No printing press to run, no army to disband, no trillion-dollar coin in the closet.

 

Greenwich Democrat Designated Intellectual, Dollar Bill: "Are there no workhouses, no prisons for millionaires?"

Greenwich Democrat Designated Intellectual, Dollar Bill: “Are there no workhouses, no prisons for millionaires?”

New York State’s run out of borrowing capacity.

State Comptroller Thomas P. DiNapoli today warned in an analysis that New York State’s heavy debt burden could jeopardize critical infrastructure projects and other capital needs. New York State has the second highest level of debt in the country and is approaching its legal borrowing limit. The state’s debt capacity is projected to dwindle to $509 million by the end of the next fiscal year.

“New York’s past borrowing is limiting our future options,” DiNapoli said. “We spend billions each year to repay existing debt, so fewer resources are available for more pressing needs. This comes at a challenging time when our state needs to rebuild and repair critical infrastructure and has growing capital needs.

New York’s outstanding debt averages $3,253 per state resident, almost three times the national median. New York’s state-funded debt totaled $63.3 billion as of March 31, second only to California and 80 percent higher than New Jersey, the state with the third highest level. This represents an increase of $24.3 billion, or 62.2 percent, from state fiscal year (SFY) 2002-03. [Connecticut leads the nation in total debt per capita, $5,840.00 - Ed]

The cost of borrowing is increasingly crowding out other state expenditures. New York paid $6.8 billion in state-funded debt service in SFY 2011-12, which amounted to approximately 5.1 percent of All Governmental Funds receipts. Growth in state-funded debt service, at an average annual rate of 9.4 percent over the last 10 years, has far outpaced average annual growth in state spending on both education (5.3 percent) and Medicaid (5.1 percent) for the same period.

7 Comments

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7 responses to “No printing press to run, no army to disband, no trillion-dollar coin in the closet.

  1. ajnock

    Krugman lives in NY and can borrow a trillion dollar coin from friends in high places no doubt.

  2. Publius

    Ah yes, New York is running out of other people’s money to keep the wheels turning. I find it amusing however when officials like Comptroller DiNapoli couch their concern about the budget as it relates to infrastructure, something many may agree on, is the correct purview of a state government. What he fails to mention is that New York is the poster child for Medicaid spending among all states. In the calendar year 2011, NY spent $44.5 billion (http://www.health.ny.gov/statistics/health_care/medicaid/quarterly/aid/2011/cy/expenditures.htm) on all medicaid expenditures. Keep in mind that NY only picks up about 50% of that with the Feds (you and I) picking up the rest. All funds for the NY fiscal year 2012 (March 31) totalled $135 billion and fiscal year 2013 is projected to be about the same (http://publications.budget.ny.gov/budgetFP/2012-13EnactedBudget.pdf). A whopping 33% of all funds is spent on Medicaid. Some how with all this money floating around the State does not have the financial werewithal to find a few billion to replace the Tappan Zee Bridge, which has been on the radar for years and is functionally obsolete.

    Cue the orchestra. The State has put itself in this position by making the decision to allocate more resources to Medicaid benefits while the roads, bridges and tunnels collpase. They get what they deserve. The electorate has to decide if essential government services should be limited to education and infrastructure or include running a large HMO (see General Motors pre bankruptcy). To add insult to injury Governor Cuomo has larded up his Sandy requests for all sorts of infrastructure goodies that have nothing to do with the storm and then expresses outrage when Congress blanches at the chutzpah. Further idiocy is the refusal of Cuomo and the Greens to allow fracking in the economically depressed areas of the state that really need an economic boost and would go a long way to generating revenue for things the State should be doing, like maintaining its infrastructure

    Be forewarned Connecticut is right behind New York.

  3. D

    These articles should mention what the debt service would be if one used a more historically normalized interest rate… the real party will start when rates start to creep back up from the current basement levels.

  4. Anonymous

    as one who drives the cross bronx often, i wonder where ny spends its infrastructure money.

  5. AJ

    They could always sell the Brooklyn Bridge. Or they could do what Governor Perry of Texas is doing and privatizing highways that your tax dollars paid for so that you can pay tolls to the new owners — maybe certain people (dissidents) could even be banned from using private property roads.

    Rick Perry’s ‘Superhighway’ Owned by Spain Returns

  6. armonk

    High tax states in the northeast (except NH) are driving business away to places where the weather is warmer and taxes are lower. In the 1950 census Rochester NY was ranked #32. Atlanta and San Diego were 31 and 33.
    While the article focuses on NY, take a 40 mile ride up to Ansonia and ride around. The city has the same 19,200 population as it had in 1940, but the economics are much different.