The North Country Chamber is holding a series of virtual town halls on various issues impacting regional business during the COVID-19 crisis. This week, the New York state Comptroller joined chamber members in a virtual meeting to provide a summary of the state’s fiscal situation and outlook in the midst of the pandemic.
North Country Chamber President Garry Douglas began by noting that the virtual town hall is part of a continuing years-long project by the organization that brings officials from the state, local and federal levels to discuss relevant business and economic issues.
During his opening comments, Democratic New York Comptroller Thomas DiNapoli reviewed what his office does and noted it is a constitutionally independently elected office. "Really set up to be an independent voice and a watchdog on state finances. So we do as I often describe it a lot of the back office work for the state: processing the payroll, approving contracts, approving payments to vendors, businesses that are have a relationship with the state, nonprofits, grants to local governments, state aid being expended. We comment on the state budget but we don’t set the spending levels. When the legislature and the governor make those choices and decisions we’re the ones that have to oversee how the money is spent. We have an audit responsibility. In New York we also have a role that’s a little different than treasurers or comptrollers in other states in that I serve as trustee of the New York Common Retirement Fund."
DiNapoli reviewed national and state economic pandemic data. He said in just one quarter the fiscal damage has been significant and severe. “Public health first imperative but the economic damage has been severe. The national numbers a 5 percent drop in Gross Domestic Product nationally just in the first quarter. In New York the unemployment benefits paid out thus far have been about $10 billion as of last week’s numbers. Just by comparison for all of 2019 unemployment payments were a little over $2 billion. In April in New York the unemployment rate was 14-point-5 percent an uptick from the March numbers of 4-point-1 percent. Private sector jobs in New York were down by 1.7 million, largest monthly drop on record.”
Sales tax is an important revenue for local governments and the state. DiNapoli said his office is now issuing monthly rather than quarterly reports. “In April sales tax collection statewide plummeted 24.4 percent year over year April to April. We don’t have the May numbers yet. Looking at North Country April sales tax numbers down in all your counties: 22.1 percent in Clinton, 21.7 in Essex, 23.7 in Franklin, 30.1 in Hamilton, 26.3 in Warren County. Every region of the state saw a drop in sales tax revenue. You know while for the state that’s not as big a tax revenue source as income tax it certainly is a significant one and for our counties particularly and for cities that have a sales tax that is a significant budget hit.”
A number of questions were posed through Chamber President Douglas. “Our next question: What about the state retirement fund and its investments?”
Dinapoli: “We’re diversified so what I can tell you is this. You know we went into this challenging time as one of the best funded state pension plans in the country, 96 percent funded in last year’s rankings. We were one of only eight states in the country that was over 90 percent funded. You know it’s going to be a single digit loss. Whether it’s 5 percent 6 percent that I don’t know for sure yet. For those who are retirees or members of the system or you have family members who are members of the system, again because we went into this well funded there is no concern about our paying pension benefits. We have plenty of liquidity. We are more than adequately funded. I have confidence in our long term investment strategy.”
The comptroller’s office has developed a COVID-19 Financial Survival Tool Kit for New Yorkers.