimited for pre-2010 hires.

In addition, unlike Tier 5, it included New York City police and firemen hired after April 2012.

On the 10^th anniversary of the Paterson–Cuomo reforms, the Empire Center for Public Policy released a report in December 2021 titled “Tiering Up: The Unfunded Business of Public Pension Reform in New York,” prepared by E.J. McMahon.

In his report, McMahon wrote “The Tier 5 and Tier 6 changes combined are saving New York state and local governments outside New York City more than $1 billion this year, reducing total employer contributions by about 15% compared to what would have been billed to cover workers under previous plans.”

This is all well and good; nevertheless New York’s public pension system plans are very generous. Benefits are in the range of 50% to 75% of final average salaries. On Long Island, for example, several retired school district superintendents are receiving north of $200,000 a year. And don’t forget recipients are exempt from paying New York State and municipal income taxes on their annual benefit.

That’s not all. “State and local employees in New York,” McMahon pointed out, “also belong to the federal Social Security system supported by combined employer and employee payroll taxes whose benefits can raise their annual post-retirement incomes to more than 100% of pre-retirement earnings.”

Not a bad deal.

But the public employee unions are never satisfied.  Hence, in an election year, they are using their clout to pressure legislators to sweeten the pension pot for members who have been employed since 2012.

On March 26, the New York Post reported “state lawmakers are set to make it easier for teachers, cops and other state workers to pad their pensions—and leave taxpayers footing the nearly $4 billon bill….”

Under Tier 6, a retiree’s final benefit is based on average salary over the last five years on the job.

Under the new legislation, the final average salary will be based on the last three years of service.

Empire Center analyst Ken Girardin has written that the new rule “would retroactively increase the pensions for a small group of people who have retired in the past two years and raise the future pensions for roughly half of New York’s public-sector workforce.”

This is an outrageous tax burden to place on civilian taxpayers, many of whom are struggling to make ends meet and do not have a guaranteed defined benefit pension plan.

Contact your state legislators and tell them this expensive and unfair sop to the unions must be rejected.

The New York Conservative Party, of which I am a member, should deny its nomination to any Republican who supports the pension giveaway.

The following appeared on Monday, March 4, 2024, in the Blank Slate Media newspaper chain and on its website, theisland360.com:

In a column I wrote in January, I was pleased to point out that Gov. Kathy Hochul “appeared to acknowledge the state’s deteriorating fiscal condition.” The proof of her concern was in her proposed $230 billion budget that called for a modest increase in spending of $3.7 billion.

Then there was Hochul’s extraordinary pledge to protect taxpayers’ “hard-earned money from politicians who want to raise your taxes.”

I, for one, found Hochul’s budgetary proclamation most refreshing. Perhaps she finally realized that there can be dire consequences if the state government does not halt runaway spending.

Unfortunately, however, the governor’s public embrace of sound fiscal policies is nothing more than play acting.

Why, you ask?

Well, as always, the devil is in the details. And the analysis of Hochul’s budget proposal performed by the office of State Comptroller Tom DiNapoli reveals that it is loaded with ill-considered fiscal gimmicks that on the surface give the illusion of responsible stewardship.

Here’s a summary of the comptroller’s findings:

First, the report states that New York’s “structural budget gap is projected to worsen over the next few years.” Accumulated deficits are expected to hit $20 billion between fiscal years 2025-2026 and 2027-2028.

Next there is the issue of the state’s reserve funds. While state statutory reserve funds have increased to $6.3 billion, there are $13.2 billion set aside as “informal reserves” for “economic uncertainties.”

The informal reserves can be spent at any time on favored projects or causes because they are under the governor’s “discretionary control.” The report notes, “There is no statutory basis for such designated funds and no accompanying guidelines or restrictions or deposits, balance levels, how or when the funding can be used or replenished.”

Very convenient, don’t you think?

This financial gimmick will permit the government to expend state dollars beyond the modest increase in spending she announced in January to much fanfare. Don’t be surprised if a significant portion of those discretionary reserves are used to pay for migrant services.

With recurring spending growing faster than recurring revenue, the governor is using an egregious gimmick to coverup the budget’s structural imbalance: “one shot revenues.” There are $14 billion in “non-recurring resources” that will be expended to balance the budget.  The utilization of “one shots” only augments the out year budget deficits.

Then there is the governor’s scheme to “obfuscate the state’s true debt burden.”

The budget circumvents the state’s debt cap “by utilizing a loophole in the New York Debt Reform Act.” It “misleadingly portrays the Gateway debt [authorized up to $2.85 billion currently estimated at $1.4 billion] as if it is not a part of the state’s direct debt burden.” The Gateway project will expand Northeast Corridor rail travel between Penn Station and Newark.

DiNapoli’s analysts also identified approximately $3.4 billion in spending that is exempt from a competitive procurement process and from the comptroller’s contract oversight authority. “These proposed changes,” the comptroller rightly observes, “reduce transparency, competition, and oversight over a significant amount of taxpayer supported state spending.”

To put it more bluntly, the governor can approve without any oversight billions in contracts to cronies and donors to her campaign treasury.

Finally, there’s the comptroller’s not so rosy outlook on the state economy.

While the national labor force has recovered from COVID, the state has not.

With New York not expected to return “to pre-pandemic employment until the second half of 2026,” this plus the ongoing loss of middle- and upper-class taxpayers to low tax states will the comptroller concluded, “continue to pose a risk to the New York economy and in turn its revenue.”

The governor’s talk about being fiscally responsible is merely empty rhetoric. Hochul’s budget is anything but balanced and the in balance will surely grow after the far-left Legislature finishes with it.

If history is a guide, Gov. Hochul will likely surrender to the demands of legislators to spend more on pork projects and on special interests.

Like many of her predecessors, Gov. Hochul is using sleight-of-hand fiscal tricks to finance her budget, leaving New York’s dwindling number of taxpayers to foot the bill.

The following appeared on Monday, January 22, 2024, in the Blank Slate Media newspaper chain and on its website, theisland360.com:

In his first annual State of the State address to the Legislature on January 7, 1975, Governor Hugh Carey said, “In the very simplest of terms, this government and we as a people have been living far beyond our means.”

He went on to say that “now the times of Plenty, the Days of Wine and Roses, are over. We were in the lead car of the roller coaster going up and we are in the lead car coming down. So, we must first recognize the immediate burdens we inherit. There is responsibility enough to go around for all. But if we would master our fate, we must first acknowledge our condition.”

Carey went on to master the fate of New York and saved the state from insolvency and the City of New York and the Urban Development Corporation from bankruptcy.

Fifty years later, the question is will Gov. Hochul have the mettle, like Carey, to say, “the days of wine and roses are over” and to master the fate of the state by bringing government spending in line with reality?

In her January 8 State of the State address, Hochul appeared to acknowledge the state’s deteriorating fiscal and social conditions.

Unlike previous years, she did not promise huge increases in spending to placate every left-wing interest group. She even made this admission: “I can actually understand why some people feel the sun is setting on the Empire State.”

The governor noted that tens of thousands have been exiting New York to live in states that happen to have lower taxes, cheaper housing and better job opportunities.

To curb the outflow, Hochul promised to protect taxpayers’ “hard-earned money from politicians who want to raise your taxes.”

That’s an incredible statement from a governor who has surrendered time and again to tax-and-spend legislators.

Next, the governor conceded that the crime issue is real and not merely a talking point of her 2022 Republican opponent, Lee Zeldin.

“Safety at the grocery store, the synagogue, the subway,” Hochul said, “is always top of the mind.” Thieves who “brazenly tear items off shelves and menace employees,” she admitted, “are not only driving many out of business [but] these attacks are nothing less than a breakdown in the social order.”

Hochul added, “I say: no more! The chaos must end…Let’s back our businesses and workers with the full force of the law and punish those who think they can break the rules with impunity.”

My goodness. The tough-talking Hochul sounds like a MAGA Republican.

But will she follow through by fighting to repeal the lax bail and discovery laws that permit offenders to continue roaming the streets? That remains to be seen.

One subject she failed to address—the sanctuary city crisis. In New York City, Mayor Eric Adams has spent over $2.5 billion this past year to service migrants. And he projects spending more than $11 billion during the next two fiscal years. Such spending is not sustainable. The city’s declining tax base cannot absorb these costs without dramatic cuts in essential services.

To manage this glaring omission, the governor’s damage control squad said the issue would be dealt with in the state budget that was subsequently released January 16.

The $233 billion proposed budget increases spending by a modest $3.7 billion. Despite projected deficits over the next three years totaling $15 billion, there are no spending cuts. The governor could not find one dime of wasteful spending.

As for migrant aid, the city will receive $2.4 billion. Focusing on the issue, Hochul rightly noted “companies won’t do business in New York if there are thousands of people sleeping on the streets or the quality of life is dramatically impacted because the city is forced to cut essential services. We must support the City of New York in this moment to avoid these disastrous effects and to protect our economy and state revenues in the short-term and the long-term as well.”

Defending her budget, Hochul said, “we can’t spend like there’s no tomorrow because tomorrow always comes.”

That’s all well and good. However, Hochul’s real test will be whether she restrains radical legislators who have called for a $40 billion tax increase to fund their spending schemes.

I hope she has the mettle to do so.