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Comptroller says pension plan won't save NY money now

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Governor Cuomo and lawmakers are deliberating behind the scenes on their remaining disagreements over the state budget. Meanwhile unions and others have expressed doubts about a recently approved pension reform plan.

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Reported by

Karen DeWitt
NYS Capitol Correspondent

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Governor Cuomo and legislative leaders have relatively few remaining differences in this year’s budget, though ironing out all of the details will likely now prevent passage of the spending plan until later next week.
 
The state’s Comptroller, Tom DiNapoli, who has been at odds with Governor Cuomo over pension reform, praised the governor and lawmakers for being conservative in their revenue estimates, and prudent, so far, in their spending plans.
 
“We don’t see the gimmicks that we’ve seen in past years, that’s good,” said DiNapoli.
 
Lawmakers are working on closing a $2 billion budget deficit, significantly less than last year’s $10 billion gap. Last December, Cuomo and the legislature agreed to an extension of an income tax surcharge on the state’s wealthiest. DiNapoli says that helped prevent any budget imbalance.
 
The Comptroller does take issue, though, with the governor’s proposal to eliminate pre audits that his office conducts on some state contracts, saying “it takes away the opportunity” for his office to look out for taxpayer interests and the “best value” for the state.
 
The state Comptroller has largely sided with the unions in the fight over a pension reform package approved in all night session March 15th. DiNapoli has said the plan, which required future public employees to pay more towards their pensions and receive less in return, won’t save state and local governments money in the short run.
 
But the Comptroller, who says he was not consulted during the pension reform negotiations, says now that the law has been enacted, his office will do its job and implement it. He says he questions the claims by Cuomo and lawmakers that the new pension tier will save $80 billion dollars in future decades, saying  there are “a lot of ifs” in that assumption.
 
He says one of the “key drivers” will be how many new workers are hired in a continued depressed economy. 
 
“I don’t think you’ll see a robust hiring season for a while,” said DiNapoli.
 
DiNapoli says he’s pleased that Cuomo’s proposal to offer the option of 401k type plans for all new hires was ultimately dropped. Only non union hires who make more than $70,000 a year are eligible for the 401k option now.
 
Unions continued to express their displeasure. On Monday, the largest public workers union, the CSEA, suspended all political endorsements and campaign contributions over the pension package, saying lawmakers traded the retirement security of future workers in exchange for new district lines, which were also passed in the all night session. On Tuesday, the teachers union, New York State United Teachers, also held a demonstration.
 
NYSUT President Dick Iannuzzi would not rule out refraining from endorsements for incumbent lawmakers in November, but he says the board and members have their own decision making process that concludes in August. He predicts, though that the passage of the pension changes will be a factor.
 
“Are they going to be heavily influenced by what happened?” Iannuzzi asked. “Absolutely.” 
 
The teacher’s union President says he’s willing, though, to give legislators a second chance, and will also be evaluating them after the state budget is finished.
 
Iannuzzi says he is pleased that Governor Cuomo has signaled that he’s willing to give up on a key budget provision that teachers, and many lawmakers, have opposed. The governor had wanted to reserve $250 million dollars of promised new school aid for  competitive grants. Assembly Speaker Sheldon Silver and others thought the money should go directly to the state’s poorest schools. Iannuzzi says he’s relieved that the governor now seems willing to go along with that change.
 
“He’s making a wise decision,” said Iannuzzi.
 
Budget conference committees were postponed for yet another day as legislators deliberated in private.

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