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Will State Fall Into The Financial Outhouse And Come Out Smelling Like A Rose This Time?

Comptroller Thomas DiNapoli is once again sounding the alarm about New York’s proflligate spending habits.

The comptroller recently reported increased spending coupled with the expectation of lower tax collections will create budget gaps over the next several years that could reach more than $36 billion.

Similar warnings have tended to be full of much sound and fury signifying little, though that says less about DiNapoli and more about the state’s ability to fall into an outhouse and come out smelling like a rose. Some years, the state has received unexpected money from outside sources like the federal government or lawsuit settlements that have helped balance its budget. Other years tax receipts that had lagged at the time DiNapoli issued warnings picked up at the last minute. In some years the state has used accounting tricks like moving payments from one year into the next in order to keep its budgets balanced.

But one of these days the state is going to fall into the outhouse and come out smelling like it was actually in an outhouse.

This may be that year.

The spending gaps DiNapoli has forecast in past years are getting bigger. Deficits are projected to grow to $9.1 billion next year and $13.9 billion in the following year, with those gaps “well above” the typical out-year budget gaps forecast in previous years. That means the state won’t need a one-shot budgeting trick to keep the money flowing to pay for the state’s expensive education and Medicaid programs — it will need three- or four-shots of extra revenue to balance the budget.

Wealthy taxpayers are fleeing the state, and DiNapoli worries that more tax hikes on the rich will only further depress already lagging tax collections.

Spending continues to go up. Revenues struggle to keep up. We can see the outhouse ahead. Whether the state comes out of this mess smelling like roses or a skunk is up to Gov Kathy Hochul and Democrats in the state Legislature who control the purse strings.

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