Paul Post writes in the Saratogian - “he long-awaited deal to name an Aqueduct Race Track gaming operator has fallen apart, casting a pall over New York’s racing industry.

Gov. David Paterson on Thursday announced withdrawal of his support for Aqueduct Entertainment Group LLC to run the racino that’s slated to get 4,500 video lottery terminals.

The facility would give New York Racing Association the funds needed to boost purses and make much-needed Saratoga Race Course improvements. Without it, NYRA’s ability to continue racing might be in doubt, but the firm declined comment about the deal’s collapse.

“The Division of the Lottery has concluded that it cannot issue a gaming license to Aqueduct Entertainment Group (AEG),” Paterson said. “Therefore, the state has officially withdrawn its support for AEG to develop and operate a VLT facility at Aqueduct. The executive branch advocates that the selection of the Aqueduct VLT franchisee be done pursuant to an expedited, transparent, apolitical and publicly accountable procurement process.”

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Joseph Spector writes on LoHud.com - ” Senate Republicans offered a plan Thursday to try to curb the state’s sky-high property tax burden.

But the plan was quickly met with questions over how Republicans would pay for the $2.6 billion proposal amid a $9 billion budget deficit for the 2010-11 fiscal year and the likelihood of cuts to programs and services.

Republicans, who are seeking in November to win back control of the chamber after losing it in 2008, said their proposal needs to be a priority during budget negotiations.

They want to resurrect many of the tax-relief programs that have been proposed or were once in effect at the state Capitol, from restoring a tax-rebate check for homeowners to linking property taxes to household incomes.

They also want to limit mandates on schools and enact a school-property-tax cap, which Senate Republicans passed when they were in the majority in 2008.

The tax cap, which was backed by Gov. David Paterson, was not approved in the Democratic-controlled Assembly.”

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Rick Karlin of the Times Union reports - “It remains to be seen whether Lt. Gov. Richard Ravitch’s plan to overhaul state finances will pass the narrowly divided state Senate.

But the price tag might include keeping an upstate prison or two open, despite Gov. David Paterson’s call to shut the facilities down due to a declining inmate count. Or the state could end up selling some New York City power plants to help balance the budget.

Both ideas were floated by North Country Democratic Sen. Darrel Aubertine on Thursday. While one senator can’t shift an entire state policy, Aubertine is one of a handful of Democrats — most from Republican-leaning regions — who once again find themselves in a pivotal position due to the Senate Democrats’ need to marshal their entire 32-vote majority to pass initiatives that Republicans, with 30 seats, are likely to oppose. (There are now 31 Democratic seats; a special election next week will fill the seat of ousted former Sen. Hiram Monserrate; the heavily Democratic district is unlikely to elect a Republican.)”

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John Faso, the 2006 GOP can didate for governor, is a co-founder of New Yorkers for Growth writes in an op-ed in today’s New York Post - ” LT. Gov. Dick Ravitch yester day outlined a five-year financial-recovery plan to plug the state’s immediate $9 billion budget hole and address its looming $60 billion structural deficit over the next half decade.

His two big fixes? More debt to finance current operating deficits, and a new body to oversee long-term budget cuts.

Both are flawed.

Ravitch proposed that the state issue up to $6 billion of new debt over the next three years — 10 percent of the five-year structural deficit — to help ease its path to fiscal health. And he envisioned the creation of a financial-review board, composed of five independent citizens, to make sure the state is cutting its massive structural deficit.

“It is not, in my judgment, possible to cut nine and a half billion dollars . . . out of this budget this coming year,” Ravitch said yesterday. “Not only because I believe it to be a political impossibility, given the varied dispositions of the members of the Legislature. But because there is a level of cuts, no matter what everyone’s politics are, [that] affects employment, it affects human beings.”

But interest costs on the state’s debt are already now about $5 billion a year and rising, so borrowing yet more is hardly a great idea. The state repeatedly has tried to borrow its way out of its problems — most recently after 9/11 — and also routinely has enacted counterproductive tax and fee increases, all on the promise that it would be the very last time that it would resort to such “emergency” measures…

New York does have a way out, but the path won’t be cleared by rearranging deck chairs. Instead, the state needs to embark upon a radically different, pro-growth strategy emphasizing private-sector job growth.

That means:

* Cutting taxes on businesses, both large and small.

* Streamlining environmental and zoning rules to encourage private investment and speedier permit approvals.

* Reducing the size and scope of government by consolidating services and functions.

* Eliminating borrowing that isn’t approved by voters.

* Capping property taxes.

* Cutting health-insurance costs by eliminating state taxes on health insurance and allowing insurers to offer a greater variety of plans.

* Abolishing job-killing taxes on energy to help create jobs.

Simply put, we need to make New York a state where business and entrepreneurs create private-sector jobs.”

To read the entire op-ed click here.

“I thank Lieutenant Governor Ravitch for his diligent work preparing recommendations to help our State government achieve long-term structural budget balance. At its core, his plan reflects our shared view that New York’s finances are on an unsustainable path and that true structural fiscal reform is urgently needed to control spending. Given the Lieutenant Governor’s considerable experience and expertise, his proposals deserve to be heard and discussed as we move forward toward the final Enacted Budget.

“When I delivered my Executive Budget proposal in January, I articulated several clear principles that I believe must be embodied in any final budget agreement. We must enact both significant recurring spending reductions and real structural fiscal reforms in order to restore our State government’s long-term financial integrity. Additional borrowing will not be considered outside of these parameters, and I know that Lieutenant Governor Ravitch strongly agrees with this position. I look forward to working closely with the Lieutenant Governor and the Legislature as we seek to achieve the important goals of long-term spending restraint and lasting fiscal reform.”

Click here for more details about the plan.

George Marlin writes in today’s New York Post - “After years of flagrant over spending, fiscal conjuring, ever-increasing taxes, fees and reliance on one-shot revenues, it appears Albany’s fiscal day of reckoning is at hand.

With the 2010-2011 budget deficit at $9 billion and recurring deficits projected for as far as the eye can see, if the governor and Legislature do not curtail their spendthrift ways and do not implement far-reaching internal reforms to control spending, pension obligations and perks, the economic recovery could be stalled. The state’s bond rating also could fall below investment grade, thus closing doors to additional tax-exempt financing due to the loss of investor confidence. ”

To read more click here.

Joseph Spector writes on LoHud.com - “Lt. Gov. Richard Ravitch proposed Wednesday the state move back the start of its fiscal year to July 1, establish a financial review board and add new borrowing to help pull the state out of its fiscal problems.

Ravitch, whom Gov. David Paterson appointed last year to help with the state’s financial problems, said New York faces severe problems if it cannot control spending, which is outpacing revenue. He said his plan would end the state’s structural deficits, which could exceed $60 billion over the next five years.

“We have to have a way to get out of this mess,” Ravitch said.

But the borrowing proposal drew a quick rebuke from fiscal watchdogs, who said it would provide additional cover to political leaders to avoid making cuts in spending — which has ballooned to $132 billion this year.
As part of a five-year fiscal plan, Ravitch proposed the state borrow up to $2 billion a year over the next three years to cover operating expenses.

The problem, some officials said, is that the state’s debt load has quickly become onerous to taxpayers, with a $3,089-per-person tab that’s fourth highest in the country.”

To read more click here.

The Manhattan Institute’s Nicole Gelina’s writes in a New York Post opinion column that the fiscal crisis in Greece due to excessive borrowing has lessons for New York.

She writes: “Greek Prime Minister George Papandreou came to Washington yesterday to ask President Obama to help save his nation from speculators. In other words, he wants America to help him shoot the messenger.

Sorry, Greece is no innocent victim: It helped get itself into a mess — by exploiting the bailout mentality.

New Yorkers should pay special heed — because we could be in the same boat.”

Read the column.

The Post’s editorial also looks at this issue stating: “Don’t blame Greece for its financial woes, Prime Minister George Papandreou said yesterday after meeting with President Obama.

Blame “speculators.”

Which got us wondering: Just whom will Albany blame when its Day of Reckoning arrives?

With tens of billions of dollars in shortfalls projected for the coming years, that day is fast approaching. And yet, a plan Lt. Gov. Richard Ravitch will announce today — which reportedly includes some borrowing to deal with the situation — may put New York in the same sinking boat as Greece.

As Nicole Gelinas explains on the previous page, Athens has been flirting with bankruptcy because it kept shelling out cash — for lavish public-employee perks and such — as if it had an endless supply. And investors kept lending.

Now that they’ve finally balked, Greece has had to struggle mightily to stay afloat.

New York, too, has long been spending more than it collects in taxes, financing the shortfall with IOUs. That’s like taking out a mortgage to pay grocery bills.”

Read the editorial.

According to a press release issues yesterday by New York State Comptroller Thomas DiNapoli his office is proposing - “a series of actions to repair New York’s recurring budget problems and out-year budget gaps. DiNapoli’s reforms require the state to address out-year budget gaps and attain multi-year budget balance, align spending with available resources, limit debt and curb the use of fiscal gimmicks.

“New York State has been addicted to unaffordable borrowing and unsustainable spending,” said DiNapoli. Now is the time to break that addiction. These reforms are first steps, some of which we can take right now, that will start us on the road to recovery. It won’t be easy, but it is absolutely necessary. We’ve already delayed too long. The last thing New Yorkers need is a replay of last year’s buy-time budget. We need to get the budget in balance and keep it in balance.”

DiNapoli’s plan, implemented through statutory changes, Constitutional amendments and controls contained in bond covenants, to address long-standing deficiencies in the state’s budget process includes:

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Ira Stoll, the editor of FutureofCapitalism.com writes in an op-ed in the New York Daily News - “From the standpoint of pure self-interest, I should support Gov. Paterson’s proposed penny-an-ounce tax on sugary sodas and other sweetened drinks, which is now being backed by Mayor Bloomberg. I’m one of the few Americans who doesn’t drink any of the stuff, so any taxes paid by soda drinkers are dollars that government doesn’t have to extract from my pocket.

But the more I think about the tax, the angrier I get. I’ve been trying to figure out why, and have come up with five reasons:

It’s a government program set up to undo the effects of another government program. The federal government has spent billions of dollars to subsidize the growing of sugar beets, sugarcane and corn that become high-fructose corn syrup. Americans who aren’t farmers are already taxed once to support these programs. Now New York wants to tax us a second time to prevent us from eating the sweeteners that our taxes are paying farmers to produce. Wouldn’t it be simpler just to get rid of the farm subsidies?”

To read more click here.