The state’s plan to shift $625 million in new Medicaid costs onto local taxpayers would place New York’s counties and the City of New York on track to contribute a record $12 billion to state coffers next fiscal year. The funding contributed by counties can only be collected through property tax and sales tax, regressive taxes that disproportionately impact seniors and low-income New Yorkers.
Since 2005, counties and New York City have provided more than $172 billion in local tax revenues to support just four major state programs: Medicaid, Safety Net, Preschool Special Education and Indigent Defense. New York is unique among most states in requiring counties to fund a significant portion of these programs through local taxes. This arrangement provides direct fiscal relief to the state financial plan at the cost of placing New York State at an affordability disadvantage.
“For decades, New York State has used local taxes to balance its books,” said NYSAC President Michael E. Zurlo. “The result is its simply making it harder to live, work and raise a family in our state. The Governor’s plan to shift yet another $625 million of new Medicaid costs onto local taxpayers will make New York even less affordable as counties are forced to cut programs and services to pay for this cost shift. We need State Lawmakers to listen to their counties and reject this proposal during final budget negotiations.”
State officials have continually asserted they deserve the federal Medicaid money because the state assumed all the cost growth in the State Medicaid Program. This is only half the story. The state’s argument fails to account for all the state programs counties pay for and additional cost shifts to local taxpayers since 2005, including:
- $21.6 billion in local tax revenues to support the state’s Safety Net program.
- $11.8 billion in local tax revenues to support the state’s Preschool special education program, despite “Universal Pre-k” purportedly funded by the state
- $6.9 billion in local taxes to support indigent legal defense services.
Counties and the City of New York also provide local tax revenues in support of the state budget for dozens of programs that the state has reduced its reimbursement for, including Child Welfare, Adoption Subsidies, Family Assistance, Youth Detention and Treatment, Foster Care, Probation and administrative costs to support many of these programs.
“Any suggestion that county taxpayers don’t need or deserve this federal funding is misguided. New York State took over the growth of Medicaid, then it shifted other costs onto local taxpayers to shore up its own finances. It all comes down to local taxpayers, and they are getting squeezed out of our state,” said NYSAC Executive Director Stephen Acquario. “Counties have done a remarkable job in recent years of managing their budgets to hold the line on property taxes, but the Governor’s Medicaid cost shift would be the anvil that breaks the camel’s back, sucking up county reserves and then forcing property tax increases that will make it more expensive to live or own a business in New York State. It’s wrong on all accounts.”
Learn more at costshiftcountdown.com.