Breaking down Gov. Cuomo’s 2022 executive budget

New York State FY 2022 Budget

ALBANY, N.Y. (NEXSTAR)- New York is looking at a $15 billion budget gap from COVID-19 related expenses including a loss in sales tax revenue. On Tuesday, Gov. Andrew Cuomo addressed the executive budget for the 2022 fiscal year, saying, “If Washington doesn’t provide New York State with our fair share of funding, we’re going to pursue litigation.”

Cuomo said his administration created two budgets. In one, New York receives $15 billion in federal aid, and in the other, just $6 billion. He also said whereas last year the discussion surrounded the costs of the COVID-19 pandemic, this year the discussion would be around “economic reconciliation.”

Gov. Cuomo talked extensively about the budget gap during his State of the State address. Though he wants the state to legalize recreational marijuana and online sports betting to increase tax revenues, he also said they wouldn’t be enough to make up for the budget shortfall.

The governor talked about two avenues that exist for the legalization of mobile sports betting, either running it similarly to how the lottery is or letting casinos run it. He said he favored the lottery model because the estimated $500 million generated would go directly to the state.

An estimated $350 million is expected from the sale of recreational marijuana. The Governor said he wants $100 of the $350 million to be put into a social equity fund. The fund would assist communities negatively affected by current marijuana laws.

How much federal aid New York receives will determine whether the state will make cuts across the board to education, healthcare, and essential services, New York State Budget Director Robert Mujica said in a budget Q&A Tuesday afternoon.

Without aid, Gov. Cuomo and Mujica said the state is facing its largest budget deficit ever. Both said New York had no notice before COVID-19 impacted the state and said its situation was unique among other states because it’s such a major port of entry in the U.S.

Cuomo said $6 billion in aid represented a worst-case (or even “drop dead”) scenario for New York. Mujica said it would mean between at least a 5% cut across the board, a state hiring freeze, a $2 billion tax increase on the state’s wealthiest, and a pause on the middle-class tax cut. It would also make New York’s income tax the highest in the nation.

On the other hand, if the state receives $15 billion, Gov. Cuomo said cuts to services, increases in income tax, and a pause on the middle-class tax cut would not be necessary. He said $15 billion represented only 4.3% of the $350 billion aid package President-elect Biden is bringing to the table. Meanwhile, Cuomo says that 4.3% portion is smaller than New Yorkers’ portion of the population.

“Considering what we went through, I believe it’s a modest request from Washington,” the governor said.

The Governor largely blamed inadequate federal leadership for the poor response to the COVID-19 pandemic, saying they could close the gap by giving financial aid to states. He called on Washington to enact a progressive tax code, levying new tax rates on the nation’s wealthiest to help pay for economic recovery.

You can read the entire plan below:

During the State of the State address and throughout daily COVID updates in 2020, Cuomo said New York had long been a victim of “political extortion.” In his budget address, he said other states have been subsidized by New York, allowing them to offer lower tax rates and a cheaper cost of living. “New York has always given more than it gets back,” Cuomo said the budget address, calling it a “donor state.” Calling out states like Maryland, Kentucky, and Virginia, he said “Your taxes are low because New York is subsidizing your taxes.”

Cuomo ultimately warned that the state would take legal action against the federal government if they failed to distribute adequate funds to New York. Still, he signaled enthusiasm for the incoming Biden/Harris administration, as well as Democratic control over both houses of Congress. “Sometimes the stars line up for change,” he said.

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