To learn what the people involved in economic development across NYS think is needed to get NYS moving again, I interview Brian McMahon, exec. dir. of the NYS Economic Development Council for the Empire Page.

My interview with Brian can be found at http://www.empirepage.com/2010/3/1/interview-with-brian-mcmahon-exec-dir-nys-economic-development-council.

The answer, according to an analysis posted today by the Citizens Budget Commission, is “yes”.

In “Unavoidable School Aid Cuts: Do the Least Harm by Targeting,” CBC staffers Elizabeth Lynam and Selma Mustovic argue “limited available funding should be targeted to the neediest schools and pupils”.

Can cutting state aid to education be avoided? Given the state’s projected $7.5 billion deficit, CBC says the answer is “No”.

The problem is that most people don’t know the facts when it comes to state school aid.

• They don’t know that New York spends more than $52 billion on education –one out of every three tax dollars raised locally and by state taxes.
• They don’t know that state aid doubled in the past decade.
• They don’t know that only 37% of the increased spending went to teachers’ salaries. The rest — nearly $5,000 per pupil — went to such things as increased administrative costs, construction costs and fringe benefits.
• They don’t know that New York’s student-to-teacher ratio is 17% lower than the rest of the country.
• They don’t know that all that spending has not yielded significant improvements in student test scores.

So while the Governor’s budget proposal would help poor districts and cut state aid to rich districts — many of which have substantial reserve funds, CBC recommends taking an even knife to the problem in order to give greater aid to poor districts.

It would take great political courage to follow this recommendation. Courage is a commodity that’s sorely been lacking in Albany in the past. Will 2010 be any different?

New York’s economy is on life support, and there is a state budget to be negotiated…and, oh by the way, revenues are projected to fall short by more than $8 billion. But some people are focusing on the question as to whether David Paterson, now that he’s dropped out of the governor’s race, should resign. Won’t that delay another who knows how long the work that needs to get done?

Perhaps our court-approved Lt. Gov. (Richard Ravitch) would be able to do a better job than Mr. Paterson in leading budget negotiations with the Legislature. If Paterson is unable to put his mind to the task at hand, then he should resign; but if he can put aside his personal situation and focus on the situation facing 18 million New Yorkers, then let’s get to it.

Kudos to those editorial boards across the state that are focused on the budget rather than the politics of the matter, namely:

The Poughkeepsie Journal: N.Y. leaders must open up budget process and

The Rochester Democrat & Chronicle: New York’s fiscal woes should motivate lawmakers.

David Paterson’s legacy will not be as a multi-term governor. At best history will say that he helped NYS out of a tough situation by being TOUGH with the state legislature in his last year in office. He talked the talk, but failed to walk the walk in 2008 and 2009. Let’s hope he’s up for the job in 2010.

Now that Gov. Paterson has wisely decided to withdraw his candidacy for governor for 2010, it’s time for Congressman Rangel to indicate that he will retire at the end of his current term.

Decisions such as these men face are difficult because they believe themselves to be righteous representatives of their communities. They have accomplished much good, but their personal failures have rendered each ineffective.

Mr. Rangel must join his colleague Mr. Paterson in honoring those who elected him. Retiring is the only honorable decision.

The arrogance disease. Many of you have encountered this disease and some of you have even had it yourself. It is particularly rampant at times in Albany — particularly when a new administration arrives at the State Capitol with its legion of appointees ready to rip their enemies and go down in history as the “_____” — you fill in the blanks.

Eliot Spitzer had it of course, but he was not the only one. It was there when George Pataki took office until his consiglieres found election rhetoric is one thing and governing another. (The latter is boring, tedious and the glory credits you earn are only a fraction of those to be had on the campaign superhighway.)

So let’s be prepared for the arrogance disease to arrive in Albany in January 2011 when Andrew Cuomo becomes New York’s 56th governor.

What do I mean by the arrogance disease? It is the belief that one is smarter and yes even better than others around him. It is the belief that one does not have to listen to others because he has all the answers. It is the belief that he can push envelopes without consequences.

Winning elections gives people a feeling that they have won a MANDATE TO RULE when it fact an election victory gives them nothing more than an OPPORTUNITY TO GOVERN!

Why do I fear Andrew Cuomo will bring the arrogance disease to Albany in 2011? His actions as attorney general are a clue. One matter in particular concerns me — the decision to go after Intel.

Given the fact that the resources of the attorney general’s office are not infinite, the attorney general ought to be making decisions about which matters are worth the effort and which are not. Whether Intel was engaging in illegal business practices is not a New York State matter. Worse, going after Intel gave the appearance that Cuomo had allowed political considerations to sway what should be a purely legal decision. The political considerations involved in that case are the fact that Intel’s rival AMD was in the midst of making a decision about whether to build a chip fab plant in the Capital Reigon. Did Cuomo go after Intel to help AMD? Probably not, but it is a reasonable question to ask. Were there other matters involving residents of New York that the resources required to pursue an International pricing fixing case could have better served? I’ll bet if I made that a poll question on the Empire Page the majority would say ‘yes’.

Does that mean Andrew Cuomo will be a bad governor and commit similiar mistakes that brought down Eliot Spitzer and David Paterson? No. In fact there are two factors in his favor. One, his father’s experience should prove extremely valuable. Mario can help Andrew avoid mistakes if he listens and I assume he will. Second, Andrew has met with failure in his life — his run against Carl McCall being one example. Typically people who have failed take victory with a degree of humility.

A key to his success as governor however will be whether he can pass along some of his life’s lessons to those he brings to Albany. If not, the arrogance disease will result in some juicy headlines down the road when one aide or another oversteps his bounds and gets caught. For Andrew’s sake and for that of the citizens of New York let’s hope he understands that arrogance has no place in Governor’s mansion or the State Capitol.

Footnote: I am not ignoring the fact that there’s a lot of water to pass under the bridge between now and January 2011. I hope the gubernatorial race garners a lot of attention from the public and that the candidates are pressed to come up with concrete proposals to help NYS out of its economic crisis. However, IMHO (which is shorthand for “In My Humble Opinion”), it would take a political earthquake for Andrew Cuomo to be denied the Democratic Party nomination for governor AND for him to lose in November.

It’s interesting to compare the response of people who are horrified at the high salaries and bonuses that some corporate executives earn when confronted with a similiar situation in the public sector. Take for example the response to the fact that the second highest paid employee of the state of New York is Alain Kaloveros, senior vice president and CEO (!) of the College of Nanonscale Science and Engineering at the University of Albany.

In a recent news story about the high salaries being paid to professors and others working in nanoscience a Mohawk Valley official stated “his salary has to be competitive with what people of his stature are getting.”

Another person stateed “He’s pretty high profile. He’s so much more than just a professor. He …raised hundreds of millions of dollars.”

Aren’t these the same arguments heard in justifing large corporate salaries? What’s good for the goose ought to be good for the gander.

On February 10, the Long Lake Town Board in Hamilton County in the heart of the Adirondacks voted 3 to 2 in favor of a resolution calling for the abolition of the Adirondack Park Agency (APA). The complaint voiced by Supervisor Craig Seaman is that the APA has assumed responsibilities that it was not given by law — namely that it is functioning as a legislative body when it was created to be a regulatory agency. The two members of the Town Board who voted against the resolution did so because they favor reforming the APA rather than abolishing it.

The views of the members of the Long Lake Town Board reflects the sentiment of the majority of year-round residents of the Adirondacks who are increasingly dismayed by the APA’s rulings and methods.

The Empire Page is asking our readers to vote on the issue of whether the APA should be abolished, reformed or left alone. In so doing we are confident that we are introducing the issue to the majority of our readers because despite its enormous power, the APA is one of the least covered governmental agencies in NYS. Other than media located in the Park, the APA gets very little press coverage although its rulings impact every tax payer in the state of New York whether they set foot in the Park during their lifetimes or not.

Recent Polls on SUNY cuts, Wines Sales & the Stimulus Spending

Empire Page readers were asked from February 1-8 to vote on the Governor’s most recent wine sales proposal. You may recall that a year ago Gov. Paterson introduced the notion of permitting stores that currently are licensed to sell beer to sell wine. The plan called for licensing fees that would generate needed revenues for the state’s coffers.

The state’s 2,000+ liquor store owners were able to beat back that proposal last year only to see it brought back again in the Governor’s 2010-11 budget with some modifications designed to mitigate the impact on liquor store owners should the measure gain legislative approval. Our readers voted 48% against the new plan with 42% in favor. Five percent think the governor’s plan could be improved and 5 percent have no opinion.

From February 8 to 18 more than 1100 people came to the Empire Page to vote on the question whether Gov. Paterson’s proposal to cut $118 million from the SUNY and CUNY budgets should go through. Eighty-seven (87) percent of those who voted dislike that concept while only 12 percent approved.

From February 18 through 24 we asked readers whether they thought the federal stimulus monies were being spent wisely in NYS? Only 13 percent said ‘yes,’ 23 percent were uncertain and a whopping 64% said there was too much waste involved in NY’s use of those funds.

What question would you like to see us ask our readers? Send an email to editor@empirepage.com and we’ll consider your suggestion.

State tax revenues nationwide continue to decline in the fourth quarter of 2009 according to a report issued today by the Rockefeller Institute of Government.

Tax revenues declined for the fourth consecutive quarter and are likely to remain below pre-recession levels for some time state the report’s authors.

A key conclusion is that “State tax revenue will continue to be insufficient to support current spending commitments, and more spending cuts and tax increases are most likely on the way for many states.”

New York’s 4th quarter 2009 revenues fell 1.6% below 2008 despite a 2.8 percent gain in revenues from personal income taxes — a result of the addition of higher rate tax categories for incomes over $200,000 and over $500,000.

However, New York sales tax revenue fell slightly and corporate income taxes fell a huge 40.4% dragging down total tax revenue.

In today’s Siena College Research Institute poll an interesting contradiction in voter thinking is revealed in hard numbers. On the one hand, voters do not want the state aid to education to be reduced; in fact they want it to be increased even if that means higher taxes. On the other hand, however, voters want the state budget to be cut and they want taxes to be lowered.

Of course we’re talking about voters in the aggregate, but that contradiction lives in the minds of many individual voters. Who ever said human beings — much less registered voters — are consistent?

The contradiction demonstrates that voters are sadly uninformed when it comes to education funding and the state budget. They view the problem from the perspective of their home community rather than from the state as a whole.

Voters are also loath publicly to oppose school spending. Yet, watch their behavior when they get a chance to vote on their local district budgets. If there is any hint of discretionary spending (on such items as libraries, art, music, etc.) and they’ll vote ‘no’.

The larger problem is complicated by the fact that governors don’t like to take on the problem of rich districts versus poor districts. There are districts across the state with large reserve funds not to mention solid tax bases, but try to reduce their next year’s state aid and they’ll run crying to their state legislators.

There is also the problem that we’ve had a laissez-faire approach to the organization of school districts. The fact is that there is unnecessary duplication of resources across the state as well as the failure to realize the benefits that centralization can bring.

Think of it this way: There are computers, fax machines, copy machines and other technology with underutilized capacity sitting in school district offices across the state. Tax payers have paid for their purchase and continue to pay for maintenance without getting the potential benefits that should accrue.

The same is true of people. Merge two districts and many of the people in the superintendent’s office from the superintendent down to the janitorial staff can become more productive without any increase in cost. Even teachers can be more productively employed. Were that not the case, then BOCES would not exist!

Here are two solutions:

1) Give districts a choice: demonstrate that you are lowering costs either on your own or as a result of sharing services with neigbhoring districts or have your state aid formula reduced.

2) Provide an incentive for small districts to merge. The State Education Department ought to be geared up to assist districts merge quickly and efficiently with lesson plans on how to reduce costs without any decline in service quality.

Other solutions, including reform of the Wicks’ Law that inflates construction costs, have been offered by a variety of organizations including the Empire Center, New Yorkers for Growth and Unshackle Upstate.

This is a great opportunity for voter education. Spread the word.

Voters asked last week by the Siena College Research Institute whether they would favor permitting wine to be sold in grocery stores said yes by a 58-39 margin. Those in favor crossed all politial lines and did not vary by whether they live upstate or downstate. Only African Americans, Latinos and older voters were evenly divided.

It now remains to be seen whether the Legislature will respond to the majority of voters or to the narrow interests of the liquor store owners.

If you follow news stories on the Empire Page, you are aware that people involved in the tea party movement in NYS are considering creating a new political party.

It makes sense. New York’s election laws provide a strong incentive for a disaffected group to form a new party rather than join an existing one. It is not easy, but getting on the ballot can be accomplished with a decent-sized organization.

Here’s the relevant section of the state’s election law for statewide candidates.

(§ 6-142. Independent nominations; number of signatures.
1. An independent nominating petition for candidates to be voted for by all the voters of the state must be signed by at least fifteen thousand voters, of whom at least one hundred shall reside in each of one-half of the congressional districts of the State.

The NYS Tea Party would presumably invite candidates from other parties to apply for their endorsement. If they followed the path of the ideologically-pure Green and Libertarian parties which do not cross-endorse, they would be consigning themselves to irrelevance which I doubt it their intent.

This being their first year playing the electoral game, candidates who are afraid of being put on the spot concerning specific issues will probably be able to ignore the Tea Party. This could result in the Tea Party being forced to run their own candidates in most Assembly, Senate and Congressional districts.

If so they’ll find out that it’s one thing to protest the policies of those currently in office, it’s another thing to mount an effective election campaign. To do so takes a willing candidate who doesn’t have any hidden baggage, such as a girl friend in Argentina or a Wall Street bonus check in her back pocket. It also requires legal help to prepare and oversee a petition drive, dozens of people to circulate petitions and later campaign literature, and some a few thousand dollars if just to pay the lawyers and print a brochure. All this effort of course has to be done despite the fact that your candidates will not win any elections and you are merely establishing your party as a force for future elections.

However, if the Tea Party is able to turn out several thousand votes in a number of Assembly and Senate districts whether for their own candidates or on behalf of those running on other lines, and if they can get 50,000 votes for a gubernatorial candidate, they will have achieved status on par with the Conservative, Independence and Working Families Party whose support is essential for victory in many districts across the state. (See my “2010: The Battle for the NYS Senate” for examples.)

One interesting aspect of all this will be the impact of this nascent political party on the existing third parties. They are unlikely to have any impact of course on the Working Families Party, but they could attract members and voters who are disaffected with the Conservative and Independent parties. For example, Warren Redlich, whose political line up with the Tea Party, is spurning the Conservative Party endorsement because they had the temerity in the past to endorse candidates like George Pataki and Rick Lazio.

The one group that perhaps ought to be considering forming a political party is Unshackle Upstate. One would think that they would be more likely than the Tea Party folks to be able to find candidates with statuture in their communities and money to spend on campaigns. Seeking to unite the small business community with community interests outside New York City, an Unshackle party might also be able to put pressure on the Democratic Party counteracting the pro-union Working Families Party.

This could get interesting.