Lt. Gov. Announces Medicaid and Pension Mandate Reform at Elmira Press Conference

Posted February 7, 2012

Duffy Touts Pension, Medicaid Proposals in Elmira
By Ray Finger, The Star-Gazette

Gov. Andrew Cuomo's proposals for Medicaid and pension mandate reform will save Chemung County taxpayers about $4 million over the next five years, Lt. Gov. Robert Duffy said Monday.

Cuomo's pension reform proposal alone -- that would affect future state employees -- is expected to save Chemung County about $243 million over 30 years, Duffy said during a news conference in Elmira.

"The current employees of the state and local government are protected by the New York State Constitution with their pensions. What the governor is proposing is a Tier 6, which only impacts new employees ... people (who) aren't even employed yet," he said.

Cuomo is proposing a system with employee contribution rates that depend on the stock market, Duffy said. If the market is producing, rates are lower, and if the market declines, as has been the case in recent years, those contributions would go up. The workers in the system bear the brunt, not the taxpayers, he said.

Also, future employees cannot have overtime calculated into their final pension, Duffy said. Tier 6 would also include a voluntary 401(k) component that would allow those employees flexibility if they leave state employment after a few years, he said.

"You look at the trajectory of the pension costs three or four years out, there's not a city or a county in the state that can afford to make those payments," he said. "It's going to break local governments. There has to be some change, and while this change only applies to new employees, it's stepping in the right direction."

The savings from not having to pay unfunded mandates can be spent on new schools, libraries, parks, recreation centers, community centers or investment in infrastructure, Duffy said.

"Rather than spend it, you could actually give it back to the taxpayer," County Executive Tom Santulli said.

Growth in Medicaid spending is currently capped at 3 percent, but with a budget the size of Medicaid, that is a lot of money, Santulli said. "What this governor is proposing is that over that four-year period, this 3 percent goes away," he said. "That is a big step forward with the largest unfunded mandate there is."

Elmira Mayor Susan Skidmore pointed out that $100,000 equals 1 percent of the city's property tax levy. "If you look at a million dollars a year, that's an awful lot of money we don't have to tax people for," she said.

Ronald Bentley, chairman of the Chemung County Chamber of Commerce and president and CEO of Chemung Trust Co., applauded Cuomo and encouraged the state Legislature to pass the reforms as soon as possible.

"For years, the private sector has watched helplessly as businesses and residents have fled our communities due to high taxes, unfunded mandates and no relief from state government," he said.

"Gov. Cuomo understands that for New York to once again be competitive and once again for the Empire State to be vital, we need a vibrant private sector supported by our partners with state government."

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