GOVERNOR SPITZER AND LEGISLATIVE LEADERS REACH REVENUE CONSENSUS
Governor Eliot Spitzer, Assembly Speaker Sheldon Silver, Senate Majority Leader Joseph L. Bruno, Senate Minority Leader Malcolm Smith, and Assembly Minority Leader James Tedisco today announced that an agreement was reached on available revenues for the 2007-08 and 2008-09 State fiscal years.
The parties agree that the weaker economic outlook reached in economic consensus should result in estimated General Fund receipts that are $250 million lower for State fiscal years 2007-08 and 2008-09 than the amounts projected in the Executive Budget.
It also indicates that based on the testimony of economic experts at the Consensus Revenue Conference held on February 27, both the Executive Budget and Legislative reports provided reasonable forecasts of both the economy and revenue. It was generally agreed that the national and State economies will slow in 2008 with a commensurate effect on tax receipts.
"When the final budget is enacted, it must limit spending to affordable levels that reflect the uncertain economic circumstances facing the state," said Governor Spitzer. "I'm pleased that we've reached this milestone in a timely manner. Given the current economic climate, we must continue to work together with the caution and prudence necessary to ensure the long-term fiscal integrity of our state."
Assembly Speaker Sheldon Silver said: "Our agreement on revenues acknowledges the significant challenges we face in both the state and national economies, and is consistent with the Assembly Majority's forecast for the coming year. I will continue to work with Ways and Means Committee Chair Denny Farrell and the entire Assembly Majority conference to ensure an on-time 2008-09 budget that reflects economic realities and addresses the needs of working families across New York State."
Senate Majority Leader Joseph L. Bruno said: "This agreement allows us to take another step toward reaching our shared goal of producing an on-time budget that meets the needs of New York's taxpayers, businessmen and women, and its working families. While there are challenges that we must face, I am confident that the Senate Majority can partner with the Governor and other legislative leaders to deliver a budget that provides meaningful tax relief, creates jobs, invests in health care and education, and strengthens the economy as New Yorkers want and deserve."
Senate Minority Leader Malcolm A. Smith said: "While revenue projections are less optimistic than we all had hoped, I have said in the past we need to spend less. I am encouraged that we will be spending less under the consensus agreement. However, a great deal of work remains before we can reach a fair, on-time budget, a budget that demonstrates that this is One New York.' A budget that will have a positive impact on the lives of the 19 million residents of this great state by helping to create high-paying jobs, improving education, reducing the property tax burden and making health care accessible and affordable. Hopefully, this quickly reached consensus agreement on revenue projections will provide the framework for productive and meaningful budget negotiations in the weeks ahead."
Assembly Minority Leader James Tedisco said: "The Governor should be commended for working with us to reach this revised figure, as it is a more realistic assessment of the current fiscal downturn New York is experiencing, as our Assembly Republican Conference had projected earlier last week in its own forecast. That we have been able to work together and reach a bi-partisan consensus on state revenue marks a significant step forward, turning a page on the type of bitter, partisan acrimony that, quite frankly, New Yorkers are sick and tired of."
Testimony of economic experts at a Consensus Revenue Conference earlier this week indicated that the Executive Budget and the Legislative reports issued this week provide reasonable forecasts of both the economy and revenue. The consensus forecast for New York State reflects lower levels of economic activity at the national level, but also the reality that many Wall Street activities have been affected, particularly the lucrative underwriting business. All parties anticipate that depressed levels of financial market activity will continue at least through the near future. Consequently, State employment and wage growth are expected to be lower in 2008 than in 2007.
With the budget reform law enacted last year, the Legislature and Governor agreed to issue a joint report by March 1 containing the consensus estimates of receipts and the economic forecast for the State's upcoming 2008-09 fiscal year, ten days earlier than previously required.