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• New York State saw its revenue decline by 1.5% during calendar year 2020. But its fiscal year runs from April to March.
• The calendar year figure that Cassidy cited includes nearly three months of 2020 with relatively normal, pre-pandemic economic activity, distorting the budget picture.
• State budget officials have already projected larger revenue declines over the full fiscal year.
How has New York state fared in collecting revenue during the coronavirus pandemic and the resulting economic turmoil?
Not so badly, according to Sen. Bill Cassidy, R-La., who said recently that New York Gov. Andrew M. Cuomo has been exaggerating the fiscal hit to his state.
In a Feb. 7 interview with NBC’s Chuck Todd on "Meet the Press on Feb. 7, Cassidy was asked about what actions the Senate needs to take to help state and local governments experiencing fiscal shortfalls in the wake of the pandemic.
Cassidy acknowledged that some states have faced budgetary difficulties, but said others have not, including Democratic-run states such as New York. "New York, for all of their complaining, Gov. Cuomo's complaining, has only had a 1.5% decrease in revenue," Cassidy said.
The remarks came amid skirmishing between the parties over President Joe Biden’s proposed $1.9 trillion American Rescue Plan. The bill is designed to boost the response to the coronavirus pandemic and aid the economic recovery.
New York Gov. Andrew Cuomo speaks at the opening of a mass COVID-19 vaccination site in Queens, N.Y., on Feb. 24, 2021. (AP)
Has New York’s fiscal hit really been that modest?
Ty Bofferding, Cassidy’s director of communications, pointed to a report by the financial institution J.P. Morgan that showed that in the calendar year 2020, New York had an aggregate tax revenue decline of 1.5% compared with 2019.
While Cuomo’s administration did not dispute the 1.5% figure, they argue that the calendar year figures are less useful for tracking the pandemic’s budgetary impact than the fiscal year figures, which run from April 1 through March 31. In 2020, January, February and part of March occurred before the pandemic hit.
"Comparing calendar years, as the chart the senator is referencing does, fails to recognize the impact of the pandemic on state revenues," said Freeman Klopott, a spokesman for the New York state Division of the Budget. "Almost the entirety of the first quarter of the calendar year 2020 was un-impacted by the pandemic and growing robustly."
In other words, the state argues, the calendar-year totals undercount the fiscal harm from the pandemic.
"Unlike the federal government, New York State must balance its budget, and it must do it on a fiscal year basis," Klopott said. "We can’t change the timing."
The J.P. Morgan report, which focused on advice to investors in municipal bonds, cautioned that its conclusions are "based on the current data, and are not indicative of future revenues, particularly given the uncertainties on the progress of the pandemic."
Meanwhile, New York state has projected a significantly larger revenue shortfall for the full fiscal year.
A baseline budget from January 2020 projected state revenue of $87.9 billion for the year ending March 31, 2021, said Laura Schultz, executive director of research at the State University of New York’s Rockefeller Institute of Government.
But by April 2020, after the impact of the pandemic started to become clear, the state revised its projection to $77.7 billion. That would be an 11.6% decline from the earlier projection, and a 6.2% drop from what was collected in the previous fiscal year.
Those numbers are significantly larger than the 1.5% decrease, though final revenue figures won’t be available until after the end of the fiscal year.
Cassidy said that "New York, for all of their complaining, Gov. Cuomo's complaining, has only had a 1.5% decrease in revenue" due to the pandemic.
New York state saw revenue decline by 1.5% in calendar year 2020. However, the state’s budget is based on a fiscal year that runs from April 1 to March 31, and the calendar year figure Cassidy cited includes nearly three months of relatively normal, pre-pandemic economic activity.
This makes it a misleading indicator of the pandemic’s budgetary impact. In fact, state budget officials have already projected larger revenue declines for the full fiscal year.
We rate the statement Mostly False.
NBC News, Meet the Press Interview with Sen. Bill Cassidy, February 07, 2021
J.P. Morgan, "Municipal Markets Weekly," Jan. 29, 2021
PolitiFact, COVID-19 aid for states and localities: How dire is the need?, February 11, 2021
PolitiFact, "What’s in Joe Biden’s $1.9 trillion American Rescue Plan?" Jan. 15, 2021
Email interview with Freeman Klopott, New York State Division of the Budget press officer, Feb. 16, 2021
Email interview with Ty Bofferding, director of communications for Sen. Bill Cassidy, Feb. 11, 2021
Email interview with Laura Schultz, executive director of research at the Rockefeller Institute, February 18, 2021
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