Cuomo Plan for New York City's Budget Woes Receives Praise the $7 Billion Package Addresses Transportation, Medicaid, and Municipal Services

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NEW York Gov. Mario Cuomo (D) is getting high marks here both for the ambitious scope of his new proposals to revitalize New York City and for the message they send of his commitment to the city's economic future.

His package includes a number of public-works projects aimed at producing jobs and streamlining transportation in and out of the city by everything from high-speed ferries to light-rail links between local airports.

The total cost has been pegged at more than $7 billion, most of which would have to come from the private sector. Many New Yorkers question whether any of the projects will really get off the ground.

"The most important thing the proposals do is boost confidence in the city," says Ronald Shelp, president of the New York City Partnership, a group of about 200 business and civic leaders.

"People have been saying that there's no hope.... It's much better if they're arguing about whether this or that project will work," he says.

One key proposal, long sought by city officials, would gradually shift the local share of Medicaid costs to the state in exchange for some portion of city and county tax revenue. New York is one of only a handful of states that require cities to pay part of the nonfederal share of the Medicaid bill. The tab for the Big Apple is now $1.8 billion a year.

Several of Governor Cuomo's proposals would eliminate duplication in city and state services and revamp laws that limit productivity. New York University economist Richard Netzer considers these one of the strongest parts of Cuomo's program.

"There's been a lot of detailed work done to think things through," he says. "This is not just grandstanding."

These are days when cities are getting little help from either Washington or their state capitals. New York State itself struggled to make cuts last summer to close an estimated $6 billion budget deficit.

Just last week the state's chief judge sued the state, charging that state funding is insufficient to operate the court system. Big cities vs. suburbs

Few of the new Cuomo proposals include state money. Yet many require legislative approval that may be hard to come by. The proportion of legislators from the suburbs is growing in New York as elsewhere and, with it, resistance to anything that might smack of an urban bailout.

Local-state fiscal tensions seem to be heightening rather than easing nationally, says Henry Coleman, who directs fiscal research at the Advisory Committee on Intergovernmental Relations. Also, in New York's case, Cuomo, a Democrat, must get his plan through a Republican-controlled Senate. …


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