state of the state address

New York State Bonds Include Warning on Climate Change

The warning, which is now appearing in the state’s bond offerings, comes as Mr. Cuomo, a Democrat, continues to urge that public officials come to grips with the frequency of extreme weather and to declare that climate change is a reality.

A spokesman for Mr. Cuomo said he believed New York was the first state to caution investors about climate change. The caution, which cites Hurricane Sandy and Tropical Storms Irene and Lee, is included alongside warnings about other risks like potential cuts in federal spending, unresolved labor negotiations and litigation against the state.

“The state determined that observed effects of climate change, such as rising sea levels, and potential effects of climate change, such as the frequency and intensity of storms, presented economic and financial risks to the state,” the spokesman, Richard Azzopardi, said on Tuesday.

Mr. Azzopardi added, “The extreme weather events of the last two years highlighted real and potential costs from extreme weather events, including the need to harden the state’s infrastructure and improve disaster preparedness, both of which have been a priority of the governor.”

Last fall, Mr. Cuomo was quick to draw a connection between climate change and the severity of Hurricane Sandy, complaining that he seemed to spend much of his time as governor responding to extreme weather events. He has frequently spoken about climate change since then, saying in his State of the State address in January that New York needed “to learn to accept the fact — and I believe it is a fact — that climate change is real.”

“There is a 100-year flood every two years now,” Mr. Cuomo said at the time. “It’s inarguable that the sea is warmer and that there is a changing weather pattern, and the time to act is now.”

Experts in public finance said they had not heard of any other state that included an explicit warning about climate change in bond offerings.

But David Hitchcock, a senior director in the public finance practice at Standard Poor’s, said climate change was not a criterion in evaluating state finances. “I have a hard time finding a direct relationship for climate change on New York State’s economy at this point,” he said, adding, “It’s not something that’s really on our radar screen right now.”

Emily Raimes, a vice president at Moody’s Investors Service, said “more disclosure is always a good thing.” But she added that most of the risk for local and state governments from powerful storms was mitigated by the presence of the Federal Emergency Management Agency, which provides disaster aid to assist states and local governments.

“One of the reasons they can get to ratings as high as they do, particularly in storm-prone areas, is because of the existence of FEMA,” Ms. Raimes said. “After Hurricane Sandy, after big natural disaster events, FEMA picks up most of the cost of the immediate cleanup and rebuilding of public infrastructure.”

She noted that Moody’s had downgraded only a small number of local governments that were in areas hit hard by Hurricane Sandy, and that those governments had financial problems even before the storm hit.

The warning about climate change first appeared in the fine print of Mr. Cuomo’s budget proposal in January, and was reported on Tuesday by Bloomberg News. It notes that recent storms “have demonstrated vulnerabilities in the state’s infrastructure, including mass transit systems, power transmission and distribution systems, and other critical lifelines.”

The warning adds, “Significant long-term planning and investment by the federal government, state and municipalities will be needed to adapt existing infrastructure to the risks posed by climate change.”

Mr. Cuomo is taking a number of steps to prepare the state for storms; for example, his administration is developing a program to offer home buyouts to residents in flood-prone areas in a bid to begin reshaping how New York develops its coastline. The state budget that lawmakers are expected to approve this week also includes a provision requiring some gas stations to be wired to accept generators that could be used in the event of a power failure.

Article source: http://www.nytimes.com/2013/03/27/nyregion/new-york-state-bonds-include-warning-on-climate-change.html?partner=rss&emc=rss

As California Bounces Back, Governor Sets Horizon High

Grasping at California’s vision of itself as a land of opportunity and a model for the rest of the nation, Mr. Brown said the state was rebounding financially after a difficult period. In a speech citing sources as varied as the Bible, Montaigne and Yeats, Mr. Brown said the state’s budget was now sound, but he also warned of profligacy, a remark that seemed directed at the Democratic lawmakers listening to him in the State Capitol here.

“The message this year is clear: California has once again confounded our critics. We have wrought in just two years a solid and enduring budget,” Mr. Brown, a Democrat, said in his third State of the State address since returning to office in 2011. “Against those who take pleasure, singing of our demise, California did the impossible.”

Mr. Brown spoke of wanting to reform school financing by empowering local school districts, and of continuing to lead efforts to fight climate change, like the cap-and-trade system for carbon emissions that went into effect recently.

Recalling the big infrastructure projects in the state’s past, Mr. Brown also voiced strong support for two big-ticket items that have drawn strong opposition: a bullet train that would eventually link Los Angeles and the Bay Area, and two tunnels that would funnel water directly from Northern California to more populated areas in the south.

“The London Olympics lasted a short while and cost $14 billion, about the same cost as this project,” he said of the tunnels. “But this project will serve California for hundreds of years.”

Mr. Brown’s speech came at what many are describing as a turning point for California after years of economic turmoil. The state’s economy is continuing to show signs of strengthening, with job growth and a housing market revival.

Fiscally, after years of ballooning budget deficits, the state is now projecting a balanced budget. In November, Mr. Brown surprised many by winning a hard-fought campaign to pass Proposition 30, a temporary tax surcharge that will pour $6 billion a year into the state treasury for the next seven years.

Still, Mr. Brown has repeatedly warned about the need to control spending. With Democrats now having supermajorities in the Senate and the Assembly, they can pass tax increases unilaterally. As experts predict that Democratic legislators will face pressure to increase spending, many are now describing Mr. Brown, long known as “Governor Moonbeam” for his eccentricities, as the only adult in the room.

Citing the story of Genesis and Pharaoh’s dream of seven cows, he said: “The people have given us seven years of extra taxes. Let us follow the wisdom of Joseph, pay down our debts and store up reserves against the leaner times that will surely come.”

In interviews, Mr. Brown, who served two terms as governor from 1975 to 1983, has brushed aside talk of his legacy. But in recent months, Mr. Brown, 74, who was treated recently for prostate cancer, has spoken about his mortality, mentioning the death of a close friend.

“This is my 11th year in the job, and I have never been more excited,” he said.

Article source: http://www.nytimes.com/2013/01/25/us/with-california-rebounding-governor-pushes-big-projects.html?partner=rss&emc=rss

New York State Bonds Include Warning on Climate Change

As California Bounces Back, Governor Sets Horizon High

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