New York is expanding its general fund spending by 7 percent in 2020, following increases of 4.4 percent in 2019 and 2.2 percent in 2018, a new report reveals.
In 2018, New York reported $69.7 billion in general fund spending, a number that is expected to increase to more than $77.8 billion in 2020, according to an analysis from the National Association of State Budget Officers (NASBO).
New York officials are anticipating a 9.3 percent increase in general fund revenues for the 2020 fiscal year, a year after they saw a 1.2 percent decline, according to the report. In 2018, the Empire State reported a 6.8 percent increase in revenues to its general fund.
While New York reported a slightly higher intake in 2019 sales tax revenue of nearly $14.2 billion over its original estimate of $14.1 billion, the state took in less in personal and corporate income tax dollars than initially anticipated. The state received $5.5 billion in corporate income tax, below its original estimate of $5.6 billion, and more than $48 billion in personal income tax, below its initial estimate of $50.4 billion.
The state also took in $15 million in gaming and lottery revenues and nearly $2.8 billion from other sources, 11.2 percent higher than initially expected.
Nationally, state lawmakers are spending more and replenishing their rainy day funds in anticipation of the next economic downturn, according to the report.
New York reported a rainy-day fund of $1.2 billion in 2011, a level that increased to nearly $1.8 billion in 2015. In 2019, the fund’s balance increased to more than $2 billion, and it is projected to rise to almost $2.5 billion in 2020, the result of a transfer from the State Purposes Account.
As is the case in New York, general fund spending across the country is expected to increase by 4.8 percent in the 2020 fiscal year, the NASBO analysis found. In total, 45 states are planning spending increases, which are predicated on general fund revenue growth of 2.6 percent.
Meanwhile, a state takeover of local Medicaid costs saved local districts nearly $3.7 billion in fiscal 2020, according to the report. Additionally, the Empire State was one of 10 states nationwide that reported increased funding for transportation.
The state’s budget increases local revenues primarily by providing an approach for collecting online marketplace sales taxes and enforcing out-of-state retailer sales tax collections, according to the NASBO analysis. The budget also makes permanent a 2 percent property tax cap.