May 11, 2020.
With COVID-19 changing the economy overnight, the state braces for projected cuts to essential services including chopping funding for local governments, Medicaid, and education. Governor Cuomo began the legislative session warning of a budget gap and the need for cuts. Now, as we wait for the latest federal stimulus, the first round of state cuts is expected to be announced soon.
Ron Deutsch, executive director at the labor-backed Fiscal Policy Institute, warned against further cuts to state agencies, since funding to those agencies has been flat for years. He said that would further squeeze agencies that he said are already at “bare-bone capacity.” Deutsch suggested that the state should engage in short-term borrowing from the Federal Reserve Bank of New York in order to offset some of the steepest immediate cuts before the arrival of potential federal aid or new revenue streams that may be approved by the state Legislature.