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.