By DIANE S. WILLIAMS

The proposed state budget for 2001-2 met with opposition from District Council 37 and Democratic leaders alike due to its sweeping cuts of millions of dollars in aid to New York City.

The plan would also eliminate $35 million in local highway funding and cut $300 million from Medicaid spending for nursing homes and home care.

Despite a smoke-and-mirrors school finance section, the budget would not close the huge gap created by unfair distribution of education funds to New York City children.

And while the budget dips into the state’s surplus for $250 million worth of upstate highway projects, the governor in effect told the Metropolitan Transportation Authority to fund its own capital improvements for subway riders and commuters.

The proposed budget would underfund the needs of New York City residents and students, although the city has generated most of the increased tax revenue that has buoyed the state’s fiscal reserves in recent years.

School aid inadequate
The $83.6 billion budget plan for the fiscal year that begins July 1 tucks away $1.3 billion to protect the state treasury from the effects of predicted national and state economic downturns.

In testimony before the State Assembly Ways and Means Committee and the Senate Finance Committee Jan. 29, DC 37 Administrator Lee Saunders called the proposed tax cuts “damaging and unaffordable.”

“The budget does not remedy the inequities that cost New York City school children over $400 million in school aid annually,” Mr. Saunders said.

The reduced education budget piggybacks on the state administration’s plan to appeal a recent landmark court decision that declared the current state educational funding system unconstitutional.

“The planned appeal disappointed so many who believed the decision marked the moment when our city’s school children and the women and men who work for the City’s Board of Education, including some 30,000 members of DC 37, would begin to see the city’s school system treated equitably by the state,” Mr. Saunders said.

Additionally, the proposed budget slashes Medicaid funding for nursing homes and care by $300 million, further debilitating a system already diagnosed as being in “critical condition”. New York State already mandates that its localities pay a higher portion of Medicaid costs than most other states. In 2001, those costs will exceed $3.2 billion.

All told, the budget would bleed New York City of $192 million in state aid. The proposed reductions come a year after the state repealed the commuter tax, reducing city revenue by $500 million annually.

“The proposed budget simply does not provide the city with its fair share,” Mr. Saunders concluded.