The Auburn Citizen — Legal Costs Hurt N.Y. Municipalities

By: Adam Morey

“As state budget season comes to a close in New York, the editors of the Auburn Citizen correctly observe that debate on many issues is hidden from public view (“Don’t shut public out of New York state budget,” Mar. 29). All too often, common sense proposals get amended or left behind without any public discussion.

This year, Governor Cuomo’s executive budget proposed much-needed relief for municipalities in the form of a reduction in the interest rate on legal settlements and judgments. Current New York law requires defendants — including taxpayer-funded entities such as cities and transportation authorities — to pay a 9 percent interest rate on expected payouts while a ruling is appealed.

The governor suggested a simple solution to ease this burden: match the interest rate on judgments to the federal rate, which remains below 2 percent. And this move couldn’t come at a better time. Last year, Governing Magazine reported that New York City pays out more in legal costs than the next 19 cities surveyed combined.”

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