New York is at the top of the heap for states relative to its population when it comes to debt issuance for both capital improvements and operating deficits. Debt is good when the payoff is aligned with the benefit period – but that hasn’t always been the case in New York.

The Citizens Budget Commission, a nonpartisan non-profit citizen participation organization focuses on finances and services of New York State and New York City, is trying to slow the rate at which the state is accumulating additional debt.

The Commission recently issued a call for action by legislators in response to the state’s rapidly increasing debt. The group is asking state leaders to commit to focus their energies on reducing the state debt now, before the problem continues to exacerbate. It is also encouraging more “pay-as-you-go” debt.

CBC President Diana Fortuna refers to the state’s debt as “out of control.” The level of state debt – which reached an all-time high during the current fiscal year – has doubled since 1993.

In response to the state’s financial challenges, the CBC has released “The Armonk Agenda: Next Steps for Fiscal Reform in New York State,” which includes 12 high-priority steps designed to stimulate discussion and promote change.

The fiscal reforms emerged from a two-day conference – held in Armonk this past spring – of business, civic, labor and government leaders.

The action steps fall into three categories:

  • Lowering local taxes
  • Lowering and better managing state debt
  • More accountable and transparent annual state budgets

The New York State Comptroller’s Office reports that as of March 31, 2006, the state had roughly $48.5 billion of total debt – including $3.5 billion in general obligation bonds and notes, and an additional $45 billion issued and outstanding by state public authorities.