spending cap

New York Gov. David Paterson layed down the gauntlet today, submitting legislation that if passed will mandate limits to unrestrained government spending.  The governor's solution to excessive budgets is represented in two bills, both caps- one on spending, the other on property taxes.  Paterson described his frustration with the state's fiscal condition, spotlighting the $60 billion in structural deficit shadowing the next four years and the exorbitant property tax bills imposed to offset deficit spending.

The governor has proposed a Constitutional amendment to cap State spending.  He cited increased spending- starting with the 2002-03 Fiscal Year to 2007-08.  State operating funds spending grew from $52.8 billion to $77 billion, an average annual rate of 7.86 percent- approximately 5% greater than the annual inflation rate.  According to Paterson, "If my spending cap had been in place in 2002, New York's annual spending growth during that period would have averaged 2.7 percent and spending would have been $16.6 billion lower in 2008." 

Gov. Paterson's property tax cap differs from previous proposals.  Those proposals focused exclusively on capping school property taxes; his proposal would limit all local property tax growth.  "My proposed property tax cap," he explained, "would limit tax levy growth for all school districts, counties, cities, towns, villages, special districts and fire districts to four percent or 120 percent of the annual increase in the consumer price index, whichever is less."   His bill is based on recommendations of the Commission on Property Tax Relief, and resonates with public opposition to paying the highest local taxes in the nation – 78 percent above the national average.

Paterson reminded that the current budget deficit demands tough choices and spending cuts and responsibility to correct mismanagement and restrain spending.  The two bills, underscored by urgings for belt-tightening, force the hand of the Legislature.  No longer can the Senate and Assembly lunch with the special interests and ignore fiscal irresponsibility.  The whole state will be watching when the ayes and nays are voiced.  Nay-sayers will clearly be acting against the will of the people.