The state Division of the Budget today released the 2011-12 Enacted Budget Financial Plan, the 423-page document that lays out the state’s fiscal condition and its budget projections for the next three years.
The budget that was adopted March 31 closed a $10 billion budget gap without raising taxes or increasing borrowing. The biggest long-term effect is that the budget deal wiped out the massive budget gaps that were predicted for the next three years, which were initially set to top $21 billion in the 2014-15 fiscal year.
Now the gaps are predicted to be “$2.4 billion in FY 2013, $2.8 billion in FY 2014, and $4.6 billion in FY 2015,” according to the report.
Gov. Andrew Cuomo’s budget was able to limit future spending growth by putting a two-year cap on spending increases for education and Medicaid, the two largest pieces of the state budget. The cap limits the spending increases to about 4 percent next year.
For this year, all funds spending — which includes state and federal aid — will total $131.7 billion, a decrease of $3.1 billion from the previous year. State operating spending is $88.2 billion, an increase of $1.7 billion or 1.9 percent.
The spending reductions include a 10 percent cut in state agency spending, a $1.5 billion cut in school aid and $450 million in workforce reductions — which will come through either union concessions or about 9,800 layoffs, Cuomo says.
The other major piece is a reduction in Medicaid spending by $2.3 billion.