Update: Cuomo Budget To Increase Fees; Includes Proposal To Suspend Driver’s License Of People With Large, Overdue Tax Bills

ALBANY, N.Y. (AP) – The $137 billion state budget that New York Gov. Andrew Cuomo proposed Tuesday would increase spending about 2 percent without tax increases, but New Yorkers would feel some fee hikes.

Cuomo’s budget proposal to the Legislature provides 4.4 percent more aid to schools and would fund his proposal to improve instruction, including longer school days and school years. State aid to municipalities outside New York City wouldn’t increase at a time when many counties and smaller local governments outside New York City worry about insolvency amid rising costs and falling tax bases.

Cuomo proposes to suspend the driver’s license of people with big, overdue tax bills. He also would make it harder to plea down some speeding charges to avoid bigger fines and insurance premium hikes. His measures, however, would include Saturday hours at some Department of Motor Vehicles offices.

The bulk of his new proposals focus on upstate jobs programs and tourism. The budget proposal that details his revenue and spending plan, however, doesn’t include mention of the potentially lucrative drilling for natural gas using the contentious process of hydraulic fracturing, or fracking. Cuomo has said he won’t indicate if he will support the process that is opposed by environmentalists until a state health study is completed.

“He’s funded a number of initiatives in a pretty responsible framework and spending isn’t going up by too much,” said Elizabeth Lynam of the independent Citizens Budget Commission.

She said several small fees will touch New Yorkers, including the extension of a utility surcharge paid by ratepayers. The budget also extends a kind of tax on high-income New Yorkers by limiting deductions to charities.

In the budget, Cuomo is putting dollar commitments to the proposals in his State of the State speech Jan. 9, which was filled with progressive and often costly ideas.

The budget he proposed on Tuesday will go to the Legislature where a series of hearings will be held. Cuomo and legislative leaders then traditionally meet behind closed doors to negotiate a final plan by the April 1 start of the fiscal year.

New York’s budget is watched closely nationwide because of its early fiscal year and because it often identifies trends in other states’ budget proposals that come out over the next several months.

Cuomo and economic forecasters had expected fiscal times to be better by now after state budgets had to contend with deficits totaling more than $10 billion because of drastically reduced tax revenue during the recession. State Comptroller Thomas DiNapoli warns, however, that tax collections continue to remain below the state’s latest estimates.

“Tax collections are still not growing at the rate needed to meet year-end projections, and the boost in personal income taxes in December likely won’t continue,” DiNapoli said.

“So far the budget has been balanced by spending less and taking advantage of one-time windfalls,” DiNapoli said. “With the budget process about to begin again, revenue projections should be realistic so that the budget is not balanced with revenues that won’t be there.”

DiNapoli said the Cuomo administration in November estimated tax growth at 2.9 percent, but it has come in at 1.2 percent. That would mean tax receipts would have to be an unlikely 7.1 percent in the last three months of the fiscal year to meet projections. He said sales tax receipts have also been flat so far this fiscal year.