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The state may need to take some remedial classes, according to a recent “management report card” issued by Governing magazine and Syracuse University’s Maxwell School.

“The Government Performance Project” assigned a letter grade to each of the 50 states in five areas of management. The average grade was a B; New York received a C-.

The researchers conducted nearly a thousand interviews to evaluate how states handle financial and capital management, human resources, managing for results, and information technology.

New York’s two worst subjects (receiving D+’s) were financial management and managing for results, a criterion that measures how efficiently the state spends its money. The report criticizes New York’s inability to prepare for the future: The state’s rainy-day fund is capped at 2 percent of general fund expenditures, one of the lowest caps in the country. The report also estimates that by 2000, New York’s debt service of $4.2 billion may be larger than its projected capital spending.

Joe Conway, a state budget spokesman, defended New York’s performance, pointing to the state’s improved credit rating and the creation of 400,000 private-sector jobs. He also quoted a February 19 Moody’s Investor Service report commending the state’s strong financial condition. He didn’t mention that Moody’s report also criticizes Pataki for relying too heavily on Wall Street revenues and not planning for a possible downturn.

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