The following appeared on the Times Union Blog “City Brights”

By John Faso
Former Assembly Minority Leader

“There is no doubt the economic recession has sent the national and state economy’s into a tailspin. How long it lasts, no one can know for sure. For every glimmer of hope, there seems to be multiple doses of bad news.

I’m most dubious as to the fiscal and budget policies of the Obama Administration. While every American should hope for success in Washington, I fear that the deficits - multiple trillions over the next five years- will set off a severe inflationary spiral. Almost $10 trillion in new national debt is in the offing and I doubt our children and grandchildren can afford to pay for it. Surely, this is the “change” they don’t know about!

We’re also likely to see a spike in interest rates as more nations around the world and state and local governments here at home seek to sell their bonds in the marketplace. More competition for bonds (and the UK just had the disquieting experience of a market failure for its debt) will inevitably cause investors to demand higher returns on their money. The prospect of higher inflation and interest rates isn’t pretty.

Meanwhile, New York State stares into the abyss. Reliance on federal fiscal stimulus, plus over $8 billion in new taxes (much I fear won’t be realized) has precariously balanced the state’s FY ‘09-’10 budget. I predict that expected revenues won’t be forthcoming and will likely require the legislature and Governor to cut spending again later this year. The state receives another bucket of “stimulus” (perhaps it should more properly be called “rescue” money) from Washington next year. But Albany’s spending trends can’t be sustained.

Barring a major economic turnaround, we risk $10 to $20 billion deficits in the 2011-’12 fiscal year. The time has long passed where state leaders need to initiate major reforms, especially in the area of state mandates, employee health and pension costs, and the collective range of subsidies and favors routinely doled out to various interest groups. New York simply can’t afford to continue on its current path. If you want to see the future for New York , look at the budget mess in California. It isn’t beyond the realm of possibility that the state, faced with horrendous deficits, next year and beyond, starts paying employees and vendors in script when it gets into cash flow problems.

In a recent article, which I published in the New York Post, I outlined a number of steps which New York needs to take, if we are to begin to put our fiscal house in order. It is linked here: http://www.nypost.com/seven/02132009/postopinion/opedcolumnists/after_wall_st___radical_rx_for_new_york_154836.htm

Governor Paterson issued an executive order yesterday which states that he will resist or veto all new legislative efforts to mandate new costs on local governments and school districts. That is a good start and I will attempt to use this blog to comment on the effectiveness of this directive.”

The pieces on the card check game board continue to move around with Congressman King wavering in his support and Senator Specter indicating he may be open to a compromise (see below from the National Journal).

Also, check out this advertisement opposing card check that appeared in the Rochester Democrat and Chronicle (on the lower right hand side of the webpage; it may take a few seconds to load).

SPECTER MIGHT BE OPEN TO CARD-CHECK COMPROMISE

Vice President Biden said Wednesday he believes Pennsylvania Sen. Arlen
Specter would have “an open mind” about voting for a bill that makes it
easier to form unions if a compromise emerges.

Specter, who became a Democrat this week, had disappointed labor leaders
last month when, as a Republican senator, he said he would not support the
bill known as card check in its current form. But he left the door open to
supporting other labor reforms.

Biden told regional reporters in a telephone conference that he has not
spoken with Specter about his position on the bill. “But knowing Arlen, I
believe Arlen will probably have an open mind if there’s a compromise
offered,” Biden said.

The following was posted on the New York Post Opinion page - “Did the MTA take a giant step back to ward the ’70s yesterday? Sure seems that way.

The authority OK’d a breathtakingly perilous plan to fund its current operations by borrowing against next year’s anticipated revenues — effectively leaving next year to fend for itself.

But why not just merge the next, say, 50 years of revenues into this year’s budget — and borrow enough to let everyone ride for free for five years?

Or until the MTA’s credit rating evaporates and there is no money left to be borrowed — and the doors start falling off the subway cars.

Just like 35 years ago.

But let’s be clear: Albany has left the agency scant choice but to turn to the reckless gimmickry of the sort that so very nearly destroyed the system more than a generation ago.

“I will be talking to the [legislative] leaders about yet another new idea that I have,” Gov. Paterson said yesterday. “Hopefully, that will end this process.”

Oh, please.

This much is certain: Whether it is lack of will, skill or fundamental understanding, Paterson and Senate Majority Leader Malcolm Smith have proved incapable of dealing with MTA’s foundering finances…”

To read the rest of the Op-ed click here.

Newsday.com reports - “As the Metropolitan Transportation Authority moved forward with plans for even higher fare hikes and deeper service cuts to address what one board member called “doomsday squared,” an outraged MTA chairman said Wednesday that Albany lawmakers have “failed to meet their obligation” to rescue the reeling agency.

Meanwhile, Gov. David A. Paterson Wednesday said he had “a new idea” - which he refused to disclose - to resolve the deadlock over how to bail out the MTA.

“There is clearly no sense of urgency north of here,” said MTA Board chairman H. Dale Hemmerdinger, who at Wednesday’s board meeting used some of the harshest language to date to address the state Legislature’s inaction on a bailout plan. “The fact is that the time for action has come and, as of today, gone. At this point there is no tomorrow.”

Hemmerdinger reacted to word that a vote on a bill to rescue the MTA from its originally projected $1.2-billion deficit had been pushed back to next week, after the Legislature amended the bill to require further independent auditing of the agency’s finances. Hemmerdinger called the most recent delay “absolutely and positively ludicrous” in light of the MTA’s considerable transparency.”

To read the rest of the story click here.

The New Yrok Times reports - “For months, Mayor Michael R. Bloomberg has been eager to stand beside labor leaders and contractors to announce projects that would employ thousands of construction workers. News conferences were scheduled first for April 16 and then for Wednesday.

But those dates came and went, in part because many powerful developers balked, threatening to tell anyone who asked that the soon-to-be-announced “project labor agreement” between builders and construction unions, with labor givebacks, was worth far less to developers than what was claimed in a press release. Further, they said it would probably not lead to a new burst of construction….

The agreement, which claims to cut project costs by “an average of 16 to 21 percent,” is all but finished and a news conference still expected. More than a dozen projects have lined up to participate. But, developers and bankers say, that does not necessarily mean that any of them will proceed. The matter has become an object lesson in the intricate dance steps of New York politicians, real estate executives and union officials…”

To read the rest of the story click here.

The Democrate and Cronicle reorts - “Americans guzzled more than 9 billion gallons of bottled water last year to quench their thirst, and a growing push by states to put deposits on those bottles has retailers and the beverage industry steaming.

“States are looking at this as a money grab,” said American Beverage Association spokesman Craig Stevens.

New York state’s 2009-10 budget passed earlier this month adds a nickel deposit on bottled water starting June 1. Soda bottles and cans already require a similar deposit, now 26 years old.
Connecticut’s 19-year-old bottle deposit law on beer and soft drinks will put a 5-cent deposit on water bottles starting Oct. 1. Oregon’s 5-cent deposit law was expanded to include water bottles effective Jan. 1.

“There’s just the fairness issue,” said Peter Spendelow, solid waste policy analyst with the Oregon Department of Environmental Quality. “If you have two plastic 16.9-ounce bottles and this one is used to hold Sprite and this one is used to hold water, why should one be covered and the other not? In 1971, people weren’t selling water in bottles. That’s why it wasn’t included. Things have changed.”

According to the Container Recycling Institute, a Connecticut-based recycling advocacy group, 11 states require some deposit on bottled beverages: California, Connecticut, Delaware, Hawaii, Iowa, Maine, Massachusetts, Michigan, New York, Oregon and Vermont.
N.Y. delay possible

Some New York lawmakers have indicated that implementation of the state’s new deposit on water bottles may be delayed to allow the rollout of a New York-specific bar code to prevent out-of-state bottles from being redeemed in the Empire State. The expansion of bottle bills to include water has run up against opposition from business groups ranging from retailers to beverage manufacturers.

“What we support is comprehensive curbside recycling that takes all material recycled in a single stream, picked up curbside. Our products are just a small speck in the waste stream,” Stevens said. “If we’re trying to cut landfill, let’s look at newspaper, let’s look at corrugated cardboard. A rigorous recycling system can reduce waste to landfills 40, 50 percent.”

To read the rest of the story click here.

Syracuse.com reports - “Sen. John DeFrancisco and members of the Senate Republican Conference launched a statewide petition drive today to try to restore STAR rebate checks to middle-class New Yorkers.

Senate Republicans created an online petition to pressure leaders to reinstate the rebate checks that were eliminated in this year’s state budget. The petition is available at www.Iwantmystarcheck.com.”

To read the rest of the story click here.

MICHAEL GORMLEY AND AMY WESTFELDT of the Associated Press report in the Times Union -” Gov. David Paterson said Wednesday that he has a secret plan to bail out New York City’s transit system, just as a transit official said the crisis has reached “a moment of truth.”

Metropolitan Transportation Authority Chairman Dale Hemmerdinger complained Wednesday of a lack of urgency in Albany to pass a bill to that could prevent high fare hikes, service cuts and layoffs. The fare hikes — raising base subway fares from $2 to $2.50 — would take effect next month.

“The time for action has come and as of today, gone,” Hemmerdinger said in Manhattan. “At this point today, there is no tomorrow. There is no next week, there is no next month to fall back on.”

An hour later in Albany, Paterson told reporters he has a compromise to bail out the MTA that he thinks will get enough votes to pass in the Legislature. He says he won’t divulge any of it until he talks to lawmakers.”

Read the rest of the by clicking here.

The Business Council of New York State, Inc. is pleased to announce that Steve A. Taylor of Troy, New York has been name director of research for the Public Policy Institute of New York State, Inc.

Taylor has more than twenty years of experience in government affairs, political science and financial analysis. He has served as a legislative and fiscal analyst for the New York State Senate Office of Fiscal Studies, a researcher for the New York State Developmental Disabilities Planning Council and a fiscal assistant for the State of Wisconsin Department of Revenue.

He is well versed in policy review and development in areas of corporate taxation, New York City finances, energy, telecommunications, pensions, nanotechnology, insurance, banking, environmental regulation and remediation, biotechnology and life sciences development.

He has been an adjunct professor at the State University of New York at Albany where he teaches courses in politics, public policy, critical thinking and ethics.

Taylor received his undergraduate degree from the University of Wisconsin, Madison, and a Masters of Art in Political Science from the State University of New York at Albany, where he is pursuing a doctorate in Political Science.

He lives with his wife and two daughters in Speigletown, New York.

Founded in 1981, The Public Policy Institute is a research and educational organization whose purpose is to formulate and promote public policies that will restore New York’s economic competitiveness. The Institute accomplishes this mission by conducting timely, in-depth research addressing key state policy issues.

Governed by an independent Board of Trustees, The Institute is a non-partisan, tax-exempt organization. The Institute depends on the support of corporations, individuals, and foundations for its income, and does not accept any government funding.

The Times Union reports today - “Despite a sharp fall in income tax revenues, the state budget should be in balance for the rest of the year as long as a complicated reduction-in-force program is achieved to avoid midyear corrections, outgoing Budget Director Laura Anglin said Tuesday.

In a presentation on the 2009-2010 budget of $132 billion, Anglin revealed personal income tax collections are down 30 percent comparing April 2008 with April 2009. She maintained the Paterson administration should be able to avoid reopening the budget as long as it rids the state of the expense associated with 8,700 positions. The plan is to achieve cuts through layoffs and attrition…”

To read the rest of the story click here.