Gotham Gazette

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In Albany, Budget Battles Behind Closed Doors

Gotham Gazette: In Albany budget battles
Gotham Gazette image by Ya-Hsuan Huang

State Republicans said it would happen under the cover of night with little to no warning. Good government advocates said legislators would be ordered to their chambers and reminded there is no time to waste. Printers would roar to life, packets of hot paper would be distributed and in a blink of an eye, groggy legislators would vote to approve New York State's 2009-2010 budget.

To a great extent, the cynics were correct. The legislature and the governor did agree on a budget deal behind closed doors -- over the weekend and late at night. The documents were printed over the weekend. It now appears, though, that members of the Assembly and Senate who are so inclined will have a few days to read the nine bills, some with thousands of pages, before the expected vote early this week. Nevertheless observers reviewing recent events still say the budget process this year has been one of the most secretive negotiations in recent memory. (Gotham Gazette will continue to cover the budget throughout the week in Eye on Albany and The Wonkster.)

New York State faces a $16 billion budget gap and by law must pass a balanced budget by Wednesday. As the clock ticked down last week, about all one heard in the Capitol were rumors. At a recent negotiating session with the three men in a room (otherwise known as the governor, Assembly speaker and Senate majority leader) a reporter asked Assembly Speaker Sheldon Silver for one detail about what is actually in the budget. Silver replied, "We'll have an on-time budget."

At first, it seemed things might be different this year. Gov. David Paterson started talking about the state's perilous finances months ago, warning that the state would have to make "draconian" cuts. Paterson even released his budget proposal in December -- earlier than most governors have done -- and used his State of the State address to hammer home the need for fiscal responsibility and shared sacrifice.

All three Democratic leaders have, at one point or another, pledged to reform Albany and ensure state government would be more transparent. The Senate Democrats started a Web page and a hot line to take budget suggestions from the public.

Now, though according to Blair Horner of the New York Public Interest Research Group, the leaders seem to have gambled that an "on-time budget" means more to voters than "transparency." Instead of openness, the three Democratic leaders hammered out the budget in closed-door sessions with limited, if any, input from Republican leaders.

"Talk is cheap," said Horner. "Reality is hard."

Crafting a Budget

New York State's budget process in kicked off when the governor introduces a budget proposal in January. The legislature's financial committees then hold hearings to review the soundness of the governor's plan.

According to the New York State Department of Budget Web site, "the legislature, primarily through its fiscal committees -- Senate Finance and Assembly Ways and Means -- analyzes the governor's spending proposals and revenue estimates, holds public hearings on major programs, and seeks further information from the Division of the Budget and other state agencies."

In most years, both houses of the legislature would pass separate budget bills, and then, since 2007, they would hold conference committees to discuss differences between their separate budget bills -- an attempt to clarify the process. "Under budget reform legislation passed in 2007, the legislature is required to use a conference committee process between the two houses to organize its deliberations, set priorities and reach agreement on a budget," the Division of Budget Web site says.

The legislature held hearings on Paterson's proposed budget earlier this year, but so far the leaders have chosen not to hold another round of conference committees.

The Quiet Before the Storm

No one doubts the state faces a dire budget situation. Up until the last minute, though, it was hard to detect that from the scene in the Capitol. Last week, normally talkative Democrats scuttled away from reporters who had questions about the budget on their lips. Near the Senate chamber Sen. Eric Schneiderman blurted to a reporter, "What do you want from me?" The reporter shot back, "I want answers!"

In all fairness, Schneiderman might not have had the answers since the three men in the room stingily parceled out information. As the negotiations dragged on, legislators who were told about parts of the deal dished out tidbits on what they thought might be in place but warned that things were steadily shifting.

Legislative action in the Senate slowed to a crawl in recent weeks as the focus shifted to the budget deal. The Senate spent the last few weeks honoring citizens and commending the recently deceased rather than passing substantive bills. Senate Majority Leader Malcolm Smith, when asked about serious pieces of legislation, repeatedly said they will be addressed "after the budget."

The Assembly, thanks to a Democratic supermajority, moved quickly on again approving bills that it had passed in previous years, bills addressing issues like Rockefeller Drug Law reform and rent control. However, the members hesitated to consider new legislation knowing that their action would be futile without support from the Senate. Silver did not act to pass his compromise plan to address the Metropolitan Transportation Authority's financial straits, nor did his house vote on an income tax increase for the wealthy, a measure that is now in the budget bill.

Hopes for Transparency

Advocates of open government initially thought they had allies in the Democratic leadership. Paterson, for example, had made a number of comments about his commitment to ending the secretive budget practices, which long plagued Albany.

Advocates had solidified relationships with the new majority after years when Senate Democrats -- then in the minority -- struggled to gain a seat at the table and to have their input taken seriously. At the same time, good government groups pushed to make the budget process more open.

Much, though, has changed since then -- as evidenced in the Democrat's new attitude toward the budget conference committees.

The 2007 law that created the committees was passed when the Republicans controlled the Senate and Democrats controlled the Assembly.

And Silver signed on. In a 2007 press release now being distributed by Republicans, the speaker said that conference committees would "move our state's budget process in the 21st century with a strong constitutional emphasis on mutual respect between the executive and legislative branches in forging a fiscal plan for our state. We will continue to rely upon the joint conference committees. We will have a more transparent, more easily understood budget process."

This year, with Democrats controlling both houses, Silver said there is no need for conference committees. "We're all Democrats," he said. "We're not going to have big philosophical differences."

Republican Minority leader Dean Skelos has said that not holding conference committees is illegal. But Silver has repeatedly declared that, if there are no differences between the budget bills in the two houses, there is nothing to be discussed in conference committees. In fact, Silver has said, there might not even be separate Assembly and Senate budget bills. For his part, Smith repeatedly insisted that he would hold conference committees. But as of Sunday night, with the budget apparently all but certain, that had not happened.

Those who observed conference committees in previous years point out that they were heavily scripted and did not actually produce more open government. Legislators would use the meetings to give speeches and hold their substantive discussions in private. By doing away with the committees and one-house budget bills, however, Silver is admitting that they were only window dressing on an ugly budget process -- just another way to placate the public.

Barbara Bartoletti of the League of Women Voters noted that the legislature fought to amend the budget process under Gov. George Pataki because he kept the budget process notoriously secretive. "It was known as Fort Pataki," she said.

According to Bartoletti, Gov. Eliot Spitzer made it a priority to open up the process and now Paterson, Smith and Silver are disregarding that work.

"This is a blatant violation of the law they passed in 2007!" said Bartoletti. "If regular people violate the law they get in trouble, but apparently these guys think they are above the law."

At a briefing Friday, reporters asked Paterson about the lack of transparency in the budget process. "I think there should be transparency in terms of the process and openness in terms of government," Paterson responded. "However, when you are in a budget position, it is very hard to negotiate in public. You never see President Obama and Senator Reid and Speaker Pelosi do it. You don't see it in any other state." And Paterson continued, "You don't see it in labor negotiations and I dare say that your negotiations with your own media outlet, your contract, is not, the last I checked, publicly observed."

Paterson failed to mention that his salary is paid by the taxpayers and reporters' salaries are not.

"There comes a point in the negotiations," continued Paterson, "where anyone who is really negotiating has to take things off the table. This is a very difficult endeavor, and it's hard to do it when the advocates you are fighting for are right there."

New Leaders, Old Habits

Silver, of course, is the only leader remaining from 2007. This year's budget negotiations took place with two new leaders -- Paterson and Smith, both of whom are considered weak and vulnerable. Smith has been rendered powerless by the combination of a slim majority and indecisive behavior. Paterson, thanks to plummeting poll numbers and his own brand of indecision is seen by many as nearly "irrelevant."

Smith and Paterson apparently hope that an on-time budget, no matter what it contains -- or how it's drafted -- will make them look responsible to the public and give them a political boost.

In addition, the lack of transparency might have helped Smith move things into the budget that would be controversial to some members. His majority is so slim that he can't afford "no" votes from any Democrats. That is why instead of passing legislation on drug law reform Smith has included it as part of the budget negotiations.

"The thinking on this issue is that there is an explicit rush to get this through," said Robert Gangi, the executive director of the Correctional Association of New York State. They wanted to have it included as part of the budget so that neither side can cherry pick. They have to vote up or down for the whole kit and caboodle."

The three announced they had reached a deal on drug reforms on Friday but did not offer a detailed account of what was agreed on.

Health care advocates have spent the last week using advertisements to target individual legislators and alert citizens about what they think will be tremendous cuts to health care funding and Medicaid payments to hospitals.

William Van Slyke from the Healthcare Association of New York, which represents health care networks and hospitals, thinks it is important to make sure legislators and voters know exactly what kinds of cuts are being considered. But he said last week, "Rank and file legislators don't even know what is in the budget. The Senate is in disarray."

For a week, information about "tentative" deals made its way around the Capitol before quickly being denounced or refuted by one of the three men in the room. Silver flatly denied a New York Times report that a deal on drug law reform had been reached, only to hold a meeting to announce the deal the next morning.

There was talk that a deal had been reached to institute the Bigger Better Bottle Bill, which would have put a deposit fee on noncarbonated beverages like water and tea and made beverage companies give the state unclaimed deposits. But it was reported quickly thereafter that the tentative deal had fallen apart. The bill is now back in as part of the budget deal, but only with deposits on water -- not juice or tea.

Bartoletti said there are many advantages for the three men in a room to keep the deal hush-hush as long as they possibly can. "Special interests still run Albany. It was probably lobbying or campaign contributions that killed the bottle deal but we won't know for two months till we see the contributions," she said before word came that parts of the bottle bill were back in. "It is the same thing with healthcare: We don't know because it is behind closed doors and special interests have their influence."

According to Horner, the budget crunch provides another convenient excuse to do business in secret. "This is unlike any other year," he said. "Thanks to the federal stimulus, the budget the governor presented is being entirely reworked, and it is being reworked behind closed doors."

"They are going to get away with it this year," said Bartoletti. "They think the public has a short memory and they will say they did it because of the financial crisis. They will even come out and say this was a bad process this year but we had to do it and we will do it better next year."

Opaque Government

Bartoletti describes this year's budget process as a "drive-by negotiation," because legislators driving away from leaders' meetings at the governor's mansion sometimes had the decency to pause briefly to give reporters placating, dismissive answers about what was discussed -- or, in the case of Republican leaders, to complain about how little input they actually have.

Last Tuesday, March 24, Republican legislators and open government groups stood together in the same room to call for Democrats to make the process more open. Skelos said he had not been invited to attend the "secret leaders meeting" that was going on just one floor below among the three Democratic leaders.

He said he thought Democrats would probably rush the budget through by issuing a so-called "message of necessity" that would eliminate the three-day waiting period normally required before the legislature votes on a bill. This would ensure, of course, that even fewer senators and Assembly members would have any idea about what's in the spending plan.

"Under the guise of getting a budget done on time, Governor Paterson, Senator Smith and Speaker Silver are prepared to rush through a budget in the dead of night with no time for public input or examination," said Skelos in a written statement.

Bartoletti expected that "legislators won't see the budget until 15 minutes before they vote and no one will even know what's in it." It was not quite that dire: Legislators will have part of the weekend and two days to review the bills. And, of course, getting bills on short notice is nothing unusual in Albany. Longtime Democratic Sen. Neil Breslin said he has "gotten bills two minutes before" he voted on them.

Last Tuesday, Smith canceled a number of public appearances to attend "budget negotiations." Meanwhile, the three leaders released a statement saying the budget deficit had increased by $2 billion to $16 billion. Republicans said the announcement was just cover for an impending announcement of a tax increase. Then news broke that Paterson had ordered the layoff of 8,900 state workers. The big three were nowhere to be seen.

At 3 p.m., school children in white shirts observed a poorly attended session of the Senate. The Senate asked the children to stand to be recognized, and then the few legislators in attendance voted to honor a recently deceased labor leader and tabled legislation pertaining to warning lights on bicycles. When the end of the session was called, a young girl looked up incredulously and said, "We came all the way for this? That's it?"

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