Legislative Updates
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Memo
| To: | All Clients |
| From: | Glenn T. Riddell |
| Date: | 8/9/10 |
| Re: | Update for the Week of March 8th |
Governor David Paterson – Resign or Stay Till The End?
Governor Paterson has again vowed to finish his term, which ends December 31st of this year, dismissing a growing chorus of calls for his resignation. "I will keep governing until the end of the year," he told parishioners in a Brooklyn church to huge applause this past Sunday. "I will not be daunted or distracted by any forces." Governor Paterson used the pulpit at Cornerstone Baptist Church in Bedford-Stuyvesant to trumpet his efforts to keep the State afloat through the current fiscal crisis. "My determination is to run this State and I come before you today in one of the most difficult times for our State. Perhaps the most difficult any Governor has ever faced," he said. Paterson's ability to lead the State has been called into question after he became embroiled in a number of alleged scandals. These include the determining of what role the Governor played in the assault charge brought against one of his top aides, David Johnson which was eventually dropped by the woman who he allegedly assaulted last October, the finding by the State Public Integrity Commission that Governor Paterson violated the State's Gifts Law by accepting free Yankee World Series tickets last October, and last but not least, the oddities that are being uncovered by State investigators of the Aqueduct Racino deal. It has been reported that key partners, in the Aqueduct Entertainment Group (AEG) Queens minister Floyd Flake and rapper JZ have pulled out of the deal. Also, Governor Paterson, on the advice of his top-gun lawyer, Ted Wells, who the Governor recently retained, has recused himself from any further matters involving AEG. Where these investigations will lead, no one knows. In the meantime, the Governor has also had his defenders saying we need to see where all this leads and to what extent the Governor was involved.
In a late-breaking story, investigators have found little evidence that Governor David Paterson tampered with a witness in the domestic abuse case against one of his top aides, the Daily News has learned. While several key people have yet to be interviewed, the woman at the heart of the case, Sherr-una Booker, told investigators she didn't feel the Governor threatened her in a phone conversation one day before a February 8th hearing on the case. Sources also say conversations that several of the Governor's aides had with Booker were too vague to nail down a witness tampering case. While voters say that what's going on in Albany makes them "embarrassed to call themselves New Yorkers", 55% of voters want embattled Governor David Paterson to serve the remainder of his term, which is consistent with two polls taken last week.
Another Resignation
The State's top cop is out after just seven days on the job. He becomes the fourth victim of the alleged scandals swirling around Governor Paterson. State Police First Deputy Superintendent and Acting Superintendent, Pedro Perez abruptly announced his retirement yesterday, just one week after former Chief, Harry Corbett quit March 3rd. It was reported that Perez quit rather than face two State Police unions who were ready to provide no-confidence votes regarding Perez. Joining Perez and Corbett on the casualty list are former Public Safety czar Denise O'Donnell and ex-Communications Director Peter Kaufman. Perez's departure thrusts the State Police into further disarray. Cop #3, Field Commander John Melville will take charge of the agency. Governor Paterson refused to talk about Perez's sudden resignation/retirement but was quick to praise Melville.
Update on 2010-'11 Budget
Lt. Governor Ravitch – Borrow $6 Billion
While all the above was going on, there still remains the problem of passing a State budget by April 1st which Governor Paterson has proposed to total $134 billion and includes a growing deficit of approximately $9 billion. New York could borrow up to $6 billion over the next three years under a budget plan unveiled Wednesday by Lt. Governor Richard Ravitch. Although Ravitch's plan buys time for lawmakers facing the unlikely prospect of balancing a $9 billion deficit by April 1st – when the 2010-'11 budget is supposed to be adopted – it would require cuts to a variety of programs and services funded by the State. "I haven't denied the fact that a lot of people are going to get hurt," Ravitch said after laying out his plan for reporters in the State Capital. Among the highlights of Ravitch's plan are:
- There could be up to $2 billion of borrowing in each of the first three years of the five year plan. Any surpluses in that time would go to debt reduction;
- The current fiscal year would be extended to June 30th, allowing for a better picture of tax collections and greater clarity on anticipated Federal monies. Future budget years would start on July 1st;
- Budgets would be developed according to "generally accepted accounting principles." This standard would preclude some current practices, such as booking future anticipated revenues in a current budget.
- The creation of a Financial Review Board as an overseer, would not propose budgets or legislation, but it could declare a budget to be out of balance after which the Governor and Legislature would have fifteen days to fix it. If not, the Governor could unilaterally reduce appropriations to bring the budget into balance.
This last element will likely be one of the more controversial proposals, as it potentially gives the Governor far greater leverage in making budget cuts. Indications are that this balance – of – power issue could be an early bargaining chip with Assembly Speaker Silver, a long time friend of the Lt. Governor. The Review Board will consist of two Gubernatorial appointments plus one each selected by the Senate, Assembly and State Comptroller.
Reaction to the proposal was mixed as E.J. McMahon, Director of the Empire Center for N.Y.S. Policy says he fears it could let lawmakers continue their stalemate without tackling runaway spending. Robert Ward, Deputy Director of the Rockefeller Institute said that "this could be one of the most significant fiscal reforms ever enacted by the State."
State Soda Tax Plan
Also related to the budget is the proposal by the Governor for a statewide tax on sugary drinks. Health Commissioners of both the State and the City will be meeting with Governor Paterson this week to discuss how to move forward on the proposed tax. State Health Commissioner Richard Danes told the news media this week that "we've talked about it, the evidence for health benefits is getting a lot stronger, and the need for the revenue this year is definitely there." Commissioner Danes hopes the Legislature will pass a penny-per-ounce tax on sugary beverages this year, setting an example for the rest of the country. Experts say soda and other sugar-loaded drinks are the largest source of extra calories consumed by Americans. It is estimated that a 10% price hike will cut consumption of sugary drinks by 8%. "Indications are that the tax could raise $1 billion annually – money that could fund healthcare programs across the State, Commissioner Danes said. It is a triple play. We would reduce obesity, earn revenue to support healthcare and in the long run, cut healthcare costs," he said.
Political News
Republicans Consider Steve Levy as Gubernatorial Candidate
Top Republican Party officials met this week with Steve Levy, a Suffolk County Executive who is a Democrat for the purpose of running Levy for Governor on the Republican ticket this fall. This was caused by Republican Party officials having second thoughts about the gubernatorial candidacy of Rick Lazio. Levy, who was buoyed by this meeting and said he would move around the State more actively campaigning for Republican support. Levy made a presentation before Republican State Chairman Ed Cox and nine Regional Vice Chairmen. Most Chairmen contacted after the meeting had encouraging statements for Levy and said he would be given a serious look if he agreed to switch his enrollment from Democrat to Republican.
Former Senator Monserrate Back in the Race
Despite getting heat from President O'Bama's grassroots political organization for using the President's logo and slogan, former Senator Monserrate is moving ahead with his campaign to win back his Senate seat. Monserrate who was recently expelled by the Senate has petitioned his way back on to the ballot for the Special Election in his Senate District to be held March 16th. He is facing Assemblymember Jose Peralta, who has the backing of the party establishment. Monserrate is hoping that his high name recognition will vault him back into the Legislature. Indications are that Monserrate's Plan B should he lose, is to run for Peralta's Assembly seat, which would be open.