New York is in the midst of budget season. By the end of the week, the state government should have decided upon spending plans for the year and New York City will follow with its budget in June. But the New Yorker in the White House is already threatening to foil Governor Andrew Cuomo and Mayor Bill de Blasio’s best-laid plans.
What’s going on?
By law, Governor Andrew Cuomo and the state legislature have a deadline of April 1st to agree on how to allocate the $162 billion or so that New York State will spend over the next twelve months. New York City has until July 1st to do the same for its $85 billion budget.
But where does Donald Trump come in?
The problem for Cuomo and de Blasio is that New York State and New York City depend on federal funding for many of their programs. The federal government funds nearly a third of the state budget. That money primarily goes towards paying for Medicaid (healthcare for poor people) but also education, transportation, and other programs. $52 billion covers a lot.
Unfortunately for New York, Trump and Republicans in Congress can take a big chunk of that money back.
Donald Trump and Paul Ryan’s proposal to repeal the Affordable Care Act would have ripped out a big chunk of money from Medicaid and also transferred more of those costs to New York State and New York City taxpayers with the so-called “Buffalo Bribe”. While that failed on Friday, Trump is still threatening to cut Medicaid (forcing New York to foot more of the cost of healthcare for people in poverty or close to the poverty line). And that’s just one way Trump could explode New York’s budgets. [Update: The House passed the American Healthcare Act to repeal Obamacare, with what has been called the Buffalo Bribe. See if your representative voted for the bill.]
I heard that Trump wants to cut Meals on Wheels. Is that one of the programs at risk?
Exactly. President Trump proposed eliminating a program that gives states and cities money for Meals on Wheels. If New York State loses that money from the national government, they would have to either find other money for programs like Meals on Wheels (raising taxes or cutting other programs) or would need to cut Meals on Wheels.
New York City might lose $190 million in funding for anti-terrorism work and perhaps more if the Trump administration follows through with its threat to deny funding to “sanctuary” cities that don’t work with Immigration and Customs Enforcement (ICE). The Heating Energy Assistance Program, which helps about 60,000 Upstate families afford heat during the winter, is also on the chopping block.
What is New York going to do about these cuts?
Last week, Governor Cuomo noted, “If you don’t know the immediate financial future, it is very hard to do an intelligent budget.” While Cuomo, de Blasio, Senator Chuck Schumer and other leaders are lobbying to prevent these cuts, the state legislature isn’t making contingency plans. Instead, they are betting that the cuts won’t actually happen or will be phased in over time so that New York State will just need to adjust future budgets.
However, the threat of these cuts may frustrate the greater ambitions of both Cuomo and de Blasio. Without the promise of federal funding, new projects may be imperiled. Cuomo and de Blasio might still talk about continuing the Second Avenue Subway Expansion, building new affordable housing, or making the SUNY college system tuition-free but they’re going to face real challenges finding the money to pay for anything new while there’s a question mark about funding existing commitments.
Will these cuts definitely happen?
The federal budget won’t actually be enacted until September and Congress has to approve it. Congress will almost certainly reverse at least some of Trump’s proposed cuts. Some of them will be enacted, though, and those changes could wreck havoc on Cuomo and de Blasio’s budgets.
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