Last Wednesday, Gov. Cuomo’s administration formally issued regulations to limit how much state-funded entities pay their top officials, and how much they spend on administrative expenses. The new rules are intended to rein in salaries at non-profits that provide a large share of the health and social services in the state.
The rules, which must go through a 45-day public comment period before they are finalized, apply to 13 state agencies, including the state Health Department.
Effective January 2013, contractors that receive at least 30 percent of their revenue from the state cannot use more than $199,000 in state funds to pay their leaders. Any wages above that figure must come from private sources. Covered entities seeking to pay top executives more than $199,000 (an amount based on a federal government pay scale) will have to show justification for the salary and secure a waiver from the cap, regardless of the source of the money. The state will also establish a statewide database of how much executives at state-contracted groups are paid.
The regulations also would require the nonprofits and for-profits to use 75 percent of state funds for services rather than administrative costs. That percentage would increase to 85 percent by 2015.