Wednesday, December 27, 2006

State Debt Key Concern for Spitzer

UticaOD.com Editorial


"AT ISSUE: Reforms needed to curb debt growth, pare it back
Gov. Eliot Spitzer will have his work cut out for him come Jan. 1, largely due to the failings of George Pataki, the man who wants to be president.
Topping his troubles will be New York's mounting debt. It's a train wreck.
In October, the Citizens Budget Commission, an independent watchdog group, said state debt will reach a record $49.7 billion this year. That's $3,515 for every adult New Yorker, second only to Massachusetts ($4,987 per adult). Compare that to Texas' $707. The debt places New York in the commission's "danger zone," which is based on the states' ability to afford the debt.
Well, as the late actor Al Jolson once said, "You ain't heard nothing yet, folks." A report last week from the state comptroller's office said state-funded debt is expected to grow by one-third over the next five years — to nearly $65 billion. Debt service alone in 2011 will grow to more than $7 billion from $4.3 billion this year.
It's a formidable challenge, to say the least, for Spitzer. Not only does such an outrageous debt threaten to strap our children and grandchildren, but it will play a significant role in budget development for the new governor.
Adding to Spitzer's challenge will be a Legislature that is oblivious to the problem. The comptroller's report noted the Legislature last year created the potential for as much as an additional $9.4 billion of debt not even counted in the debt limits established in the Debt Reform Act of 2000. That includes Building Aid Revenue Bonds (BARBs) issued by the New York City Transitional Financing Authority (TFA) to pay for school construction in New York City. The TFA has already issued $650 million of this debt and plans to issue a total of $4.7 billion through 2010. These bonds are paid for exclusively with state building aid.
Even when presented with an opportunity to trim some of the debt — New York had a $1.1 billion budget surplus this year -- legislators opted to blow it in their own self-serving way by handing out tax rebates. Leaders proclaimed the rebates would arrive just in time to pay school taxes, which was, coincidentally, right around election time. Clearly, Spitzer and the Legislature will need to turn their immediate attention not only to curbing the growth of state debt, but to reducing it. They can't afford not.
And neither can we. "

Nobody ever said this was going to be easy..........andy



Comments:
Moving out of the country is a big deal. Moving out of the state is not. Most of the people I know are regular working folk, as am I. If I had ten dollars for every one who a) muses of moving out of state, b) plans to move out of state, c) has moved out of state, then I myself would find it a breeze to pay NYS taxes, which is always the reason my pals give.

I don't know why legislators don't realize that their state is in competition with other states and that packing up, moving on is always an option, particularly upon losing a job from a company which has fled to avoid high taxes.
 
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